auto component industry has enhanced its productivity and achieved substantial
improvement in quality as a result of the UNIDO partnership programme for the
Indian auto component industry, which is now in the third phase of implementation
since its launch eight years ago, according to an impact assessment of the programme
by Price Waterhouse Coopers.
partnership programme enhanced the business performance as well as the operational
performance of targeted domestic small and medium enterprises (SMEs). 15 of the
30 firms (for which data was available for the phase II of the programme which
began in 2002), showed growth rates that beat the industry growth rate of 62 per
cent", the study says.
programme, which is a partnership between the United Nations Industrial Development
Organization (UNIDO), the government of India and the Automotive Component Manufacturers
Association of India (ACMA), was in recognition of the need for the Indian auto
components industry to not only become globally competitive by adopting global
best practices in their own operations as the sector gradually opened up to foreign
competition, but also to vertically extend such practices to their sub-suppliers.
Around 20 companies
participated in the first phase in the western region; 40 companies in phase 11
and 58 companies in the current phase III of the programme at the national level.
It aimed at strengthening the small and medium auto component suppliers to meet
the requirements of automobile manufacturers and their first tier suppliers, and
enhancing productivity and overall performance to enable their inclusion in the
domestic as well as global supply chains.
to business performance in terms of productivity, quality, delivery, safety and
cost, the study states that existing customers have placed additional orders,
and firms have also acquired new customers in the course of the programme.
per representatives of many participant firms, the interventions transformed the
look and feel of their shop floors to such an extent that customers who would
otherwise not be inspired to place an order with them felt confident that the
firm could deliver to expectation. The programme has helped firms to enhance labour
productivity and these enhancements have come about as a result of a combination
of training interventions. Firms have also been awarded quality certifications
over the course of the programme (ISO 9001, QS 9000, ISO 14000), many of which
were (due to) training interventions," the study noted.
programme has helped firms to plan better to meet delivery schedules. About 50
per cent of the firms have shown a percentage increase in inventory turnover ratio
(ITR) of 95 per cent, while Kaizen activities have helped firms achieve cost savings",
the study reveals.
study has also underlined the importance of expanding the outreach of the programme
so as to upgrade the competitiveness of an increasing number of target companies
in India as well as the need to ensure sustainability of the programme by building
a pool of well-trained national engineers.
study recommended, "Going forward, the UNIDO partnership programme would
do well to provide firms with inputs specific to enable firms to further enhance
performance to hasten their inclusion in the global supply chain. This could include
supporting firms to achieve the ISO / TS 16949 standard since it is essential
to securing global automotive business.
is also a need to take these interventions beyond the realm of operations, to
enabling firms to establish appropriate management frameworks. The programme could
also work towards sensitising manufacturers to disciplines relevant to international
business activities such as the impact on industry of the WTO, international trade
operations, export documentation, financial risk management etc".
its new / integrated programme of cooperation 2007-2012/ currently under review
by government of India, UNIDO plans to develop turnkey training packages for manufacturing
enterprises building on the core expertise in quality and productivity management
honed through the partnership with ACMA, but also integrating other dimensions
such as cleaner production, energy efficiency and occupational health and safety
in a holistic approach of sustainable industrial development.