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Outline of Proposal for project work

Name of Student :

Name of Guide :

INTRODUCTION OF ORGANISATION

PROPOSED TITLE OF THE PROJECT WORK WORK:

“CRITICAL INVESTIGATIONS INTO THE FACTORS INFLUENCING SURVIVAL & GROWTH OF

SMALL SCALE AND MEDIUM SCALE TECHNOLOGICAL INDUSTRIES IN MUMBAI & SUBURBAN

REGIONS”.

INTRODUCTION

In the present scenario of liberalization, privatization & globalization, small and medium scale

technological industries are facing intense competition and hence survival and growth of these

industries has become a tough challenge. Some industries are consistently achieving the growth

under competitive conditions while others are not. As a result of this, new opportunities and

threats have emerged.

Maharashtra is financially and industrially one of the most developed state in India and often

called as the economic power house of India while the state’s capital Mumbai is called the

Commercial or the Business capital of India. While agriculture sector provides employment to a

majority (approximately 70%) of state’s population, it is the manufacturing and service sectors

that constitute significantly to the gross domestic product. This sector provides nearly 80% of the

state’s GDP, as compared with the national average of 65%. Major technological manufacturing

industries are located in and around Mumbai, Nashik, Aurangabad and Pune. Many small scale

technological industries have grown up and supporting the needs of the local big manufacturing

industries as well as exporting their products [1, 2].

Many small and medium scale technological industries are operating in Mumbai and suburban

region .Though there are lots of challenges and opportunities in front of these industries, most of

the people neglect the importance of the existing technology in these industries and its handling.

At present many small and medium scale industries are either sick or underperforming. There is

tremendous scope for the production management, product development, process planning, tool

design, plant layout improvement, productivity improvement etc. for performance improvement

in these industries with ultimate aim of cost reduction and to provide the innovative product or

technology to catering to the needs of the customer.

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PROBLEM IN HAND

IMPORTANCE OF THE STUDY

There are many factors which affects the performance of technological industries. It may be

divided into two groups: (1) External factors & (2) Internal factors.

External factors are those which result from factors beyond the control of entrepreneur (e.g.

availability of power and other infrastructure facilities required for smooth running of industry)

while internal factors are those which are within the control of an entrepreneur. Some of the

internal factors affecting the industries are related to organization structure, production planning

& control, distribution channel, technical know-how, training, industrial relations and inadequacy

of management etc [9,10].

Industrial sickness and growth is a gradual process and does not develop suddenly. There are

some symptoms on the basis of which growth or decline of S.S.I. is seen. It includes turnover of

Industries, stock movement (slow or fast), increase or decline in production, sales and

profitability [7].

Small scale industries sector plays a vital role for the growth of the country. It contributes 40 %

of the gross manufacture to the Indian economy. The number of small scale units has increased

from 8.74 lakhs units in 1980-81 to 50 lakhs units in the year 2007. The S.S.I. sector was also

affected by foreign exchange constraints, credit squeeze, demand recession, higher interest

rates, shortage of raw material etc [3]. When the performance of this sector is viewed against

the growth in the manufacturing and the industrial sector as a whole, it shows confidence in the

resilience of small scale sector. In India, small scale sector play a pivotal role in the overall

industrial economy. It is estimated that in terms of value, the sector accounts for about 40 % of

the total export of the country. Further, in recent years, the medium & small scale enterprises

(MSE) sector has consistently registered higher growth rate compared to overall industrial sector.

The major advantage of the sector is its employment potential at low capital cost. As per

available statistics, these sector employs about 31 million persons spread over 12.8 million

enterprises and the labor intensity in the small scale sector is estimated to be almost four times

higher than the large enterprises.

Maharashtra contributes almost 14.7 % of Indian’s GDP and more than 15 % of the national

income, more than 215 industrial estates. Out of this major contribution is given by industries in

and around Mumbai and Pune. Almost 40 % of Technological manufacturing output comes from

small scale industries [3]. Despite the tremendous potential and large contribution of small and

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medium enterprises to the economy, nearly 60% of the units are limping or are declared sick

[26]. There are various causes for such a situation and unfortunately there are no easy solutions.

Considering the above facts, it is more important to study the factors influencing survival and

growth of small scale technological industries in Mumbai & suburban regions and develop

conceptual framework for performance improvement of these industries

LITERATURE REVIEW

Entrepreneurship Development:

Entrepreneurship Development is a process in which persons are injected with motivational drives

of achievement and insight to tackle uncertain and risky situations especially in business

undertaking. The process of Entrepreneurship Development focuses on Training, education,

reorientation, creation of healthy environment for growth of enterprises.

Development and commercialization calls for expertise, ingenuity, and entrepreneurial creativity

in order to achieve success [9, 10]. By combining international marketing experience, human

resources, financial management, risk assessment skills, brand names, and intangible

organizational capabilities, these entities are far better positioned than smaller firms and public

agencies to convert an innovation into a commercial asset. Large firms are not necessarily the

most creative in terms of new ideas, nor are their R&D expenditures necessarily more productive

than those of smaller companies in terms of innovations. But the bigger companies stand a better

chance of developing and marketing an innovative product or service on a global scale and

reaping large returns with the help of well-developed research systems and channels of

distribution. The larger industries have advantage of resources, infrastructure and finance. But

changing business model, values and ultimately culture is difficult, if not possible for large

established companies. Smaller organization on the other hand can leverage their capacities for

entrepreneurial innovations and organizational change, thereby learning to achieve advantages

over larger organizations [19].

The Industrial Service Institute (ISI) under the Department of Industrial Promotion (DIP)

launched the EDP to give substance to the government’s policies of stimulation of economic

growth of the country with following objectives:

1. To promote the development of small and medium enterprises that would encourage self-

employment among potential entrepreneur.

2. To provide in rural areas, special programmes are designed to stimulate new ventures and

encourage expansion of existing activities of small and medium enterprises.

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3. To generate employment and self employment opportunities in the processing o indigenous

raw materials for local consumption and export.

4. To develop entrepreneurial opportunities for potential entrepreneur and upgrade managerial

skill for existing entrepreneur.

Techno-entrepreneurship:

Techno-entrepreneurship is defined as the entrepreneurial and intrapreneurial activities of both

existing and nascent companies operating an technology intensive environments (5).

It is a process in which industries are performing impressively in the development,

commercialization and standard new technology with sustained growth. [23]. The interplay of

Techno-nationalism and Techno-Globalism will have increasingly important regional dimension in

coming years [23].

Factors affecting Entrepreneurship Development

There are external and internal factors which affect the entrepreneurship development process as

mentioned below [42]:

Culture: Attitudes to wealth, elders, youth, experimentation, risk, work, professions, achievers,

success etc. Family, extended family, collective ownership vs. individual, Treatment of women,

castes, classes, minorities, etc.

INFRASTRUCTURE: Tangible, intangible, telecommunications, transport, distribution, health,

public safety, law and courts, education system, etc.

TECHNOLOGY: Access to large firms or universities and research labs for technology transfer

Access to supply chains Access to incubators and technology support

SOCIAL: Demographic profile (e.g. ageing population reduces entrepreneurship and start up

rates) Immigration and migration patterns Caste and class rigidities Social homogeneity

ECONOMIC: Growth opportunities, domestically and across borders Cyclical opportunities and

threats (unemployment may lead to entrepreneurship) Taxation treatment of capital gains, start

up expenses, intangible asset expenditure, stock options, etc.

LEGAL AND REGULATORY: Administrative burden imposed on smaller firms and start ups

Regulatory barriers (licenses, etc.) Property rights (tangible, intangible) can be protected and

marketed Right to incorporate, and costs of incorporation Costs of defending or enforcing

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agreements or rights Penalties imposed for "failure", treatment of bankrupts Specific regulations

and laws relating to specific markets or activities

INFORMATION: Access to information about opportunities, technology, partners, laws and

regulations etc. Freedom of press and ability to advertise or disseminate information (e.g. about

new products) Accessibility of information in different languages

FINANCE : Discrimination in finance (e.g. age, gender, class discrimination) Sophistication and

development of markets (e.g. microfinance, start up and seed finance, angles, equity, religion

[e.g. Muslim finance], Venture Capital, second board and OTC markets, mezzanine, etc.)

Continuity in finance markets (i.e. are the gaps in the markets, or can an entrepreneur expand

smoothly from seed to IPO) Competition in financial markets (e.g. competitive finance markets

reduce the margin above cost of finance to lenders, and increase range of services) Ability to use

property rights as security (enables entrepreneurs to secure finance)

EDUCATION and HUMAN RESOURCES: Levels of literacy, numeric Computer and ICT literacy --

Specific education in entrepreneurship at school, university - Access to training programs,

mentoring, advice

MARKET STRUCTURES: Monopolistic behavior, predatory pricing by large firms Networks,

clusters Flexibility in labour markets Industry or market specific incentives and subsidies

INDIVIDUAL: Individual personality and motivation traits e.g. locus of control, risk taking,

innovativeness Individual experience and knowledge

Creativity, Innovation, Entrepreneurship Development and Economic Growth:

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Fig-1: Creativity and Economic Performance

Creativity: Creativity in some societies might be expressed through art, music, and crafts or

through institutions that ensure survival in harsh environments. While many forms of creativity

can be valuable, the economic measure encourages creativity that ultimately leads from

innovations to commercial results [17].

As knowledge deepens and becomes more varied, human capital becomes more creative pooled

into ‘‘Wikicapital’’ [15] through the formation of local and global teams, partnerships,

associations, and learning societies that facilitate the deepening and sharing of knowledge and

bring together diverse talents with different perspectives, viewpoints, and spheres of knowledge.

Wikicapital is accumulating because so many scientists share a common medium of

communication (English and Mathematics), they are increasingly mobile, and they have more

opportunities for face-to-face contact. Moreover, collaborative work has been greatly facilitated

by information and communication technology and the declining cost of Internet access.

Entrepreneurial Innovation:

Creativity

Innovation

Entrepreneurship Development /

Commercialization

Economic Growth

Talent Quality

Wikicapital

Culture

Incentives Institutions

Urban Environment

Finance

R&D

Corporate System

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The quality of human capital and its enhanced creativity create preconditions; but catalyzing that

innovation requires triggers and mechanisms that reinforce certain types of productive behavior.

One is a culture that is relatively tolerant of risk taking, specifically risks associated with

entrepreneurial activity. Such a culture is also more tolerant of entrepreneurial failure. Not only is

business failure not stigmatized, but specific institutions (e.g., bankruptcy and limited liability

laws) that contain penalties to be imposed on individuals when their business ventures fail, may

also encourage fresh initiatives. Thus, the social attitude towards certain kinds of risk taking

induces willingness on the part of individuals to be ambitious and to search for significant and

disruptive innovations. Culture, institutions, and incentive mechanisms serve as the matrix within

which creativity can flourish and lead to innovation [17].

There are three forms of innovation [7]:

• Programmed innovation that is planned through research and development

• Non- programmed innovation occurs when there is slack in the organization in the form

of more resources available than are presently needed. These are then used for

innovation purposes

• Distressed innovation, when it is forced on the organization, such as when a crisis is

perceived and new actions are taken.

The techniques which speed up innovation process are:

• Quality Function Deployment (QFD)

• Robust Design(Taguchi Methods)

• Failure-Mode-Effect-Analysis(FMEA)

• CAD/CAM

The following are the other techniques which speed up innovation process:

• Overlapping development phases

• Fewer development phases can be implemented using CAD/CAM

• Incremental Development using Kaizen

• Better use of prototyping

The outcomes of value innovation as summarized in literature are [7]:

• High commitment to the professional training of organizational members.

• �High degree of connectivity between organizational members

• �High level of decent realization in decision making

• �Low level of formalization.

• �Low stratification in the differential distribution of rewards.

• �High emphasis on both productivity and quality.

• A high level of job satisfaction on the part of organizational member s.

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• High coexistence of creativity and efficiency.

• High concentration of cosmopolitan professionals and specialists.

Major constraints in promoting innovations [7] are:

• Power politics within the organization

• Low investment in human resource development

• Negligible investment in research and development

• Lack of emphasis for creating learning organization

• Governmental policies towards providing economic incentives

• Short term interests of business leaders

• Quick- fix expectations and shallow thinking of managers

• Emphasis on superiority of administration over innovation

• Dysfunctional organization and performance measurement systems

• Dependence on foreign knowhow.

Entrepreneurship:

There have been dozens of definitions of entrepreneurship. Taking all entrepreneurship

definitions together, they broadly reflect two relatively distinct social realities. The first is the

phenomenon that some people, rather than working for somebody else under an employment

contract, strike out their own and become self- employed. The second is, entrepreneurship

means the creation of new economic activities and organizations (Schumpeterian

entrepreneurship) as well as the transformation of exiting one [25]. Entrepreneurship is a

process undertaken by an entrepreneur to augment his business interest. It is the risk taking

ability of the individual, broadly coupled with correct decision making [9]. According to the

literature, one can find the following forms of entrepreneurship:

1. Academic entrepreneurship (Bercovitz & Feldman, 2008);

2. Diffused Entrepreneurship (Minkes & Foxall, 1980);

3. Dispersed entrepreneurship (Minkes & Foxall, 2003);

4. Distributed entrepreneurship (Hsieh, Nickerson, & Zenger, 2007);

5. Disintegrated entrepreneurship (Royer & Stratmann, 2007);

6. Collaborative entrepreneurship (Miles, Miles, & Snow, 2005);

7. Collective entrepreneurship (Zito, 2001);

8. Community based entrepreneurship (Peredo & Chrisman,2006, community in the

9. Social meaning of the term);

10. Corporate entrepreneurship (Burgelman, 1984);

11. Intrapreneurship (Carrier, 1996);

12. Knowledge based entrepreneurship (Witt & Zellner, 2007);

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13. Managerial entrepreneurship (Stevenson & Jarillo, 1990);

14. Modular entrepreneurship (Brusoni & Sgalari, 2006);

15. Network entrepreneurship (Harryson, 2008);

16. Open entrepreneurship (Gruber & Henkel, 2006);

17. Serial entrepreneurship (Hytinen & Ilmakunnas, 2007)[20].

18. International entrepreneurship;

19. Techno entrepreneurship.

Corporate Entrepreneurship (CE) refers to the process of organizational renewal and relates to

two distinct but related phenomena. First is innovation and Corporate Venturing (CV) activities. It

state that CV focuses on the various steps and processes associated with creating new

businesses and integrating them into the firm's overall business portfolio. In hierarchy of CE, CV

can be divided into internal and external CV. Internal CV involves the creation of new businesses

that generally reside within the corporate structure although they may be located outside the

firm as semi-autonomous entities, such as spin-offs. Pre-existing internal organization structures

may accommodate these new ventures or newly created organizational entities may be created

within the corporate structure. Second, CE embodies renewal activities that enhance a

corporations' ability to compete and take risks, which may or may not involve the addition of new

businesses to a corporation. [24]. International Entrepreneurship is a combination of innovative,

proactive and risk-seeking behavior that crosses national borders and is intended to create value

in organizations and the study of IE includes research on such behavior and research comparing

domestic entrepreneurial behavior in multiple countries’’[21].

Following are the basic elements in the entrepreneurship;

1. Entrepreneur: person

2. Entrepreneurship: Process of action

3. Enterprise: Object

Entrepreneur Vs. Efficient Employee:

Ø Efficient employee: Given the resources add value to it and converts them in to a

product or service

Ø Entrepreneur: proactive understanding the need, generates resources and

converts them in to a product or service

The following qualities contribute success to the entrepreneur:

Ø Need for professionalism (Techno-economic-ethical)

Ø Techno-scientific vision

Ø Organizing

Ø Motivation

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Ø Risk Taking

Ø Aptitude for change

Ø Will Power

Ø Creativity

Ø Managerial quality

Ø Ambitious

Small Scale Industry:

The following requirements are to be completed with by an industrial undertaking to be graded

as small scale industrial undertaking with effect from 21.12.1999.[2,6]

“An industrial undertaking in which the investment in fixed assets in plant and machinery

whether held or ownership terms on lease or on hire purchase does not exceed Rs.1 crore

(subject to condition that unit not owned, controlled or subsidiary of any other industrial

undertaking)”[6].

Ancillary industrial undertaking:

The following requirements are to be compiled with by an industrial undertaking for being

regarded as ancillary industrial undertaking [6]:

“An industrial undertaking which is engaged or is proposed to be engaged in the manufacture or

production of parts, components, sub-assemblies, tooling or intermediates, or the rendering of

services and the undertaking supplies or renders or proposes to supply or render not less than 50

% of its production or services, as the case may be to one or more other industrial undertakings

whose investment in fixed assets in plant and machinery whether held on ownership terms or on

lease or on hire purchase, does not exceed Rs. 1 crore.”

Medium Scale Industry:

The following requirements are to be completed with by an industrial undertaking to be graded

as medium scale industrial undertaking with effect from 21.12.1999. [2,6]

“An industrial undertaking in which the investment in fixed assets in plant and machinery

whether held or ownership terms on lease or on hire purchase does not exceed Rs.10 crore

(subject to condition that unit not owned, controlled or subsidiary of any other industrial

undertaking)” [6].

There is wide scope for the way by which technological innovations and acquisition is carried out

in SMEs, particularly in technological industries. So there is a need to asses the application of

technology and its consequences.

Entrepreneurship Development large-scale vs. Small-scale industries:

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Ø The larger industries have advantage of resources, infrastructure and finance. But

changing business model, values and ultimately culture is difficult, if not possible for

large established companies

Ø Smaller organization on the other hand can leverage their capacities for

entrepreneurial innovations and organizational change, thereby learning to achieve

advantages over larger organizations [22].

Technology: [8]

Ø In general technology is the relationship that society has with its tools and crafts and

to what extent society can control its environment.

Ø The Merriam – Webster dictionary offers a definition of the term: “The practical

application of knowledge especially in a particular area” and “a capability given by

the practical application of knowledge”

Ø The word “technology” can also be used to refer to a collection of techniques.

The various technological terms are explained below:

The concept of Technology intelligence began to be developed starting with World War II and

generally indicates the process of gathering and using information on the trends of technologies

that ‘‘have the potential to affect a company’s competitive situation’’ ; sometimes technology

intelligence is meant not only as the process but also as its output, namely valuable information.

The aim of Technology forecasting, is to identify predictions of technological changes, seems to

be aimed less than technology intelligence at gathering and processing information. The term

technology assessment takes on different meanings depending on the aims of the evaluation

process and context where it is being carried out, e.g. it is often used to mean an analysis of the

goals and costs and benefits related to the acquisition of a new technology, just as it is often

used, especially in managerial practice, to refer to the process of making an overall evaluation of

the technological patrimony of a company.

Technology monitoring, an expression which is still mainly used in managerial literature, seems to

encompass the three aspects that have just been mentioned, i.e. the word ‘monitoring’ can be

understood as a process, providing information on technology (intelligence), predicting the

directions technological change will take (forecasting) or evaluating and scouting out the

potential technologies that a company should adopt (assessment), but it is most often used to

indicate the process of identifying and evaluating the critical technological advances that can

have a significant impact on a company’s competitive positioning (intelligence)[18].

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Technological Competencies:

Fig-2: Relationship Between Different Competencies on Firm’s Performance [17]

Technological competencies determine which products or services can be provided technically at

one time; marketing competencies determine which products or services can be detected that

are demanded by targeted customers; integrative competencies reflect the degree of fitness

between the above two constituents of core competencies and the effectiveness and efficiency of

delivering offerings with superior customer value. It is based on the third constituent of

integrative competencies that a firm is able to encompass the deployment of its unique resources

and capabilities to respond to a variety of changing environmental conditions in a way that can

lead to sustainable performance.

Production and Industrial Engineering Techniques to improve the performance of an

industry:

There are various techniques used in modern industries to effectively manage the business:

1. Total Quality Management (TQM)

TQM is the organization-wide management of quality. Management consists of planning,

organizing, directing, control, and assurance. Total quality is called total because it consists of

two qualities: quality of return to satisfy the needs of the shareholders, and quality of

products[30]. TQM is an approach to improving both customer satisfaction and the way

organizations do business [31]. In a nutshell TQM comprises following basic concepts:

1. A committed and involved management

2. Focus on the customer

Core Competencies

Integrated firm performance

Marketing Competenc

ies

Technological

Competenc

Integrative Competenc

ies

Technological

Influence

Market Influence

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3. Involvement of total work force

4. Continuous process improvement

5. Supplier partnering

6. Performance measures

In Japan, TQM comprises four process steps, namely:

1. Kaizen – Focuses on "Continuous Process Improvement", to make processes visible,

repeatable and measurable.

2. Atarimae Hinshitsu – The idea that "things will work as they are supposed to" (for

example, a pen will write).

3. Kansei – Examining the way the user applies the product leads to improvement in the

product itself.

4. Miryokuteki Hinshitsu – The idea that "things should have an aesthetic quality" (for

example, a pen will write in a way that is pleasing to the writer).

2. Just in Time (JIT)

According to American Production and Inventory Control Society (APICS), "JIT is a philosophy of

manufacturing based on planned elimination of all waste and continuous improvement of

productivity. It encompasses the successful execution of all manufacturing activities required to

produce a final product, from design engineering to delivery and including all stages of

conversion from raw material onward. The primary elements include having only the required

inventory when needed; to improve quality to zero defects; to reduce lead time by reducing

setup times, queue lengths and lot sizes; to incrementally revise the operations themselves; and

to accomplish these things at minimum cost".

When the JIT principles are implemented successfully, significant competitive advantages are

realized. JIT principles can be applied to all parts of an organization: product design, order

taking, purchasing, manufacturing operations, distribution, sales, accounting, etc.

JIT is a philosophy of continuous improvement in which non-value-adding activities (or wastes)

are identified and removed for the purposes of [31, 32]:

Reducing Cost Improving Quality Improving Performance

Improving Delivery Adding Flexibility Increase innovativeness

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JIT usually identifies seven prominent types of waste to be eliminated:

Waste from Overproduction Waste of waiting/idle time

Transportation Waste Inventory Waste

Processing Waste Waste of Motion

Waste from Product Defects

3. Process flexibility

It is required so that the company can react swiftly to changes in the volume and mix of their

products [31]. To achieve this operators and machines must be flexible and the system must be

able to be changed over quickly from one product to another.

4. Total Productive Maintenance (TPM)

TPM is a new way of looking at maintenance, or conversely, a reversion to old ways but on a

mass scale. In TPM the machine operator performs much, and sometimes all, of the routine

maintenance tasks themselves. This auto maintenance ensures appropriate and effective efforts

are expended since the machine is wholly the domain of one person or team. TPM is a critical

adjunct to lean manufacturing. If machine uptime is not predictable and if process capability is

not sustained, the process must keep extra stocks to buffer against this uncertainty and flow

through the process will be interrupted.. One way to think of TPM is "deterioration prevention"

and "maintenance reduction", not fixing machines. For this reason many people refer to TPM as

"Total Productive Manufacturing" or "Total Process Management". TPM is a proactive approach

that essentially aims to prevent any kind of slack before occurrence. Its motto is "zero error, zero

work-related accident, and zero loss"[33].

5. Partnership with Suppliers

Partnering implies a long term commitment between two or more organizations to achieve

specific goals. There are three key factors in partnering long term commitment, trust, and shared

vision.

The benefits to the supplier are:

Ø Improvement in quality of supplied product.

Ø The ability to make frequent deliveries on a just-in-time basis.

Ø Improvement in performance, quality and cost.

The benefits to the buyer are:

Ø A greater share of business with long term security.

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Ø Ability to plan more effectively.

Ø More competitive as a just-in-time supplier.

6. Enterprise Resource Planning (ERP)

ERP basically involves the planning of the ‘4M’s of an enterprise’s resources - Man, Money,

Materials, and Machines to obtain their best synergistic value. ERP helps an organization in

addressing critical issues such as [7]:

• Establishing new service levels for increased market share,

• Creating new market opportunities through the extension of existing Products/services

offering or the development of new ones,

• Developing a support and interfacing infrastructure to facilitate decision making at all

levels and eventuate instant action,

• Streamlining processes and procedures and achieving synergy through logical application

and integration.

7. Business Process Re-engineering (BPR)

BPR is an approach aiming at improvements by means of elevating efficiency and effectiveness of

the business processes that exist within and across organizations. The key to BPR is for

organizations to look at their business processes from a "clean slate" perspective and determine

how they can best construct these processes to improve how they conduct business [34].The

proper co-ordination between different strategy is important to effectively run the business. The

business excellence includes proper alignment between manufacturing strategy and business

strategy, formal strategic planning, and communication of manufacturing strategy to the

employees [40, 41].

8. Lean Manufacturing

It is a concept that has evolved from JIT. It is the system-wide philosophical approach used to

integrate the system towards an ultimate goal of maximizing customer service with minimal

service waste [31]. It is the process of satisfying the customer by adding value and eliminating

the waste. It involves maintaining long term relationship with supplier [36]. Lean thinking is

applied at operation level effectively to reduce cost, to improve quality and to improve prompt

delivery by improvement in overall equipment effectiveness, the overall supply chain

effectiveness, and overall vehicle effectiveness[35].

9. Agile Manufacturing

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It is an integration of system towards satisfying the customer by configuring to order. It gives

more importance to responsiveness of supply chain. Customer satisfaction is a measure of

effectiveness in agile manufacturing.

10. Material Requirement Planning (MRP)

MRP is a process used to establish a schedule showing the components required at each level of

the assembly and, based on lead times, calculates the time when these components will be

needed [31]. The inputs of MRP are master production schedule, inventory record and bill of

material.

11. Manufacturing Resource Planning (MRP-II)

MRP-II is the process of integrating marketing, finance and manufacturing plan. It provides the

mechanism for coordinating the efforts of marketing, finance, production and other departments

in the company. MRP-II is a method for the effective planning of all resources of a manufacturing

company [31].

12. Total Productivity Management

The various definitions of Productivity given in literature are summarized as follows [11, 12, 13,

14, 15]:

Depending upon who is defining it, whether it is an Economist, Accountant, Manager, Politician,

Union Leader or Industrial Engineer you will get lightly different definitions of the term

“Productivity”.

Productivity is the quantitative relation between what we produce i.e. output and what we use as

a resource to produce them i.e. input.

Productivity = Output / Input

The other definitions of productivity are:

Ø Productivity is the measure of how well the resources are brought together in an

organization and utilized for accomplishing the set of objectives.

Ø Productivity is concerned with establishing congruency between organizational goals with

social aspirations through input-output relationship.

Productivity can be increased by following three ways[12]:

Ø Increase in output with same input.

Ø Same output with decrease in input.

Ø The rate of increase in output is more compared to rate of increase in input.

The Strategies to improve productivity are[27]:

Ø Improve product design, process planning, manufacturing methods, etc

Ø Improve material flow

Ø Improve plant layout

13. Supply Chain Management (SCM)

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SCM consist of all stages involved directly or indirectly, in fulfilling the customer request. The

supply chain not only includes the manufacture and supplier but also transporter, warehouses,

retailers, and customer themselves [37]. The objective of every supply chain is to maximize the

overall value generated. Value is correlated with Supply chains profitability, and it is the total

profit to be generated across all supply chain stages. SCM involves the management of flows

between and among stages in a supply chain to maximize total profitability.

14. Concurrent Engineering

It is an approach in which all the departments in a company work together to define a product,

determine how to design it so that it can be made and sold profitably, and decide how the

factory can be operated to support the logic of the design and production-marketing

strategy[39].

15. Flexible Manufacturing System (FMS)

FMS consist of groups of computer controlled metal cutting machines with a common control and

material handling system. In this product design can be done with a computer aided design

(CAD) system which directly connected to manufacturing system. Automatic inventory control,

tool operations, inspection, and quality can be closely coupled in this system [31, 39].

Indicators for performance improvement:

The indicators for performance improvement of an organization as mentioned in literature are:

• Cost

• Quality

• Flexibility

• Delivery Dependability

• Delivery speed

• Innovation

NEED OF THE STUDY

Small and medium scale technological industries e.g. steel, castings, textile and agriculture

machineries, fertilizers, polymers, commercial vehicles, machine tool, fabrication, polyester

filament yarns, tyre industries, two wheeler, automobile based industries, electric accessories,

manufacturing industries, cement, glass etc. are playing major role in the development of the

Indian economy. The small scale technological industry in and around Mumbai has major share in

it, because Mumbai is considered industrial and commercial hub of India, contributing 40 % of

income tax generated in India. The contribution of small & medium scale industries to Indian

economy is shown in Table-1.

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Table-1: Contribution of the SMEs for Select Years [29]

1990 2000 2005

Number of Units(’000) 6790 10110 12340

Employees(’000) 15830 23870 29490

Value of Production(in

billions)

$46.73 $39.44 $61.31

Exports(in billions) $5.33 $14.93 $21.72

Share of SME’s Exports to

Total Exports

29.70% 34.30% 33.30%

Despite the tremendous potential and large contribution of small and medium enterprises to the

economy, nearly 60% of the units are limping or are declared sick [26].There are various causes

for such a situation and unfortunately there are no easy solutions. Every unit has its own causes

for sickness. Despite several sick units, the production share of SMEs is 45 per cent and accounts

for 40 per cent of the total exports of the country in year 2008 as per the information given in

Rajyasabha, by minister for Micro, Small and Medium Industries Shri Mahavir Prasad[28]. There

are big challenges in front of these small and medium scale technological industries. Their major

weaknesses are high cost of operation, financially weak, lack of management skill and its

knowledge, lack of marketing ability, lack of knowledge about generation of venture capital,

training etc. Survival and steady growth of these industries in the era of globalization,

liberalization and competition is depending on how efficiently these industries are managed.

Performance improvement of these industries is a need of time. For this purpose critical

investigation of factors affecting their survival and growth is necessary.

OBJECTIVES OF THE PRESENT PROJECT WORK

Ø Identifying small and medium scale technological industries in Mumbai and suburban

region.

Ø Identifying strengths, weaknesses, opportunities and threats of small and medium scale

technological industries in Mumbai and suburban region.

Ø Benchmarking small and medium scale technological industries in Mumbai and suburban

region

Ø To identify the extent of turbulence in the small and medium scale industrial

environment.

Ø To Measure the impact of the turbulence factors and identify those are critical.

Ø Studying manufacturing strategy adopted by small and medium scale technological

industries in Mumbai and suburban region.

19

Ø To prioritize attributes based on degree of alignment or threat to business strategy.

Ø To identify an organization’s current capability in these area and set targets.

Ø Identifying factors responsible for performance improvement of small and medium scale

technological industries in Mumbai and suburban region.

Ø To develop conceptual framework for survival and growth of small and medium scale

technological industries in Mumbai and suburban region.

METHEDOLOGY:

The methodology proposed to achieve the objective of the research project consists of the

following steps:

1. Identifying small and medium scale technological industries in Mumbai and suburban region.

2. Literature Review about:

Ø Concept of techno-entrepreneurship

Ø Present statistics of small and medium scale technological industries in

Mumbai & suburban region.

Ø SWOT analysis of these industries

Ø Strategies for performance improvement like Product design, Selection of

Manufacturing methods and Process planning using the principles of

Concurrent Engineering, JIT, Lean manufacturing, TQM, BPR, Technology

transfer etc.

3. Development of questionnaires:

Ø Visits to various manufacturing industries.

Ø Study of manufacturing industries in view of techno-entrepreneurship.

Ø Frame pilot questionnaire based on literature and feed back from industries.

Ø Collecting data from various case studies.

4. Analysis of data: Use of statistical techniques to analyze data from various studies.

5. Development of conceptual framework for survival and growth of these industries.

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3) Nair P.N.V. (7th Feb 2009), “What makes Maharashtra unique”, Project Monitor SECON

Surveys Pvt. Ltd., http://www.projectsmonitor.com/detailnews.asp? new sid=2076

20

4) Naveen Y.S. Editor (2008),“Making Sense of the Financial Crisis”, The Entrepreneur

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21

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