Winning the “Facility of the Year” - Award with an Indian Plant

The Indian economy has undergone several structural changes in the last decades. Beginning with the 1950s, India faced excessive regulation that characterized its industrial development policy for the next four decades. These regulations, set up to govern manufacturing capacity, products, technology etc. had the objective to prevent the developing and capital-scarce economy from costly over capacity. With the opening of India’s economy in the late 1980s inflows of knowledge, foreign technology, and capital has started. Local manufacturers expanded their production and the country became a center of interest for foreign competitors. Moreover, a lack of sufficient import regulations evoked the structural change of the Indian economy. In 1991, India introduced a new set of reforms that substantially reshaped the competitive environment for both domestic and foreign companies. Due to the abolition of India’s license regime, protectionism and control measures came to an end and brought the manufacturing sector at a critical juncture (Dangayachy and Deshmukh 2001). However, although the perception of manufacturing in India as a support activity for marketing and finance rather than the vital value creation of a company is gradually changing, today’s manufacturing still lacks attention of senior management (Chandra and Sastry 1998). Therefore, it’s no wonder, that most companies in India are still far from practices summarized under the umbrella of world class manufacturing (Dangayachy and Deshmukh 2001). Meanwhile, international competitors improve their manufacturing functions continuously, market new products in the country, and thus increase the flexibility and responsiveness of the entire Indian manufacturing sector. As such, the domestic Indian economy experiences rising competition from both multinationals entering the market and from imported goods. This new competition is characterized by the simultaneous combination of a wider range of products – mostly coming with higher performance, reduced cost, improved quality, and better services (Chandra and Sastry 1998; Dangayachy and Deshmukh 2001).