Weaving Advanced Manufacturing Technology into the Fabric of the Business
Kanet, John J., Research-Technology Management
This apparel manufacturers marketing strategy is built around exploiting its technological capability and engineering know-how-and giving every employee a stake in the outcome.
OVERVIEW: Advanced manufacturing technology is often considered only in the context of the direct benefits it provides to manufacturing operations-for example, lower cost, greater efficiency and more consistent quality. Not so for William Epstein, a small South Carolina-based apparel manufacturer. His companies integrate advanced manufacturing technology into virtually every aspect of the business enterprise. Advanced technology not only tempers the design of the manufacturing unit, but also profoundly shapes the business strategy and is heavily exploited for new business development. It even has a fundamental bearing on the corporate capital structure of the firm. Moreover, Epstein employs a variety of novel approaches for motivating the acceptance of new technology into his apparel operations.
Apparel-maker Iva Manufacturing has a technology champion for its president. But William (Bill) Epstein is not merely committed to the innovative use of technology He pursues a long-term business strategy in which technology is so thoroughly integrated that even the lowest-ranking machine operator's pay depends upon its proper implementation.
This article chronicles Epsteins' assumptions, practices and philosophies with respect to the business role of advanced technology. It traces the processes he has adopted for managing the evaluation, uptake and operation of advanced technology. Its focus is on the managerial processes and not on the details of the adopted technology per se.
Iva Manufacturing Company is located in the rural upstate region of South Carolina. Bill Epstein founded Iva in 1953 with an initial investment of $5,000. Epstein's current scope of activity has grown to include a network of six apparel factories throughout the region, as well as two marketing companies, employing some 600 workers and producing some 60,000 garments per week (See Figure 1). Annual revenues are approximately $20 million from women's sportswear, pants, robes, and nightgowns; as well as home furnishings and automotive interiors. The two marketing organizations, New Fashion and Third Generation, sell to a variety of outlets including mail order houses, regional chains, and directly to smaller retailers. Orders are also received from other independent marketing organizations outside the Epstein companies. Depending on the product involved, a garment is produced in one of the six Epstein factories (Iva, Sportswear, Amco, Fair Play, Clark Hill, or Honea Path).
The labor pool available in upstate South Carolina is relatively unskilled, and there is no union at any of the six apparel companies. Epstein's personal vigor and capabilities have been the driving influence in the success of his companies. On balance, he views government largely as a constraining factor that adds to the expense and/or complication of operating (e.g., income tax laws, 807 trade policies, Mexican economic support, occupational safety and health regulations, minimum wage laws, plant construction codes and regulations, depreciation rules for capital investment, etc.). He views government social programs as contributing to the deterioration of the "work ethic." He is a strong believer that people, regardless of background, will respond when given the right economic incentive.
Epstein knows the technology of apparel manufacturing inside out, having started as a sewing operator at age 16. He attended the Fashion Institute of Technology, in New York City, receiving an associate's degree in industrial engineering in 1953. Prior to 1989, his firm was able to compete on cost, largely due to his genius for work organization and the innovative use of technology-in his words, "By working smarter, not harder." With the adoption of 807 legislation (see "807 Contracting," page 51), he recognized the need to respond in creative ways other than just cost reduction. …