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Cluster development for business excellence

By Guest Author,

Added 30 August 2016

Clusters have the philosophy of ‘getting together, learning together, achieving together’.

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Over the last few years, Frankfurt International Airport has been expanding to meet passenger demand estimated to grow from 61mn currently to 70mn by 2021. To meet this growth Europe’s third busiest airport is looking beyond mere physical transformation. It is gradually evolving into an ‘airport city’—a sophisticated knowledge-sharing and high-tech business cluster. The German airport is using the cluster approach to attract more business travellers and conference delegates, position itself as a leading knowledge hub in the logistics and transportation industry, and transform the metropolian area into a mega hub for business and economic growth.

The ‘cluster concept’ is a worldwide phenomenon. Companies in continents such as Asia, South America, Europe and North America are introducing cluster development programmes (CDP) to catapult their businesses into centers of excellence with shared values of trust and integrity.

India is no exception to this unique idea. In 1998, the government launched a programme for small and medium enterprises (SMEs) to boost interconnectivity and knowledgesharing among companies. The schemes usually relate to technology, quality up gradation, marketing support, and entrepreneurial and managerial development. Till date, the government has organised more than a thousand interventions in various clusters across 29 states. So far, 677 programmes have been completed. As many as 178 of these were for new build and up-gradation of infrastructure facilities.

Manufacturing cluster development
While there are many aspects to it, cluster development primarily refers to the sharing of knowledge and best practices and improved networking among enterprises across one or more sectors. It plays an important role in increasing the competitiveness of businesses, especially SMEs —through fresh insights and strategies resulting in better productivity and profits. Apart from knowledge-sharing, the other values that drive these clusters are transparency, learning, speed, adaptability, sustenance and zero tolerance. The success of cluster programmes depends on to what extent participants fulfil these and other values.

Clusters started in India within the auto Industry. Generally the SMEs participated in it. These cluster programs helped building a robust supply chain for the industry. The methodology was to learn and share from each other under a mentor. It was a low cost approach compared to full time consultants working for large OEMs.

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