Auto Component Industry Research Articles

Lean manufacturing implementation using value stream mapping as a tool

Purpose – Value stream mapping (VSM) is a lean manufacturing (LM) tool used for analyzing material and information flow on a specific product family. The purpose of this article is to address the importance of VSM in LM environment in an Indian auto components industry. Design/methodology/approach – The case study approach has been used to show the applicability and importance of VSM in an Indian auto components company, in which the current state of manufacturing is mapped with the help of VSM symbols. According to the current state mapping, the study conducted analysis and identifies the area of improvement needed in terms of work in process, lead time and cycle time. The study further implemented kaizen on the current state map and developed future state map while including these kaizens. Findings – The study clearly shows that the VSM brings out the positive impact on process ratio, TAKT time, process inventory level, line speed, total lead and process time and reduced man power. It is helping the company in satisfying their customers with respect to quality, cost and delivery. Research limitations/implications – The main limitation of the study is the confined focus on a single industry. The case should be extended to other industries in order to support the findings and for the purpose of the wider generalization. Practical implications – The results obtained from the study will help other industries and sectors to implement VSM in LM environment. Originality/value – The article deals with a real case study, which shows application of VSM for implementing lean principles.

Compressed New Product Development Cycle & its Impact on Outsourcing Decisions in Auto Component Industry

The compulsion to continuous development of new product has resulted in compressed product life cycle.A consequence of this compressed product life cycle is the time crunch or the “schedule pressure” that the new product development (NPD) team in a companyconfronts. The time-to-market or schedule pressure can be one of the main reason of increasing outsourcing activities related to NPD as outsourcing brings together multiple best-in-class suppliers work simultaneously on individual components of a system a nd

Strategic Technology Management in Indian Auto Component Industry

Strategic Technology Management in Indian Auto Component Industry

Effect of Quality Management Systems and Total Quality Management on Productivity Before and After: Empirical Evidence from the Indian Auto Component Industry

We study the linkages between firm‐level quality initiatives such as quality management systems (QMS) and total quality management (TQM) and output productivity in the Indian auto component industry. We use externally validated quality certification and quality awards as proxies for QMS and TQM, respectively, as it is difficult to directly measure the QMS and TQM efforts of firms. We use an unbalanced panel of 220 firms and a balanced panel of 73 firms from the Indian auto component industry over the period 1993–2006 to study these links. Both parametric as well as non‐parametric approaches are used, as appropriate, to measure the rate of change in productivity and the impact of quality initiatives on productivity change during this period. We determine the proportion of productivity resulting from technical change and relative efficiency change, thus providing insights into the structure of productivity improvements. We find that TQM efforts resulted in a high rate of productivity change (11%) in the award‐winning firms after the award. On the other hand, pre‐certification productivity change due to QMS was 5% and post‐certification change was 3.6%. In the periods prior to certification, productivity change was driven mainly by technical change; whereas the source of productivity change after certification is mixed. However, prior to awards, productivity change was driven mainly by relative efficiency change, whereas post‐award productivity change was due to technical change. The results suggest that management focus on attaining certification did generate conceptual learning (linked to technical change) during the period leading to certification, but these effects were not significant after certification. The results also suggest that the TQM programs generated significant productivity gains in the long run, although setting the associated systems in place did not result in significant productivity change prior to winning awards. Thus, the study provides direct but nuanced evidence linking quality certification as well as the adoption of TQM programs to the associated conceptual and operational learning processes and their impact on the change in productivity.

Green supply chain management for the SME automotive suppliers

With the rise of environmental awareness, regulations in various countries become stricter, which consequently results in environmental pressures. In this study, we analyse the relationship of green supply chain management (GSCM) and institutional pressures with environmental performance of firms in the auto component industry, as well as the relationship between small and medium enterprises (SMEs) and corporate social responsibility (CSR). Moreover, we study 224 firms in Taiwan by means of questionnaires and the results show that investment recovery and eco-design in GSCM as well as normative pressures in institutional pressures positively relate to a firm’s environmental performance. Moreover, SMEs tend to do more external GSCM practice and internal environmental management.

A cloud computing-based framework for internationalisation of SMEs

The paper examines the current growth rate of the Indian auto component industry and its contribution to the global markets. Recent researches have concluded that low and ineffective adoption of IT by the manufacturers is one of the primary reasons of the dismal contribution of the sector to the export markets. Majority of the firms operating in this sector are small and medium enterprises (SMEs) who cannot afford to invest in world class IT solutions. The diversity and tiered structure of the industry further complicates the process of adoption of IT practices. The paper presents a community cloud-based framework for crafting the IT strategy and further accelerating the adoption of IT among the Indian auto manufacturers. It also shows how the framework can be used for achieving effective supply chain integration in the sector.

Quality management in new automotive supply chains: a study of select Indian auto component SMEs

As the Indian auto component industry has matured, SMEs have emerged as strong contributors to the overall output of this industry in the country and have a significant share in the exports of the industry. The present paper aims to study the extent of quality management implementation in Indian auto component SMEs and to further examine the association between organisational cultural values and the extent of quality management principles practiced in this sector. Results indicate a higher level of implementation of all quality principles in these SMEs. In addition, values of organisational culture and principles of quality management were found interrelated; however, each dimension of culture is related to seven quality management principles in different manner.

Sustainable Development in Indian Automotive Component Clusters

India is the world’s second fastest growing auto market and boasts of the sixth largest automobile industry after China, the US, Germany, Japan and Brazil. The Indian auto component industry recorded its highest year-on-year growth of 34.2 % in 2010–2011, raking in revenue of US$ 39.9 billion; major contribution coming from exports at US$ five billion and fresh investment from the US at around US$ two billion. For inclusive growth and sustainable development most of the auto components manufacturers has adopted the cluster development approach. The objective is to study the technical efficiency (θ), peer weights (λ i ), input slacks (S−) and output slacks (S+) of four Auto Component Clusters (ACC) in India. The methodology adopted is using Data Envelopment Analysis of Input Oriented Banker Charnes Cooper Model by taking number of units and number of employments as inputs and sales and exports in crores as an outputs. The non-zero λ i ’s represents the weights for efficient clusters. The S > 0 obtained for one ACC reveals the excess no. of units (S−) and employment (S−) and shortage in sales (S+) and exports (S+). However the variable returns to scale are increasing for three clusters, constant for one more cluster and with nil decrease. To conclude, for inclusive growth and sustainable development, the inefficient ACC should increase their turnover and exports, as decrease in no. of enterprises and employment is practically not possible. Moreover for sustainable development, the ACC should strengthen infrastructure interrelationships, technology interrelationships, procurement interrelationships, production interrelationships and marketing interrelationships to increase productivity and efficiency to compete in the world market.

Effect of QMS and TQM on Productivity Before and After: Empirical Evidence from the Indian Auto Component Industry

We study the linkages between firm level quality initiatives such as Quality Management Systems (QMS) and Total Quality Management (TQM) and output productivity in the Indian auto component industry. We use externally validated quality certification and quality awards as proxies for QMS and TQM respectively, since it is difficult to directly measure the QMS and TQM efforts of firms.We use an unbalanced panel of 220 firms and a balanced panel of 73 firms from the Indian auto component industry over the period 1993 to 2006 to study these links. Both parametric as well as non parametric approaches are used, as appropriate, to measure the rate of change in productivity and the impact of quality initiatives on productivity change during this period. We determine the proportion of productivity resulting from technical change and relative efficiency change, thus providing insights into the structure of productivity improvements. We find that TQM efforts resulted in a high rate of productivity change (11%) in the award winning firms post-award. On the other hand, pre-certification productivity change due to QMS was 5% and post-certification change was 3.6%. In the periods prior to certification, productivity change was driven mainly by technical change; while the source of productivity change post-certification is mixed. However, prior to awards, productivity change was driven mainly by relative efficiency change while post-award productivity change was due to technical change. The results suggest that management focus on attaining certification did generate conceptual learning (linked to technical change) during the period leading to certification, but these effects were not significant post-certification. The results also suggest that the TQM programs generated significant productivity gains in the long run, although setting the associated systems in place did not result in significant productivity change prior to winning awards. Thus, the study provides direct but nuanced evidence linking quality certification as well as the adoption of TQM programs to the associated conceptual and operational learning processes and their impact on the change in productivity.

Innovative Resources and Capabilities in Emerging Economies – Their Impact on Firm Performance

Innovative resources and capabilities have been found to be essential to climb up the value chain in most industries. However, development of innovative resources and effective deployment of these resources requires significant investments on a sustained basis, which is a difficult task for domestic firms in many emerging economies, especially if they operated with obsolete technologies under protected regimes for long periods of time. To understand how and what type of resources and capabilities are developed in emerging economies, which are going through institutional transitions from protected to liberalized regimes, we examine various management theories and propose a conceptual framework that integrates relevant theories and helps us study the process of resource and capability development. Based on the existing literature on resource based view and dynamic capability approach, we also frame certain hypotheses on innovative resources and capabilities and their impact on firm performance. We collected primary and secondary data from the Indian auto component industry to test these hypotheses and carried out detailed interviews with industry experts to understand the industry dynamics and the results from our data analysis. We use the proposed conceptual framework and qualitative inputs from industry experts to explain our empirical results which provide very interesting insights into the selection and development of innovative resources and capabilities by the emerging economy firms and their impact on various measures of firm performance.

Catch-up strategies in the Indian auto components industry: Domestic firms’ responses to market liberalization

Market liberalization in emerging-market economies and the entry of multinational firms spur significant changes to the industry/institutional environment faced by domestic firms. Prior studies have described how such changes tend to be disruptive to the relatively backward domestic firms, and negatively affect their performance and survival prospects. In this paper, we study how domestic supplier firms may adapt and continue to perform, as market liberalization progresses, through catch-up strategies aimed at integrating with the industry's global value chain. Drawing on internalization theory and the literatures on upgrading and catch-up processes, learning and relational networks, we hypothesize that, for continued performance, domestic supplier firms need to adapt their strategies from catching up initially through technology licensing/collaborations and joint ventures with multinational enterprises (MNEs) to also developing strong customer relationships with downstream firms (especially MNEs). Further, we propose that successful catch-up through these two strategies lays the foundation for a strategy of knowledge creation during the integration of domestic industry with the global value chain. Our analysis of data from the auto components industry in India during the period 1992–2002, that is, the decade since liberalization began in 1991, offers support for our hypotheses.

Strategic technology management in the auto component industry in India

Purpose – The automobile industry in India is one of the sunrise industries and is poised to enhance its contribution from 5 percent of GDP in 2006 to 10 percent by 2016. The auto component industry in India has grown hand in hand with the industry and is in the process of transforming itself from being a “Job order fulfiller” to being an “Integrated organization”. With the liberalization process having started in 1991, most auto component manufacturers in India have chosen the easy path of attempting to progress on operational or manufacturing capabilities. For advancing on technology capability dimension, they mostly relied on international collaborations. The purpose of this paper is to study the strategic technology management (STM) practices in select case organizations in the auto component industry in India.

Six Sigma implementation in Indian medium scale automotive enterprises – a review and agenda for future research

The increase in demand of the growing customer looking for a better quality of product has compelled corporations to adopt Six Sigma in order to improve the quality for enhanced competitive advantage. This research article focuses on the current empirical study of the Indian medium scale automotive industries along with the scope of implementing Six Sigma. The data analysis will highlight that the Indian auto component industry has rapidly grown, catering to the expanding domestic market and exporting to the external replacement market, as well as a number of SMEs in the auto component industry which have increased due to new entry. Information about the research findings along with the use of quality tools for problem solving tools are discussed along with elaboration of research methodology. This paper will propose the need for the development of Six Sigma framework and necessity for implementing Six Sigma for better business opportunity with regards to Indian medium scale automotive organisations in the current competitive era.

Strategic technology management practices in select auto component joint ventures in India: a case study using SAP-LAP methodology

The automobile industry in India has gone through a lot of transformation since inception. With the liberalisation process starting in 1991, the industry has seen the entry of global auto majors in India. Due to changing customer preferences, environmental regulations, concern for safety and inclination towards entertainment, the role of technology in the auto industry has assumed great significance. In line with the global auto and auto component industry, the auto component companies in India has also gone in for technical alliances (TA), joint ventures (JV) with global auto component manufacturers, which seems to have impacted their technology management practices. This paper covers the longitudinal study of technology development at two joint venture auto component manufacturers. The methodology employed for this study is a combination of literature survey, expert opinion, comparative case analysis and SAP-LAP, a flexible systems methodology. The study finds that effective strategic technology management can contribute to faster technology absorption and overall business performance. The two cases provide valuable insights into the strategic technology management practices in joint venture organisations and exhibit the methodology adopted by the companies in their evolutions towards becoming the world-class integrated organisations.

Determinants of competitiveness and their relative importance: a study of Indian auto-component industry

A focused study on determinants of competitiveness for Indian automotive component industry in special context to supply chain activities is presented. The paper delineates the relative importance of various determinants of competitiveness by using analytic network process (ANP). A set of 24 determinants identified through a survey and face-to-face interviews is presented. The survey results find that customer demand to be the most important element for the competitiveness. It further unveils dependency among all the 24 metrics of competitiveness prompting the need for trade-offs amongst the factors. The proposed methodology and findings of the research can provide the supply chain managers and strategists with an important business intelligence and analytical tool to integrate their supply chain strategy with corporate strategy considering the impact of individual factors on overall industrial growth.

Self‐managed teams in the auto components industry

PurposeThe overall purpose of this paper is to explain theoretically the autonomy phenomenon of teams working within the auto manufacturing context and its implications for the technical and social aspects of group work.Design/methodology/approachThree auto component companies were studied. The procedures of a qualitative methodology were followed, adopting naturalistic observation techniques of work teams, and unstructured and semi‐structured interviews conducted with operators, supervisors and middle managers. To analyse and interpret the qualitative data obtained, the grounded theory technique was used.FindingsIn this paper 33 concepts were obtained, which resulted from the constant comparative method applied to data. The relationships between those concepts allowed the construction of a theoretical model that is settled in the “bridge” concept. This “bridge” is a metaphor that translates the process which binds operational work group goals to the needs of external clients. This process is supported by social aspects – team decision making, participation, mutual helpfulness, and social and emotional relationships, and by technical aspects – operations and information. The bridge has four pillars that are critical to the effective functioning of self‐directed teams: team facilitation, hierarchical relationships established within the teams, quality of manufactured components, and productivity achieved.Research limitations/implicationsThe present investigation was carried out in a specific industry, which does not allow for the generalization of the model to other industries. Furthermore, it may be questioned whether the same results be obtained if the operators of the teams observed were interviewed, not individually, but in a group situation. Other kinds of research design and other industries organized on the basis of autonomous work groups must be studied, applying the grounded theory technique, in order to compare diverse theoretical models.Practical implicationsThe organization of the industrial automotive production based on self‐directed teams, which know the needs of external customers and to whom a high level of participation in operational decisions was given, can generate a substantial increase of working groups' efficiency and an increase in job satisfaction.Originality/valueThe study of teams in the automotive components industry – in a southern country of Europe – and the consequent elaboration of a specific theoretical model draws attention to the need for social research that takes into account the fact that realities are constructed by the actors who interact in a certain context. No theoretical model can ever encompass the reality of all contexts.

Development of index for measuring leanness: study of an Indian auto component industry

PurposeThe extant literature fails to provide an efficient method to measure leanness of any manufacturing firm. The purpose of this paper is to discuss the concept of leanness and to provide an efficient measurement method for measuring leanness.Design/methodology/approachMeasurement method is based on the judgment and evaluation given by leanness measurement team (LMT) on various leanness parameters such as supplier's issues, investment priorities, Lean practices, and various waste addressed by lean and customers' issues. Further fuzzy set theory is introduced to remove the bias of human judgment and finally defuzzification is done and results are presented in the form of leanness index.FindingsLeanness indices have been developed and presented separately on 100 points scale for all parameters of leanness i.e. LISuppliers = 47.98, LIInvestment = 50.66, LIpractices = 58.38, LIWaste = 60.01, LICustomers = 47.1.Research limitations/implicationsThis leanness measurement method used the views of experts and may contain human judgment error.Practical implicationsIt will be helpful to both academician and practitioners as an assessment tool for evaluation of lean status of any industry utilized.Originality/valueLeanness measurement method based on judgment of experts is used first time for evaluation of leanness.

Assessing innovation quotient (InQ) of Indian auto component manufacturers

Innovation is imperative today as a key tool for creating winning organisations globally. With many global auto players setting up operations in India in the last ten years, Indian companies are now exposed to manufacturing excellence techniques used globally. They need to scale up on innovations to remain competitive and create winning organisations. It would also be important to assess where we stand, identify areas of improvements with respect to global benchmarks and then workout an action plan to have a transition to global levels to build winning organisations. This paper, through an exploratory empirical study, identifies drivers of innovation through a cross sector study. Further, it attempts to probe as to where does Indian auto component industry stand on innovation by suggesting an innovation quotient (InQ) and then measuring them over InQ; what are the enablers and barriers of innovation and what strategy should the industry and the company adopt to accelerate innovation and have transition to reach global benchmarks to create world class winning sustainable organisations.

Inching towards global competitiveness: Adoption of Advanced Manufacturing Technologies (AMTs) in Indian auto components industry

The purpose of the paper is to analyse the nature and patterns of adoption of Advanced Manufacturing Technologies (AMTs) in the Indian auto components industry in light of the policy changes in India and changes in world automotive industry. We empirically investigate the determinants of AMT adoption in order to tease out the parameters of technological change. The process of technology diffusion is dynamic and appears to have been driven by an apparent objective of steering the industry in the direction of an innovation-driven industry. The evolution of the industry in the light of these is discussed and relevant policy implications are spelled out in the paper.

The Indian auto component industry – Estimation of operational efficiency and its determinants using DEA

In this paper, the performance analysis of the Indian auto component industry is carried out from the perspectives of an original equipment manufacturer and a component supplier. Various efficiency measures are estimated using Data Envelopment Analysis with publicly available financial data on a representative sample of 50 firms. The first stage analysis reveals various operational inefficiencies in the auto component industry which are subsequently decomposed into technical, input mix and scale efficiencies. The study finds evidence that a majority of the inefficient firms are operating in the diminishing returns to scale region and demonstrates potential savings through benchmark input targets. A second stage analysis aimed at exploring root causes of inefficiencies finds that substitution of labour for capital could be causing a variety of inefficiencies including the input mix inefficiency in the Indian component industry. The empirical results also suggest that, unlike the global auto supply chain, higher average inventories are required for higher operational efficiencies in the Indian context. Contrary to the popular expectations, the technology licensing does not show significant influence on efficiency, at least in the short term, whereas efficient working capital management does result in higher operational efficiencies. The study also unearths the need to reform labour laws which are significantly contributing to various inefficiencies in the Indian component industry.