Technology crucial for innovations and productivity in manufacturing

Technology adoption, organization of SMEs in clusters and behavioural changes key to boosting manufacturing sector

pratap

Pratap Vikram Singh | April 16, 2014



To make manufacturing sector an engine of growth, the government had committed itself to increase the share of manufacturing in the GDP to 25 percent by 2022. This, however, could only be achieved through promotion of small and medium enterprises (SME), increasing the adoption of information technology to enhance the productivity in manufacturing and infrastructure sector.

The same was deliberated by a panel of experts at a CII summit titled ‘Technology: a catalyst in driving growth in Indian industry’.

Delivering the keynote address, Arun Maira, member, planning commission, said, “We need small and medium enterprises to grow. Only when the SME grow, it will be able to feed large industries. There has to be a healthy ecosystem of SME, lest we will be unable to create 100million jobs in the coming years.”

He said the SME need to organize themselves in clusters and create common sharable resources. This way they can optimally utilize resources and grow faster. He said the technology is useful in streamlining processes and hence must be available to the SMEs.

He said that technology should also be used for innovation and decentralization of the manufacturing so that more and more people could participate and contribute in the overall growth and development.

Shibulal, managing director and chief executive officer, Infosys Ltd, talked about how the Indian IT major, set up in 1981, grew exponentially from a 4,000-people organization to an organization of more than 1.5 lakh employees. He said the drastic reduction of cost of communications technology and transactions has made a stronger case of technology adoption.

He cited an example of how technology has helped in reforming the supply chain for even shop owners and distributors. A simple SMS communication between shop owners and distributors, he said, has optimized the supply chain and reduced the transaction cost between the two parties.

There is a need for creating employment in a distributed fashion, and this could be done through SMEs. The technology could be an enabler, he said.  Besides, the IT adoption gives a competitive advantage.

Arguing that India is a country of contradictions, he said while IT sector employs over 2 million people, over 16 million children remain out of school.  While 70 percent of the healthcare facilities are concentrated in urban areas, a similar percentage of people live in villages.

Here too technology can play a key role in bridging the gap in terms of health, education, banking, employment, manufacturing and services.

The panel included Bhaskar Pramanik, chairman, Microsoft Corporation andNeil Wilson, executive director and partner, Pricewaterhouse Coopers India.

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