Strategic Alliances
Exploiting Complementarity for Competitive Advantage
Interaction of different Elements of Quick Response.
Itself a product of a joining of forces of complementary personalities, MNI Partners has repeatedly brought together for their mutual benefit client companies with complementary capabilities. We have successfully parlayed our emphasis on bringing people together within organizations to get things done into the ability to bring companies together to do things more efficiently or effectively. Our extensive base of international clients is a source of prospective partners and our entrepreneurial bent drives us to create needed partners when they can′t be found.
For too long, the IT solution has been the only solution. IT has clearly changed the supply chain environment beyond all recognition, but companies are fooling themselves if they think it is a panacea. The companies that get the most from their investment in supply chain IT are those that recognize that the interaction of process and people is the key.
Consider the example of a team sportswear retailer. A changing market environment, rising cost structures in the licensing category, and general competitive alterations in the sports apparel industry were negatively affecting the manufacturer′s bottom line. The company was annually discounting fully 25% of its outerwear by as much as 40%. To minimize inventory exposure this team sportswear retailer encouraged the placing of orders five to six months in advance, but shifting inventory risk to retailers was not particularly well received. Looking for a new way to do business, something “outside-the-box,” the team sportswear retailer entered into a strategic alliance with MNI Partners, which had achieved considerable success with implementations of the Quick Response methodology worldwide.
The alliance involved the team sportswear retailer guarantee in the form of a contract to purchase team outerwear garments. MNI Partners established Dextrous Faber, a greenfield Quick Response manufacturing facility in India in which it maintained stakes as both an investor and advisor.
- The plant was designed and built from scratch.
- Raw materials were sourced from South Korea.
- Large numbers of employees were trained.
- Production was organized to output small quantities to accommodate frequent deliveries.
Dextrous reduced the time required to respond to the team sportswear retailer orders from 26 weeks to 10 days, enabling the manufacturer to pursue in-season orders or “chase business.”
The considerable savings that accrue to Dextrous Faber′s unique business vision, which combines low wage labor with highly flexible delivery systems, can be shared as incentives with partner factories and workers. So great are the benefits of speed and flexibility that every player in a cooperative supply chain can benefit. The social implications are profound in such a large, worldwide industry.