Creativity and Innovations as the Key Differentiator for Future Growth

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MICRO, SMALL AND MEDIUM ENTERPRISE
NEXT GENERATION ENGINE OF GROWTH
A TWELFTH PLAN PERSPECTIVE

TRACK: CREATIVITY AND INOVATION AS THE KEY DIFFERENTIATOR FOR FUTURE GROWTH OF MSME SECTOR.

AUTHOR: Prof. GULBASH DUGGAL, (Academic Head)

ORGANISATION:INTERNATIONAL COLLEGE OF FASHION

ADDRESS:M-39, LAJPAT NAGAR- 2
NEW DELHI – 110024

MOBILE:9811111303, 9711440003

EMAIL:gulbash@hotmail.com , gulbashduggal@icf.edu.in

ABSTRACT

Many MSMEs in India face challenges such as sub-optimal scale of operation, technological obsolescence, lack of work space, supply chain inefficiencies, increasing domestic and global competition, fund shortages, change in manufacturing strategies and turbulent and uncertain market scenario. Therefore, there is an urgent need for enabling a conducive policy environment which would help enhance competitiveness of Indian MSMEs. This research study aims to debate on the effectiveness of existing schemes and suggest innovative policies from the learning of the best practices being followed globally that could be adopted in the policy framework of 12th Five Year Plan for the development of MSMEs. Josef Schumpeter pointed out in the early 20th century that innovation rates increase more than proportionally with firm size and market concentration; he thus established that large firms were the engines of innovation in capitalist economies. But things have changed over the last decades. Small companies have proved to be as innovative and efficient as their larger counterparts. Nonetheless, innovation ability still tends to vary with firm size. Innovation has traditionally been regarded as the development and introduction of new production technologies. However, innovation is rather the innate entrepreneurial drive that impels some individuals to upgrade their business. There are more than 8 million SMEs in India today – small companies that churn out electronic parts, garments, etc. – making manufacturing the biggest engine for job creation in our economy, contributing to 60 % of India’s exports, with the latent potential to grow bigger, signifying one thing clearly: To succeed in a competitive environment the manufacturing sector has to adopt some best practices and embrace some new age tools. One of the key differentiators can be Information Technology, and its adoption by Indian MSMEs, can play a significant part in enhancing their competitiveness on the world stage. This leads to positive influece at three levels.

Firstly at the enterprise level, by increasing operational efficiency through better productivity, reduced costs, improved quality, access to better skills, improved market access and enhanced sales and profits.

AUTHOR’S NOTE

We live in the middle of a richly diverse, vibrant country which is brimming with creative energy and innovative ideas. As a recent conference speaker has said, being “big enough to matter and small enough to care,” the regions are ideally placed to foster this natural wealth and to do everything possible to promote it. This paper highlights the importance of creativity and innovation to a healthy and prosperous India, something the country as a whole is recognizing in its designation of 2010-2020 as the Decade of Creativity and Innovation. Throughout the decade, the government will promote debate on how to increase India's creative and innovative potential and to raise awareness of the importance of creativity and innovation as key drivers of personal, social and economic development. The debate raises questions. How do we drive the central words, creativity, innovation and culture? How do they interrelate? How can culture and creative thinking drive innovation? Art and business – are they oil and water, or can one fuel the other? How can we help people attain their potential to be creative and innovative thinkers? What is the role of education and lifelong learning in making our populations more dynamic,...
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