Around 60 to 70 per cent of the Indian apparel manufacturing industry are MSMEs (Micro, Small and Medium enterprises). The majority of micro and small apparel manufacturing units have comparatively more challenges like limited resources, lack of experts, lack of technology innovation and adoption. Despite these challenges, they can improve their manufacturing processes. Vinay Advani, GM (IT), Texport Industries;Prabir Jana, Professor, NIFT;Tejas (Abhishek) Srivastava, Chief Technology Officer, Groyyo share solutions for such units which can be implemented with little effort and can contribute to good results.
Ecosystem and change in mindset
An overall uplifting ecosystem can be a starting point and it has to be created for manufacturing units where resources and technology are available. It has to be a collaborative effort where the manufacturers, vendors and innovators have to work as partners. And for this, there is a dire need to change the mindset of manufacturers and their business associates too.
“Factories have to work as an ecosystem, shift from thinking that ‘we are not as big’, ‘we are not ready’, ‘we need this!’, ‘this is our problem’. No entity is small enough to adopt a process, but the decision has to be made based on need not want or belief. For example, any automation will obviously be beneficial but it is also possible that at a particular time, one needs only 2 levels of automation and the other 10 levels are not needed. And the ecosystem should be able to fulfil the need. This involves identification of the problem and creation of pointed solutions, which is the responsibility of the whole ecosystem and not of an individual,” says Tejas.
He further adds that stakeholders like experts, vendors, technology and any other allied function have to clearly understand that the ecosystem develops only if manufacturing develops. Growth and failure will impact everyone. Thus, it is important to put the needs of the industry at the forefront.
It’s crucial to understand that the focus shouldn’t rest solely on the needs of a selected few within the industry. Instead, attention should be directed towards the wider needs of the industry as a whole. At present, solutions, business models and innovations are primarily founded on financial accounting principles. However, the unique needs of manufacturers often go unaddressed. As such, proactive measures must be adopted to assess and respond to manufacturers’ needs at every stage. A collaborative, facilitating ecosystem is one step forward towards this direction. Consequently, concerted efforts must be made to identify and cater to these needs effectively and efficiently.
MSME typically comes with trading mindset, which has to be changed. Government needs to incentivise the technological investment (both capex and opex) in some way or the other. Familiarisation with technology through awareness and accessibility is the key to higher technology adoption. We are still very poor in technology adoption, adds Prabir Jana.
He observes that MSME enterprises are now engaging consultants for specific help, participating in fairs for greater awareness which is a good sign. The abundant availability of ‘one-army’ consultants is doing good to the industry by making knowledge affordable!
Technology ideation and adoption
According to Prabir Jana, “The equation between the scale of business and technology investment is no more applicable as most of the tech investment are nowadays offered as service model reducing the risk of one time capital investment. The MSME definition puts asset to revenue ratio at 1:5 which incidentally fits well for medium to large enterprises engaged in garment manufacturing. Micro and small enterprises have a steeper ratio of approximately 1:7. Due to asset light model, the MSMEs (especially micro and small factories) are comparatively in a better position to exploit the SaaS technology today.”
Tejas is strongly of the view that a clear shift of technology ideation has to be carried out wherein a system should be built keeping in mind the limitations. This is essentially how the IT industry caters to the needs of a big corporate as well as a small BPO.
“Currently the technology in the industry is built with the aim of catering to large businesses with set SOPs. These systems try to solve multiple issues at one time which in turn complicates them. The new generation tech should be made with the view of handling the not-so-organised SOPs of small-scale factories. The system also has to be pointed to cater to one problem at a time and not try to solve many things at one time. The cost and solution should be simple with quick in-and-out fixes without compromising on the benefits,” he says.
There is no doubt that technology is complicated. But the current approach to solutions is also complicated. And the solution is to focus on making technology easy, personalised and shifting the ownership of adoption to technology innovators.
“Teams should find out the best suitable technological solutions like ERP, shop floor digitisation, planning tools, machine maintenance tools, 3D modelling and communication tools. The introduction of digital showrooms and catwalks has reduced the need to meet current or new buyers physically. 3D tools help designers understand fit better, reduce quality issues, abolish sending samples and speed up the approval process,” says Vinay.
ERP Software is easily available as per various requirements and the best use of it adds value to productivity, cost control and helps in getting closer to correct decisions. The shop floor system will collect important information like hourly production, WIP, production bottlenecks, quality control issues and other details from the shop floor and help to find out what is working and what is not working.This information will help to work on the improvement and address quality concerns promptly.
“Although the IT solutions are available as SaaS, the hardware machinery are still capital cost. Sometimes the specialised machinery are cost prohibitive for these MSMEs. The fashion-driven and seasonal nature makes the industry averse to capital investment in specialised equipment that are style-specific. On one hand, we have low utilisation of machinery, on the other hand, some specialised functions are outsourced. We need some start-ups to take up the challenge of providing the latest technology on rent at affordable cost”, Prabir Jana continues.
Significant focus areas
Setting and defining the process, operating procedure and standardised operation help align in the right direction. Defined production workflow, reduced wastage of efforts, manpower, materials and the non-value-added process help move towards lean and enhanced productivity thereby leading to optimisation of the capabilities.
Investment in human resource skill development/skill upgradation and refinancing existing resources add value to enhance productivity. Taking support through workshops/seminars from industry leaders also helps in a great way.
“Grooming of new talent must be an ongoing process. Empowerment and inclusivity at all levels generate a sense of belongingness towards the organisation. This strongly benefits the organisation,” concludes Vinay.
Prabir Jana feels, “The current hurdles for MSME sare the raw material sourcing (fabric etc.) related to MOQ and payment terms which are more favoured towards large enterprises. An intermediate model needs to be developed to facilitate easy access to raw material in short quantity and at quicker lead time.”
“Although MSMEs enjoys protection against delayed payments according to Government guidelines, I doubt the large buyers and retailers actually honour that,”concludes Prabir Jana.
