Hanbo’s Peter Cheng and Albert Liu say role of bosses is changing amid shift to OBM

Many apparel suppliers in Hong Kong are making the transition to supply chain management and seeking managers with in-depth knowledge of the global garment supply chain, excellent communication skills and cultural sensitivity.
Since the abolition of textile quotas by the World Trade Organisation in 2005, the global garment industry has been growing, says Peter Cheng, chairman of Hanbo Enterprises Holdings. Although the majority of Hong Kong’s garment production has moved north of the border and to other lower-cost manufacturing centres, particularly in Southeast Asia, the city remains an important design centre. 
“The product design function, which focuses on execution for mass production, has been relocated to where the production bases are for smooth workflow,” Cheng says.
Albert Liu, deputy chairman and executive director of Hanbo, adds: “Hong Kong is an established design centre with well-developed infrastructure to nurture design talent locally. It is also a financial centre for the garment industry because of its currency stability, thanks to the peg to the US dollar.”
Hanbo’s history dates back to the 1970s and it listed on the Hong Kong stock exchange in 2014. It operates factories in China, Vietnam, Cambodia and Bangladesh. The US is its biggest market and most of its clients are publicly listed companies.
In the 2015-16 budget, the government pledged more financial support to develop garment design talent locally. “Government policy encourages us to focus on design,” Cheng says. “We have progressed from OEM [original equipment manufacturing] to ODM [original design manufacturing] to OBM [original brand manufacturing] now. Our clients have demanded enhanced transparency in the production process. 
“We have deployed substantial resources into supply chain management and we also manage risks. We all need to be well prepared, highly flexible and ready to propose multiple solutions to clients.
The entire garment product cycle is between 120 and 150 days. Factory production usually accounts for between 30 and 45 days, says Cheng.
Hong Kong companies have shifted their focus to the entire value chain and subcontract cutting, sewing and tacking to other lower-cost production centres. Nevertheless, we ‘own’ the process.”
A new generation of managers is needed to help in the transformation of the local garment sector. “We aim to develop supply chain managers. As we have advanced to supply chain management, we look after the full process, including logistics, to fulfil all the requirements of clients,” Cheng says. “We have well-developed and tested systems, like enterprise resource planning [ERP] and a full set of operation manuals.
“We help clients monitor the full production cycle in compliance with stringent standardised requirements.” 
Hanbo began recruiting management trainees more than a dozen years ago. “Managers these days need the mentality for a risk management approach to mitigate risks,” Cheng says. “They should clearly communicate different scenarios to clients and to make joint decisions with them [and] they should have the mindset that they are in the same boat as their clients.”
Liu believes a good supply chain manager should uphold high standards of integrity. “He or she should see things in slow motion, but react in fast-forward mode. The manager should have thorough knowledge of their responsibilities in the entire work process and the ability to multitask, because they look after different clients and each customer may have several lines and labels.”
It is vital that managers develop knowledge and skills in specialised areas such as costing, budgeting, business development, compliance, production planning and documentation, so that they can work well with clients and their own teams, Liu says. 
Cheng adds that managers need strong team-building skills, as they do not own the production facilities. “They should know how to leverage the specialised expertise of others, like material and accessories suppliers and factories, and cooperate with them effectively. 
“Excellent coordination and team-building skills will ensure they can maximise the potential of such teams … the prerequisite is that all our production partners make profits. We need to make our partners successful, then we will be successful.”
 On top of these skills, Liu believes managers should also possess excellent puzzle-solving skills. “All solutions are there. It requires knowledgeable supply chain managers to skilfully put them together to deliver optimal results.” 
Because of the progression from ODM to OBM, Hanbo’s managers need to understand what clients want at the initial design stage and then use their communication skills to pass vital information to the various parties involved.
“This calls for great ‘storytelling’ skills,” Liu says. “Because our production is based in different regions, the managers should effectively communicate the ‘stories’ to different production teams [to get things done]. They should also be highly cultural sensitive [and] aware of the politics and risks involved.” 
Good supply chain managers should possess empathy. “They must always look at issues from the perspectives of the ultimate suppliers and the ultimate consumers.”
Cheng adds that managers should continue to upgrade their knowledge and skills by enrolling in postgraduate education and taking up technical training in project management.