SMEs unveil moves to be more competitive

Form clusters and apply lean manufacturing techniques

In order to achieve sustainable rates of growth and enhance their competitiveness, SMEs in the northern region are gearing up to apply various lean manufacturing techniques under a scheme initiated by the Union ministry of micro, small and medium enterprises (MSME).

The techniques focus on reducing seven types of waste, including over-production, inventory, transportation, over-processing and defects. The scheme is basically a business initiative to reduce these kinds of waste, yielding improved quality, improved delivery and reduced cost.

SMEs that manufacture bathroom fittings and accessories in Mohali have come together to form a mini “cluster”, under the lean manufacturing competitiveness scheme introduced by the Union ministry of MSME.

A similar cluster has been formed at Baddi (Himachal Pradesh) by SMEs that manufacture engineering goods. They, too, will adopt lean manufacturing techniques.

Further, the consultancy division of Punjab Technical University’s Gian Jyoti School of TQM & Entrepreneurship (PGSTE) has been appointed lean manufacturing consultant for the Mohali and Baddi clusters, said Manish Trehan, chief executive officer of the school.

Under the scheme, 80 per cent of the project cost will be born by the Union government. The scheme will be implemented under the supervision, control and direction of the development commissioner, MSME, through a special purpose vehicle (SPV) set up by the cluster.

Trehan said the assignment was formally initiated last week by signing a tri-partite agreement between PGSTE, the SPV formed by the cluster and National Productivity Council, which has been nominated to act as the national monitoring and implementing unit by the ministry of MSME. It will be completed over a period of one year.

Lean manufacturing is a manufacturing philosophy that has its roots in Japan. It emphasises the use of “just enough” resources and continuous effort to “do more with less”, thereby increasing productivity.

Trehan added, “The participating units will be assisted in becoming ‘lean’ through better planning, better manpower allocation, better space utilisation, scientific inventory management, improved process flows and reduced processing time with the application of lean manufacturing techniques.”

The programme was kick-started last week for the Mohali cluster by Vijay Kapoor (who is principal consultant) and Naresh K Chawla (general manager, consultancy services) of PGST. It was mutually agreed that to achieve a sustainable rate of growth and build competitiveness, it is essential to reduce “waste” (“non-value added” activities) in manufacturing.

Trehan further added, “It has been noticed that SMEs are so engaged in day-to-day management issues that they do not have the time and resources to dedicate to acquiring various techniques, which would help them in enhancing their productivity and being competitive in the world.”

Under the scheme being initiated by the MSME ministry, 100 mini clusters with an average of 10 MSMEs per cluster, will be formed all over the country in the pilot phase. The ministry plans to start another 1,000 clusters country-wide after achieving success in the pilot phase.