16 research outputs found
Competitiveness of Indian Manufacturing: Finding of the 2001 National Manufacturing Survey
In this paper we present findings of the second national survey on the competitiveness of Indian manufacturing. The paper develops hypotheses on the competitiveness of firms in the manufacturing sector and addresses some key questions on the characteristics of world class firms in India. We analyze the processes and practices that such firms have adopted to become world class. More important, we highlight firm level practices that are preventing Indian firms from becoming globally competitive. The findings point towards three distinct aspects of manufacturing management that define the capabilities of the firm, i.e., strategies related to dynamic control of shop floors, network linkages and innovation. It is found that firms that build distinctive technological and managerial capabilities in these domains are able to compete globally. The paper provides a comparison with manufacturing capabilities of competitors in China and draws lessons for organizing large scale manufacturing. It also provides an assessment of the changes that have happened in manufacturing priorities and strategies in India since our last survey that was conducted in 1997 and highlights the implications of these changes.
Entry Strategies in Emerging Economies: The Case of the Indian Automobile Industry
In anticipation of rapid growth, the passenger car market in India is crowded with 18
companies trying to establish themselves. Most companies have joint ventures with Indian
partners and have entered the market in the last two years. The number of new entrants over a
narrow time window of two years is unprecedented. Demand forecasts vary and analysts
expect anywhere between 2 and 3.5 million cars to be sold in the next five years. Equity
holding for the international partner is usually over 50% and they retain significant managerial
control. Most of them have introduced cars in the 33,000 price range, which is
viewed as a luxury segment in India. Automobile companies have also chosen to establish
exclusive dealerships. Initially, companies have chosen to import completely knocked down
(CKD) kits and assemble them in India. However, this strategy is not effective in the long run
since such imports attract 50% duty. The major implications are that a shake out is likely and
that companies would need to have alternate plans, including introduction of cars in other
market segments, lower prices, and exports from India if they cannot establish themselves in
the domestic market. The supplier industry is very small and needs to develop simultaneously
on all fronts including rapid capacity expansion, acquisition of technology, improvement in
manufacturing practices, quality and productivity, adoption of lean manufacturing, and
developing product design capabilities to meet the needs of assemblers. Therefore, a critical
requirement for rapid growth of the industry is adequate assembler involvement in the suppler
industry
Recent Developments and Future Prospects in the Indian Automotive Industry
The automobile market is growing at about 25% for the last three years. The number of persons
per car is 200, which is very large compared to other emerging markets like Korea and Brazil
which have about 12 persons per car. There is therefore a very huge untapped market. Uncertainty
exists about the extent of growth, but a minimum growth rate of 20% is expected until the year
2000. Sales are expected to rise to anywhere between 850,000 to 1.5 million vehicles by the year
2000. Markets are highly price sensitive since a car is about 18 to 24 months salary for the average
middle class buyer. However, incomes are rising and the economy has been growing steadily at
nearly 6%.
Import duties on CKDs and components is 50%. Reduction of prices because of lower duties and
taxes and progressive indigenization, and rising middle class incomes are likely to further increase
industry growth rates. Penetration in rural and semi urban areas is extremely low and could
provide fresh markets. New entrants will have to deal with uncertainty of demand, different and
evolving customer needs, a relatively poor supplier base, a market crowded with competition and
industry wide capacity shortages. However, if there is a shake out as many analysts expect, further
opportunities for survivors will open up. Another implication is that India could emerge as a significant manufacturing base for exports. The supplier industry is also going through massive growth, although from a small initial base. Except for Telco, indigenous product development capabilities are very low, and the industry has some way to go before it becomes world class
The Automotive Industry in Emerging Economies: A Comparison of Korea, Brazil, China and India
The automotive industry in Korea, Brazil, China and India is currently going through
impressive growth. Governments have played a key role in the evolution of the industry in all
these countries. The Korean industry has made the most significant progress, and is now
exporting cars to developed markets. It is the only country that invested in R&D for product
development, retained management control in joint ventures with multinational companies
(MNCs), and had ambitious export targets. The industry in Brazil is controlled entirely by
MNCs. Although this has led to growth and adoption of lean production, indigenous product
development is lacking. Tariff barriers have come down, forcing domestic production to
become more market responsive. Fluctuating tariffs and taxes, and cyclical demand have
characterized the industry. Indian industry is experiencing a revolution with rapid growth and
the entry of 9 MNCs and plans for 3 more to enter in the next two years. The Chinese industry
is also growing very rapidly although it is still highly fragmented. Passenger cars are only
15% of total vehicle production in China. Demand in Brazil, India and China is highly price
sensitive and growth is led by the demand for a small car. Higher taxes on mid and large size
cars give the small car a big price advantage. Import duties for components imply that the
supplier base in these countries needs to develop fast. The supplier industry could become a
bottleneck for growth
Polyhedral structure of the product cycling problem with changeover costs
Thesis (Ph. D.)--Massachusetts Institute of Technology, Sloan School of Management, 1990.Includes bibliographical references (leaves 214-220).by Trilochan Sastry.Ph.D