Why Amazon is eating Zalando.

I write this as the result of my cognitive and imaginative activities around the
concept “Digitalization of the manufacturing processes” (particularly focusing
the attention on the industry devoted to the fulfillment of the human needs for
clothing).

Mainly, I proceded from a comparative analysis, from the opposition of the

artisanal process to the industrial process to get to the thesis: so far, digital
transformation has been implemented as a tool to achieve the extension of
Fordism, that I call NeoFordism, the extension of mass production, in the form
of Globalization (where 'Globalization' means the way to achieve the goal of
minimising costs' strategy, the costs of goods and of labour). Along this way,
the opportunity to fulfill the promises to integrate the quality of the artisan
into the quantity of the industrial has been wasted, that is the realization of
the personification of mass production has remained just a dream.

What I say in here is based on this: the promises have not come to reality not
because the stage of technology, the level of evolution of technology, the
maturity of it, is not enough, that technology needs to grow more because it is
still in its infantry, BUT because the supply side, the operators of the supply
side still see and reason about through the lenses, the schemas of Fordism,
considering Informatics and Digital Environments just as tools to win the
competition the way it was thought in the XIX° c. and fully implemented
through the XX° century.
Supply side used Informatics and Digital Environments and stage them the
form of Globalization, but globalization is not digitalization, just as the
extension of mass production is not the personification of production.

Before you start to read about the thesis (I hope so) I wrote, let me add one
thing, that the scope of it can be succintly expressed this way: the clothing
industry is in the ideal conditions to implement (and considering the case of
Balenciaga in 2018 the implementing has begun) the promises of
digitalization, ment as the transformation, the integration between the man
and the machine, the unification of the artisan and the industrial.
Why do I say this to you? Because I consider you a friend of mine (even if we
never met physically); because in addition of you as a friendly person to my
eyes, I consider your virtual presence as part of the 'Elohiym that the Net
represents (like McLuhann imagined and predicted in 1967, and as I like to
represent it to myself). As wells as, I say this to you because knowing and
reflecting on your previous business initiative with 3D printers helped me
easing the process of the elaboration of my thinking: you formulated “Send me
a photo of yours and I will make a 3D model of it”; and I formulated “I take a
photo of you that I transform it in a 3D model, so that I manifacture a garment
on it”.
Enjoy the reading.

The following expressions, concepts, mostly every day meet my eyes while
surfing the timeline of social media: “taking care of consumers”, “by the side
of consumers”, “in the interests of consumers”; and all of those forms can be
synthetized with “consumers' surplus” to mean that tech innovations and the
changes that occurred in the behaivours (of the supply side, specifically) are
gains for customers, the people.

It is not in my goal to ask myself if the frequency, the high numbers of times,
the insistency in the use of that expression is in some way related to need to
hinder the negative perception that occur thinking at globalization (and its
deflative impact over income and purchasing power of industrialized
countries' citizens). Instead, I just want to underline where that expression
comes from: who is interested in consumers' surplus, who has the goal of
taking care of consumers' interests, is on the other side of consumers; it is the
side of suppliers, the supply side.
The supply side is pretty crowded these days: large numbers of operators
want to have demand's interests at the heart of their activity, want to better
satisfy the needs of demand. And all of them want it so much that they're
engaged in the competition to be the first and the best in achieving those
noble goals, and to access to the consumers' gratitude for it.
The competition between supply siders started at the beginning of times, and
sometimes it assumes the form of a sportive competition, sometimes the form
of a friendly confrontation, other times the form of a battle or of a war. But its
perpetuity is a constant: competition has been, competition is, and
competition will be.

Given the fact that the object of my reasoning is the clothing industry, seen as
the supply side aimed at the fulfillment of the needs of garments of
individuals, I will depict the traits of the operators competing in the clothing
environment.
So, let's start by considering that each individual knows he has to satisfy the
need to be dressed to live in society: I'm not interested to explore the why a
human can't live “nature”, that is naked, but everyone knows the reasons are
numerous (last but not least, to adapt to weather's conditions) and real, so
that the need to have some garment to dress must be fulfilled.
And each individual has two options to do that:
1) make it by him/herself;
2) make it by some other than him/herself.

Thinking at option 1), a personal memory appears on the surface of my

coscience: the stacks of BURDA magazine that my mother was used to
regularly buy in the 70s, the design-paper, the French chalks, the remnants of
cloth, the shopping at the haberdashery. To make garments by yourself you
just need to be furnished of what it takes and... ZAC act like a skilled taylor.
Option 2) must be divided in two sub-alternatives, because an individual who
wants others to satisfy the need of garments can, must chose between an
artisan taylor and an industrial taylor.

The symbol of the artisan taylor is the taylor's model.

The path that takes place in the taylor's laboratory and that it ends up with
the individual (the demand, the customer, the consumer) that wears the
finished garment, goes like this (simplified):
– the customer enters the taylor's laboratory because he/she wants the
need for a shirt (as example) to be satisfied;
– the taylor takes the measures of the customer's body;
– the taylor cut the cloth, making of it so many component parts of the
unity called “shirt”;
– the taylor assembles the component parts to manufacture the shirt;
– the customer has a fitting: if OK then the shirt is sewed; else the taylor
modifies the shirt (until is not OK).
On the other side of the alternative, the customer finds the industrial taylor,
that is perceived as the huge (physical and/or virtual) clothing store where
he/she goes to search the shirt that better matches his/her taste and that
better fits his/her size.
For the purpose of my thesis, it is interesting the production process of the
industrial taylor, to look at the way the industrial taylor manufactures the
shirt. Infact, what I'm trying to figure out is that there some evident
differences between artisan taylor and industrial taylor, BUT are no longer
decisive to oppose the realization of the digitalization of the manufacturing
process, the integration of the artisanal soul into the industrial body.

So, let's take a look at the simplified version of the production process of the
industrial taylor (IT):
(with the expression “industrial taylor” I mean that the manufacturing process
is organized around the principles of labour division and specialization of
tasks, as designed by Adam Smith and firstly implemented by Frederic Taylor)

– IT buys the supply of cloth;

– IT cut the material on the basis of standard models and sizes (XS, S, M,
L, XL...) of the majority of the individuals who live in a specific territory;
– all the component parts of each shirt (as example) of every size are
sewed to make the unity called “Shirt”;
– the level of the automation of the manufacturing process depends on the
management's decision and strategy, but what happens is that the
process of cut-&-sew of the component parts is repeated so many times
as are the scheduled number of shirts, for every size the management
foresees to sell on the end market;
– finished goods are delivered to the stores where the shirts will meet the
customers' bodies, and hopefully will be buyed by them.

At this stage it is important to make a digression into the context to realize

how we got here. It will take few lines to summarize and synthetize the
evolution of competition on the supply side since the first industrial revolution
happened until today.
John Maynard Keynes, in his Essays In Persuasion, wrote that for almost two
thousand years living conditions for humanity have not much improved
significantly until two key factors didn't appeared: capital accumulation and
tecnological advancements. Since the second half of XVIII° century those two
key factors combined togheter and living conditions, both in crowded cities
and in country, have started to improve, the english man stated.
It is the second industrial revolution with its killer application, the electric net,
that gave fruitful soil for the ideas of specialization and labour division, by
Adam Smith, to grow and prosper. Smith wrote The Wealth of Nations at the
time the STEAM revolution appeared: the train, the car, the knitter have had a
huge and irreversible impact on human life but it is only the ELECTRIC
revolution that created the context in which Smith's idea could be fully
implemented.

Henry Ford, together with german engineer Frederic Taylor, did not
discovered or invented automobile but they invented the way to mass produce
it, transforming what was firstly an artisanal activity into an industrial
process. Infact, before Taylor combined the Smith's schema with the reality of
the electric net, forging what has become known as mass production line, only
rich people could afford to order an artisanal mechanic the construction of a
car. Inside the machine-shop, in the middle of it, there was the source of
energy and the manufacturing activity of the car was organized all around the
boiler.
The electric net revolutionized the organization of work inside what was no
longer called machine-shop but plant. I don't want to describe what History is,
but only underline again that the mass production, the Fordism, started with
the electric revolution. And, what matters more, today the Fordism evolved
into what it is also known as NeoFordism, a form that relies more on the
innovations of the second revolution than on those brought by the third one,
the Informatics.

Earlier I stated that the evolution of Fordism used Informatics in the form of
Globalization. The need for this evolution is related to, as a consequence, the
change of the scenario, of the context, of the environment and the markets in
which the Fordist Corporation operates.
I refer at Ford as an archetype of the mass production corporation (echoing
the study and the analysis of Alfred Chandler) that emerged since the first
decades of XX° century. At that time, the Fordist corporation had a bright,
brilliant future in front of itself: 'virgin' markets, people to be educated to the
use and the need of goods, of new tools that were manufactured to help them
in the day to day stuffs: houses were empty; no fridge, no washinhg-machine,
no hair-dryer, no dishwashing-machine, no cars.
In this context, it appears no surprising that Fordist corporation's
management did not considered to have a marketing division, but just a sales
department: infact, why bother to spend to have a new sale when all you need
to do is to pick up the telephone and ask your resellers “How many items you
want this weeek?”
It's not difficult to agree that one thing is to educate individuals to consider
the car an absolutely necessary tool for him and his family; that another thing
is to make him realize that he must have a second car, the first one for the
family the second one just for himself; and that is a totally different thing to
persuade a man that, despite his cars work properly, he has to change them
and to make a new buy because of smog limits and of the ozone's issue.

Moreover, Vance Packard, in his seminal book The Occult Persuaders of the
60s, reported the emergence of the concept “programmed obsolescence”,
talked about the hiring of psychologists to study emotions and motivations in
individuals because Fordist corporation needed to empty warehouses more
rapidly, persuading customers to buy more, than the improvement of
technology was going to fill them.

What is that I want to highlight? That the consequences of electric revolution

has been the consolidation of the principles that bigger is better, is stronger
than the small one, and that the strategy to be implemented can only be to do
more of what it has been done, so becoming bigger and bigger, together with
becoming always more efficient: both, facing 'Virgin' markets or fighting in
satured hyper-competitive environment, there is no alternative.

And if the scenario of the early XX° century was of milions of customers to be
educated to the need for mass manufactured standardized goods, today at the
end of the second decade of XXI° century, big corporations want to face the
scenario of satured markets with an evolved version of the same recipe, the
same schema, the same strategy: persuade customers to buy their
standardized goods (at least customers can chose colors and other details).
And how big corporation are developing this game plan? They created a
concept, Globalization, and through that they pursue the minimizing costs
strategy: moving production plants toward the Far East they achieved
restoration of those conditions in which the Fordism began; labour force with
no union representation, low wages, higher productivity. It's understandable,
it's reasonable and it is not my intention to critize it, because if you see no
alternatives, to win the hyper-competition in satured markets, other than
always reducing the costs, both of goods and of labour, well that is what you
have to do.
BUT the question is: is there really no alternative?

The answer is that alternatives exist; and one of them is the digitalization, in
the form of personification, of production; in the garment industry today,
implementing Matrioska.
Moreover, another evidence that the NeoFordist recipe is not a change but an
adaptation of an old approach is represented by the destruction of the
intermediate parts (logistic, trade, sales, and the other parts of the supply that
were used to organize the meeting between the production and the
consumption, the supply and the demand): big corporations, after deflating
labour forces, has started to eliminate another part of its own organism. And
the role of the killer application is played by the digital net (and the
consequent change of the way customers 'get in touch' with the satisfaction of
their needs).

As I stated before, supply siders compete who dominates the function of

'taking care of individuals'; I can extend the reasoning citing the battle
between religious organizations in the past, or between kings and popes, or
between kings and then between nations: it's in the name of the game called
'human life'. And in this 'game' technology plays a role, an instrumental role,
to implement the strategy the nation/king/corporation thinks is the best to win
the battle/war/competition.
The point here is that digital technology can do more than just a do the
globalization. Digitalization can fulfill the promise of personification of mass
production, and specifically in the industry of garments.

Now it is time to take a close look to what Matrioska is and how it works in
the manufacturing process of a shirt (as an example). To easily describe the
clothing industry, I am going to use a linea representation, like this:

The shirt that I am wearing right now has gone through this path (backward):
– before I wore it, the shirt was bought in a store (physical and/or virtual);
– before the shirt was bought, it was fitted;
– before it was fitted by me, the shirt was brought into the shop-store;
– before the shirt arrived into the shop-store, it was packaged and
delivered;
– before it was packaged and delivered, the shirt was sewed;
– before the shirt was sewed, the cloth was cut into the component parts
on the basis of model and size;
– and before the cloth was cut into component parts of the shirt, the cloth
 was made.
This sequence is valid for artisanal process as well as for industrial process.

What is important here is the CLOTHING (CUT-&-SEW) part of the

manufacturing process. Both artisanal taylor and industrial taylor do the
clothing (cut-&-sew) operations like this:

[see fig. 4]

In more detailed description:

[see fig. 5]

Now it is interesting to focus on the cut operation, in which the result is

creation of the component part of the unity called “shirt”. The questions that
arise considering the meaning of the verb “to cut” are: how do the cut is
done? on the basis of what is the cut done?
[see fig. 6]

The cloth will be cut on the basis of a design the shirt is given and of a size.
With size I mean the measures of the body on which the cloth will be
composed to form the shirt. And here, at this stage, lies the decisive difference
between an artisanal taylor and an industrial taylor:
[see fig. 7]

This is the critical point, the CUT operation, when the cloth is cut based on
the size of a person's precise measures (artisanal taylor) or based on the size
of model's standard measures (industrial taylor).
In 2018 Balenciaga, a spanish fashion designer, introduced an innovation in
which he used the real size measures of a mannequin to guide the cut
operations of his creation. Balenciaga interpreted the innovation by his point-
of-view, the point-of-view of a super artisan taylor, who has the goal to
maximize the uniqueness, the value and the scarcity, of his creative activity.

Matrioska shares the same principles and interpret them as the way to
personalize the production of shirt:
– industrial taylor cut # copies of a standard size (S-M-L-XL), for each
size;
– artisanal taylor cut 1 copy of 1 personalized size;
 – Matrioska cut 1 copy of # of personalized size.

[see fig. 8]

The integration of the soul of the artisan taylor into the body of industrial
taylor is achieved by feeding with the data of the personalized sizes to the
software in the computer that address and guides the CUT machinery:
– software 'acquires' the data of the size of the model in the same format
that it acquires the size of a standardized model (S-M-L-XL) in the
industrial process (.in design, .pdf, ecc. ecc.);
– the 'content' of the file, that guides the cut machinery, is a digital 3D
model of the body of the individual, specific, customer (the cut
machinery doesn't mind the difference between a standard size and a
personalized size, because all it needs to know is how much of the cloth
is to be cut);
– the cut machinery is aimed to operate variable numbers of requested
cut based on variable different standard size (based on management's
valuations)
[see fig. 10]
So the fundamental task is to continuosly supply the software, of the computer
the guides the cut machinery, with data of personalized size. The bet here is to
present to people/customers the alternatives of fulfilling the need for a new
shirt, like this
– buy the shirt from artisanal taylor for 85 $;
– buy the shirt from industrial taylor for 25 $;
– buy the artisanal shirt from Matrioska for 40 $ (you just make yourself a
photo to have it)

Well, I am sure it will work properly conquering the market and forcing every
other competitor in the industry to adapt the manufacturing process (that is
not working efficiently, by the way) to Matrioska's schema.
And the relationship between the supply and the individual demand, in the
form of point-of-access to personal data (measures) will be crucial.