An assignment on

Analysis of Operations Management Practices in the RMG Sector of Bangladesh

Course: Operations Management
Course code: HRM-306

Submitted to: SHARIFA AKTER

Assistant professor
Department of Human Resource Management
Jatiya Kabi Kazi Nazrul Islam University
 Submitted by:
Student ID Name Chapter
22133013 Arpan Dash Using operations to create value
22133014 MD Galib Hossain Riad Process strategy and analysis
22133015 Ibrahim Sadi Quality and performance
22133016 Shreya chisim Capacity planning
22133017 MD Kamrul Hasan Saikot Inventory management
22133018 MD Udoy Islam Operation planning and scheduling
 Chapter-1: Using operations to create value
(Submitted by: Arpan Dash, Student ID: 22133013)

What is Operations Management?

Operations Management (OM) refers to the systematic design, planning, implementation, and
control of processes that transform inputs (materials, labor, technology) into goods or services
for customers. In the context of the Bangladesh RMG sector, operations management ensures
that garment manufacturing is efficient, cost-effective, timely, and quality-compliant, which is
critical given the country’s position as one of the largest garment exporters globally.

Example:

• Ha-Meem Group carefully plans fabric procurement, sewing line operations, finishing,
and shipment schedules to meet international buyer deadlines. OM involves not just
producing garments, but also managing labor, machines, inventory, and quality checks to
satisfy clients like H&M and Puma.

2. Main Functions of Operations Management

Operations Management encompasses multiple functional areas. In the Bangladesh RMG
sector, these functions are critical to achieving efficiency, meeting international standards, and
competing in global markets.

Functions:

1. Production Planning & Scheduling

Determines how production lines will operate to meet delivery dates.
o Example: DBL Group uses advanced line-balancing software to schedule
sewing lines, reducing idle time and ensuring on-time delivery to H&M orders.
2. Supply Chain & Procurement Management
o Involves sourcing fabrics, trims, and accessories, often from multiple countries.
o Example: BGMEA members plan procurement months in advance to ensure
continuous supply for fast-fashion brands like Zara.
3. Quality Management o Ensures products meet international standards (AQL, ISO,
or buyer-specific requirements).
 o Example: Ha-Meem Group implements multiple inspection points, including
cutting, sewing, and finishing, to reduce defects before shipping.
4. Inventory & Material Management
Controls raw material stock, work-in-progress (WIP), and finished goods.
o Example: Mondol Group uses ERP systems to track fabric rolls and minimize
excess cutting or wastage, reducing costs and improving efficiency.
5. Workforce Management & Compliance
o Hiring, training, and ensuring worker safety while complying with labor laws.
o Example: Fakir Apparels improved safety training, established fire drills, and
upgraded work environments post-Rana Plaza.
6. Process Improvement & Productivity Enhancement
Uses Lean, Kaizen, and 5S techniques to reduce waste and improve efficiency.
o Example: Standard Group reorganized sewing lines using 5S, increasing
productivity by 20%.
7. Cost Control & Budgeting
Monitors labor, energy, and production costs to remain globally competitive.
o Example: Factories implement energy-efficient boilers and LED lighting to
reduce operational costs.
8. Technology & Automation Integration o CAD systems, automated cutting, and ERP
systems optimize production and tracking.
o Example: Epyllion Group uses Gerber cutting machines to enhance accuracy and
reduce fabric waste.
9. Sustainability & Environmental Management o Includes waste management, energy
efficiency, and chemical safety to meet buyer requirements.
o Example: Envoy Textiles achieved LEED Platinum certification through solar
power, water recycling, and eco-friendly dyeing.
10. Risk Management & Compliance Audits o Identifying potential risks, preparing for
supply chain disruptions, and meeting buyer audits. o Example: Interstoff Apparels
conducts regular fire safety inspections, compliance checks, and risk mitigation
exercises.

3. Major Competitive Priorities in Operations Management

Operations management aligns production and service delivery with market expectations. In
Bangladesh RMG, competitive priorities determine how factories compete globally.

Elaborated Competitive Priorities with Examples:

1. Cost (Low-Cost Production)

Minimizing unit cost while maintaining quality.
 o Example: Ha-Meem Group leverages low-cost labor and economies of scale to
offer competitive prices to global buyers.
2. Quality (High Product Standards) o Consistently delivering defect-free garments. o
Example: DBL Group ensures all products pass AQL inspections and meet buyer
specifications.
3. Delivery Speed (Fast Order Fulfillment)
Reducing production lead time to meet fashion deadlines. o Example: Epyllion Group
uses ERP and automated cutting to shorten order cycles for Zara.
4. Delivery Reliability (On-Time Delivery)
Ensuring orders arrive exactly as promised. o Example: Pacific Jeans maintains strict
production schedules and tracking systems to deliver Levi’s products on time.
5. Flexibility (Variety & Customization)
Ability to produce multiple styles or sizes quickly.
o Example: Fakir Apparels adapts production lines to produce multiple
buyerspecific styles in the same month.
6. Innovation (Process & Product) o Adopting new technology or manufacturing
methods. o Example: Beximco introduced digital printing and advanced denim finishing
to attract new buyers.
7. Sustainability (Eco-Friendly Operations) o Green production processes for ethical
compliance. o Example: Over 200 LEED-certified factories in Bangladesh, including
Envoy Textiles.
8. Compliance & Safety Ensuring worker safety and adherence to labor laws.
o Example: Interstoff Apparels meets Accord/Alliance safety standards to maintain
buyer confidence.

4. Operation Strategy & Its Linkages

Operation Strategy:

A long-term plan that determines how a company will use its operational resources (machines,
labor, technology, supply chain) to support corporate goals and compete in the market.

Linkage to Corporate Strategy:

• Corporate strategy defines the overall direction (cost leadership, differentiation,

growth).
• Operations strategy ensures production, quality, and logistics systems are aligned to
achieve these corporate objectives.
• Example: Ha-Meem’s corporate strategy is low-cost global supplier; its operation
strategy focuses on high-volume, efficient production, and cost management.
Linkage to Market Analysis:

• Market analysis identifies buyer needs, trends, and expectations.

• Operation strategy converts these insights into operational capabilities.
• Example: DBL Group responds to H&M and Zara’s demand for sustainable production
and faster delivery by adopting green factories and ERP-based tracking.

5. Service and Manufacturing Process

Manufacturing Process:

• Physical transformation of inputs into garments.

• Example: Fabric → Cutting → Sewing → Finishing → Packing (Ha-Meem or Epyllion).

Service Process:

• Intangible activities supporting manufacturing, logistics, and buyers.

• Example: DBL Group provides design support, sample development, and compliance
assistance to global buyers.

Differences Between Manufacturing & Service:

Aspect Manufacturing Service RMG Example
Output Tangible garments Intangible service Sewing line vs. design
sample preparation
Customer Low High Factory vs. merchandising
Contact team
Storage Can store finished Cannot store Garments vs. design ideas
products
Quality Measurable (defects) Harder (buyer Inspection vs. feedback
Measurement satisfaction)
Automation High Moderate Cutting machines vs.
compliance processes
Similarities: Both require planning, quality control, skilled workforce, technology, and
continuous improvement.
6. Supply Chain View of Operations Management
Core Processes:

• Inbound Logistics: Raw material procurement (BGMEA factories import fabrics from
India/China).
• Production/Operations: Cutting, sewing, finishing (Ha-Meem Group).
• Outbound Logistics: Packing and shipment (Epyllion Group to Zara/H&M).

Support Processes:

• Procurement, vendor management, ERP systems, HR & training, QA & compliance.

• Example: DBL Group uses ERP to monitor production; Fakir Apparels trains workers for
efficiency and safety.

Linkage:

Support processes enable core processes to run efficiently and meet market demand.

Example Flow (RMG):

• Procurement team sources fabrics → supports production.

• ERP system monitors cutting/sewing lines → ensures on-time delivery.
• QA & compliance checks → maintain quality for buyers.

This integrated approach ensures cost-effectiveness, quality, and timely delivery, which are
critical for global competitiveness.

Chapter-2: Process strategy and Analysis

 Chapter-3: Quality and Performance
(Submitted by:Ibrahim Sadi, Student ID: 22133015)

Basic Principles of Total Quality Management (TQM)

Total Quality Management (TQM) is a continuous management approach focused on improving
products, services, and processes by involving all members of an organization. Its main goal is
customer satisfaction and long-term success.
Below are the core principles:
1. Customer Focus
The primary goal of TQM is to meet or exceed customer expectations.
Quality is defined by the customer, not the organization.
Understanding customer needs, preferences, and feedback is essential.
Example: Regular customer surveys to improve product features.

2. Continuous Improvement (Kaizen)

TQM emphasizes ongoing improvement in processes, systems, and outcomes.
Small, incremental improvements lead to long-term excellence.
Tools: PDCA cycle, Six Sigma techniques.
Example: Reducing defects step by step over time.

3. Employee Involvement and Empowerment

All employees—from top management to workers—participate in quality improvement.
Involving employees increases ownership, motivation, and innovation.
Techniques: Quality circles, teamwork, training.
Example: Workers suggesting process improvements.
4. Process-Centered Approach
Quality results depend on well-designed and well-managed processes.
Focus is placed on understanding, controlling, and improving processes rather than individuals.
Uses standard operating procedures (SOPs), flowcharts, and process mapping.
Example: Improving the production line workflow to reduce bottlenecks.

5. Integrated System
All departments and levels work together as part of a single system.
Quality management becomes integrated into the organization’s culture.
Standards like ISO 9001 promote this integration.
Example: Marketing, production, and supply chain working together toward quality goals.

6. Strategic and Systematic Approach

Quality initiatives must align with organizational goals and strategic planning.
TQM is not random—it is systematic and organized.
Example: Incorporating quality goals into the organization's mission and strategy.

7. Fact-Based Decision Making

Decisions should be based on data and analysis, not assumptions.
Tools: Statistical process control, benchmarking, quality indicators.
Example: Using performance metrics to identify areas that need improvement.

8. Communication
Effective communication supports teamwork, transparency, and involvement.
It ensures employees understand goals, responsibilities, and progress.
Example: Regular meetings, bulletins, and feedback sessions.
9. Supplier Partnership
Quality also depends on reliable suppliers.
Building long-term relationships with suppliers ensures consistent quality inputs.
Example: Collaborating with suppliers to improve raw material quality.

Major Challenges of TQM in the RMG Sector of Bangladesh

1. Lack of Strong Leadership Commitment-

Many factories still treat quality as the responsibility of the QC/QA department only, rather than
a company-wide priority.

Why it is a challenge-
Top management often focuses on meeting shipment deadlines rather than building long-term
quality systems.

Quality initiatives stop when production pressure increases.

Example
A factory may delay operator training or skip inline inspection during peak seasons to “save
time,” resulting in high rework and buyer complaints.

2. Insufficient Skilled Workforce and High Employee Turnover-

TQM requires skilled operators, trained supervisors, and quality-aware staff—something many
factories struggle to maintain.
Why it is a challenge-
High turnover among sewing operators disrupts quality consistency.
Many line supervisors are promoted from within but lack formal training in quality tools (e.g.,
5S, cause-and-effect analysis).
Example-
New operators join frequently and do not fully understand sewing tolerances, leading to uneven
stitching, measurement defects, or fabric damage.
3. Weak Process Standardization-
Many RMG factories rely heavily on manual processes with inconsistent documentation.
Why it is a challenge-
SOPs (Standard Operating Procedures) may exist on paper but are not followed on the
production floor.

Lack of proper process mapping results in defects being identified too late.

Example-
Cutting defects such as incorrect marker placement or fabric distortion occur because the process
is not standardized or monitored effectively.

4. Limited Use of Data and Modern Quality Tools-

TQM emphasizes fact-based decisions, but many factories still depend on visual checks and trial-
and-error methods.
Why it is a challenge-
Many factories do not use statistical tools like control charts or root-cause analysis.
Quality reports are often manual, slow, and inaccurate.
Example-
Defects like skipped stitches or shade variation recur because data is not analyzed to identify
patterns or root causes.
5. Production Pressure and Short Lead Times-
Bangladesh RMG factories operate under intense buyer pressure for fast delivery at low cost.
Why it is a challenge-
Production speed is prioritized over quality.
Quality inspections are sometimes bypassed to meet shipment dates.
Example-
A factory rushes finishing and packing processes to meet shipment deadlines, resulting in mixed-
size cartons, poor ironing, and packing errors.

6. Ineffective Supplier Management-

Quality often begins with raw materials, but many factories have limited control over fabric and
trim suppliers.

Why it is a challenge-
Imported fabrics sometimes arrive late, forcing factories to skip proper testing.
Local suppliers may not follow global quality standards.
Example-
Poor-quality zippers, buttons, or fabric shrinkage create defects during sewing or after washing,
hurting the buyer’s confidence.
7. Lack of Continuous Improvement Culture-
TQM requires constant learning and improvement, but many factories treat it as a one-time
activity.
Why it is a challenge-
Employees rarely participate in problem-solving teams or suggestion programs.
Corrective actions are taken only when buyers point out issues.
Example-
A factory corrects a specific defect only for the current order but fails to implement long-term
process improvement, so the same issue reappears in the next style.
8. Resistance to Change-
Introducing TQM means altering routines, accountability, and culture.
Why it is a challenge-
Many workers fear that changes (like new inspections or training) may reduce their production
speed or lead to blame.
Managers may resist because TQM demands more transparency.

Example-
Operators resist following new quality checklists, thinking it slows the line; supervisors avoid
data recording because it increases their workload.
9. Insufficient Investment in Technology and Infrastructure-
TQM becomes more effective with modern machines, automation, and digital quality tracking.
Why it is a challenge-
Many small and medium factories cannot invest in updated sewing machines, ERP systems, or
laboratory equipment.
Lack of proper lighting, ventilation, and maintenance also affects product quality.
Example-
Factories without fabric testing equipment cannot detect GSM variation or colorfastness issues
before production, leading to buyer rejection.
10. Buyer-Driven Compliance Pressure Without Internal Ownership-
Most quality improvements happen because buyers demand them—not because factories plan
long-term quality strategy.

Why it is a challenge-
Factories stay reactive instead of proactive.
TQM becomes box-ticking rather than real improvement.
Example-
Factories prepare documentation only when auditors visit but do not use it to improve
their own operations.
 Chapter-5: Capacity planning
(Submitted by: Shreya chisim, Student ID: 22133016)

CAPACITY PLANNING IN THE RMG SECTOR

OF BANGLADESH

1. Planning Long-Term Capacity

Long-term capacity planning refers to the decisions a firm makes about the maximum output it
can produce over an extended period when all major resources—such as facilities, equipment,
and labor—can be changed. It is essential for industries like the Ready-Made Garments (RMG)
sector of Bangladesh where large-scale production, tight delivery schedules, and cost efficiency
are crucial for global competitiveness.

a. Measures of Capacity and Utilization

Capacity can be measured in two major ways:

Output Measures:
Used when the product is standardized. In the RMG sector, factories measure output in “pieces
per hour,” “shirts per line per day,” or “sewing minutes per hour (SMV).”
For example, Ha-Meem Group, one of the largest RMG exporters, measures its sewing-line
output to plan how many machines are needed for upcoming bulk orders.

Utilization:
Utilization shows the degree to which capacity is being used.
Utilization = (Actual Output / Maximum Capacity) × 100%
Bangladeshi garment factories usually aim for 80–90% utilization, because lower than that
means waste, and higher than that causes pressure and quality issues.
b. Economies of Scale in the RMG Sector

Economies of scale occur when increasing production volume reduces the cost per unit.
In Bangladesh’s RMG industry, large factories achieve economies of scale because:

 They buy fabric, thread, and trims in bulk at lower cost

 Operators become highly specialized through repetitive tasks
 Machines and wages are spread over larger outputs

For example, DBL Group, which operates multiple vertically integrated facilities, benefits from
producing large batches of knit garments. Their per-unit cost drops because raw materials,
dyeing, sewing, and finishing occur within the same integrated setup.

c. Diseconomies of Scale in the RMG Sector

Diseconomies of scale occur when factories expand too much and become hard to manage,
causing the cost per unit to rise.

In Bangladesh, some large factories face problems like:

 Too many production lines to supervise

 Difficulty maintaining consistent quality
 Communication gaps between cutting, sewing, and finishing floors
 Overloaded HR, compliance, and maintenance teams

For example, a large factory like Ha-Meem Group, with 26 garment units, must coordinate
thousands of workers. Managing a high number of lines increases complexity and can lead to
production delays if not planned properly.

2. Capacity Timing and Sizing Strategies

a. Sizing Capacity Cushions

A capacity cushion is the extra capacity kept to handle sudden increases in demand.
Capacity Cushion = 100% – Utilization

In the RMG industry of Bangladesh, most factories keep very low capacity cushions because
buyers give strict deadlines and the industry operates on thin margins. Many factories only keep
a small cushion to accommodate urgent orders or last-minute style changes from buyers.
b. Timing and Sizing Capacity Expansion

This refers to deciding when and how much capacity to add.

Expansionist Strategy (Lead Strategy)

Some large RMG firms add capacity before demand actually rises.
For example, Badsha Group (Pioneer Denim) has built new large-scale denim facilities
anticipating future export growth. This ensures they never lose orders due to lack of capacity.

Wait-and-See Strategy (Lag Strategy)

Small and medium RMG factories typically add capacity after receiving confirmed orders.
For example, a mid-level knitwear factory in Narayanganj may only purchase new sewing
machines once a buyer like H&M or C&A places a confirmed order.

Moderate Strategy (Incremental Expansion)

Many factories increase capacity line by line, matching steady growth in order volume.
This reduces financial risk and maintains stable production.

c. Linking Capacity Decisions with Other Areas

Capacity decisions are connected to:

 Workforce planning: Hiring more operators when lines increase

 Supply chain: More machine capacity requires more fabric and trims
 Technology: Adding advanced sewing machines increases productivity
 Facilities: High capacity requires larger buildings and warehouse space

In the RMG sector, expanding sewing capacity without increasing finishing capacity will cause
bottlenecks. For example, Beximco Apparels coordinates capacity across cutting, sewing,
washing, and finishing so one step does not overload another.

3. A Systematic Four-Step Approach to Long-Term Capacity Decisions

This approach from Krajewski & Malhotra is widely used in manufacturing planning.

Step 1: Forecast Future Capacity Requirements

Bangladeshi RMG exporters forecast demand based on:

 Buyer order histories

  Upcoming seasons (summer/winter collections)
 Global market trends
 Expected demand for specific product categories

For example, Pacific Jeans Group forecasts denim demand before deciding how many lines to
dedicate to jeans production.

Step 2: Identify Capacity Gaps

Factories compare their current capacity (machines, lines, workforce) to future capacity
needs.

Example:
If a factory has the capacity to produce 10,000 pieces/day, but demand forecasts show 12,000
pieces/day, it has a capacity gap of 2,000 pieces/day.

Step 3: Develop Alternative Capacity Plans

Possible alternatives include:

 Adding new sewing lines

 Purchasing new machines
 Hiring and training new operators
 Running overtime
 Subcontracting part of the order
 Process improvement to increase efficiency

For example, DBL Group often uses subcontracting for sudden large orders during peak seasons
to avoid delivery delays.

Step 4: Evaluate Financial Costs and Cash Flows

Factories analyze:

 Cost of machines (e.g., Juki/Jak sewing machines)

 Cost of new buildings or floors
 Labor costs
 Overtime expenses
 Expected revenue from fulfilling the orders
They choose the option that gives the best financial return while maintaining delivery
commitments.

4. Tools for Capacity Planning

a. Waiting-Line Models

Used to analyze bottlenecks and worker queues.

In the RMG industry:

 Long queues at ironing, washing, or quality-check tables slow down production

 Waiting-line models help factories decide how many workers or machines to add

For example, Beximco Apparels can use waiting-line analysis to find the optimal number of
finishing workers so shirts do not pile up after sewing.

b. Simulation

Simulation models test “what-if” scenarios without real-life risk.

In the RMG sector, factories use simulation to understand:

 Whether adding 2 new sewing lines will meet a tight shipment deadline
 How changing line balance affects daily output
 How machinery breakdowns will affect delivery dates

Factories like Epyllion Group use simulation-based planning to decide whether a new order
volume can be taken.

C. Decision tree

Decision trees help managers choose between investment options under uncertainty.

Example in RMG:

A factory owner considering buying 50 new sewing machines might create a decision tree with
branches like:

 High-demand scenario: Invest and earn high profit

  Low-demand scenario: Use subcontracting instead
 Medium demand: Invest in fewer machines and adjust capacity gradually

This method helps firms manage risk before committing large investments.

Conclusion
Capacity planning is a critical function in the Bangladesh RMG sector because it directly
influences production efficiency, cost control, delivery performance, and the ability to respond to
global buyer demands. By using long-term capacity measures, appropriate timing strategies,
systematic four-step decision tools, and analytical methods such as waiting-line models,
simulation, and decision trees, garment factories can optimize their production capacity and
maintain competitiveness in a highly demanding global market.

Bangladesh’s leading RMG companies such as Ha-Meem Group, DBL Group, Beximco
Apparels, Pacific Jeans, and Badsha Group demonstrate how effective capacity planning allows
factories to manage large-scale operations, maintain efficiency, and meet strict shipment
deadlines. When properly implemented, capacity planning ensures that factories balance demand
with available resources, minimize operational bottlenecks, and achieve sustainable growth.
Chapter-9: Inventory Management
(Submitted by: MD Kamrul Hasan Saikot, Student ID: 22133017)

Inventory & Inventory Management

Inventory refers to the stock of goods and materials that a business holds for production or sale.
Inventory Management:
Inventory management is the systematic process of ordering, storing, tracking, and controlling
inventory so that the right materials are available at the right time, in the right quantity, and at the
lowest possible cost.

Types of Inventory Commonly Handled in the RMG Sector of Bangladesh

In the RMG (Ready-Made Garments) sector, factories typically manage four major types
of inventory:

Raw Materials
Such as fabric, trims, accessories, threads, labels, and packaging items. These materials are
necessary to start production, and any delay in receiving them directly affects shipment dates.
Work-in-Progress (WIP)
Inventory that includes cut panels, semi-stitched garments, and items that move through sewing,
finishing, and quality stages. WIP ensures the production line keeps moving without interruption.
Finished Goods
Export-ready garments waiting for shipment. Proper control ensures timely delivery to
international buyers.
MRO (Maintenance, Repair & Operations)
Items including tools, machine parts, needles, and lubricants needed for smooth machine
operation.
Inventory Management Techniques Used in Bangladeshi RMG Factories
RMG factories in Bangladesh use several inventory techniques to balance cost, speed, and
accuracy:
FIFO (First-In, First-Out)
Prevents old fabric from becoming obsolete and maintains quality.
ABC Analysis
Helps categorize items based on value and usage, allowing management to focus more on high-
value items (A-category) while applying lighter control to low-value items.
Safety Stock
Covers risks like shipment delays, fabric shortages, or unexpected order changes.
Economic Order Quantity (EOQ)
Assists factories in ordering the right amount of raw materials while minimizing holding and
ordering costs.
Challenges in Inventory Management
Bangladesh’s RMG sector faces several inventory-related challenges:
Lead Time Issues
Many fabrics and trims are imported, causing delays in production when customs clearance or
shipping takes longer than expected.

Forecasting Difficulty
Frequent buyer style changes, unpredictable seasonal demand, and very short production
windows make accurate demand prediction difficult.
Manual Tracking
Small and medium factories still rely heavily on manual record-keeping, leading to mismatched
stock, fabric shortages, and human errors.
WIP Pile-up
Occurs when production lines are unbalanced, scheduling is poor, or certain processes become
bottlenecks.
Improvement & Solution Strategies
To improve inventory management, RMG factories can adopt the following practical solutions:
Implement Digital Systems
Use ERP software, RFID tags, and barcode systems to reduce manual errors and enable real-time
tracking of materials and garments.
Staff Training
Regularly train warehouse and production staff on proper handling, accurate counting, and
standardized tracking procedures.
Strengthen Supplier Collaboration
Build closer relationships with fabric and trim suppliers to reduce raw material lead times and
improve planning accuracy.
Adopt Lean Inventory Principles
Focus on reducing unnecessary WIP, eliminating overstock, and maintaining only the required
stock levels.
Improve Forecasting
Analyze historical orders, buyer trends, market data, and seasonal patterns to create more
accurate production and material forecasts.
By applying these improvements, RMG factories can significantly enhance inventory accuracy,
reduce costs, minimize delays, and meet global delivery deadlines more consistently.