Financial Times FT.com

Green technology or green IT – which takes priority?

By Dan Ilett

Published: September 16 2009 17:23 | Last updated: September 16 2009 17:23

With 10 factories in east Asia employing 33,000 people, and lengthy supply chains throughout the US, TAL Apparel inevitably makes an impact on the environment.

The company claims to make one in seven shirts in the US. It makes 55m garments a year for brands such as Banana Republic, Burberry, Calvin Klein, DKNY, Tommy Hilfiger and many more.

So how is TAL tackling sustainability issues?

“Green IT is not top of the list for us,” says Delman Lee, director of operations and technology for TAL Apparel (and nephew of Harry Lee, the company’s chief executive). “It’s not our top contribution to CO2. IT vendors say whatever they need to say to sell more products, but the bigger problem to tackle is people.”

About 40 per cent of the electricity TAL uses is for “wet processing” machinery that washes, dyes or processes regular garments and “wrinkle-free” clothing. The company has factories in Hong Kong, Thailand, Malaysia, Indonesia, China and Vietnam.

“A lot of our focus in green initiatives is on those heavy machines, rather than on how much [power] is consumed by the computers,” says Mr Lee. “We do the standard things, such as not leaving computers on, but we have a lot of factories.”

Although TAL says that making its technology green is not a priority (as in energy-saving servers), it still uses huge IT systems to drive efficiency and cut waste. Today the company’s success is rooted in its supply-chain system that removes the need for warehouses.

Using a system called Vendor Managed Inventory, TAL is able to take real-time information from a shop floor in the US and make clothes in response to demand in certain products.

“We work with department stores in the US,” says Mr Lee. “We have a system that captures point-of-sale information down to the size and colour of a garment so we work out what we need to replenish. We pack goods at the factory so they can be sent straight to the store without going to a warehouse.

“You could think of that as taking a whole level out of the supply chain.”

“It’s always good when you do something green and it actually turns out to be cost effective. There are times when you try to do something green and it actually costs more.”

“It’s a waste if a supply chain is not managed properly,” he adds. “Supply chain is one of the areas that differentiates us from other manufacturers.”

Mr Lee has tried to educate his staff – many are factory workers – as to why efficiency and waste reduction are important for the company and the planet. Staff at the company headquarters now run monthly seminars on climate change, greenhouse gasses and waste management in business.

“It’s important to get people to be aware of green issues to change habits. Employees will now turn off lights when they go to lunch and not use so much paper.”

Technology affects the company’s green approach in another way: the Chinese government is focusing on water management and uses cameras and IT systems to monitor TAL’s utility bills.

“Actually the Chinese got pretty active on green,” says Mr Lee. “They can look at how well your plant is doing.”

The company works with the WWF on its low-carbon manufacturing programme but it still has a way to go on its data centre.

“Most of our servers are in the data centres hosted by IBM. Whether they are doing heat exchange or not, I don’t know,” says Mr Lee. “We don’t have a system that links it all up, but we have regular reports on this because they all come in from different plants and areas of the business.”

Despite all the company’s efforts, it still needs to do more to improve its green credentials and image, says Mr Lee – although it’s not as easy as flicking a switch.

“We are looking at all the things that we can fix within our four walls, like the heavy machinery like we mentioned and all the internal processes.  We’ve looked a lot at lifecycle management and the opportunity for improvement.

“But even if you cut CO2, everything won’t be hunky dory,” he says. “It’s not as simple as just reducing your carbon footprint. CO2 cannot be the single issue – it neglects water, greenhouse gasses and pollution. It’s an interesting journey though.”

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