Scaling up your business can be a blessing or — without the right data — a curse. That’s because serving all of the customers you can handle doesn’t mean much if you can’t even tell whether or not you’re turning a profit.

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Industry 4.0 relies on IoT, cloud computing and other technology to create smart factories, which streamline manufacturing with state-of-the-art automation and data analytics.

So data and analytics are crucial to Industry 4.0, which is transforming automated plants into IoT-enabled smart factories. This technology has helped customized knitted fabric manufacturer Pacific Textiles Holdings Inc. to accurately calculate profitability, better manage inventory and ensure the consistency of every batch — while producing about 100 million kg (more than 110,000 tons) of fabric every year — enough for more than 1 billion garments.

“That’s why data is so important to us,” Pacific Textiles CIO Hubert Tsang said in a video (see below). “The more analysis we can do, the better we can achieve the colors and the consistency that our customers need.”

Yeah, but Are You Making Money?

Pacific Textiles has a lot going on. It produces outwear, sportswear, intimates and more for Victoria’s Secret, Triumph, Walmart and others. And it does so via factories in China, Sri Lanka and Vietnam, which have state-of-the-art power plants and water treatment, along with equipment for knitting, dying, printing and finishing.

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“But when we install the SAP system, every individual system will link up together,” according to Pacific Textiles Chairman Wan Wai Loi.

“There’s a very long manufacturing chain and … and this is a very labor intensive process,” Wan Wai Loi, chairman of Pacific Textiles, told SAP. “As you can imagine, there’s a lot of human error — we need an ERP system to help us.”

The company’s annual reports, margins and dividends were good, according to Wan, but legacy systems acquired long ago were outdated and unhelpful. Pacific Textiles knew its net income for every month, but needed a better idea of which individual orders generated the most profit.

“Which customer gives us a better yield?” Wan said. “We had no idea.”

Making the Grade with Industry 4.0

Industry 4.0 is “the next phase in the digitization of the manufacturing sector,” according to management consultancy McKinsey & Company. And the factors driving manufacturing’s fourth disruption since the 1970s include:

  • Rapidly increasing data volumes, computational power and connectivity
  • Burgeoning analytics and business-intelligence capabilities
  • New ways for people and machines to interact

“Every day we need some improvement [in] every department,” Wan said. “But I need a huge data supply — from the connection of the production equipment to the system — then the system can show us the result.”

Scaling Up the Right Way with the Right Tech

Optimizing all of that data is no small order in an organization that started two decades ago with about six manufacturing machines, and now uses more than 1,500. Yet Pacific Textiles cut its month-end closing time in half, thanks to SAP MaxAttention services and SAP Mill Products best practices and global expertise.

MaxAttention has helped Pacific Textiles:

  • Localize its template solution to comply with local requirements
  • Deliver a deep process and organization re-engineering
  • Implement the company’s most comprehensive SAP Supply Chain Execution solution to date

What’s more, Pacific Textiles became SAP’s first textile customer in APJ to run Suite on HANA end-to-end — supporting its business wall-to-wall — when the company went live with the solution in December. Pacific Textiles has also rolled out SAP Best Practices business process and Suite on HANA at a new 500-acre complex in Vietnam, which will employ about 30,000 local workers.

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Going live with SAP technology has helped Pacific Textiles reduce its month-end closing time from more than two weeks to about seven days.

Working Together Across the Region

Having the right data — and being able to use it wisely — is helping Pacific Textiles scale its business, grow across Asia and turn on a dime when customers change their orders midstream. And SAP technology is enabling Pacific Textiles to build smart factories on the cutting edge of Industry 4.0.

“If we have a six factories under one roof — but they’re working individually — then we don’t have good performance,” Wan said. “But when we install the SAP system, every individual system will link up together.

“That can help us very much.”

Follow Derek on Twitter: @DKlobucher

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