With the world economy in the doldrums, enterprises of all sizes are busy investigating ways to enhance their competitiveness. Can information technology tools help firms find an advantage? Tradelink Talk interviewed two garment companies to find out how IT can help Hong Kong businesses.

Lai Wing Garment Manufacturers - the IT Trailblazer

Lai Wing Garment Manufacturers Ltd. was founded some 30 years ago, and specialises in producing garments for clients in the Scandinavian market. In order to meet Production Notification requirements, Lai Wing continues to operate a production line in Hong Kong. However, in order to keep down production costs the company has also established a production base in mainland China.

Lai Wing is a self-described "small" garment industry operation. However, that does not deter the management's determination to apply IT in their operations, and the driving force behind that determination is the real benefit the company's managers have personally experienced. Cindy Chan, Director of Lai Wing, notes: "Actually we are already lagging behind in the trend of adopting IT to enhance business operations. We only started to install computers in the company a few years ago, when we needed to use the services provided by Tradelink."

From Chan's perspective, IT is an impressive data communication media through which business operations can be greatly enhanced. For example, the use of e-mail has allowed Lai Wing employees to have closer communication with clients, enabling them to respond more quickly to clients' inquiries. Moreover, as most of Lai Wing's clients are companies in Scandinavia, time zone differences often make e-mail a more reliable and convenient method of communication than the telephone.

Director Morten Freksen is responsible for providing and implementing IT solutions at Lai King, and admits that the company has a long way to go to reach its goals, but predicts that market forces will drive quicker decisions and implementations. "Some systems allow garment manufacturers to bid for production orders via the Internet," he says. "Real-time bidding allows manufacturers to more quickly grasp changes in market price and adjust their operations accordingly."

Morten acknowledges that for small companies, lack of capital is often the biggest stumbling block to investing in IT. Although sympathetic to the plight of the cash-strapped SME, he believes companies must make IT a priority. "We contract out work such as systems design and maintenance to outside service providers," he says. "This saves money as we no longer needs to hire IT staff."

Morten's plan for Lai Wing is straightforward. "Our goal is to provide all of our product information via the Internet, saving our customers time and effort," he says. Although we are still not very far along the road, we believe that IT will be a leading force that influences our business development."

Hongkong Sales (Knitwear) Limited carefully utilising IT

Hongkong Sales (Knitwear) Limited was established in 1963 and has since been in the business of production and export of knitwear. In the last five years, the company has been expanding its product portfolio, producing other kinds of garments, and is now an international business with a global staff of more than 10,000, with offices in such major fashion cities as New York, London and Paris, as well as overseas production bases.

Like many companies, Hong Kong Sales is working to bring down production costs in order to improve competitiveness. To this end, Hong Kong Sales has set up production sites in China, Thailand and Madagascar. According to Elena Shih, Director and Deputy General Manager, this strategic scattering of production sites takes advantage of production resources from different regions and compensates for possible disadvantages (e.g. tax, logistical) in a single production base.

In addition to its efforts to lower production costs by diversifying its production base, Hong Kong Sales is utilising IT to enhance operational efficiency. Shih notes that often IT cannot be applied with uniform success across entire organisations. "For many of our products, texture is as or more important than colour," she says. "Many of our customers need to touch the sample with their own hands to determine if the product has the right feel."

For this reason, putting an inventory of products on a web site does not necessarily help the customer to a buying decision. However, Hong Kong Sales has implemented IT to speed the transmission of information, allowing employees to introduce customers to new product concepts by sending text, illustration and digital pictures by e-mail. Later on, samples are sent to interested clients.

Ayres Chan, another Hong Kong Sales Director, says that in the area of business development IT has not brought much change to the company's operations. "Of course, sometimes we receive e-mail from prospective clients, but usually they just want us to e-mail back our prices. We've found that we generate much more business from face-to-face meetings," he says.

Although Shih and Chan do not come across as unreserved IT enthusiasts, the company is not falling behind by any means. It maintains an IT department that is tasked with identifying and implementing appropriate technologies and applications, and the company is also studying the feasibility of applying IT solutions to production and supply chain management issues. Chan says, "We will continue to invest in IT, and economic benefit will remain the most important factor influencing our investment."

Garment-making has long been a crucial sector of Hong Kong's manufacturing industry. Although the wholly "made in Hong Kong" garment has all but disappeared, Hong Kong-based manufacturers haven't stopped searching for new ways of moving ahead. Their development strategies, and the extent to which they embrace IT may be different, but one thing is certain: leading companies have integrated IT into all aspects of their operations, and the clock can not be turned back.