As many as 21 firms have received Deming Excellence awards and 153 have bagged the TPM Excellence Award.
At the end of the first decade of the 21st century, Indian manufacturing companies are on a par with the best in the world from the quality perspective, and the next steps will take them to the next stage. The graph indicates the progress made by the automotive industry, including the original equipment manufacturers (OEMs), Tier-1, Tier-2 and some Tier-3 companies. The auto industry has made a huge investment in building world-class quality at competitive costs. And equally important, costs have come down significantly.
India has the largest number of companies, outside of Japan, that have been recognised for excellence in quality. As many as 21 companies have received the Deming Excellence awards; 153 companies have achieved Total Productive Maintenance (TPM) Excellence Award for their total productivity management practices by the Japan Institute of Plant Maintenance (JIPM) committee. Also, 165 companies have been recognised for CII-Exim Bank Awards for Business Excellence (equivalent to European Foundation of Quality Award) — 80 per cent of these are manufacturing companies. Sundaram-Clayton, Sundram Brakes Linings (SBL), TVS Motors, Brakes India, Sona Koyo and Indo-Gulf Fertilisers are a few companies that have received the Deming and the TPM awards.
This has happened because Indian manufacturing, in the last decade, has adopted world-class practices in manufacturing management by educating their employees, both managers and shop-floor staff with the help of global teachers, mainly Japanese, who have brought in the best manufacturing management techniques. These practices have shown positive results in bringing down customer returns to below 50 parts per million (ppm), and have reduced manufacturing costs by 15-20 per cent over the decade.
By focusing on quality, costs have been reduced by eliminating waste (muda, the Japanese word), which is the mantra of all manufacturing in India today.
Sundaram Clayton of the TVS group became the first company to get the Deming prize in 1998, after having put in 10 years of significant efforts to imbibe the total quality management (TQM) culture. The TVS group found a lot of commonalities between their culture and the one prescribed by TQM — and these companies became fully aligned to bringing about “continuous improvement” into their fold. Many Deming Award winners are from the automotive and automobile component sectors, with Tata Steel being the most recent claimant in 2008. Tata Motors, among many others, is pursuing the Deming journey.
India’s interest in TQM came about by years of selfless contribution of one Japanese unsung hero — Professor Yoshikazu Tsuda, invited by the Confederation of Indian Industry (CII) to introduce TQM to the Indian manufacturing industry. He was the guide assigned by the Union of Japanese Scientists and Engineers (JUSE), that is responsible for TQM promotion in Japan and the world over. After the success of TQM implementation in Sundaram Clayton in India, Professor Tsuda set up two clusters of 20 of Maruti’s top suppliers to take them through this journey. In 2001, Mahesh of Sundram Brakes Linings got the first Deming Prize followed by others. Sona Koyo was among these companies!
Today, Mahindra & Mahindra, Tata Motors and others are pursuing this road map as well, while others like Tata Steel are pursuing the Japan Quality Medal.
Vikram Cements started the journey of TPM in 1992 and became the first company in India, in 1995, to get the TPM Excellence Award from JIPM — it was a cement plant clean enough for one to eat off the floor! Sundram Fastners became the next to follow in 1998. It was Suresh Krishna who called CII to make the TPM Club India and spread the TPM movement in the Indian manufacturing industry. Today, we have 153 Indian companies that stand head and shoulders with the best in class in the world on manufacturing excellence, with the world’s best to receive this award. CII also tied up with the Japan Management Association and has brought “lean manufacturing” experts to India. These experts work out of CII office in Gurgaon. CII has its own TPM experts who organise the TPM National Conference each year and also organise training programmes around the year. The highest honour of Nakajima Award has been given to V Krishnamurthy for his leadership and contribution.
When SBL got the Deming prize in the first cluster with Tsuda, he approached the Automotive Component Manufacturers’ Association of India (ACMA) and CII to form a cluster of second-tier suppliers to the automotive sector to bring about TQM in their working. The chief architect of this initiative was C Narasimhan, (at that time the president of Sundaram Clayton) who integrated TQM, TPM and “lean manufacturing” into creating road maps that would help Tier-2 and Tier-3 companies from the automobile sector in a cluster mode with Indian consultants from CII and ACMA. Today, more than 1,500 companies from the suppliers have become world class through this process, and others are signing up. These companies pay for the service, and are not under any government subsidy. In 2009, the Ministry of Micro, Small and Medium Enterprises launched the “lean manufacturing” scheme for SMEs. CII would link this scheme to the SMEs to make them world class. When I say CII, I really mean a great synergy between ACMA, Maruti Centre of Excellence, National Institute of Quality and Reliability and CII-LM Thapar Centre of Excellence in Chandigarh.
A lot of American and European companies in this sector are following the six sigma approach — while it is difficult to make an exact assessment of the numbers, judging by the response received by CII and ACMA on our six sigma initiative in the last four years, the number of companies following this approach is perhaps matching the number of firms following the Japanese approach.
In addition, there are programmes launched by each of the OEMs for their vendors. I am, for example, chairman of the Tata Motors supplier development programme. Today, these programmes are setting a benchmark of 0 ppm — even 100 ppm is not good enough!
Quality standards set by the OEM companies are very stringent and based on the regulatory, safety and environmental requirements. On all these fronts, the product quality has to be either six sigma or this sector has to build up competence.
On November 13, 2003, I had the opportunity to meet Shoji Shiba in Japan after we got the Deming Prize, and he introduced us to the concept of “breakthrough management”. With this initiative, we developed a new programme called Visionary Leader for Manufacturing (VLFM), which works as an Indo-Japan education programme, which was endorsed by the two prime ministers. The VLFM programme is structured to separately cater to CEOs, middle managers and SME owners. The target is to train 500 companies, so that these “visionary leaders” will take the Indian manufacturing companies forward to be the leading ones in the world, and thus will act as engines of growth for all manufacturing companies in India.
These companies will use techniques to create the next best global practices and develop an industrial culture that India will be proud of.Indian manufacturing has come of age and, for that reason, global companies are looking to set up facilities in India, to capture the market opportunities and to make use of Indian manufacturing quality capabilities which are world class.
Nano has revolutionised the global automotive thrust towards affordable cars and Godrej’s Chotu Kool will do the same for the white goods industry, as Sony’s walkman and the Apple iPod and iPhone have done.
The DNA of Indian manufacturing, with regard to quality, has changed — the next decade will find Indian-manufactured goods being sought in the global marketplace.
The author is chairman of Sona Koyo Steering Systems
