What the textile industry can learn from “Silicon Valley” – embrace a new mindset !

silicon-valley-sign-lgRecently I have read a book from Christoph Keese called “Silicon Valley” and for sure this was one of the most inspiring ones I have read in years. The content gives a brief overview about this particular Californian area next to San Francisco and tries to understand the mechanics behind this “entrepreneurial machine” with all its secrets, the people, the so uncommon and underestimated mindset, the power, the fascination and the fear that comes with it.

So why did this book fascinate me so much ? Well, not only because I am so in love with technology since my childhood. No, the big on thought for me was “What is in it for me – how will my life change if all that is true ?”. And so I started to compare some of these predictions and assumptions with our textile industry. Now, again, only because I preferred  to watch “Starship Enterprise” as a child and not “The Waltons” I am still realistic enough to see that not everything is digitisable. But I can imagine  a lot more than we have in place and usage today and it could be that not us will force this transformation.

Following the book’s structure i’ll start with the students and Universities.

Stanford has so much money and intellectual power that it is rather difficult not to give the best tuition for the students that is possible. Only few other Universities have the intellectual and financial power and influence to compete or perform better. This means a very filtered and focused education for very few people. Stanford builds their own elite and it seems to be hard to enter into this system as they often fund the first business steps of their former students. If we have a look at our industry we have lots of Universities too, around the globe who also thrive to do the best for their students but when it comes to industry involvement, government support, financing or networking they mainly struggle.  And after study quite often they leave the Designers and technical Engineers alone. I have had a lot of interviews with students in past years and some already failed in the interview introduction because they simply hadn’t learned how to market themselves. Presenting a nice folder with sketches or some pictures of prototypes is not enough to pitch today. But whom to learn from and when ? It’s not on the tuition plan to build your own brand and there is very weak connection with HR departments, consultants or companies at all. We – the industry have the duty to support that system to evolve.

Next is our flirt with technology.

Very few industries today value products the highest the more they are made in a traditional way. In the textile luxury segment, say for high-end suits, shirts, shoes, bags and such it practically means to produce “Oldtimers” and sell them as the newest products in the seasons to come. The only way to understand that is if we pause our rational thinking for a moment and focus only on our limbic system or emotional mindset. We simply value hard manmade work more than technical achievements. That’s a fact and of course it will help keep the traditional clothing business running because I can hardly think of a 3D printed suit or shirt. Only if we would allow to destroy the cultural and emotional code of a suit it would disappear. But as my 16 y old son wore a suit for the last ball of his dance course and there was no doubt about that I think we can relax here. When it comes to technology in the “art part” of our business we tend to value manual over technical. Remember the run for the highest place in creative team – the art director. You don’t think that a “Tom Ford type” would fall in love with his laptop or PC at work and spend hours and hours behind a screen. We still have a romantic impression about being a Designer in the fashion industry and as long as we have these role models I cannot see that design will embrace technology very deeply. That does not mean that we don’t use software in that field but the wish to undertake the processes, structures and  tools a deep dive and find leaner principles is not super established. So – let’s embrace technology and processes in the design part of our business!

What about the field of research and development ?

Well, we all use Social Media and buy goods online based on what we see on the screen. But when it comes to product development, we can hardly make decisions based on pictures and so we ship thousands of prototypes around the world. This is not only a waste in material it is a disaster in terms of timing. The farer the vendors are, the longer it takes. And if that wouldn’t be enough, we tend to work with agents or sourcing offices that either translate the briefing and documents their way or worse, add their interpretations to the original ones. Not so lean and efficient if we compare that to the super tiny offices in Silicon Valley where all needed resources are packed together so that they develop and communicate permanently in a super fast mode. Have a break here and browse the internet for AirBnB or Uber headquarters – you would be surprised. I am happy that we have restructured our technical development area 4 years ago and renamed it to “product excellence” to underline the fact that only a super diverse team can achieve great and mature results in time and in budget. Nevertheless the traditional “over the wall” meaning “first develop something nice and then start arguing about the price and sourcing” approach is still common and should be killed sooner than later.  Some ideas to implement innovative tools are rising like the platform “fastfit 360” which tries to combine social media tools with textile development processes but a lot of companies are still hesitated and of course our IT departments start to shake when we talk about having all these data somewhere in the Cloud. So – let’s start copying our personal habits to professional processes.

No secrets about the customer’s habits – the Google-mania

Now we all know how much we are tracked by every electronic tool – the search engines, the navigation apps, our smartphones explain our movements and travels, our credit card usage and paypal account, it is endless. How about our textile industry ? Only a few have understood that tracking the buying behaviour and the favourite styles of our customers is really beneficial and that big data can be used by all of us, not only the big fishes in the pond. Prediction tools like “Blue Yonder” improve online platforms dramatically and the vertical oriented brands like Zara, H&M, Uniqlo, aso. show us that success in own retail depends heavily on the fast feedback and profound analysis of the sales results. That means not only tracking the numbers in the ERP systems but understand and involve store personal and customers itself into the development process. Today many of us look at their sales figures from the past and then try to predict the future, “through the rear mirror”. Again, with the eyes of “Silicon Valley” they might think that we still live in medieval times. Putting Lab-Stores in place, analyse products with A-B testing methods and the so called MVP – the minimal viable product – developed and tested in super fast timeframes, would certainly give us much more accuracy and predictability. For sure this means a much leaner, a more agile process and a quite flat organisational structure which we are all unfamiliar with and it feels uncomfortable. But – let’s get started.

Projectmanagement – please, give me a problem !

Speed and total engagement are golden rules in Silicon Valley and as such there’s no time for complicated regulations. If the problem is unsure they use agile methodologies like “The Lean Startup” from Eric Reis (build-measure-learn). If it is more clear they use agile project methods like SCRUM. The more they can define problems or challenges they switch to Waterfall or Kanban systems. I like that because it uses the right tools for the right task. Much too often we try to define one standard process for the company and are surprised by either the number of unfinished projects or the delays in the timing or the exploding costs. By looking behind the curtain it is not such a surprise. Practically speaking we cannot use one screwdriver for all operations. But in this case we try to. I have done some projects in a more agile way and the result was quite good but it takes a lot of energy and persuasion if your colleagues are not used or not trained to work like that and sometimes it even makes them disappointed. Nevertheless – my personal advice here is to always try to be the pirate, not an officer 🙂

Money Money Money !

Financially our worlds couldn’t be more different. In Silicon Valley you find money “on the street” namely the Sand Hill Road – and you can find a lot, if you have the right idea and the right scale, thousands of ideas per year find venture capital.  Only 10 % of these startups make it but they seem to produce enough pay back to invest in 90 % failure. In our business as a young fellow you borrow money from your parents, your grandparents, aunts and uncles, friends and stretch the credit card and then you hope that you survive the first 3 to 4 seasons. For sure no bank will give you any credit for opening a new fashion brand. The other, more robust way is to to find a job in a famous brand, become famous to some extend and well-known in the fashion industry and then borrow money, stretch you credit card, …  We could do better, there is money out there, also for new ventures. Unfortunately until today investors focus more on brands that have already earned reputation and then try to excel the already proven business strategy. So – dare to find the Uber’s of our business when they just have an idea that aims to shoot to the moon.

Now – what to do next ?

Well, a lot of disruptive innovations are on the way, change our lives already and will do even more in the future. Our chance here is not to wait for others to do something courageous but start acting by ourselves. There are examples visible, some stores have successfully combined online and offline business, some development platforms are build. Some showrooms are digitized like Adidas and just recently Tommy Hilfiger so that orders can be made completely digital, saving money and time. We see brands that try to make better predictions using better analytic tools. From my point of view the biggest challenge is the speed and harsh competition we are not aware of from these pirates like Amazon, Google, Uber, AirBnB, aso. Their fearless energies and targets, their shooting to the moon strategies, their endless money and their rude business behaviour ( the winner takes it all ) is not to underestimate. As much as I benefit from their technic I am also aware of the fact of being eaten at breakfast if they wish.

How is your feeling about that – how do you digitize yourself and how do you intend to adapt yourself to future changes ?

I would certainly love to hear from you and learn from your perspectives.

br

Josch

3 responses to What the textile industry can learn from “Silicon Valley” – embrace a new mindset !

  1. 

    I really which I could find an English translation of this book- it sounds fascinating!

    Like

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