Africa, South East Asia want to replicate cluster approach

The success stories of SME clusters in India have caught the fancy of small businesses and consultants in the countries of Africa, Middle East and South East Asia, who have evinced interest in learning about the cluster approach. These countries want to emulate the methods that Indian SMEs have adopted to conserve resources and cut input costs.

Recently, executives of small businesses from South Africa, Kenya, Tanzania, Sudan, Congo, Sri Lanka and Afghanistan met their Indian counterparts in Chandigarh to understand how Indian SMEs enhance their competitiveness.

A cluster is a group of companies that work together to improve their performance through mutual learning and sharing — for example, improving productivity and quality by reducing waste; introducing innovative practices to improve overall competitiveness by inducting good manufacturing practices; reducing customer complaints; optimally utilising resources such as space, manpower, material, equipment and energy; and empowering employees.

The queries are put across through the CII-Avantha Centre of Competitiveness for SMEs, which has been conducting various cluster development programmes to enhance the competitiveness of SMEs. Harinderjeet Singh, who heads the centre, said cost cutting is a key tool for improving productivity.

“We try to develop customised models for different manufacturing outfits, to compress their input costs in terms of energy, better management of human resources and exchange of ideas through joint training sessions and review sessions to broaden their horizons,” he said.

Singh said Hero Cycles has benefitted immensely from the cluster approach and, after completing consultations for two clusters, had engaged CII-Avantha Centre for a third cluster.

The centre has already worked with Indonesian steel manufacturing units to help them improve energy efficiency.

“The success of the cluster approach in India has prompted SMEs from other countries to adopt cluster programmes. Already we are working in Indonesia and are in talks with Africa, Dubai and Malawi for similar programmes,” Singh said.

Recently, officials from the Malawi High Commission in Delhi visited Punjab to see the clusters at Ludhiana and Jalandhar. They now want their manpower to be trained by Indian trainers, especially in the area of improving competitiveness, Singh added.

Bosch India, one of the largest manufacturers of automotive parts and accessories, has trained over 60 suppliers with the help of the Automotive Component Manufacturers Association (Acma), the United Nations Industrial Development Organisation (Unido) and the CII-Avantha Centre.

A senior official in the company said Bosch India had received acclaim from the management for being among the best in the global operations of Bosch. He added that training provided to suppliers helped reduce tangible costs as well as absenteeism, attrition and inventories.