With a long heritage of over 250 years in the UK and over 125 years in the subcontinent, Coats recently celebrated its silver jubilee on completion of 25 years of its existence and partnership with its business associates AK Khan Group in Bangladesh. A gala show supported by the top management from Coats plc., namely – Paul Forman, Group CEO; Rajiv Sharma, CEO Industrial Division; Ashok Mathur, CEO-Asia; Ranjan Chakhaiyar, Managing Director of Coats Bangladesh along with Salahuddin Kasem Khan, Managing Director AK Khan Group & Chairman – Coats Bangladesh and other business associates from the RMG sector, all patting themselves for the excellent work being done by the Bangladesh office.With a seating dinner arrangement for over 450 guests, the Coats management ignited the night with Runa Laila’s live performance along with a vibrant fashion show.
Coats’ journey in Bangladesh started in 1989 when the company set up a joint venture company –Tootal Thread Bangladesh with AK Khan Group; which later changed name to Coats Bangladesh Ltd. Paul praised the work done by team Bangladesh and spared no words in appreciation of Salahuddin for his constructive support of better management of the JV and always being there to give his advice whenever needed. Coats conducted an annual global employee engagement survey and Bangladesh has experienced the most significant improvement in the 2013 survey, wherein the engagement score was 87%, up from 49% in 2010.
The highlight of his address was also how the company is keeping pace with the market needs and getting into niche products like flame-retardant thread and high elongation thread which is useful in both – sportswear and jeans. Paul also proudly announced the opening in early 2015 of a zipper factory in the same thread manufacturing premises and an extended JV with the same Group which will facilitate Bangladesh’s RMG sector as well as footwear industry.
Speaking on the occasion, Salahuddin said, “It is a moment of great pride for us to celebrate the silver jubilee of Coats Bangladesh. We are privileged to have an association with Coats, which being a global leader in thread and the second largest and fastest growing zip company in the world brings huge value to the country. We believe that a successful partnership will be built on the principals of transparency, integrity and mutual respect.” Congratulating Ranjan Chakhaiyar, and his dynamic team, Salahuddin also thanked Paul Forman for being here in Bangladesh within his first quarter of appointment as CEO in January 2010. “This gives a lot of confidence to the buyers and supply chain partners who are working with Coats plc. He has also been able to develop a world class management team that has brought Coats Bangladesh to the best position in the business group,” said Salahuddin.
Bangladesh is the southeastern hotspot for Coats; Vietnam and Indonesia are equally well positioned, while Cambodia and Myanmar are the next wave in coming times. In terms of near-sourcing, Eastern Europe and Turkey are focus markets.
Coats Bangladesh is one of the finest examples of enriched human resources with over 1,500 employees, some sticking to the company since its inception. It is the pioneer in achieving ISO 9002 certificate in the textile sector. “Recently we have achieved ISO 9001 2000 certificate and also been certified for our eco-friendly products. The drive for excellence at Coats continues with focus on extending relationships with customers and ensuring enhanced product quality and valued services with every upcoming year,” was the underlining message from Ranjan. Coats has also established a new warehouse-cum-distribution centre in Bangladesh to support better services to its customers.
“We need to accelerate our GDP growth to 8% plus to reach middle income status. This will happen only if we can increase our overall investment from 25% to 35% by 2015. To close this gap, Bangladesh has to attract huge FDI. AK Khan Group has been trying since the ’80s to bring FDI in Bangladesh. Till today, we have been able to attract over US $ 400 million through FDI. Our target is to attract another US $ 600 million FDI,” concluded” Salahuddin.
Interview: Paul Forman, Group CEO, Coats plc.
In his usual candid style, Paul was very vocal about the immense transformation of the Bangladesh team from an average performer in the global context to being among the top three players for Coats plc. At the annual Coats global leadership conference recently, the Bangladesh team was awarded ‘Coats Business of the Year’as the best performer, they also won the inaugural Coats CEO Safety Award for ‘Health and Safety Excellence’ having reached over five million accident-free hours. The award was instituted to encourage safety practices within the company and its global factories and offices. “It has been a real pleasure watching the transformation of Bangladesh operations, almost like seeing children growing up. The enthusiasm and passion I see here is very encouraging for future growth,” says Paul. In fact, the target set is as ambitious as the one set by BGMEA, to double turnover in five years.
Reiterating that his role was of a motivator, Paul very humbly stated, “Since I joined Coats in 2009, I have not concentrated on teaching them their business, but strengthening the culture where every employee has a safe and respectful place of work, feels totally engaged and aligned with the strategy and goals set by the top management, can gainfully contribute to the goals and most importantly wants to go to work in the morning.” One of the first things that Paul did was to layout the philosophy and goals of the company and to have them translated into 42 languages, so that every employee of the company around all manufacturing/operating locations could read and understand the DNA. Secondly, it became important to select and make investments based on the clear strategy laid out, so all the actions were aligned to the company’s growth objective.
“One of the good things about being part of Coats is that during a conversation, which I regularly indulge in, I can actually cite some very interesting facts that really take the breath away. For instance we make enough thread in every three-and-a-half hours to go to the moon and back to earth. Another way of putting it, which might be slightly easier to understand, is that every 11 minutes we make enough thread to circle the equator. So quite breathtaking statistics.” – Paul Forman, Group CEO, Coats plc.
From a company which was a market leader in terms of sales, Coats has matured into a company that is always doing something new, something different. “Innovation and new solutions are what will keep our competitors on their toes,” argues Paul. He is particularly excited about Coats Global Services, which for countries like Bangladesh provides tools to further improve productivity. “We are now looking at a bigger role with customers, supporting their efforts for improvement as we believe that with our global perspective, can help engineer that change,” says Paul.
Throwing light on Coats relation with its Bangladeshi partner AK Khan Group, Paul emphasized that the Bangladesh connections which the Group enriched through its contacts and intricate understanding of the industry has been a big support in the growth of Coats in the country. The confidence that Coats has in the Bangladeshi operations is also highlighted in the fact that the country is amongst the top 3 recipients of investments in the group during the last several years.
Paul went on to highlight that the strategy for Coats was a reflection of the changes that the industry was going through, be it resource optimization, near-shoring for speed to operations, differentiation, innovation and ethical sourcing. No doubt, Bangladesh is one of the priority markets for Coats and in line with the future directions many initiatives have been launched here first. “Bangladesh is the first market where we have started the implementation of Coats’ Supplier Code. This is a policy which sets out our expectations in four categories such as labour rights and compliance; environmental compliance; animal welfare, and ethical business practices. It is to ensure that our suppliers do the right thing, thereby providing security for employees and for our customers that there is no weak link in the chain,” shares Paul.
In an effort to support ‘speed to market’, Coats has introduced three key elements in the digital space which help vendors take decisions quickly. “First is our industrial portal – coatsindustrial.com – that is the source of information. We started it less than two years ago and now we are getting over 50,000 hits in a month. We have free advice and FAQs. It is really exciting. We also have an e-commerce service that means if any customer orders any product it can directly go into our manufacturing process. It will save huge time. It also keeps a digital record of information and orders. So there is efficiency throughout the supply chain. Another successful digital venture is Coats Colour Express that can automatically match colours in labs. It reduces lead time by 75%. In fact, Coats particularly focuses on the influential and informed customer base in Bangladesh to test and launch new products and services. In April 2012, it was one of seven countries where Coats Colour Express, the world’s first fully digitised web based colour matching service, was previewed. The full global roll out for the now award winning service took place later in 2013.
While many new threads are slated to be manufactured in Bangladesh, the focus will remain on Apparel Thread requirements, which is the mainstay of business in the country. “We cannot ignore what is happening around us and all our offices are tuned into how they have to carry the operations further. The Bangladesh operation is already leading in many areas and going forward, I see it evolving and maturing not only as a frontrunner for the global operations, but also as a support partner to the efforts of the industry to evolve responsible manufacturers,” concludes Paul.
