The manufacturing industry in India is experiencing expansion, fueled largely by potential government initiatives such as Make in India and Atmanirbhar Bharat. However, the success or failure of any manufacturing business is not based only on the machines, manpower, or other resources at their disposal, but on the quality of management on a daily basis.
Many manufacturing businesses in India, especially SMEs, do not have an issue with a lack of supply but rather with the quality of their management. If manufacturers want to scale their business and create a profitable and sustainable business, then they need to establish a structure around the principles of business management.
Top 10 Business Management Principles
1. Clarity of Vision and Goals: A manufacturing business must have a clearly articulated vision and it must set measurable goals. Whether that goal is to increase capacity, produce with zero defects, or enter new markets, every employee must understand why they are working and what they are working for. When this is unclear, daily decisions become aimless.
2. Strong Financial Discipline: Cash flow is the heartbeat of manufacturing. Many manufacturers in India incur losses not due to lack of demand but due to lack of financial management, for example, late payments, extended credit cycles, or lack of budgets.
- Exercise firm control over receivables and payables.
- Review cost sheets, margins, and working capital regularly.
- Employ accounting software for accurate, real-time information.
3. Prioritize Quality and Process Discipline: In India, many SMEs often take a hit on quality in order to save on costs. This can result in more rejections, a bad reputation and a lack of trust for their customer base. Establishing standardized processes via Good Manufacturing Practices (GMPs) and utilization of quality checkpoints will always guarantee consistency and long-term profit.
4. Effectively Manage Supply Chain & Inventory: Raw material delays or incorrect stock levels can completely halt production. Therefore, manufacturers should consider:
- Just-in-time (JIT) principles (where applicable).
- Engaging with vendors that guarantee supply.
- Leveraging technology to track inventory.
An effective supply chain leads to increased levels of productivity and customer satisfaction.
5. Investments in Technology & Automation: Indian manufacturers may feel uneasy when contemplating investments in technology, as they are often cost-sensitive. Even small investments in automation, ERP, or IoT monitoring can lead to large reductions in waste, downtime and human error; thus allowing for more competitiveness on a global scale.
6. Importance of Skilled Manpower and Training: Although machines, technology, and processes are very important, skilled, critical thinkers are equally important to enhance the productivity and efficiency of the organization. Regular training on safety, new technologies and process improvement will create a more efficient, loyal, and innovative workforce.
7. Sales and Marketing Orientation: This is the area in which many Indian manufacturers have difficulty operating. When sales and marketing de-prioritize production, they rely too heavily on in-person networks or distributors for sales. Make sure you have an intentional sales team ready to market the business without a current inventory of products.
8. Customer Orientation: Repeat orders are the foundation of any manufacturing unit. Sustainable growth is created by building relationships through after-service, timely delivery, and customizing specific solutions. Customer feedback collected daily and dealing with their pain points should be part of the management culture.
9. Compliance and Risk Management: Ignoring labor laws, safety regulations, or environmental laws can immediately shut down a business. Indian manufacturers need to stay current with statutory compliances, insurance, and safety. Risk management also requires managing your client list so you’re not relying on a few clients for work.
10. Continuous Improvement & Innovation: Markets are changing and holding onto the past is just as bad as neglecting to evolve. Indian manufacturers should consider Kaizen (continuous improvement) and encourage investment in R&D. A small change to process or design can create tremendous competitive advantage and substantial profitability.
Conclusion
Managing a manufacturing company in India requires more than just production; it requires discipline, financial vigilance, attention to people, and a customer-driven innovation focus. By applying the above-mentioned business management principles, manufacturing companies in India can run more productively, efficiently, and profitably and compete globally. The companies that will become successful in the next few years will not be the ones with the biggest factory; they will be the companies that are managed better than their competitors.