“Building Quality Supply Base”
Harinder Jeet Singh
Principal Counselor & Head
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
1
“Building Quality Supply Base”
India : GDP Growth and Contribution of
Manufacturing sector
India - GDP growth % vs. Manufacturing contribution
25
20
15
10
5
-5
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
0
-10
GDP growth (annual %)
Manufacturing, value added (% of GDP)
Source : World Bank
Manufacturing sector contribution to GDP has always
been consistent
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
India’s Manufacturing Competitiveness
Proven Product
Development
Capabilities
Stable Economic
Policies
Proximity to
Markets
High Quality
Standards
India as a
manufacturing
hub
Competitive
Manufacturing
Cost
Large and growing
domestic demand
Availability of
manpower
Export Potential
Indian Manufacturing positioned for a higher growth rate
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
3
“Building Quality Supply Base”
Some interesting facts about Indian MSMEs
(Supply Base)
• 8% contribution towards India’s GDP
• Account for 45% of manufacturing output
• More than 26 million spread over the country
• Producing 6000+ products
• Employment to 59 million+ people
• Share 40% to national exports currently
• Growing at 35% over the last 2 years
Unleash the hidden potential
Source : MSME Annual Report 2009-10
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
What is Quality Supply Base all about ?
Improve
Productivity
?
Revenue
generation?
Improve
Quality ?
?
Maximize
Production
?
Mfg Cost
reduction?
Energy
saving?
22 June 2011
Technology
up?
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
What is Quality Supply Base all about ?
Improve
Productivity
?
Revenue
generation?
Improve
Quality ?
PEOPLE
and
?
Mfg Cost
reduction?
SYSTEMS
Energy
saving?
Maximize
Production
?
Technology
up?
Too many parameters to work upon ?
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 1
 Standardized work
 Use Techniques & Technology in process
improvements
 Prevention systems
 Feedback and control systems
 Customer supplier relation building
Systems robustness – the first step
22 June 2011
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“Building Quality Supply Base”
Standardization as Base
• Start with work standards - First
– Need based updation of standards
– Work instructions in local languages
– Visual standards
• Reaching the mass is the key
• Focus on standardization while building capacities
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
A Work Standard Example
Explanatory
Photographs
Explains the
operation sequence
Explains the quality, safety
& standard related points
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 1
 Standardized work
 Use Techniques & Technology in process
improvements
 Prevention systems
 Feedback and control systems
 Customer supplier relation building
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
10
“Building Quality Supply Base”
Element # 1
- Use Techniques & Technology in process
improvements
-
5S, 3M, SMED
Quality Circle tools
Kaizen
Value Stream Mapping (VSM)
Failure modes and effects analysis (FMEA)
- Special focus on Low cost automations
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 1
 Standardized work
 Use Techniques & Technology in process
improvements
 Prevention systems
 Feedback and control systems
 Customer supplier relation building
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
12
“Building Quality Supply Base”
Element # 1
 Prevention systems
– Extracting the advantage of technology &
automations
– Shift from Time based to Cycle Based maintenance
– Process Maintenance
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
13
“Building Quality Supply Base”
Element # 1
 Standardized work
 Use Techniques & Technology in process
improvements
 Prevention systems
 Feedback and control systems
 Customer supplier relation building
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
14
“Building Quality Supply Base”
Element # 1
Feedback and control systems
 Traceability
 Visual control – Seeing is believing
 IT enabled Quality & production control systems
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Visual control – “Seeing is believing”
Visual control in material identification
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“Building Quality Supply Base”
Visual Communication of an Abnormality
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“Building Quality Supply Base”
Element # 2
• Safe and comfortable
• Engagement of People
• Imbibe Daily Work Management
Bringing the Ownership
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“Building Quality Supply Base”
Element # 2
• Safe and comfortable work environment
• Engagement of People
• Imbibe Daily Work Management
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Safe and comfortable work environment
Spot coolers
Casting shop:
Adverse Conditions:
Heat resistant
protective gear
1.Molten metal
handling
2.55C ambient
temperature
Air regulator
3.Working with die
temperature of 350C
22 June 2011
Comfortable
safety shoes
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Daily Management System



Role Clarity
Development through collaborative approach
- Openness to provide and implement ideas
Higher the levels – wider the focus
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Higher the levels – wider the focus
Observation by
Supervisors
View
by
various
levels
22 June 2011
Observation by
Executives
Observation by
Manager
Observation by
Plant Head
Check on Check function responsibility at every level
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 3
 Communication across level
 Skill management – Multiskilling & structured training
 Capability building - Development of specialists
Build systems adaptive to changes
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 3
 Communication across level
 Skill management – Multiskilling & structured training
 Capability building - Development of specialists
Build systems adaptive to changes
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 3
Communication across levels
 Seamless communication
 Change control displays
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Seamless Communication
2-way Communication at all levels
Dept. Head’s Monthly
Communication Meeting
Dept. Head’s Daily
Communication Meeting
“Communication is the real work of leadership.”
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Element # 3
 Communication across level
 Skill management – Multiskilling & structured training
 Capability building - Development of specialists
Build systems adaptive to changes
22 June 2011
© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
27
“Building Quality Supply Base”
Model of Manufacturing Excellence
Ownership
Sustainability
Involvement
Integration
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Building Quality Supply Chain
The CII - CLUSTER approach
•
Getting Together
•
Learning together
•
Achieving together
By
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
CII – CLUSTER ROAD MAP
Management System
• H R Management
• Cost Management
• Energy Management
• SMED
• MIS - Key Indicators
Equipment Quality
• Model Machine
• Breakdown Reduction
Employee Quality (TEI)
• 3M
• 5S
• Kaizen, Suggestion Scheme
• Cost Consciousness
22 June 2011
Reliable Quality &
Delivery at low cost
Competitiveness
Product Performance
• Flow Manufacturing
• Problem solving
• Poka Yoke
• Product Profitability
Good Management
Practices
Healthy
Equipments
Motivated
Employees
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“Building Quality Supply Base”
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Cluster Methodology
•
•
•
•
•
Assessment & short Listings
Kick-off
Common Training Programmes
Individual handholding visits by counselors
Review Meetings in the premises of one of the
companies followed by visit to the company.
• Documentation and sharing of improvements
• Closing ceremony
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
KEY INDICATORS FOR SUPPLY CHAIN
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22 June 2011
Not Right First Time
Stock Turnover (Inventory Turn Ratio-ITR)
Delivery Schedule Achievement
Floor Space Utilization
5S
Quick Changeover- Customer Response
Safety
Absenteeism
No. of suggestions per employee
Employees involved in Improvement Activities
Cost of Internal Non-conformities
Machine Breakdown (Hours)
Machine Breakdown (Frequency)
Energy Cost Savings
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“Building Quality Supply Base”
Major Benefits CII - Cluster
CII – MOHALI CLUSTER BENEFITS
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“Building Quality Supply Base”
Major Benefits CII - Cluster
CII – JALANDHAR CLUSTER BENEFITS
Turnover Range of Cos – Rs 10 Crores to Rs 35 Crores
Product Profile of Cos – Hand Tools
Tangible Results (Avrg) of Jalandhar Cluster
+ Before Joining the cluster
# One year after joining the cluster
> > > Total Savings achieved by
Cluster companies - Rs. 9.5 Crores < < <
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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“Building Quality Supply Base”
Major Benefits CII - Cluster
CII – GURGAON CLUSTER BENEFITS
Turnover Range of Co’s – Rs 2 Crores to Rs 25 Crores
Product Profile of Co’s – Auto Components
Total Savings achieved by
Cluster companies - Rs. 2.5Crores
22 June 2011
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CII-AVANTHA Centre for Competitiveness for SMEs
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Any Queries can be forwarded to
ciicfc@cii.in
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© Confederation of Indian Industry
CII-AVANTHA Centre for Competitiveness for SMEs
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