Sweatshops within the supply chain and how to solve them

For many, the term “sweatshop” may be quite new. For people that work deep within the supply chain business, this word is very common. And for people that work in the supply chain management in the garment industry, this word could easily be a nightmare.

Let’s take it from the beginning. Sweatshops is a name that is given to workplaces that do not meet standards and that are full of labor abuses towards workers, their lives, rights, surroundings and even their safety. This term is commonly used in the clothing industry, and it refers to workshops where people are employed to do manual work on a repetitive basis with little to no working conditions at all. This includes low wages, poor working conditions, health risks and abuses from the employers.

Now, these sweatshops have been constantly used by big brands as their suppliers leading to significant problems with the media and their corporate image around the world. The best examples are GAP clothing, WalMart, and H&M. These brands are accused of being negligent, or in the worst case scenario, they are accused of being clueless and not even paying attention to such big problems such as the exploitative and unsafe working conditions that took place in their factories or in the factories they had an as suppliers for their clothing.

Take for example H&M, they had a huge scandal in September last year that involved their factories and what some claimed were “sweatshops” condition. H&M has a plant in Phnom Penh that holds more than  3,500 workers, and it is considered one of the  “platinum” plants. 

This plant goes by the name of  Eastex Garment, and many of the people that worked there said that they had to live with very unfair work conditions such as illegal short-term contracts that did not even talk about sick pay, had wages that went a lot lower than minimum wage in the country and had hard penalties for simple mistakes such as arriving 5 minutes late. In other plants called  Vanco and Seduno workers say that bosses took advantage of them and didn’t  give them the correct working or sanitary conditions. Some even claimed that managers at those factories limited the number of times employees could go to the bathroom.

Then comes all the times we have seen in the news that a factory burns down taking the lives of many people and that many brands are involved as their garments were being made there under poor working conditions.

sweatshops_supply chain_logistics
Image courtesy of Quinn Dombrowski at Flickr.com

But what can be done about it? Well the answer, some say, lies within the lean manufacturing approach. Here is how it works and how this could benefit supply chains in the long run. There are two mass manufacturing approaches that can be used to produce or supply big quantities in industries such as clothing.  The Traditional Mass manufacturing is rooted in a “Scientific Management” principle that was established in the 19th century, and it consists of workers making and following simple and routine operations. They are motivated to finish as soon as possible and they get compensation based on time and production quantity. In this model, all the decisions are made by the managers and they have all the authority around the workplace and in the process. It is a “sweatshop” in disguise.

On the other hand, the lean-manufacturing approach empowers workers within their job. In this approach workers on the assembly line have the ability to do many tasks, be accountable for poor quality products and are motivated to improve their own job or workstation with their own proposals. This approach works perfectly in first world countries and powerful companies, but can it work in the developing world?

The first answer would be maybe not. The reason is that there is a belief that lean actually exposes workers to more exploitation and injury but there wasn’t any real evidence of this claim. On the other hand, mass production has shown the world that it can be pretty dangerous itself.

The argument that proves that lean manufacturing can cure the “sweatshop” cancer is what Nike did in the mid-2000s where they offered training to factory management teams in developing countries and trained them in the correct way to handle simple management things such as wages, work hours, disciplinary practices, health and safety, and environmental compliance, and then they audited them on these same topics to see if they were meeting the standards.  The results were amazing with a reduction in violations of labor standards of 15% and impacting the whole supply chain.

Supply chains start with the manufacturer and supplier. If this company or person is not meeting the correct standards and in contrast is breaking the law, the whole supply chain will be affected at any moment with an accident or a regulation fine. The best idea is to follow Nike’s example and really understand the operation that is taking place behind the production of the company’s products.

Be sure to also read this post about things you need to know about the supply chain and retailers.

* Featured Image courtesy of marissaorton at Flickr.com

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