The Impact of Technology on Entrepreneurs in the Auto Components Sector

The latest abstract to be accepted for publication in my forthcoming collection on technological change and organizational development is:

The Impact of Technology on Entrepreneurs in the Auto Components Sector

Mukund Deshpande, Professor & Research Scholar at HNIMRW, Pune- India and Dr. Neeta Baporikar, Doctoral Guide, University of Pune, India

Abstract

Organizational excellence has at all times aroused curiosity and been a favourite area of dialogue for entrepreneurs. Small and medium-sized enterprises (SMEs) have been recognized world over as important drivers of the national economy. Nevertheless, running such an enterprise amidst global challenges can require extraordinary skills at both managerial and entrepreneurial levels, if the enterprise is to survive and grow. Whilst technology endeavours to introduce useful techniques based on functional logic for proactively conducting business, excellence is only attainable in the course of innovative practices. Good business policy-making requires effective entrepreneurship and proper engagement with all key stakeholders throughout the process. Enterprise leaders believe that the ability to innovate and change is crucial to the success of business. Given this situation, a built-in innovative mechanism has become a critical ingredient of the current business model.

The business approach of SMEs in particular has been a key area of research as these firms, generally lacking human, financial and other tangible and scarce resources, need to be configured accurately to match the new business surroundings. Consequently, a major challenge has been the articulation of resources so as to enable them to achieve success for the enterprise overall. The globe itself seems to be shrinking as a result of information exchange through the internet. For that reason, organization of resources has regularly posed a challenge for SMEs to manufacture products with competitive prices, timely delivery and appropriate quality. The traditional business approaches fail to gratify the general needs of business, owing to the complex environment and, as a result, businesspeople are always alert for approaches. The overall objective of good business strategy is to ensure that it is fit for the purpose, resource efficient, sustainable, resilient, adaptable and attractive.

This case study explores and elaborates such approaches in the Pune Auto-Component industry in India as an illustration of excellence that is setting new trends in modernizing the industry. The auto components industry is a major sub-sector of the automobile manufacturing sector. In effect, it is a large feeder industry that has put India on the global map for excellence and innovation and it has been categorized in the SME class by the Indian Government. Whilst the auto-component industry has been exponentially growing in India at three different locations, the Pune region has been particularly vibrant due to the support from the Automotive Research Institute and the IT industry, coupled with the availability of technological talent. To take advantage of this market opportunity, prospective entrepreneurs must remain inquisitive about new initiatives in this area.

The mainstream auto-component industries are mostly run by family-owned enterprises at Pune, with interest in diverse product ranges that operate around the world. Industry specific challenges ensue due to global competition and continually changing customer demands. They pose further challenges concerning the dearth of in-house resources, as well as the recurrent fresh demands posed by intensification of information exchanges. The case focuses on implementing the “Strategy for the SME” approach that is, in effect, accountable and well judged for the start up, survival and growth of such enterprises. The research methodology designed for the study consists of in-depth study of diverse sources describing the success of the business. A diverse range of entrepreneurs was approached for interviewing and a questionnaire utilising five-point Likert scale questions used to collect data. Emphasis was placed on issues of Face, Construct and Criteria validity. Data collected, based on personal interviews with owners, managers and supervisors of SMEs, were collated into a database. Seven such SMEs agreed to share confidential information and they represent the primary sources of data. In-depth analysis of the data, employing a deductive approach, was undertaken to identify and understand the effective instruments used by SMEs in their businesses. The statistical analysis, in terms of consistency of the approaches, has uncovered very constructive, reliable and sustainable approaches and techniques employed in these industries. The purpose of this research study was to reveal the tools, techniques and behaviour of the Pune businesspeople, at their workplaces, as they addressed the multiplicity of challenges they faced.

The study has revealed that Pune entrepreneurs require an analytical mind and belief to enter the business successfully, which should be undertaken after thorough investigation of facts and figures as well as government policies, while also taking account of the need for information technology back-up for continuity of market knowledge, information on innovation in technology and to link with prospective collaborators. Placing emphasis on customers’ requirements is considered an important policy in manufacturing. A strong belief in the importance of technology is evident, as well as the need for world class amenities that facilitate auto-components manufacture with diverse designs resulting in sustainable policy options. This policy effectively leverages manufacturing competence into access into multiple markets.

Their survival strategy has also been determined and it is to to obtain repeat business from existing customers by providing good quality products, with timely delivery and competitive prices. They are also cautious in maintaining a sound cash flow that is coupled with restricnig the number of debtors and creditors to a minimum and ensuring the prompt recovery of receivables. Keeping borrowings to the minimum and making financial collaborations has also been used to gain access to low or zero interest funds for the business. Survival is also accomplished through supply chain management by way of cooperating with partners. Strengthening survival likelihood is achieved through low rejection of products and eliminating waste materials through effective means that are also consistent with government.

The growth policy of firms involves making smart investments in projects through innovation, adding multiple sources of income and controlling spending to generate surpluses for reinvestment to promote enterprise growth and, where appropriate, collaborating with prospective partners. The Pune auto-component industry has been utilizing a trilateral instrument for designing policies for business that includes the phases of conceptualization, formulation and analytical. They further believe that this approach to business is formulated on its utility, flexibility, viability and competitiveness to match the type, size and value of resources of the enterprise for its prolonged subsistence. These firms prepare business plans and intentionally sketch out process flow charts to generate operational Key Performance Indicators (KPIs). Sector specific indicators allow an entrepreneur to quickly ascertain whether assumptions are out of line with industry benchmarks.

A further finding of the study is that Pune industries use a bilateral approach to link up the internal and external environments through what are termed ‘core’ and ‘complementary’ approaches. The core approach has emerged to relate the external environment to the internal, whilst the complementary approach represents support for the core approach to the business. Findings further indicate that these are practical instruments and reliably improve operating economics, maintain environmental equilibrium and intensify harmonious social dealings. The modus operandi of growth is to have an innovative model with repeated iteration which has the ability to surmount sometimes dreadful challenges.

Key words: Auto Components, Entrepreneurs, India, Technology

SIU Journal of Management, Vol.1, No.2 Published

The Volume 1, Number 2 (December, 2011) issue of the SIU Journal of Management has now been published. Download the full version here.

The contents of the December 2011 issue of the SIU Journal of Management are as follows:

CONTENTS

                  Editor’s Introduction                                Download

INVITED ARTICLE

The Real Causes of Inflation and Perspectives for Overcoming Them: The Case of Armenia – Tatoul Manasserian

RESEARCH ARTICLES

1.	Working   for Money or Working for the Group? Community-based Women’s Rural Enterprises   in Chainat Province under the OTOP Project – Lada Phadungkiati. Kyoko Kusakabe and Soparth Pongquan
2.	Insurance Broking in India – A Relationship Model Approach – Arup Mazumdar
3.	Thailand and the Inflow of FDI under the ASEAN Economic Community (AEC) - Sittichai Anantarangsi

CONFERENCE REPORT

	International Conference on Management Cases (ICMC), 2011, Noida, India
	G.D. Sardana and Tojo Thatchenkery

BOOK REVIEWS

1.	Cashing In across the Golden Triangle: Thailand’s Northern Border Trade with China, Laos, and Myanmar by Thein Swe and Paul Chambers – John Walsh
2.	Uneven Development: Nature, Capital and the Production of Space by Neil Smith and The Enigma of Capital and the Crises of Capitalism by David Harvey – John Walsh

CALL FOR PAPERS

AUTHOR’S GUIDELINES

ABOUT SHINAWATRA UNIVERSITY

EDITORIAL ADVISORY BOARD

The official website of the journal is at SIU.

Chiang Rai

We managed a few days in the northern town of Chiang Rai just before Christmas, which was very pleasant. The town was founded by the legendary (but real) King Mengrai at the end of the thirteenth century as part of the Lanna state.

Lanna was, with the Sukothai of King Ramkhamhaeng, among the first independent Tai polities. Together with the Prince of Phayao, the two kings formed a triple alliance which resisted the onslaught of the Mongols (in fact, the Yuan Dynasty Chinese), although mosquitoes and disease probably also had parts to play.

Chiang Rai has a number of wats to visit (of course) and one of the more interesting is the so-called White Temple (Wat Rong Khun), which has been created by the famous artist Ajarn Chalermchai Kositpipat  as a form of dedication to the Buddhist philosophy and to house his own artwork. Here is one of the main buildings:

It is well-worth visiting: a lot of Ajarn Chalermchai’s work focuses on the suffering that people face before they can reach Nirvana (enlightenment) and that makes for some startling and enjoyable scenes.

We also popped up to the border town of Mae Sai, which is part of the Golden Triangle region and an important border post for trade and labour migration (mostly temporary). Here are some people crossing between the two posts, with Myanmar (Burma) in the background.

All throughout Mae Sai are markets, some for general items and some for the gems, particularly jade, for which Burma has been known throughout history. These days, many of the items are imported from China, including the packet of Chinese ‘chocolate’ sitting on my desk in front of me, from the Tianjin Dagang Chunrong Food Factory.

Here are the women looking at some stuff and a picture of Chinese and domestic wine-selling  vendors from the other side of the road (if you know the place, I mean).

It was cold, for Thailand at least, with temperatures dipping below the 20 degree mark during daytimes – I note that 18 provinces have already been declared ‘cold weather disaster zones,’ which is a little premature. Here in Bangkok, it is struggling to get over 25 degrees some days and that is also considered cold winter weather, although extremely pleasant for foreigners such as self. It is unfortunate that people in this office think it is too cold to turn on the air conditioning in a building designed for its use, making the place somewhat stuffy and airless. Never mind.

Limiting Product Innovation to Low-Budget Customers: Firm-level Bricolage, Swastik Surgical Industries, Bhiwani, Haryana

Another abstract happily received for the case study book. This one is from: Dr. V. L. Narasimham, Assistant Professor (Selection Grade), University of Petroleum & Energy Studies.

Abstract

Bricolage, a term adapted from structural anthropology has been applied in this study to navigate path-making business processes of Swastik Surgical Industries (SSI), Bhiwani, western Haryana state, India. SSI, a small scale enterprise for more than 20 years of existence, employs approximately 10 members of workforce in the manufacture and fabrication of medical operating tables and operating lighting equipments. The equipment, in different models and specifications, largely serves as one time capital assets for medical professionals and to the upcoming medical facilities. SSI brings in model variations using raw metal (steel/nickel/cast-iron) gauge differences and with additional features like, manual/automation modes to the operating tables, and through combination in the illumination (lux) to the operational lighting equipment that aptly suit the financial limitations of the medical facilities. The business success of SSI over the years of its existence may largely be attributed to customers who have fitting needs with negligible sophistication with the operating tables and lighting equipments, and for their minimal inclination for electronic accessories. However, the strength of SSI also lies with its operational process that largely get accustomed to the deficiencies with trained workforce, and at times, malingering attitudes of skilled workforce.

Turning Customers Complaints into Compliments: A Case Study of Indian Railways

The latest abstract accepted for my collection of case studies is:

Turning Customers Complaints into Compliments: A Case Study of Indian Railways

by Dr. Harjit Singh (Faculty Member, School of Business, Galgotias University, Greater Noida, India) and Manoj Kumar Pachariya (Faculty, School of Computer & Information Sciences, Galgotias University, Greater Noida, India).

Abstract

An organization may have hundreds of branches, thousands of employees and millions of customers but from a customer’s point of view, you are just one organizaton. They perceive your organization as a complete network, funnelled directly through you, dedicated to meeting their requirements, listening to them and not as competing sections preoccupied with their own personal issues, rules and politics. In short, in the business world, it is expected that if you are in competition, you cannot say ‘No’ or ‘sorry it’s not my fault’, or “I’m helpless, I’m not getting support from my colleagues” or ‘Sorry, today our network is not working’ to your customers. The customer is little bothered about what is happening in the organisation and wants the service which is being paid for. In other words, you cannot assign blame to another employee or department. This case study is about Indian Railways (IR) which, before going online, used to have same reaction. The system was overwhelmed with manpower and human resource development had not kept pace with the latest technological inventions.

Consequently, IR found itself in a critical situation. There was a lack of modern management as Indian railway failed to attract high quality human resources and to provide appropriate incentives. This made railways incompetent when coping with increasing number of passengers and reservations. Consumer complaints were on the rise. The number of complaints/cases for refund of tariffs and loss for ‘delay’ were increasing at unprecedented rates. The railway booking system was totally in the hands of private agents. Further, railway employees’ negative attitudes, the sheer volume of passengers and the accompanying chaos at the booking centres made the prospect of booking railway tickets an unlikeable thought. The position became more worsened with the entry of low cost airlines which were offering slightly higher or even the same fares than railways for most commercial destinations. Consequently, IR was not only confronted on the passenger front but also saw a steep downfall in the transport sector too. The case begins with the growth of IR and studies the operations of a large Indian organisation that played a vital role in the social, political and economic development of the country. The case highlights the disparity between the organization’s social and economic objectives and the strategies adopted to attain them. What circumstances forced Indian railways to introduce ‘Online Passenger Reservation System’ and its progress in recent years to become one of the most passenger-friendly railway systems in the world. The case emphasizes IR’s efforts to develop consumer perception as the most reliable travel system.

Key Words: Indian Railways, Consumer Complaints, Online reservation.

What Is Internationalism?

What does it mean when I say ‘I am an internationalist?’ On the one hand, the  answer seems very simple: I support people in their struggle for survival and self-expression around  the world, irrespective of their nationality, ethnicity, ideology, sexual  orientation or any other factor. In fact, this goes slightly beyond the normal  definition of internationalism which is usually limited to disregard for  nationality but solidarity in terms of class membership.
Read the full article here.

Minimum Wage Determination

Nearly all developed countries have a form of minimum wage that is applicable  throughout their economies. The purpose of a minimum wage is to protect the lowest-paid workers, since poverty is not  limited to people without work but can seriously affect the ‘working poor’ – those people who are in employment, even full-time employment, but who  nevertheless cannot afford to pay for basic goods and services.

Read the full article here.

Ethics and Philosophy

A philosophy is a closed system which aspires to explain all elements of life  and the universe, or at least to provide some kind of ideology which helps the  follower to understand what is happening in the present and predict what is  likely to happen in the future. In this sense, then, a philosophy such as  Buddhism, Marxism or existentialism, provides a more or less comprehensive and  coherent framework with which to make sense of the world.

Read the full article here.

Dark Secrets

My story ‘Master Zhang’s Slave’ is included in Dark Secrets, edited by the inestimable Dorothy Davis, which has just been published by Static Movement. It is available here.

That’s half a dozen or so stories I’ve had published this year, which is quite gratifying. I have been too busy to write much fiction recently but perhaps it will be possible in the new year, after catching up with the flood-induced delays.

Implications for Management of the Entry of Foreign Retail and Wholesale Stores in Nonthaburi Wholesale Markets

Cheevapruk, Supitcha and John Walsh, “Implications for Management of the Entry of Foreign Retail and Wholesale Stores in Nonthaburi Wholesale Markets,” paper to be presented at the International Conference on Global Business Environment (ICGBE) (Bangkok: Feburary, 2012).

Abstract

The entrance of foreign retail and wholesale businesses in Thailand started some ten years ago and led to the closure of many Thai wholesale stores. The objective of this study is to determine the needs of Thai wholesalers in the Nonthaburi area and to identify suitable strategies for relevant managers to be able to compete with contemporary commercial strategies of the foreign enterprises. A total of 114 of the 120 Thai traditional wholesale stores in Nonthaburi were surveyed by questionnaire and results were analysed by statistical means. It was found that low price strategy, location of store and full cycle service strategies were the principal approaches employed by the managers of the foreign wholesale and retail stores. Tesco Lotus was the foreign venture with the greatest impact on the Thai environment. With respect to managerial approach, it was found that Thai traditional wholesale stores should try to build stronger relationships with customers and regularly search for new markets. Employee performance should also be taken into consideration to some extent. Other issues of importance included the presentation of the store and visual merchandising, as well as transparency in management systems and the need for well–organized financial and accounting systems and their proper control.