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Industry Will Emerge Leaner, More Flexible & Agile From Current Volatility

The common refrain at the recently held 3rd edition of the CII Conference on Achieving Excellence in Manufacturing – Managing In Challenging Times, at the Northern Region headquarters in Chandigarh, was that the current times are challenging, and at the same time exciting for the manufacturing industry. Industry honchos expressed confidence that the industry will emerge leaner, more flexible and agile from this volatility, which is expected to continue for a while. These downturns are cyclic in nature and have been witnessed every 10-12 years in the past as well, but the industry has come out stronger each time, participants in the conference were reassured.

The Punjab Government on its part promised to back the industry to the hilt through its policy interventions, which are being made more relevant to the present times. The conference was informed that in the last two years, because of the various initiatives of the state government, Rs 5,000 crore of new investments have been grounded in the state, most of it in expansion of existing units. Leveraging the new Industrial Park and Make In Punjab policies, the state government is confident of crystallising more investments by boosting public-private partnerships.       

Industry Will Emerge Leaner, More Flexible & Agile From Current Volatility, Lifeinchd

Photos By : Life In Chandigarh

Addressing the inaugural session, Punjab Additional Chief Secretary Industry, Commerce and Investment Promotion Vini Mahajan reminded the participants that Punjab has traditionally aspired to be No. 1 in whatever it does and its indomitable spirit does not allow it to settle for anything less. She expressed confidence that maintaining that tradition, Punjab will once again lead the nation in manufacturing and will restore the trust in the rest of the country that whatever comes out of Punjab is excellence personified.

“We are committed to hand hold and fully support companies keen on investing in Punjab. The state government is steadfast in its resolve to ensure 100% facilitation and zero interference to enable the industry to prosper. The inspections regime will no longer be person driven and all transactions will be done through a portal for ease of doing business. Efforts are being made to remove all the other pain points as well for investors in the state,” she added.

Emphasising that a pragmatic policy and guidelines have been laid out for setting up new industrial parks, she invited CII to support the state machinery in meetings its intended development goals by ensuring that the industry members make the best use of the structured policy framework provisioned by the government. She also assured the industry that the state government is aspiring to provide an enabling ecosystem for industrial growth and is aggressively working towards skill development, provisioning employment, supporting startups as well as building quality infrastructure.

1,000 Acre Industrial Park At Rajpura

Updating the gathering on the latest developments, Vini Mahajan said a few private industrial parks have already started coming up as a result of these policy initiatives and more are expected to follow suit. The state government is also aggressively pursuing its plans to set up its own 1,000 acre industrial park in Rajpura in collaboration with the central government under the Industrial Park Scheme of the Department for Promotion of Industry and Internal Trade (DPIIT), she added.

The ACS-Industry asserted that despite the financial crunch being faced by the state government, funds will not be allowed to become a constraint in upgradation of infrastructure, especially roads, in the existing focal points in the state with the help of the central government. Work is already in progress in four focal points and plans are in process of being finalised for eight more. Infrastructure and facilities will be upgraded in all focal points in the state by the end of 2020, she promised.

She shared that plants for tertiary treatment of wastewater are being set up to provide regular treated water to the industry and common facilities clusters are being planned as per demand of various MSMEs.

Confiding in the audience that so far Government of India funds for infrastructure upgradation of the export industry were not being availed of by the Punjab government, which is being done now, she said the existing STPI in Mohali is being upgraded by setting up of a Centre for Excellence in Artificial Intelligence (AI) there and another STPI has been planned to be opened in Amritsar.

Seeking the industry’s partnership in developing a startup culture in the state, by supporting the efforts of promising young startups, Vini Mahajan also sought its support in making the recently launched Make In Punjab policy a success story. The policy gives preference in government procurements to locally manufactured goods.

Punjab Government Backing

Earlier, saluting the enterprising spirit of Punjab, which boasts of among other things the biggest tractor manufacturing plant in the country, the biggest bicycle manufacturing plant in the world and the biggest food park in the country, Rajat Agarwal, CEO, Punjab Bureau of Investment Promotion, said all the state government initiatives are aimed at encouraging faster adoption of technology, upskilling the work force and providing easy finance options to the industry.  

He also informed the participants that the industry incentive structure in Punjab encourages upgradation, diversification, expansion and modernisation of existing industries, with special focus on the MSME sector. The government support is aimed at boosting industry competitiveness, ensuring quality compliance, revival of sick units, strengthening R&D centres and establishing centres of excellence. The announcement of a research centre in artificial intelligence (AI) and machine learning to be opened in IIT Ropar in collaboration with National Chung Cheng University of Taiwan is a welcome development, he added. 

Cos. Should Have DNA To Win

Industry Will Emerge Leaner, More Flexible & Agile From Current Volatility, Lifeinchd

Vijay Kalra, CEO, Mahindra Vehicle Manufacturers Limited, and Chief of Manufacturing Operations, Mahindra &Mahindra Ltd, felt that in this increasingly dynamic world, when rules of the game are changing at a brisk pace and forecasting growth trends is becoming almost impossible, manufacturing companies need to become more flexible and agile in all aspects of their business model. “In an emerging scenario where you either win, or lose, there being no room for a draw, companies need to have the DNA to win,” he added.

Kalra stressed that “Our knowledge and skills become huge differentiators in using technology and innovation to our advantage. We cannot win by just aping the advanced economies in adopting technologies, systems and processes. We have to choose what is best suited to our business lines. A healthy mix of advanced technology and traditional wisdom is the key to our competitiveness,” was his advice to the gathering.

Time To Show Mettle In Manufacturing

Displaying a never-say-die attitude, Kamal Bali, President & Managing Director, Volvo Group India, described the present times, when the Indian economy is showing clear signs of a slowdown, as “challenging but exciting” despite the doomsayers having a field day. “I see hope and opportunity in the shift which is happening, when new boundaries are being drawn and existing boundaries being challenged. We have proven our mettle in IT, now it’s time to show that in manufacturing as well. For that we need to plan for the future to stay ahead of the curve,” he opined.

Dwelling on various trends that are driving the future of businesses, he said the speed of digitalisation, rapid urbanisation, a clear shift from asset-led to idea-led business models, change in customer demand from products to 360 degree solutions, challenges of sustainability and need for new and emerging skill sets, have marked a shift in fortunes of companies. While some iconic companies have been consigned to history, younger and more innovative brands are charting a new course, creating wealth for all stakeholders in the process, he shared.

Arrogance of large companies is fast making way for a more collaborative approach, he said, adding that only companies which remain economically competitive, socially inclusive and environmentally friendly will hope to survive in the future.

Achieving 25% Share Of GDP

The top honcho of Volvo Group India was emphatic in saying that “India needs to fire its manufacturing sector and strive to not only leap-frog but pole-vault into the future by achieving an at least 25% share of the country’s GDP. With a current share of 15% of GDP, India’s manufacturing sector is lagging far behind some of the world economies anchored by manufacturing like Germany, China, Japan and South Korea, with percentage share in their national GDPs ranging between 22-30%, he informed.

He felt that for this to happen, the government has to aggressively make policy interventions to not only fire local demand but also create a domestic ecosystem where land, capital and labour costs are aligned to sustain the competitiveness of manufacturing operations in the country.

Skilling of manpower in tune with modern day and future requirements is also of paramount importance for the manufacturing sector. Private sector has to play a very important role in this by collaborating with the government to revamp the education system from secondary school level, so that it is geared to produce a job-ready workforce, he averred.

Replace Flab With Muscle

MM Singh, Executive Advisor, Maruti Suzuki India Limited, while acknowledging the concern and anxiety in the market on account of the slowing demand, felt that it is not unexpected. “We have seen these ups and downs, with slowdowns happening cyclically every 10-12 years. Volatility is here to stay. We have to see how flexible we are in our approach to business, to be able to adjust to changing situations,” he said, adding that “certain level of complacency invariably sets in when the going is good, and the current challenges have thrown up an opportunity to dwell deep into our systems and processes and replace the flab with muscle.”

“This is no time to cry, but to rise to the challenge. Look here and there and everywhere. There will be some flab everywhere. Experience has shown that productivity can be improved by 20-30% by revisiting your own practices and operational procedures, resulting in matching cut in costs,” he shared from his experience.

Stressing on the need for maintaining quality of output at all costs, and creating a safe and conducive atmosphere for employees in factories, Singh shared his favourite example of a Maruti vendor being persistently resistant to changes being suggested in his work environment. When, finally the supplier was persuaded to add some more facilities for his workforce, to his utter surprise productivity shot up by as much as 80%. Regular maintenance of machinery is another very crucial factor in cutting down costs and wastages of materials and costs, he said, adding that general tendency to overlook this aspect of operations often leads to disruptions.

He opined that blindly following global trends and practices may not be the answer to modernising manufacturing operations in India, “we have to devise indigenous solutions best suited to the peculiar environment of individual businesses by delving deep into our own knowledge and skills.”

Govt-Industry Cooperation Must

Harish Chavan, Chairman, CII Punjab State and CEO, Mahindra & Mahindra (Swaraj division), while stressing the need for manufacturing entities to increase their internal competitiveness, said government and industry cooperation is necessary to spur growth of the manufacturing sector in Punjab. “CII would be happy to partner the government not only in exposing the companies to the emerging opportunities, but also in making them aware of the stringent performance expectations necessary to succeed,” he added.

Industry Will Emerge Leaner, More Flexible & Agile From Current Volatility, Lifeinchd

Later moderating a session on Flexible Manufacturing to Create Long Term Sustainable Businesses, Kamal Bali, while setting the context, spelled out a 10-point formula for success of manufacturing in the present challenging times, and for the future. Among the points he raised were : contributing to the success of your customer, becoming globally competitive, focussing on quality, safety and machine maintenance, taking care of employees as partners, becoming flexible and agile, ensuring tracking of global trends, adopting holistic IT, shifting from mass production to mass customisation and adopting diversity in the workforce. 

Induct Woman Force In Manufacturing

He shared with the gathering the success story of Volvo Group India in its experiment to demolish the male bastion in manufacturing and inducting a large female workforce. The initiative has paid rich dividends to the company, he said, adding that 30-50% women workforce could do a world of good to the manufacturing units.

Gaurav Sarup, MD, Marshall Machines Limited, which provides complete machining solutions to manufacture a wide variety of components like axles, crankshafts, auto parts, fans, pumps, etc., expressed the need for transformation in the way we work on production lines with increased flexibility, affordable automation and Industry 4.0 technologies and practices. These are necessary to overcome the problem of profits being under severe pressure, existing and growing shortfall of skilled manpower and factories performing at
rnsub-optimal levels, he added.

Anil Sehgal, Director, MT Autocraft Limited, a leading automotive machined components and assemblies supplier for automotive and farm industry, while speaking on ‘Flexible Manufacturing System’ gave the example of Mahindra & Mahindra, starting with Scorpio, and  rolling out one car after another in the last two decades from the same platform. Tesla has likewise scaled up its production from 7,000 units per month to 30,000 units per month, he said, adding that, with tooling changing by the day, there is a need for flexible low cost automation machines, which can adapt to newer technologies. He emphasised that mass customisation, which is the need of the hour, is possible with these machines.

Giving a presentation on ‘Robots & Integration’, Karan Kantoor, Director, Encon Systems International, one of the leading providers of robotics, factory automation and industrial safety solutions, opined that the man and machines have to be aligned for optimum results and outcomes.

He said collaborative robots (or cobots) are in great demand with increasing automation of operations in manufacturing units. Their deployment in various processes leads to significant reduction in wastage of materials. Allaying fears of widespread downsizing of the workforce where robots or cobots are deployed in the manufacturing process, he claimed that in 90% cases it is seen that there is no retrenchment. The workforce just gets redeployed elsewhere in the manufacturing unit, he added.

Intervening during a discussion, MM Singh expressed the need for owners of manufacturing units to visit their plants and factories more often. It has been seen that 90% of the owners do not visit their operations at all, because of which there is a disconnection between the owner and the workforce. This is suicidal in these challenging times, which demand that everyone in an organisation takes its ownership and all collectively put their heads together in finding solutions to constantly remain ahead of the curve, he added.

Get Engineers Exited In Manufacturing

Reflecting on the disturbing trend of engineers not showing passion in their work, which shows in their lack of interest in visiting the production line and introducing innovations, Kamal Bali made an impassioned appeal for bringing back glory to the manufacturing sector. “We have to get the engineers excited about Industry 4.0, which is being billed as the 4th Industrial Revolution. With modern manufacturing becoming a hybrid of IT and traditional ways, it is now a very cool proposition for enterprising young engineers, he said. 

Advising manufacturers not to remain confined to just generating products, he said “They must serve a higher purpose of making their customers succeed by staying with them till the entire life cycle of the product. Even small and medium manufacturers should strive to create brands. They can learn from entrepreneurs in Germany and Sweden who have created brands of their own, and are really proud of them.

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