FICCI-EFESO launches first survey report of the Manufacturing Excellence in India – Current & Future Survey 2021

Dr V K Saraswat, Member, NITI Aayog, has a valid point when he says that there is a need to push the Make in India and Atmanirbhar Bharat programs in the Indian manufacturing ecosystem.

“A service-based economy is prone to market risks and manufacturing is going to facilitate a stronger and stable growth. Atmanirbharta calls for high reliance on imports that limits our holistic growth, hence we need to have more indigenous production,” he pointed ou while addressing the virtual ‘FICCI-UNIDO Dialogue on Swachh Udyog- Manufacturing Excellence in India’ on April 12.

Dr Saraswat said that Make in India through Industry 4.0 is an important transition in the manufacturing sector that will bring new technologies, new operations, and will impact all sectors. This will bring competitiveness, Atmanirbharta, and make our manufacturing sector a bigger contributor to the GDP, he added.

Dr Saraswat, while highlighting the manufacturing vision of 2030, said that we will see factories that are green and sustainable. Factories should be in areas that are closer to both the workers and the customers. The Indian production system should be design-oriented, he added.

Further on, he said that our Industry 4.0 must be a human and process-oriented simulation and digitalization to ensure a major role for the workers. The 6-R approach in the manufacturing sector includes re-manufacture, redesign, recover, recycle, re-use and reduce and is what we want to achieve by 2030-35, added Dr Saraswat.

He further stated that R&D plays a crucial role in manufacturing and there is a need for smart manufacturing R&D centres to showcase new technologies so that industries can use them to grow further. “This will also help in proving Atmanirbharta in these areas and we will not be dependent on importing these technologies,” he said.

Addressing the introductory session, Ms Alka Arora, Joint Secretary, Ministry of MSME said that manufacturing is the future of the world. “We all know that manufacturing is not at the level at which we have would have wanted it to be. COVID-19 posed a challenge to the MSMEs to get up and start working on chapters that will take them to the next level. There are challenges, apart from the financial ones that MSMEs need to overcome.”

Ms Arora said that the change in the definition of MSMEs gives an opportunity to MSMEs to play a role in the global market. “We need to be a part of the global value chain. We are also working to make India an export hub. We will shortly be coming up with a Global MSME Intelligence System to aid MSMEs towards this effect,” she added.

Mr Shyam Bang, Chairman, FICCI Taskforce on Manufacturing Excellence said that profit is not an indicator of excellence, therefore manufacturing excellence initiatives are essential to increase competitiveness.

Mr Suresh Khandelia, Co-Chairman, FICCI Committee on Textiles and Technical Textiles & Advisor to Executive Chairman, Sutlej Textiles, and Industries Ltd. said, “A dialogue like this is important to spread the awareness about how technologies around the globe are shaping the manufacturing space to achieve excellence. Indian industry, including MSMEs, have been adopting Industry 4.0 technologies,” he said.

Mr Rene Van Berkel, UNIDO Representative, Regional Office in India, said that there is a dependence on the contribution of clusters of manufacturing MSMEs in India and there is a need to make the factories effective, efficient, and mature.

The FICCI-EFESO Consulting (India) Survey on Manufacturing Excellence was also released during the event.

It may be noted that FICCI–EFESO survey on Manufacturing Excellence in India – Current & Future was launched in the Q4 2020. The aim is to measure the pulse of the current Indian manufacturing practices while also anticipating the preparedness of the industry for the future.

The survey is designed to cover three axes of Manufacturing Excellence viz. “Process – Human Dynamics – DigiTech”.

Through a range of questions, the survey tried to understand the maturity of the Manufacturing Excellence journey in their businesses, as well as exploring the barriers that companies face and the solutions they have adopted. The survey received 150 responses across the sectors.

The Responses were analysed with key themes and insights identified. Several one-to-one interviews with survey participants and subject matter experts were carried out to further deepen the survey and validate the meaning behind some responses.

The consolidated findings have been summarised in this research report:

Manufacturing Excellence, in India, is still an emerging capability for most organisations. 1 out of 3 participants believe that “Top management is driving the Manufacturing Excellence initiatives at plant right now”.

The survey-analysis clearly highlights the positive impact of Internal teams and Top management on manufacturing excellence practices. 1 in 2 participants organizations are using structured methodology such as TPM, TQM, WCM, etc. to predict product, equipment, and process failures. Only 13% participants organizations are using IoT devices to predict failures in a pilot area or across the plant. 41% of participants organizations are following traditional Key Performance Indicators (KPIs) in use (P, Q, C, D, S, M) to ensure people work towards company objectives. Only 6% participants organizations understand Key Activity Indicators (KAI). More than 90% of participants are using 5S manufacturing practices in organizations whereas only 30% participants are using Anomaly Tagging – De-tagging, VSM and Poka-Yoke in their organizations. 1 out of 3 participants organizations have skill building plan made for a small group of employees. Only 10% participants organizations have done data analytics skill development in a few pilot areas. 1 in 3 participants organizations are using TPM/WCM approach to reduce unplanned breakdowns. Only 21% are focusing on total cost of Maintenance, using IoT (Sensors etc.) for condition monitoring, real time alerts and Artificial Intelligence to prevent breakdowns. 1 in 3 participants organizations are using “Sensors for reliably collecting data from diverse sources. Only 18% participants organizations have all assets monitored in real-time with negligible delay. 1 in 2 participants organizations are using advanced automation in some pain areas. Only 15% participants organizations have advanced automation across the plant and Artificial Intelligence and Machine Learning are integral part of running the plant.

Performance and Manufacturing Excellence Companies with Manufacturing Excellence will dynamically adapt and respond faster to the “new normality”. It is time for business leaders to embrace and actively lead Manufacturing Excellence and capitalise on the opportunities that excellence in end-to-end operations can bring. There is an undeniable correlation between performance and manufacturing excellence application with tangible and sustainable results.

The 3-Axes of Manufacturing Excellence Process is the most fundamental axis of any business organization. Organisations must cover all the dimensions of an end-to-end value chain: procurement, innovation, supply chain, manufacturing, marketing & sales to customer service. Regularly assess and measure the “health” of company’s supply chain processes, its success in eradicating losses, managing performance, seamlessness of planning processes, etc. Some examples are product feature optimization, synchronized end-to-end planning, loss intelligence, performance management among others. Human Dynamics – Ultimately, it is the people who will drive progression and can influence process indicators. Measure adoption and engagement along with the actual behaviour displayed by people from all levels in an organization, on HD Entities such as Leadership, Teamwork, Individual Behaviour and Organizational Culture. Get these insights and appropriately acting on them can significantly boost the rate of success and sustainability of any progression journey.

DigiTech – Digital & Technological transformation today is vital for the sustainability and future success of any organization. It is critical to look at data and data management as the bedrocks for achieving real-time visibility of a business and embarking on DigiTech transformation to align both process and people. Assess and measure the digital maturity level of organizations on four dimensions – IT and Digital Architecture, Applied Digital Business Solutions, Digitization of E2E Supply Chain Systems and Processes and Organization Design and HR Digital Maturity.