ADF uniforms literally touch every soldier, sailor and airman everyday. With hundreds of thousands of individual products fitting thousands of people across the globe, ADA has been making uniforms for over a century. But the business is changing rapidly as ADM Managing Editor Katherine Ziesing found out speaking to ADA CEO Chris Dixon recently.
ADM: Can you give us an overview of what the ADA business looks like at the moment in terms of structures and capabilities?
Dixon: ADA has evolved considerably over recent years, building on the foundation of over 100 years of business. Serving Defence remains our core business, but we have broadened from a manufacturing business that focuses on defence procurement to a provider of integrated uniform and equipment solutions.
We’re a far bigger organisation than we were even five years ago. We are now operating in markets vastly different to that of Defence and using our Defence heritage as a key differentiator in the way that we approach these new markets and opportunities. We are then leveraging technological advancements from these other markets, like emergency and health services, to improve our offerings to Defence.
ADA now provides complete asset and inventory management solutions to more than 30 organisations and their 300,000 plus Australian staff within various sectors from health care through to law enforcement and utilities. This year alone, we will deliver some 3 million items of protective uniform and equipment through our intelligent online systems to front line users in high-risk industries.
ADM: When you say you’re a far bigger organisation than five years ago, what is your workforce headcount at the moment?
Dixon: ADA employs around 280 people in Australia. I say around because due to fluctuation in demand in manufacturing our staffing needs regularly change. We’re proud that our management team is almost 50 per cent female and across the entire organisation women make up around 80 percent of our employees.
At our Bendigo facility we employ around 130 people; this is the largest garment manufacturing facility in Australia. There are a further 130 staff at our Thomastown head office. Our design team of 30 people is the largest in the country and continues to grow with the hiring of specialists. The IT side of our business has gone from a single person to a team of 16, reflecting our commitment to excellence in logistics, data security, entitlement management and our customisable ordering systems. We have plans for further growth to ensure that we meet and exceed our client’s digital expectations.
We’ve expanded significantly across Australia and NZ in recent years, with offices now in Townsville, Brisbane, Gold Coast, Sydney, Canberra, Adelaide and Auckland. This includes two retail stores for LEGEAR, a division of ADA.
ADM: How has the purchase of LEGEAR in 2016 grown the business? What’s the split between Defence and other sectors of your business such as health and emergency services?
Dixon: The LEGEAR purchase was a perfect fit for our strategic plan. The acquisition has allowed us to align ourselves more closely with adjacent law enforcement and emergency services first responder markets. Most of the organisations in this space are looking for far more than just uniforms these days, leaning more towards a complete solution from one supplier, a true prime vendor.
LEGEAR’s suite of brands has allowed ADA to immediately be a more holistic solution provider. We’ve been able to strengthen our online capability and provide access to around 200 of the world’s best brands in law enforcement and first responder.
The ADF remains around 70 per cent of our business, by far the most significant portion, which forms our primary focus. Outside of that, we now have a heavy focus on law enforcement and the first responder emergency network – ambulance, fire, police. Also, we’re producing integrated asset solutions for the health, utilities and logistics sectors.
We specialise in targeting complex requirements; complex in terms of style, fabric, garment performance, entitlement program
and inventory management. From each of these new sectors we have identified new technologies, products or services that can improve our support to Defence as well.
ADM: Is that hybrid solution of online/outsourced management something that you’re looking to provide to Defence as well?
Dixon: No, not so much for Defence; we deliver in bulk to them and they manage their own internal inventory management, storage and distribution.
ADM: Is there any appetite from Defence to adopt a similar system, particularly in the wake of the First Principals Review (FPR)?
Dixon: Possibly; it is becoming more popular with similar organisations. Government entities are consolidating and then outsourcing their procurement function, and they’re looking for more than ‘just clothing’ or ‘just equipment’; they’re looking for training, entitlement management, inventory management, an integrated logistics and supply chain function.
There is significant demand in adjacent markets for real-time analytics to enable data driven decision making in regards to trends and forecasting so that organisations can ultimately return value. In the current Industry 4.0 digital supply chain environment, the cost savings from reduced stock holdings, logistics and transport costs when moving to a business to consumer (B2C) model are astronomical.
These changes could even enable key Defence logistics assets to be released from looking after warehousing and transport of uniforms and equipment domestically and reallocated back to the more forward logistics echelons. This move lets an organisation focus on its core business, which is warfighting in the case of Defence.
ADM: As you mentioned, the company has gone through a massive evolution over its 100-year history, with the clothing, textiles and footwear industry in Australia a shadow of its peak. What does that mean for your supply chain?
Dixon: You’re right, that is how the general textile industry has moved. ADA offers far more than just textiles and is at its all-time peak of local manufacturing. Through our Bendigo factory and our other Defence-approved subcontractors, we’ve produced over 600,000 garments on shore over the past year.
ADM: There have been issues surrounding the sourcing and manufacturing of ADF uniforms as to the ‘Australian Made’ tag in recent history. In essence, what does your supply chain look like to support that Australian Made claim?
Dixon: We have as broad a reach domestically as we do internationally with regards to the supply of both raw materials and garments. We have Australia’s largest local manufacturing base, and we have a chain of backup subcontracting manufacturers behind this.
Some of our Defence programs require us to locally purchase their raw materials from domestic fabric manufacturers, domestic accessories and raw materials suppliers. Locally, we are very strong I would say; where we can keep it in-house, we keep it in-house, where we can keep it local, we keep it local.
We also have access to a range of offshore manufacturers where our client requires it. In addition, where we can achieve the appropriate demand for a specific technology that is only available overseas, we will whenever possible develop locally or bring onshore new technologies to enhance our Australian operations.
ADM: How does that affect your price point or value for money proposition?
Dixon: It depends on how you determine value; in our opinion, it’s not always the cheapest price. At ADA, our value for money proposition is a dynamic balance of capability, cost effectiveness and Australian industry content.
We will not compromise on the capability of the product, when looking for the optimal balance of performance, comfort, durability, ergonomics and overall design, noting that often these attributes conflict with each other. We’re looking for a range of things that ultimately get us to our goal or our required item.
Value can be derived in several different ways. Certainly, some of the items that we’re providing are simple by nature, but some of them are incredibly complex; some of them are designed to protect a life and often for us performance in high risk environments will outweigh the cost in regard to perceived value for money.
ADM: What is your relationship with Diggerworks and Soldier Combat Ensemble development? How does that work in a practical sense? What’s the R&D focus at the moment?
Dixon: We work very closely with Diggerworks, through a range of touch points: our tech team deals directly with their tech, design with design contract with contract. As our relationship has continued to build, we’ve opened up more of our business.
It is important to note that Diggerworks is firewalled from the procurement side of CASG, and open to work with industry to meet new or emerging technological needs of the ADF combatant. We have been very fortunate that Diggerworks’ development priorities have aligned with us on so many projects.
This collaborative approach to making a system or platform for a soldier is a key differentiator in the way that (and the speed at which) we design and deliver product that is ‘operations ready’.
What we see as the final product is often the fifth, sixth or even tenth iteration of a design. One could argue that all those designs along the way are commercially ready, but we’re constantly refining and revising until we end up with a product that the soldier is happy to use on operations.
ADM: When we think of a soldier combat ensemble in terms of the webbing and the packs and the uniforms, the boots, the socks, everything; how much of that is from ADA?
Dixon: The majority. At the moment we’re doing everything from base layers through to the soldier combat ensemble and load carriage equipment. Everything that’s textile based is coming from ADA and our network of subcontracting suppliers. But the design, I would say, is a collaborative effort between the two organisations. This meshes our expertise in product manufacture with their expertise in end user engagement to deliver higher performing products. It is a real synergy that has led to the Australian SCE being the envy of many partner forces globally.
ADM: How have AIC requirements affected how you do business?
Dixon: Managing Australia’s largest clothing manufacturing base in Bendigo is incredibly important for us. Most of our local manufacturing is for Defence, but we also produce other garments in our local supply chain, such as structural suits for fire fighters. We’re always looking for other opportunities to manufacture onshore: one recent example is the development and manufacture of injection-moulded hanging systems in Melbourne, previously only available off shore.
ADM: You mentioned before your parent company (Logistik Unicorp) who are Canadian based and they’re a massive supplier of uniforms for the Canadian MoD. Have you been able to do technology or IP transfer between those businesses?
Dixon: Absolutely. The information technology used in our business – and that has enabled us to move from manufacturing to integrated asset management – is leveraged from the capability that Logistik is famous for, tailored for the Australian consumer. Our clever online systems manage entitlement, sizing, planning and forecasting; these sorts of technologies have been injected into ADA and enabled our growth.
ADM: How has your business transformed, even in the last five to ten years, and then can you give us an example of how you’ve transformed another business under that new model?
Dixon: We’ve moved well beyond just clothing provision and we’re more dynamic. Rather than a business that waited for the phone to ring, we’ve become far more proactive, more agile and nimble in the way that we approach our work.
We have looked for ways that we can streamline the business and how we can evolve outside of the traditional garment or textile area. We now offer a more complete asset management solution to provide more than just clothing.
One area that we’ve branched into is the Health sector. We provide uniform solutions to the NSW Health network, consisting of 150,000 staff, with 90,000 staff in uniform, 147 styles and 10,000 SKUs. We deliver to that organisation anywhere in NSW, from ADA’s Thomastown headquarters within five days, at an average fill rate of more than 99 per cent.
This is something that I don’t think ADA or even NSW Health ever envisaged doing 5-10 years ago. It’s allowed them to realise substantial cost savings in outsourcing their entire procurement function to the point that it’s now run by one person and a help desk.
ADM: So in five years time, what does ADA look like?
Dixon: An industry leader in the integrated, asset management space, a true prime systems integrator – a one-stop-shop for all things that organisations are looking for in the areas we specialise in; anything on or with the person that protects them in their daily work or enables them to operate in a high risk environment safely. More and more the organisations that we are dealing with, major government agencies and companies, are consolidating, they’re amalgamating and then they’re outsourcing.
Our ultimate goal is to offer holistic value back to the organisation through equipment, clothing, training, planning, inventory management, and allowing that organisation to focus on their core purpose, be that Defence, Health, Emergency Services or Law Enforcement.
This article first appeared in the July 2019 edition of ADM.