Changing Paradigm of Cluster Development:
Learning from Global Experiences
20th February 2014: The Lalit Hotel, New Delhi
CII National Cluster Programme for SMEs
&
1000 Visionary SMEs programme
Thank you Prof Tsuda for teaching us
the cluster approach
Thank you Prof Shiba(Padmashri 2012)
for teaching us 1000 Visionary SME
237 Clusters formed
LUDHIANA
Ludhiana Advance
Heterogenous Cluster-II
by CII-AVANTHA Centre for Competitiveness for SMEs
and its Strategic Partners
.… impacting 2428 Companies
18 Clusters of Maruti Centre of
Excellence
JALANDHAR
Jalandhar Cluster – II
HR International Cluster (Level-II)
2 ACMA Clusters (NR)
HARIDWAR
Century Metal Cluster
RUDRAPUR
MINDA Supplier Cluster, Pantnagar
Kolkata
Bata supplier Cluster
DELHI
3 ACMA Clusters (ER)
BATA supplier Cluster
ERODE
• School Cluster
FARIDABAD
JCB Sustenance Cluster
JCB Supplier Cluster III
JCB Supplier Cluster II (Level II)
PUNE
Thermax supplier Cluster
MUMBAI
Forbes & Company Cluster
1 ACMA Clusters (WR)
Ongoing 37 Clusters, covering 240 companies…
As on : Jan 2014
Distribution of Cluster Programmes
Sl.
No
States
No
s.
1.
1
2.
1
3.
Gujarat
Automobile
66%
5.
4
Himachal
Pradesh
Sectoral Distribution
1
20
1
14.
Jharkhand
Rajasthan
5
Tamil Nadu
4
Uttar
Pradesh
1
Uttrakhand
3
West Bengal
3
13.
6.
2
15.
Karnataka
8.
Pondicherry
Punjab
10
7.
Heavy
engineering
8%
22
12.
Haryana
Consumer
products
5%
Light
Engineering
13%
Maharashtra
11.
4.
Education
3%
No
s.
10.
Goa
Leather
5%
States
9.
Delhi
Region wise Distribution
Sl.
No
Madhya
Pradesh
2
16.
1
Example of Benefit from one cluster
Sr.
No.
Key Indicator
UOM
Before
After
Improvement
1
Financial Benefits
In Cr
3.14
2
Benefits in Space
Saving
Sq. Ft
38891
3
Inventory Turn Over
In No.
18
25
Increased by 37 %
4
Customer Complaints
In Nos.
7
2
Reduced by 64 %
5
Customer Return
PPM
2033
973
Reduced by 52 %
6
In Process Rejection
PPM
11070
4716
Reduced by 57 %
7
Delivery Schedule
Adherence
%
92
99.7
Improved by 8.2%
8
Employee Involvement
%
1.6
77.2
9
Cluster Company Sales
In Cr.
42.38
61.09
Increased by 44%
Key Cluster Results
• More than 1 lac Kaizens implemented via CII-Cluster
approach
• More than 1000 Crore Savings achieved
• 50000+ professional Trained via Cluster Methodology
• Reduction in Rejection & Rework by more than 80%
• Reduction in Customer Complaints by 50%
• Reduction in Inventory by more than 50%
• Reduction in Mfg Cost by more than 25%
• More than 60% of SMEs Profitability increased by 50% or
more
1000 Visionary SME
Programme
1000 Visionary SME is the
programme
for Tier 1 & Tier 2s
work together to create
Tier Relationship Of Win-Win,
leading to developing
visionary leaders in SME sector
and contributing Indian
manufacturing.
System Approach
Traditional Way
Focus on individual SME
Visionary SME
Learning Community
Focus on system
OEM
Tier 11
SME1
Tier 21
Tier 12
SME2
Tier 22
Tier 23
What Are The Results
Of Visionary SME
For The Last 3 Years?
Examples of results: Batch 3 (2012)
Visionary Leaders Developed
Nos of plants participated
35
(cumulative)
30
Nos of Real Change Leader developed
250
(cumulative)
29
203
200
25
19
20
Tier 115
Present
Batch
12
150
128
Present
Batch
3
4
100
59
10
5
50
5
13
0
0
1
2
3
120
4
107
100
1
2
Total: 288 + 142
250
227
200
84
160
80
Tier 2
Present
Batch
59
60
Present
Batch
150
90
100
40
23
50
20
0
28
0
1
2
3
4
1
2
3
4
Result-1:
Delivery Performance
Tier 2
Delivery of
Tier 2 to Tier 1
97-100%:
No delay in delivery
of timing & quantity
Tier 1
OEM
Delivery of
Tier 1 to OEM
97-100%:
No delay in delivery
of timing & quantity
Result-2:
Increase Of Productivity
Tier 1
Tier 2
Highest:4.1times
4.5
4
4
3.5
3.5
3
2.5
2
1.5
1
0.5
0
Highest:3.7times
3
Average
2.0 times
2.5
2
1.5
1
0.5
0
Average
2.2 times
Result-3:
Reduction Of Inventory (WIP)
Tier 2
Tier 1
85%
58-62%
Result-4: Business Growth
Tier 2
Tier 1
1.5 Times
NSV (Mn$)
0.14
0.13
0.12
0.1
0.08
0.08
0.06
0.04
0.02
0
May-12
May-13
Thank you!