We have transformed 2,438 SMEs through 239 clusters: Yogesh Munjal

Interview with Chairman, CII National Cluster Summit

The National Cluster Summit, the annual flagship programme of the CII-Avantha Centre for Competitiveness for SMEs, is a platform for discussions between leaders from the government, the SME sector, large corporates, academia, R&D organisations and consulting firms. The theme for the 7th National Cluster Summit, scheduled for October 29-30, is "Scaling up clusters: Fostering growth and employment in SMEs". In an e-mailed response, Yogesh Munjal, Chairman, CII National Cluster Summit, explains to Rajiv Shirali the activities and achievements of the CII-Avantha Centre. Edited excerpts:

What is the centre doing to facilitate the development of SME clusters?

CII has worked with its strategic partners to transform 2,438 SMEs through 239 clusters. Thirty-eight clusters are presently supporting 250 SMEs with the help of 20 experts based in five locations. The capability to create customised roadmaps for individual companies and clusters from almost any sector (with a manufacturing process at its core), developed over 16 years of practice, sets this centre apart uniquely. CII clusters are formed with six to 12 SMEs or mid-sized companies.

Typical tangible benefits of a cluster include reduction in operational cost by 15-20 per cent, space utilisation by 20-30 per cent, reduced customer complaints and rejections, and better inventory turnover ratio. Intangible benefits include a world-class plant which is almost 'hospital clean' from inside and garden-green from outside, lower attrition, better attendance and accident record and a stronger supplier base for global players and large Indian corporations.

Does the centre work with the government on programmes aimed at making SMEs more competitive?

The centre collaborates with the office of development commissioner (MSME) for various training programmes, clusters and missions. It strives to work in collaboration with the government so that the reach of the programmes can be greater for SMEs. In 2014 itself the centre has worked with the ministry of MSME to conduct 30 programmes on different quality tools at locations identified by the government. The centre is currently working with the office of DC (MSME) to form 20 clusters under the Lean Manufacturing Competitiveness Scheme across India.

In addition, an international delegation of 20 SMEs with two government officials visited several companies and government bodies in Japan to learn about quality tools and global practices. In the last five years, CII has organised about seven general batches and five international batches, impacting 148 managers, under the Indo-German Manager Training Programme.

What focus do you give SMEs' energy efficiency?

The centre offers consultancy services on energy audits and conducts audits with accurate estimate of savings and cost. The importance of energy conservation is communicated to SMEs through structured training programmes, awareness sessions, conferences or audits. The two-day training programme is specifically designed for the technical team and entrepreneurs on different subjects with practical demonstration wherever relevant. Detailed energy audits are undertaken by the centre's qualified auditors.

In the last five years, through the centre's energy management services, around Rs 70 crores in annual savings has been reported by about 90 companies.

The energy wing of the centre collaborates with the Bureau of Energy Efficiency as part of a World Bank project to conduct training programmes and walk-through audits which help SMEs take the desired decisions to help conserve energy.

What programmes do you conduct to give SMEs global exposure?

We have the Indo-German Manager Training Programme, whose objective is to enhance the administrative, social, intercultural and professional competencies of Indian managers. SMEs, especially entrepreneurs, are given exhaustive training in Germany for one month on several subjects, which help promote business between the two countries.

Then we have the International Mission to Japan, which aims at exposing eligible MSMEs to enterprises that have won awards for quality. The focus is on helping delegates understand how quality management systems and quality technology tools (QMS/QTT) have been adopted by industries in the developed countries and how they can apply similar techniques in their businesses to increase competitiveness.

What is the centre doing to encourage innovation by SMEs?

The centre encourages innovation and breakthroughs among cluster companies by way of awards like the 'Cluster Championship' and 'Kaizen' awards. These awards are presented during the National Cluster Summit. The centre also organises the Unique Cluster Mission to enable SMEs to learn best practices and thus encourage innovativeness within them.