Wednesday, February 1, 2012

The change in Textile and garment industry

The globalization of business has increased the shares of international trade of the developing countries. It has increased the interaction of domestic economies with the world economy. Technological change is one of the major driving forces for business globalization. 

The globalization of business has facilitated textile and garment production to be more international. The main factors contributed to the globalization of this industry include labor-intensive nature of production technology, the loss of comparative cost advantage of developed countries, dramatic decline in transport and communication costs, search for production sites with lower labor costs, and shift in exports from more restricted to less restricted among the developing countries due to the discriminatory nature of the restrictions imposed by the Multifibre Arrangement ( Ramaswamy and gereffi, 2000). In last three decades, half of the total production capacity of textile and garment production has shifted from developed to the developing countries. The main reason for this shift could be attributed by the low labor costs in production. Developing countries enjoy low labor cost advantages in producing textiles and garments. It increased at a rate of 17 percent between 1985 to 1990, which is higher than the world trade in manufacturing of 15.50 percent during the same period (World Trade Organization, 1995).This production performance is achieved by using labor intensive technologies. But globalization has increased the need for using advanced technologies in developing countries. This has created a challenge for this countries because they enjoy low labor costs in producing textiles and this advantage is disappearing.

With the change in production technology, regulatory measures, economic issues, and demographic factors textile and garment manufacturing processes have been changing. Technological change (eg., CAD, Cam, Cim) is the most powerful change driver in this sector (World Bank, 1995). Technological change in textile and garment production includes new and advanced machines, computer-aided production, design, and control. The CAD/CAM for grading, pattern making, marking, and sewing is most important among the technological developments in the sector. For exporting with greater design content and high value-added products, technological change is crucial for the garment company. This is the main balancing factors between suppliers and customers for satisfying their demands.

Technology has become a major shaping force of textile and garment sector to satisfy the requirements of customers. The rapid development and diffusion of textile technologies are contributing to changing both the environment in which people work and the location of that work. Essentially, technology demands specialized knowledge and skills that raise concerns in terms of cost, utilization of capacities, length of educational and training programs, availability of human resource etc. Understanding and controlling the diffusion of technology are important considerations for human resource planning.

Due to the presence of external change drivers, many companies are experiencing pressures to ensure continued growth through enhanced competitiveness in international market. Textile and garment manufacturers recognize that a workforce with the high skills to implement new business strategies is the key component to their future success (Human Resource Development Canada, 1997). These create significant negative effects on lower skilled workers. New human resource requirements need to be considered through an impact analysis of technology before its adaptation. Technological change influence managers to consider change in training requirements, job content, skill levels and demand of workers. Identifying new emerging and existing technologies, place of use, functions, degree of development, probability of their being introduced and their impact on workers are important for the sustainable growth of these companies.

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