5 ways of improving competitiveness of Indian industry

1. Innovation - Research and development

R & D expenditures in India are inadequate. India as a whole spends only 0.85 % GDP on research and development. Focus should be on development of indigenous technology, efficiency and adaptation of imported technologies. Also government has to come up with industrial and trade policies which will promote research and development. The industries should make alliances with educational systems for providing solutions to practical problems face by them. The alliances in business and education should focus on identifying creative, flexible partnership models between governments, industry, and the academic community. Industries should also provide necessary funding and infrastructure to set up laboratory in educational institutes. They should promote students for doing extensive R & D and acquiring patents. The renewable energy and sustainable resources track highlighted opportunities in the renewable and alternative energy sector that are keys to creating greater energy security and economic competitiveness.

2. Information Technology (IT) systems

Information technology (IT) is playing & will play a crucial role in Indian industries. It has transformed the whole world into a global village with a global economy, which is increasingly dependant on the creative management and distribution of information. IT provides the communication and analytical power that industries need for conducting trade and managing business at global level with much ease. IT will help industries to coordinate their worldwide network of suppliers, distributors and consumers. It will also help to develop global information systems that can track orders, deliveries, and payments round the clock.
Industries should gain the benefits of Information Technology (IT) systems that comprise the engineering to manufacturing continuum - systems essential to compete successfully in a demand driven environment. Strategic and tactical solutions to the many problems in this continuum require several integrated IT systems. Among them is product lifecycle management (PLM), product configuration, enterprise resource planning (ERP) and supporting IT infrastructure.
3. Improving quality, reducing cost and shortening lead-times

Quality often cannot be improved without major changes in Production processes. In discrete part manufacturing, the use of some key ideas from the Toyota Production System, which in turn require changes in layouts, process improvements and so on, will help industries to improve quality. Industries should give an exclusive focus on quality tools like SQC and SPC, or on programs like TQM and TPM (Total productive maintenance). Quality is largely a function of design. Without attention to product design, it is unlikely that improvement can be sustained. Quality products and services delivered by the industries will help them to provide products and services at reduced cost and at shorter lead time.
4. Demand based strategies

Many of the industries have not yet been able to tightly control inventories across the supply chain. They still appear to be using inventories to meet demand rather than developing quick response manufacturing to meet changes in market needs. The relationship between batch sizes, WIP and lead times is very close. Increase in batch sizes leads to higher WIP and longer lead-times. The key is to perform process analysis, de-bottleneck, reduce setup times and synchronize order release with throughput rates. In short, manufacturing has to become process oriented and keeping in mind the customer requirements. The pull system should be followed by industries considering customer requirement rather that push system where products are pushed in the market. Thus in short industries should follow demand base strategies.
5. Corporate governance
Through its impact on corporate competitiveness and access to global capital markets, corporate governance will play an increasingly important role for entrepreneurship, economic growth and employment. While corporate governance should remain primarily a private sector prerogative, governments have a distinct and important responsibility in providing a regulatory framework that allows investors and enterprises to adapt corporate governance practices to rapidly changing circumstances. It should encouraged credible regulations emphasizing fairness, transparency, accountability and responsibility.