Indian Manufacturing Research Articles

Interpretive Structural Modelling Approach to Evaluate Knowledge Sharing Enablers in Circular Supply Chain: A Study of The Indian Manufacturing Sector

Interpretive Structural Modelling Approach to Evaluate Knowledge Sharing Enablers in Circular Supply Chain: A Study of The Indian Manufacturing Sector

Impact of Firm-Specific and Macroeconomic Determinants on Environmental Expenditures: Empirical Evidence from Manufacturing Firms

This research aims to examine the association between firm-specific and macroeconomic determinants and environmental expenditures in the Indian manufacturing sector. Furthermore, it seeks to investigate the moderation effect of country-level governance and economic development on the association between macroeconomic, firm-specific, and environmental expenditures. The current study is based on 70 manufacturing firms for the period of 2011 to 2021. The dependent variable is environmental expenditures and the independent variables are firm-specific and microeconomic determinants. The results revealed that market capitalization and firm size have a positive and significant impact on environmental expenditures. On the other hand, inflation and the rule of law negatively and significantly affect environmental expenditures. Regarding the moderation effect, the results revealed that the rule of law and GDP positively moderate the association between inflation and environmental expenditures. Hence, this research has significant implications for corporate executives, financial experts, regulators, and other interested parties.

Digital twins' readiness and its impacts on supply chain transparency and sustainable performance

PurposeProduction systems occupy geographically dispersed organizations with limited visibility and transparency. Such limitations create operational inefficiencies across the Supply Chain (SC). Recently, researchers have started exploring applications of Digital Twins Technology (DTT) to improve SC operations. In this context, there is a need to provide comprehensive theoretical knowledge and frameworks to help stakeholders understand the adoption of DTT. This study aims to fulfill the research gap by empirically investigating DTT readiness to enable transparency in SC.Design/methodology/approachA comprehensive literature survey was conducted to develop a theoretical model related to Supply Chain Transparency (SCT) and DTT readiness. Then, a questionnaire was developed based on the proposed theoretical model, and data was collected from Indian manufacturers. The data was analyzed using Confirmatory Factor Analysis (CFA) and Structural Equation Modelling (SEM) to confirm the proposed relationships.FindingsThe findings from the study confirmed a positive relationship between DTT implementation and SCT. This study reported that data readiness, perceived values and benefits of DTT, and organizational readiness and leadership support influence DTT readiness and further lead to SCT.Originality/valueThis study contributes to the literature and knowledge by uniquely mapping and validating various interactions between DTT readiness and sustainable SC performance.

Evaluation of competency dimensions for employee performance assessment: evidence from micro, small, and medium enterprises

PurposeIn recent years, there has been a growing emphasis on competency-based systems as a means of assessing employee performance. These systems assess the degree to which the competencies of employees align with the requirements of their employment positions. This study aims to identify, prioritize, and make contextual interrelationships of the competency dimensions that are relevant for evaluating employees in the context of Indian manufacturing MSMEs.Design/methodology/approachThese dimensions were identified through an extensive literature review and interviews with industry experts. Further, a mixed-methods approach, including the “Bayesian Best-Worst Method” (BBWM), is applied for prioritizing important dimensions, whereas for making mutual relationships, the “Interpretive Structural Modeling” (ISM) method is utilized. “Matrice d'impacts croisés multiplication appliquée á un classment” (MICMAC) is also known as “cross-impact matrix multiplication applied to classification” is used for clustering competency dimensions based on their “driving power” and “dependence power”.FindingsThe findings reveal that among the primary dimensions, “creative performance,” and among the sub-dimensions, “innovative behaviors,” are the most critical competency dimensions for an employee assessment. The study also found that “smart working”, “factual and theoretical knowledge”, “empathy at work”, “understanding of specific knowledge”, and “engagement ideas and activities” are the main dimensions driving employees' competency.Originality/valueThis paper provides contribution to the competence literature by identifying and evaluating competency dimensions for assessing employees' performance within manufacturing MSMEs in an emerging economy such as India. The study also assesses the rank and contextual relationship between the identified dimensions as no past research focused on the same by using BBWM and ISM in the Indian manufacturing MSMEs context.

Is There Any Link Between FDI and Profitability in the Indian Manufacturing Sector?

Although a plethora of studies examine the determinants of profitability, this study adds to existing literature by assessing whether foreign direct investment (FDI) inflows make any significant contribution to profitability. To do so, the article uses disaggregated annual data relating to the Indian manufacturing sector 2012−2019. Results obtained from employing panel data models showed that FDI inflows have a positive and significant impact on profitability. Further, our results indicate that FDI affects profitability only in the long run but not in the short run. Capital intensity and size do not affect the profitability of the Indian manufacturing sector. From a policy perspective, it is imperative for manufacturing industries in India to attract more FDI inflow in order to boost profitability in the long run.

Does carbon intensity affect technical efficiency? An empirical assessment of manufacturing industries in Maharashtra, Odisha, and India

Technical progress has a tremendous potential to reduce carbon dioxide emissions by reducing energy consumption, a major concern across production units. However, the existing empirical literature concerning technical efficiency and carbon intensity is scanty. Thus, this paper examines the relationship between technical efficiency and carbon intensity for the organized manufacturing sector of two states, Maharashtra and Odisha, and the all-India level from 2001 to 2018. The paper uses data envelopment analysis to estimate technical efficiency scores. It applies the 2006 Intergovernmental Panel on Climate Change Tier 1 methodology for estimating carbon intensity for each 3-digit manufacturing industry in all three sample cases. The study has used static panel regression and fractional logit regression techniques to examine the deterministic relationship between technical efficiency and carbon intensity. The result shows that technical efficiency is highly sensitive to carbon intensity in the Indian manufacturing industries. The findings also addressed that the size of the industries also reduces the technical performance of manufacturing units. This paper also confirmed that increased profit could boost the Indian manufacturing industries’ technical efficiency. Thus, this study addresses that carbon intensity as a proxy for the manufacturing sector’s potential to affect climate change plays a crucial role in explaining the technical efficiency variations across industries. Thus, it calls for better policies aimed at reducing the emissions of industries specifically to achieve sustainable growth for the Indian manufacturing sector.

Investigating smart manufacturing process implementation in the Indian manufacturing industries using tecnomatix and response surface methodology

Investigating smart manufacturing process implementation in the Indian manufacturing industries using tecnomatix and response surface methodology

From intentions to action: how behavioural intentions shape employee performance through digital learning?

PurposeThis study aims to explore the impact of “Performance Expectancy” (PE) on the performance of Indian automotive manufacturing employees through their “Behavioural Intention” (BI) in the context of digital learning within the volatile, uncertain, complex and ambiguous (VUCA) world.Design/methodology/approachA descriptive research design was adopted to gather data from 211 employees of Indian automotive manufacturing companies. Structural equation modelling was applied for data analysis and obtaining results.FindingsLargely, the findings indicate that BI does mediate the relationship between PE and employee performance (EP) in the context of the Indian automotive manufacturing sector. The findings would help in boosting digital learning initiatives, improving EP and fostering organizational success in the VUCA world.Research limitations/implicationsThe current study focused on the Indian manufacturing industry. Extending the research beyond the manufacturing sector to other industries in India could possibly help in generalizing the findings, and thereby enhance knowledge of the broader consequences of digital learning on EP.Practical implicationsDigital learning platforms can enhance sustainable industrialization in the manufacturing sector by providing employees with access to digital learning opportunities. Managers must provide employees with access to digital learning opportunities for making them more creative and innovative, so that they can become real change agents, and can handle real-world problems more efficiently, leading the organization to deal with the complexities and unpredictability in this VUCA world.Originality/valueWithin the ambits of Indian automotive manufacturing organizations, there have been limited research studies that have used two constructs of the UTAUT2 framework to see their impact on EP in terms of digital learning. Thus, based on the limited information available, this research stands as a pioneering effort in the realm of digital learning within the Indian automotive manufacturing industry, where the relationship between PE and EP is examined through the mediational role of BI of employees. Moreover, this research possibly would pave the way for further research studies on exploring the role of potential factors influencing the strength and direction of the relationships between these variables (PE and EP).

Exploring the impact of green entrepreneurial orientation on sustainable performance: insights from CSR, policy and innovation

PurposeIn recent years, “Corporate Social Responsibility” (CSR) has gained significant traction as a strategic concept embraced by business managers. However, there remains a dearth of comprehensive research exploring the impact of CSR on “Green Entrepreneurial Orientation” (GEO), a firm’s sustainability performance, and their interplay with other influential factors. Therefore, this study aims to explore how CSR, “Policy Awareness” (PA), and “Personal Innovativeness” (PI) influence GEO and “Sustainable Performance” (SP). The research also delves into understanding the mediating role of GEO and how this mediation is moderated by “Green Innovation” (GI).Design/methodology/approachDrawing from the “natural resource-based view” (NRBV) theory and employing “partial least square structural equation modeling” (PLS-SEM), the study analyzed a sample of 137 Indian manufacturing “micro, small, and medium enterprises” (MSMEs).FindingsThe results underscore the positive associations of CSR and PA with both GEO and SP. Additionally, the findings highlight the moderating effects of GI in enhancing firms' sustainability performance. The moderated mediation analysis reveals that CSR significantly contributes to SP by fostering the adoption of GEO.Research limitations/implicationsThese study outcomes offer valuable insights for policymakers, managers, and entrepreneurs, emphasizing the importance of crafting effective CSR strategies intertwined with innovativeness to cultivate a conducive green entrepreneurial ecosystem in businesses aligned with sustainable development goals.Originality/valueThere is a paucity of research on the determinants of GEO within the context of manufacturing MSMEs, especially in developing and underdeveloped nations. Furthermore, no previous study has delved into the factors that underlie GEO using a moderated mediation framework, particularly within the Indian manufacturing MSMEs landscape.

Mediating factors and spillover effects of foreign direct investment : Evidence from Indian manufacturing firms

The present study examines the extent and direction of horizontal, backward and forward spillover effects of FDIs on firms' productivity. It also shows how the mediating factors (firm's age, export and import intensity, R&D and advertisement intensity) contribute to the firms' productivity. Further, the study also uncovers the importance of the ownership patterns of the firms that affect the spillovers. It uses a balanced firm-level panel data set from the Indian manufacturing industries over the available period 2003 to 2016 to examine the inter- and intra-industry spillovers of the FDIs. The estimation methods used in this study are the fixed effects approach and the generalised method of moments. The study also applies the Levinsohn-Petrin method to compute firm-level productivity. It finds a significant positive spillover backward effect and confirms the supportive role of the mediating factors in augmenting the spillover channels. However, the results do not support the existence of horizontal and forward FDI spillover effects for the overall manufacturing industries. They suggest that a comprehensive policy package approach be used, thereby underlining the importance of all channels of the FDI spillover effects and their relations to the downstream sector, particularly by keeping the performance of the firms and their external links in perspective.

Aggregate productivity, economic fluctuations, and export orientation: Evidence from India

Understanding the cyclicality in aggregate productivity helps answer whether the economy allocates resources efficiently or not. The paper analyses the sources of aggregate productivity growth, such as direct efficiency gain within-plants, allocative efficiency gain, and gains due to entry and exit during economic fluctuations. In particular, we exploit the economic shock of the Great Recession to analyse the validity of the 'Cleansing’ or ‘Scarring’ effect of recession and 'Schumpeterian Darwinian Selection' for Indian manufacturing. The rise and fall of within-plant and net-entry effects during the economic fluctuations explains the pro-cyclicality of productivity growth. Plants in export-oriented industries are crucial in explaining the pro-cyclicality. Negative external shock to exporting sectors during 2008–09 shifted resources from more productive to less productive plants. The relatively productive exporters exited the markets following the global crisis, scarring the economy. Nonetheless, the positive effect from the net-entry exit of plants during the economic downturn makes the 'Schumpeterian approach of Darwinian Selection' valid.

What explains exit in Indian manufacturing industries?

PurposeThe purpose of this paper is to investigate the likelihood of firm exit, focusing on firm- and sector-specific factors and other potential constraints that may lead to exit.Design/methodology/approachThe authors address the main research question by using hazard-cox and probit models on plant level data for the period 1998–1999 to 2012–2013, drawn from the Annual Survey of Industries collected by the Central Statistical Organisation.FindingsThe authors find that probability of exit reduces with improved firm performance. Urban firms, proprietary firms and smaller firms are more likely to exit as compared with their respective counterparts. The findings are robust to alternate measures of performance, alternate specifications and different methods.Originality/valueStudies of entry and exit rates at a point in time are useful in examining the turnover of establishments. But to understand the establishment survival, the authors must also examine the probability of firm exit and the possible determinants that aid exit. There are institutional factors that prevent easy exit of firms from an industry. It would be worthwhile to see how the exit rate will be impacted if these barriers ceased to exist. In this study, the authors construct a model of exit, which would help us to predict firm exit.

Analysis of barriers to the implementation of circular economy in an Indian electric vehicle batteries manufacturer

Analysis of barriers to the implementation of circular economy in an Indian electric vehicle batteries manufacturer

Validation of Lean–Green–Six Sigma practice model for improving performance and competitiveness in an Indian manufacturing industry

Validation of Lean–Green–Six Sigma practice model for improving performance and competitiveness in an Indian manufacturing industry

Does Working Capital Management Affect Financial Performance: Empirical Evidence of Indian Manufacturing Sector?

This research aims to analyse the Working Capital Management affects financial performance in Indian manufacturing sector. This research employs secondary data for data collecting from BSE, which comprises 20-year financial data from 2003 to 2022 using the sample of 419 companies. The study used descriptive statistics, random effects, and fixed effect models to define the sample and evaluate the influence of working capital management on manufacturing industry. Findings suggested that working capital management proxies have a major impact on the financial performance of the company. Proxy of CCC indicates that negative and significant impact of GOP, NPM, and NPR. The coefficient of ICP indicates that negative and significant relation between firm performances. In addition, we discovered a statistically significant inverse relationship between APP and GOP and NPM and NPR, suggesting that the more quickly a company in our sample pays its bills, the less profit it generates. The above table demonstrates that RCP has a positive and significant alliance with GOP. To the best of the author’s knowledge, this paper provides the study to examine the WCM’s effect for firm’s performance and contributes valuable insights on this company’s investors and managers.

Impact of Trade Liberalisation and MSME Classification on Productivity of Indian Manufacturing Firms

This article examines the effects of tariff and non-tariff reductions on firm-level productivity of large as well as Micro, Small and Medium Enterprises (MSMEs) in India’s manufacturing sector for the 1999–2009 period. We calculate input and final goods tariffs, effective rates of protection and non-tariff barriers (NTBs) for broad product groups using information from India’s Exim Policy of 1997–2003 and 2004–2009 to examine this impact. We use a balanced as well as unbalanced firm-level panel data set, while accounting for firm, industry, state and time-specific factors. By using fixed effect models and Heckman’s two-step estimation procedure, we find that trade liberalisation is associated with improved firm-level productivity for large firms but not in the case of MSMEs. We posit that this might be due to the relative disadvantages that Indian MSMEs face which prevent them from benefiting from trade liberalisation. We also find that productivity gains arising from the sourcing of imported inputs have been greater than those arising from increased product competition and that NTB liberalisation has had a greater impact compared to tariff liberalisation on firm-level productivity. Changes in MSME legislation and the classification of firms are also found to have a bearing on firm performance. Our study contributes to the literature by confirming the need to focus specifically on constraints faced by MSMEs if they are to benefit from trade liberalisation. It highlights the importance of liberalising trade in intermediates as well as the role of MSME classification in enabling productivity gains. JEL Codes: L6, D24, L1, F13

The conundrum of porter hypothesis, pollution haven hypothesis, and pollution halo hypothesis: evidence from the Indian manufacturing sector

The conundrum of porter hypothesis, pollution haven hypothesis, and pollution halo hypothesis: evidence from the Indian manufacturing sector

Outward FDI, Profit Shifting, and Its Impact on the Tax Payments of the Parent Firm: A Case of Indian Manufacturing Firms

Outward FDI, Profit Shifting, and Its Impact on the Tax Payments of the Parent Firm: A Case of Indian Manufacturing Firms

Determinants of financial constraint: a text-based financial constraint index approach

ABSTRACT The study employs a text-based Phrase Matching Method (PMM) index for the financial constraint to identify the key determinants of financial constraints. The study finds that conventional determinants of financial constraint like size, age, dividend payment, long-term borrowing, credit rating, group membership, current ratio, price-to-book ratio, debt-to-equity ratio, capital expenditure, cash flow, and sales growth play a significant role in determining the financial constraint of Indian manufacturing firms. Apart from the conventional determinants, the study also finds that factors like tangibility, R and D intensity, and corporate governance also play an important role in determining financial constraints.

Impact of ISO 14000 on Energy Intensity of Manufacturing Plants in India

Using plant-level data for 2008-2017, we examine the impact of the adoption of ISO 14000 by Indian manufacturing plants on their energy intensity. The propensity-score-matching difference-in-difference (PSM-DID) estimator is used to assess the effect. Our results show that the adoption of ISO 14000 tends to reduce energy intensity in Indian manufacturing plants, especially among the low and low-medium technology industries. ISO 14000 lowers energy intensity in industrial plants in energy-intensive industries, and the effect is stronger for the group of such industries covered under the Perform–Achieve–Trade (PAT) scheme of the Indian government, a market-based compliance mechanism for energy efficiency improvement.