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Enhancing Competitiveness of India Inc.: Examining the Contribution of an Organization

©2005, Global Institute ofFlexible Systems Management

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Introduction

Global competition is the name of the game today. Thepressure of competition is being felt with increasingintensity as the world opens up to trade and commerce inthe post WTO regime (Bhaumik, 1999). Although in sucha fiercely competitive environment, companies are undertremendous pressure to offer consistent quality ofinternational standard at a competitive price to providevalue for money competition has contributed to theeconomic growth of a nation. Sakakibara and Porter, whileexploring the influence of domestic competition oninternational trade performance, using data from a broad

Enhancing Competitiveness of India Inc.: Examining the Contribution of anOrganization to Build the Competitiveness of India

Sanjib Kumar DuttaSenior Counsellor –TQM

Confederation of Indian Industry6 Netaji Subhas Road, Kolkata 700 001, India

N. SrinivasanDirector General

Confederation of Indian IndustryThe Mantosh Sondhi Centre,

23, Institutional Area, Lodi Road, New Delhi 110 003, India

Pratap K J MohapatraProfessor

Department of Industrial Engineering & ManagementIndian Institute of Technology,

Kharagpur, West Bengal, India, 721302

AbstractThis study critically looks into the distinctive competitive features of prioritized sectors of Indian Economy takinginto cognition of India’s competitive position in the global perspective. It suggests a framework of competitivenessconsidering the views of eminent quality gurus and criteria of leading excellence models. The suggested frameworknot only provides a framework to an organization for positioning existing initiatives and identifying gaps in itsjourney of competitiveness but also links its enabling practices and planned results to the growth process of thecountry. The paper makes an effort to rank the participating organizations while applying the framework to selectIndian organizations from the identified sectors with respect to selected framework criteria using Analytic HierarchyProcess. It also captures best practices, studies the gaps and explores the relationships from a unique viewpoint. Theresults of the study indicate that a truly competitive organization looks beyond its narrow self- interests and contributesto the growth and competitiveness of a nation.

Keywords: Competitiveness, Framework, Leadership, Country, Organizational Purpose, Latent Customers

International Journal ofGlobal Business and Competitiveness2005, Vol. 1, No. pp-33-47Research Paper

sample of Japanese industries have found that domesticcompetition has a positive and significant relationship withtrade performance measured by world export share(Sakakibara and Porter, 2001).

While examining the finer elements of competition,Garelli has described competition and competitiveness asthe two faces of the same coin. According to him,competition is an external and environmental factor andcompetitiveness is an intrinsic feature of an entity whichcan be developed and nurtured (Garelli, 2004). In today’sperspectives competitiveness has become a fundamentalforce in economics. Across countries and regions, there is

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Sanjib Kumar Dutta, N. Srinivasan and Pratap K J Mohapatra

a drive to enhance competitiveness. This includescompetitiveness of nations, industry sectors and individualunits. Competitiveness describes economic strength of acountry or an industry or an organization with respect toits competitors in the global market economy in whichgoods, services, people, skills and ideas move freely acrossgeographical borders. Highly competitive entities arewinner in global competitiveness game.

The biggest challenge for an Indian organization todayis to be competitive, not only in the country but globallyalso. Competitiveness, being a multi-dimensional concept,can be enhanced through many ways. An effective and aproven way is through the Quality way, which is a majorsource for creating sustainable competitive advantage fororganizations. These include Japan, US, Germany, andmany organizations from these countries like Sony, Toyota,Xerox, Canon, Microsoft, Intel, HP, to name a few(Conference Papers ofQuality summit, 2004).

It is not only a few largeorganizations who benefitedby the adoption of TQMprinciples. Over the years a number of research studieshave investigated the correlation between the adoptionof TQM and the improved organizational results. Themajority of such studies show a positive linkageirrespective of type, size and sectors. To elicit a few, thework of Solis Louis, Subba Rao and Ragunathan (2001)have revealed that total quality management provides asound foundation upon which small and mediumenterprises (SMEs) can compete and grow in the globalarena. Teng and Jaramillo (2005) have described howquality plays an important role in the globalisation of UStextile-apparel supply chains. Campos-Soria Juan, GonzálezGarcía and Ropero García Miguel (2005) have analysedand quantified the main interrelationships between servicequality and the competitiveness of hotels.

Practice of TQM philosophy in its broader sense notonly results in business results but also leads to the growthand prosperity of the country. Kondo in his work haselaborated in the post second world war period how Japanhad improved its competitiveness by adopting TQMprinciples (Kondo, 1995). The number of non-Japanesecompanies introducing and promoting this style of qualitymanagement continues to grow.

This study makes an attempt to suggest a frameworkof competitiveness in the Quality way for Indianorganizations that contributes to the growth and prosperityof the nation. It carefully examines the views of eminentquality practitioners and features of the leading businessexcellence models, studies the gap while applying the

framework to select Indian organizations with respect toselected framework criteria and captures best practicesusing analytical techniques and investigates into causalrelationships from the viewpoint of local culture and ethos.

Competitiveness of India Inc.

Garelli, in his work, explored that a new breed of competitorsis emerging to reshape the world where Asia is attracting60 per cent of the investments going to developingcountries and China has become the first recipient of directinvestment and the 4th largest exporter of manufacturedgoods in the world (Garelli, 2004). In this scenario, it isgood to do a reality check on where India stands.

According to the Global Competitiveness Report(GCR) 2003-2004 released by the World Economic Forum(WEF), India is ranked 56th place on the World EconomicForum’s Growth Competitiveness Index (GCR, 2003-2004).

At the industry level, clearlymuch needs to be done toenhance competitiveness tomeet the onslaught ofcompetition from around theworld.

In 2002, Confederation of Indian Industry (CII)introduced its theme for 2002-03 as “Competitiveness ofIndia Inc.” and set a target for all those representing IndianInc. to ensure that India reaches the top 20 on the WorldEconomic Forum’s Growth Competitiveness Index by 2010.“India Inc.” represents the national government, stategovernments, business and industry, voluntary services /NGOs, agriculture, services and infrastructure (The Hindu,April 30, 2002).

“India Inc.” stands for India as a whole – representinggovernment at the national and state level and representingIndian Industry. Therefore, the focus lies on two keyelements of competitiveness:

Competitiveness of the nation as a wholeCompetitiveness of Indian Industry (Conference

Papers of Quality summit, 2002).

Objectives and Scope of the Study

Porter has argued that Competitiveness of a nation islargely dependent upon the competitiveness of the keysectors of the economy, which impact the country’sgrowth, where sound macroeconomic measures arenecessary but not sufficient conditions to ensure aprosperous economy (Porter, 2004). The crux of the issuelies in the sector’s microeconomic fundamentals-how theindividual organizations are fundamentally improving their

competition is an external and environmental fac-tor and competitiveness is an intrinsic feature ofan entity which can be developed and nurtured



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operations and strategies that contribute to the growthand development of the country. Therefore, the task aheadis to suggest a framework of competitiveness that not onlymeasures the performance of an organization for its survivaland growth but also contributes to the growth process ofthe country. In line with this the objective of the presentstudy is conceptualized as:

To identify the status of Indian Organizations byevaluating the gaps with respect to selected frameworkcriteria and to capture the best practices from select IndianOrganizations.

We planned to carry out a sample survey by applyingthe framework to leadingIndian organizations fromselected sectors. At the outset,two broad sectors,manufacturing and service,were selected consideringvaried product-service mix (ISO 9004-2: 1991) and thedegree of priorities on profit motive (Dutta, 2003). Wefurther narrow our focus by selecting healthcare and textilesectors from service and manufacturing sectorsrespectively considering the role of these sectors inproviding most basic needs of people and looking at thegrowth potential of these two sectors. The methodologyof the study is given in Appendix 1.

Competitiveness of Health Care Sector

To ascertain the competitiveness of a health careorganization various measures can be identified(McCracken, McIlwain, Fottler, 2001). In a HarvardBusiness School Case Study, Kasturi Rajan has describedsuch measures for an eye hospital (Kasturi Rajan, 1993).Along with various clinical factors these measures includeeye camp performance, complication details for thepatients operated and financial performance. In anotherarticle, Gallivant has mentioned that in case of a heart/lung transplantation centre poor outcome can becontributed by poor patient selection, donor mismatch, postoperative infection and so on (Gallivant, 2003). Whileselecting an appropriate measure for a health careorganization following issues need to be considered.

a) Key trends in the global health care industry relevantto India includes changing demographics and healthtransitions, rising cost of health care, capacity constraintsand manpower shortages, accountability and qualitycompliance, new technologies for healthcare delivery andother similar example ( Palnitkar, 2004)

b) Health care organizations are mostly non-profitorganizations. Although financial viability is essential fora health care organization for the sustenance, profitmaximization alone cannot be its ultimate motive. Waltersand Jones have argued a strong sense of purpose (Raisond’être; reason that accounts for, justifies, or originallycaused an organization’s existence) must become thedriving force in these organizations (Walters and Jones,2001).

To elaborate the integration part of these two elementsof competitiveness (that is, competitiveness of the nationvis-à-vis competitiveness of an organization) we may referto National Health Policy 2002 (NHP) of India (National

Health Policy, 2002). Section4.25.1 of NHP encourages theprovision of health services tousers from overseas. Suchservices shall enjoy the statusof “deemed exports”’ which

are available to other exporters of goods and services andthe earnings in foreign exchange shall be eligible for allfiscal incentives. Datta and Krishnan have projected themarket for health tourism is US$ 40 billion and it is growingat 20 per cent every year (Datta and Krishnan, 2003). Now,by capitalizing the comparative cost advantage, Indianhealth care organizations may make an effort to penetratethis market. In such a case, along with its own businessperformance, it fulfils the requirements of the nationalhealth policy.

Competitiveness of Textile Sector

The profit motive, trading and competition are the typicalcharacteristics of most of the organizations from textilesector. Return on investment (ROI) and free cash flow pershare (FCF) are the most important financial measures ofsuch organizations amongst others such as net Income,ROI, ROE, ROA, EPS, free cash flow per share, and equitygrowth rate (NTC Project: SO1-PH13, 2004). The deadlinefor phasing out of quota regime in textiles and clothingsector comes to an end in January 1, 2005. Keeping this inview a study by CII has identified the key drivers for textilevalue chain and identified the value chain competitivenessindex for different segments of this sector in line with theNational Textile Policy (National Textile Policy, 2000).The study has revealed although on certain parametersIndia is ahead of China, Pakistan, Indonesia, Bangladeshand Sri Lanka, clearly much needs to be done to enhancecompetitiveness to meet the onslaught of competition fromaround the world (A Report on IntrospectingCompetitiveness of the Textile Sector in Southern Sector,2003).

Practice of TQM philosophy in its broader sense notonly results in business results but also leads to thegrowth and prosperity of the country

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Need for a Framework for Competitiveness

In order to integrate the two elements of competitiveness,an organization need to transform itself from the status ofnarrow self-interested and competitive entity to aresponsible corporate citizen that would participate in thegrowth process of the country. This is only possible bylooking into the purpose of the organization that justifiesits existence. The term “purpose” refers to the fundamentalreason that an organization exists

A careful examination of the models of differentquality awards, such as Malcolm Baldrige National QualityAward (2005), the European Quality Award (2004) , theDeming Prize from Japan (2000), the Australian QualityAward (2004), the Canadian Quality Award (2000),indicates that in one form or another the issue of purposeis addressed in each of these models. However, it isobserved that most organizations (especially the profitmaking ones) do not evaluate the degree of attainmenttowards the higher-level purpose vis-à-vis the stakeholderrequirements. They use these models to achieveexcellence at the organizational level.

Latent Customers – The Conceptual Framework

Various quality gurus like Deming (1982), Crosby (1979),Feigenbaum (1983), Taguchi (1985), Ishikawa (1985) andJuran (1998) agree on the core concept of customersatisfaction. A customer is defined as an organization orperson that receives a product. Various interest groupslike consumer, client, end-user, retailer, beneficiary andpurchasers constitute the example of a customer (ISO9000: 2000). Bose and Dutta (1997) have argued thatcustomer may be known partly when the seeker seekswith a purpose. An organization focuses on the needsand expectations of the appropriate set of customers fromthese interest groups to maximize customer loyalty,retention and gain in market share. However, while doingso, the growth and prosperity of the country are ignored.The growth process of a country is only ensured byaddressing the requirements of the appropriate interestgroup(s) whose interests are aligned to those of the country.The interest group that may or may not receive or consumethe products of an organization but assimilates its effectwould be termed as latent customers (Dutta, 1999).Prevalent approachesto strategyformulation lose sightof the latentcustomers andthereby ignore thehigher order goal.However, the

question remains as to what extent the organizationexplores its latent customers. A key to enrich themethodology is to consider the national policy, whileformulating purpose statement of the organization.

The Proposed Framework - An Overview

In line with the arguments made in preceding sections wepropose a framework of competitiveness (Figure 1) thataddresses both the local goal of survival and growth of anorganization and the global goal of contributing to thegrowth of the nation based on Dutta’ work (1998). Theproposed framework is presented here in a diagrammaticform.

Figure 1: The Proposed Framework of Competitiveness

The framework is based on ten criteria. First four ofthese are termed as enablers and remaining ones areresults. The enabler criteria cover what an organizationdoes. The result criteria cover what an organizationachieves. A brief description of the ten criteria is givenherewith.

Enablers

1. Purpose: The purposestatement justifies the existence of anorganization. It is formulated based onthe effects the organization would like

The crux of the issue lies in the sector’smicroeconomic fundamentals — how the individualorganizations are fundamentally improving their op-erations and strategies that contribute to the growthand development of the country

Fulfillment of Societal

requirements (8)

Purpose (1)

Purpose Fulfillment

(10)

Fulfillment of the requirements of the

employees (6)

Policy &

Strategy (2)

Fulfillment the requirements of the

partners (7)

Resources (3)

Planned business performance (9)

Processes (4)

Fulfillment of the requirements of the

customers (5)

INNER LOOP



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to generate and control. This provides the overalldirection for an organization.

2. Policy and Strategy: The organization converts itsoverall direction into a clear strategic directionsupported by relevant plans and policies.

3. Resources: The organization plans and managesexternal partnerships, suppliers and internal resources(human, infrastructural, information, material,technology and so on) in order to support policy andstrategy and the effective operation of the processes.

4. Process: The organization designs, manages andimproves processes, in order to satisfy and generatevalue for its stakeholders.

Results

5. Fulfilment of the Requirements of the Customers:The organization formally measures and achievesresults with respect to its direct customers.

6. Fulfilment of the Requirements of the Employees:The organizationc o m p r e h e n s i v e l ymeasures and achievesresults with respect toits direct employees.

7. Fulfillment of theRequirements of thePartners: The organization comprehensivelymeasures and achieves results with respect to itsdirect partners.

8. Fulfillment of the Societal Requirements: Theorganization comprehensively measures and achievesresults with respect to its society.

9. Planned Business Performance: The organizationcomprehensively measures and achieves results withrespect to its investors.

10. Purpose Fulfilment: The organizationcomprehensively measures and achieves results withrespect to its latent customers. The organizationensures that the desired effects (for exampletechnology upgradation, culture and behavior,product innovation, education, wastages and so on)that contribute to the competitiveness of the nationhave been generated.

The Framework

The proposed framework works on two broad loops:a) An inner loop, spanning criteria 2 through 9 where

the organization focuses on its own survival andgrowth. This is steered from “Policy and Strategy”and achieved by fulfilling the requirements of itsstakeholders (for example direct customers,shareholders, employees, partners and society at

large) focusing at the competitiveness at theorganizational level.

b) An outer loop, spanning criteria 1 through 10 wherethe organization looks beyond its narrow self-interests and focuses on the attainment of somehigher-level purpose like country levelcompetitiveness. This is steered from “Purpose” andthe achievement level is evaluated by the degree towhich an organization fulfils the requirements of theappropriate beneficiaries (including LatentCustomers).

Both the loops need to be properly integrated andaligned through a robust management system.

Aims of the Study

Our effort in this study is purely analytical and exploratory.The framework of competitiveness, proposed earlier isappropriate to both manufacturing and service

organizations. Here, we havevalidated the framework byapplying it to selectedorganizations in India fromhealth care and textile sectors.In line with the primaryobjective, mentioned earlier, this

study focuses on the criteria 1 and 10 of the outer loop ofthe framework. The objectives of the study are as follows:

1. To study and ascertain the status of the Indianorganizations with respect to the process ofdevelopment, implementation, review andachievement level of the organizational purpose.

2. To establish a generic approach towards thedevelopment, implementation and review of theorganizational purpose by studying the adapted bestpractices in these organizations.

Selection of the Sample

At the outset, 10 leading hospitals from India were chosenas the potential assessees of the study considering thediversities in geographical spread, size, type and kind. Aformal letter was sent to these health care organizations.Four organizations agreed to take part in the study. Theimportant features of these organizations are given inAppendix 2. Statements related to the organizationalpurpose are provided in Appendix 3.Similarly 24 leading Indian organizations from textilesectors were chosen as the potential assessees of the study.A formal letter was sent to these organizations. Only fourorganizations agreed to take part in the study. Theimportant features of these organizations along with the

it is observed that most organizations (especially theprofit making ones) do not evaluate the degree ofattainment towards the higher-level purpose vis-à-vis the stakeholder requirements

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dates of study are given in Appendix 4. Statements relatedto the organizational purpose are provided in Appendix 5.

Designing the Questionnaire

The questionnaire contains two separate parts. The firstpart was designed as a blank format. This was filled in bythe respondent organizations during the study. The secondpart contains a list of questions. This was used by theinterviewer, while conducting the study.

The first part, there are two sections as given below:

1) The first sectionis meant to gatherthe primaryinformation aboutthe respondentorganizations, forexample, the nameof theorganization or business entity undergoing study, itsaddress, contact details, product and services offered,number of employees, number of locations / sites,annual sales, relationship and contact details of theparent organization (if applicable) and the dates ofthe study.

2) The second section provides information about theorganization and its business addressingorganizational environment, relationships, competitiveenvironment and so on. Second part of thequestionnaire is covered into seven broad categories;five of them are linked to criterion 1 and rest is linkedto criterion 10. These are as follows:

a) Criterion 1:

1) Availability of the purpose statement (Sub-criterion1.1)

2) Development of the purpose statement (Sub-criterion1.2)

3) Focus of the purpose statement (Sub-criterion 1.3)4) Management system supporting purpose (Sub-

criterion 1.4)5) Evaluating the Effects and Refining the Approaches

(Sub-criterion 1.5)b) Criterion 10:1) Purpose Fulfilment (Sub-criterion 10.1)2) Performance Indicators (Sub-criterion 10.2)

Sub-criterion 10.2 addresses the performance driversor leading indicators whereas sub-criterion 10.1 is relatedto the outcome or lagging indicators (Kaplan and Norton,1996).

For criterion 1, questions were framed to gatherinformation on how the organization approaches sub-criterion 1.1 to sub-criterion 1.4, the extent to which theapproach has been deployed and how the approachesand their deployment are subjected to regularmeasurement.

For criterion 10, questions were framed to gatherinformation on parameters the organization uses tomeasure results and the trends of data and the extent towhich the parameters presented reasonably cover therange of the organization’s activities.

Scoring GuidelinesCriterion 1

Criterion 1 looks for the process fordevelopment, implementation andreview of the organizational purpose.This is supported by five sub-criteria.First four sub-criteria address theissues on approach and deployment,

whereas the last one addresses how the organizationevaluates the desired effects and thereby refines itsapproaches. The approach describes what and why anorganization plans to do. The deployment covers what anorganization does to deploy the approaches in a systematicmanner to ensure implementation in the relevant areas.1) Each approach is covered by a range of part

requirements. Weights (either 1 or 2) are provided toeach part, depending on their relative importance.

2) Scoring methodology of an approach is as under:a) Scores on each part requirement are added to get the

overall score.b) Total score does not exceed nine.

As an example the scoring Guideline for approach forsub criteria 1.1 (Availability of the Purpose Statement)is given in Table 1.

Table 1 : Scoring Guidelines for Approach for Sub-Criteria 1.1

The growth and prosperity of the country are ig-nored. The growth process of a country is only en-sured by addressing the requirements of the appro-priate interest group(s) whose interests are alignedto those of the country

Sl No

Nature of evidence Score

1 No evidence or informally top management has some intentions

1

2 Available in the form of quality policy, SHE policy, environmental policy (as an extension of process management system standard)

2

3 Available in the form of vision, values, role and so on

2

4 Available in the form of purpose and/or mission statements

2

5 Appropriate to the role of the organisation 1 6 Clear distinction between different

statements 1



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2) Deployment of an approach was studied from twoangles:

a) Relevant areas for implementation–termed asdeployment denominators.

b) Systematic implementation–covering attributes ofimplementation.

3) Scoring methodology of deployment is as under:a) A scoring matrix addressing both the elements of

deployment is used to score on deployment.b) Maximum score is 1 for each attribute of

implementation. (foreach applicabled e p l o y m e n tdenominators)

c) Maximum score is 3 incase the organizationfollows a systematicway for each attributeof implementation (for each applicable deploymentdenominators)

d) Score for each applicable deployment denominator isdetermined by adding the scores obtained in eachapplicable column.

e) Overall score for deployment for an approach isdetermined by adding the scores for all applicabledeployment denominators.

f) Deployment score is normalised to a 9 point scale.g) All the element of implementation may not be

applicable for a particular deployment sub-denominator.

h) Scoring Guideline for deployment for sub-criteria 1.1is given in Table 2.

i) All the deployment denominators may not beapplicable to the overall deployment for an approach.

Table 2: Deployment-Scoring Matrix for Sub-Criteria1.1

2) Overall score for the first four sub-criteria for criterion1 is determined by averaging the score of approachand the normalised score of deployment.

3) Score for the fifth sub-criterion for criterion 1 isdetermined by considering the score on approach.

Criterion 10

For criterion 10, each sub criterion is covered from theviewpoint of results and scope, in line with the radar

scoring matrix, elaborated in theapplication brochure for CIIEXIM Award for BusinessExcellence (CII- EXIM BankAward for Business Excellence,2004).1) Results cover thefollowing measures

a) Trends - Trends are positive and/ or there is sustainedgood performance

b) Targets - Targets are appropriate and achievedc) Comparisons-Comparisons with external

organizations take place and results compare well withindustry averages or acknowledged ‘best in class’

d) Causes: Results are caused by approach1) Scope: Results address relevant areas2) Score for each measure of results is determined by

studying the performance level of the organization.3) Guidelines for scoring on each measure are available

in the scoring guidelines.4) Scores on each measure of results is assigned. Total

score does not exceed nine.5) Overall score on results is determined by averaging

the scores on each measure.6) Scores on scope is also assigned. Total score does

not exceed nine.7) Scoring Guideline for trends for sub-criteria 10.1 is

given in Table 3.8) Overall score on each sub-criterion is obtained by

averaging the scores of results and scopes.

Assessment and Scoring

The study was conducted by assessing eight differentand leading organizations from health care and textilesectors across the country. At start, a formal presentationwas made before the top management of the organizationexplaining the purpose and method of the study. Theassessment was carried out by interviewing the topmanagement of the organization using the questionnaireas per the programme schedule. Individual scoring hasbeen awarded to each sub criteria described above as perthe guidelines for scoring.

The organization ensures that the desired effects (e.g.technology upgradation, unemplyment, culture &behavior, product innovation, education, wastagesetc.) that contribute to the competitiveness of thenation have been generated

Deployment Denominators

Both way Communi-cation

Accepted (While developing whether the purpose statement is accepted)

Linkage (How the relevant requirements are put into purpose statement)

Systematic System for Communication Balancing the needs and expectations of stakeholders Integrating the requirements from beneficiaries Resolve any conflict and any action thereof

Score

Employees Partners Customers Shareholders Society Competitors, Benchmarking Partners

Beneficiary

Total

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Table 3: Scoring Guidelines for Trend for Sub-Criteria 10.1

Analysis of Data

The Analytical Hierarchy Process (AHP) is proposed inthis study in order to handle both tangible and intangiblefactors and sub-factors affecting the decision of selectingthe best practicing organization. AHP (Saaty, 2000) is adecision approach designed to aid in the solution ofcomplex multiple criteria problems in a number ofapplication domains. The goal of our problem is to identifythe best practicing organization to satisfy the degree ofcompetitiveness as proposed in the present paper. Thegoal is placed on the first level of the hierarchy. Criteria 1and 10 form the second levelof hierarchy. The third levelof hierarchy occupies thesub-criteria under these twocriteria. The lowest level ofthe hierarchy consists ofthe alternatives, namely thedifferent health careorganizations or the organizations from textile sector to beevaluated in order to select the best practicingorganization. The various levels of the hierarchy withrespect to the healthcare and textile sectors are shown inAppendices 6 and 7 respectively.

Inference

From the AHP ranking of four organizations from textilesectors we do not find any significant difference amongthese organizations with respect to the scale of preference.In case of the health care sector, H3 has been found as thebest practicing organization amongst the fourorganizations that were surveyed.

It has been found that the whole organization (H3) is drivenby a strong purpose or mission, which is derived from aselfless motive and appropriate to the role of theorganization. The mission statement is established throughthe passion from the founder member which is linked to aprioritized national problem. It is quite evident that H3 isnot only concerned about their direct customers (patients)it also reaches out to the different layers of beneficiariesand their requirements such as building the capacity ofother eye hospitals at the stake of losing its owncompetitive advantage. The effectiveness H3’smanagement system comes from the synergy between thetwo dimensions described as1. Business Model2. Spiritual ModelThese two dimensions resemble the inner and outer loopsof the proposed framework. While the second dimensionprovides a purposeful direction the business model startedfrom the motive of Self-Reliance (Venkataswamy, 2003). Inthe last two decades the organization has developed it toa large extent and enlarged it. Following this, theorganization has demonstrated high productivity, goodquality and appropriate pricing that not only support thecharity work but also support the expansion and growth.To summarize, the results of the exercise indicate that atruly competitive organization looks beyond its narrowself- interests and contributes to the growth andcompetitiveness of a nation.

Elements of Leadership

Leaders in an organization fosterbuilding the competitiveness ifIndia inc. in a sustained mannerby setting a clear direction andinspiring people within theorganization. They set themission, vision, values and

ethics in the organization in line with the purpose of theorganization to set the direction and nurture the culture ofan organization. Discovering the purpose of anorganization in line with the prioritized national intereststhat is appropriate to the role of the organization is a matterof purity of emotions and mind. Progressive attainmenttowards the pure mind is possible by detaching from selfishinterests (that is, pursuing only the local goal at the firmlevel) in the light of sattwa guna that facilitatestransparency in the vision in the context of fast movingand constantly changing external environment, realizingthe relevance of the organization in the nationalperspective and fulfilling requirements of the stakeholdersin a balanced manner arises out of duties and obligations.

Sl. No.

Results Score

1. No results or anecdotal information

1

2. Positive trends and/ or satisfactory performance on some results

2-3

3. Positive trends and/ or sustained good performance on many results over at least 3 years.

4-5

4. Strongly positive trends and/ or sustained excellent performance on most results over at least 3 years

6-7

5. Strongly positive trends and/ or sustained excellent performance in all areas over at least 5 years.

8-9

Leaders in an organization foster building the com-petitiveness if India inc. in a sustained manner bysetting a clear direction and inspiring people withinthe organization



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Conclusion

This study critically looks into the distinctive competitivefeatures of prioritized sectors of Indian Economy takinginto consideration the India’s competitive position in theglobal perspective. It suggests a framework ofcompetitiveness considering the views of eminent qualitygurus and criteria of leading excellence models. It notonly provides a framework to an organization forpositioning existing initiatives and identifying gaps in itsjourney of competitiveness but also links its enablingpractices and planned results to the growth processes of acountry. The outer and inner loops of the framework ofcompetitiveness describe how the inner union of theorganization with the country contributes to decide thestrategic direction with reduced error and confusion. Italso ranks the participating organizations while applyingthe framework to select Indian organizations from theidentified sectors with respect to selected frameworkcriteria using Analytic Hierarchy Process, captures bestpractices, studies the gaps and explores the relationshipsfrom a unique viewpoint.

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• Global Competitiveness Report, 2003-2004 (2004)World Economic Forum, Geneva, Switzerland.

• ISO 9000 (2000) Quality Management System andVocabulary.

• ISO 9004-2 (1991) Quality Management and QualitySystem Elements, Part-2: Guidelines for Services.

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• Ishikawa K. (1985) What is Total Quality Control? -The Japanese Way, Prentice Hall, Englewood Cliffs,NJ.

• Juran J.M. (1998) Quality Control Handbook,McGraw-Hill, NY.

• Kaplan R.S. and Norton D.P. (1996) The BalancedScorecard–Translating Strategy into Action, 67-73,Harvard Business School Press, Boston,Massachusetts,.

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• McCracken M.J, McIlwain T.F. and Fottler M.D.(2001) Measuring Organizational Performance in theHospital Industry: An Exploratory Comparison ofObjective and Subjective Methods, Health ServicesManagement Research, 14(4), 211-219(9), RoyalSociety of Medicine Press, 1 November.

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43

Number of Employees

Sl No

Healthcare organization

Date(s) of Study

Type Turnover (Rs)

Medical Total

Key Features

1 H1 24-25 June, 2003

Teaching, Research & Patient Care. Tertiary Hospital

1. 05 billion (Approximately)

498 7,182 Established by an Act of Parliament; Managed by the institute body – presided by Minister of State for Health & Family Welfare, Government of India; Non-Profit organization.

2 H2 30-31 July, 2003

General Hospital

150 million (Approximately)

35 421 Managed by a Board of Directors; Focus on shareholders’ interests; Strong Profit Motive.

3 H3

28 & 30 June, 2003

Eye Care 388 million (Approximately)

43 492 Managed by a Trust; Managed from two dimensions: a)Spiritual Model b) Business Model; Non-Profit organization.

4 H4

18 November, 2003

super specialty hospital dedicated exclusively to the diagnosis, treatment and research related to cardiovascular diseases

360 million (Approximately)

43 605 Managed by a Trust; Focus on society and self sustenance. Non-Profit organization.

Sl. No

Healthcare organization

Documented Statements

1 H1 Objective: To develop ideal standards for medical education and training, research and patient care.

2 H2 Mission: Care delayed is care denied Vision: To become a “centre of excellence” in the provision of healthcare services in Eastern India and to be developed as the centre of choice for all tertiary care patient referrals. Quality Policy: We, the employees of “H2” driven by personal commitment and determination, shall support each other to deliver “TOTAL HEALTH CARE” to each patient, so that they remember us for having provided service that was more than what they had expected. We will achieve this by continuous measurement, analysis and improvement of every work activity.

3 H3 Mission: To eradicate needless blindness by providing appropriate compassion and high quality eye care for all Quality Policy of one of the associate units (set up primarily for manufacturing intraocular lens): We shall strive for excellence in all our activities. We shall manufacture superior quality products and deliver on time with world- class service at comparative prices to achieve total customer satisfaction, through continuous improvement by teamwork.

4 H4 Vision: To be the leading Cardiac and Thoracic care institution in India with world-class standards of Quality and Service. Mission: To offer highest standards of Cardiac and Thoracic treatment and care to all sections of society at large. Commitment: To continuously upgrade technology and expertise in terms of equipment and human resources in a manner so as to keep pace with the latest development worldwide. Quality Policy: We at “H4” shall strive to be a leading institution offering best possible treatment, care and services by anticipating and exceeding customer’s expectations. Continuous improvement shall be our motto and we shall achieve the same through training, motivation and teamwork. Environmental Policy: “H4” shall strive to provide a clean and healthy environment to our patients and the society. Being a leading institution, our care and services should be environmentally responsive and sensitive to the community. We shall comply with the relevant Environmental Laws and Regulations and as such prevent pollution at the source of generation and reduce waste through continual improvement.

1 Determing Sources of Data 2 Designing the Questionnaire and Scoring

Guideline 3 Determining Sampling Design and

Sampling Size 4 Organizing and conducting the study 5 Processing and Analysing the Collected

Data 6 Interpretation of Data

Appendix 1The Methodology of the Study

Appendix 2Key Features of Participating Health Care Organizations

Appendix 3Documented Statements Leading to Organizational

Purpose (Health care Sector)

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Sl No

Textile organization

Date(s) of Study

Type Turnover (Rs) Number of Employees

Key Customer Groups

1 T1 1-2 December, 2003

Raw White and Melange Yarn

1.4 billion (Approximately)

728 100 % EOU Textile unit

2 T2 5th December, 2003

Cotton and Blended Fabrics of Yarn


4540 Overseas Importers, Readymade Garment Manufacturers, Government & Public Institutions, Domestic Market

3 T3

6-8 December, 2003

Textile Yarn (100 % Cotton Yarn, Acrylic Yarn) etc.


1440 Garment Producers & Fabricators (Export 50 %; domestic 50 %)

4 T4

9-10 December, 2003

100 % Cotton Yarn


418 100 % EOU Textile unit

Sl. No

Organization from the

textile sector

Documented Statements

1 T1 Corporate Mission: To accelerate, maintain and sustain efforts to become global leaders in value added yarns. Corporate Objectives: • 80% of our existing capacity to be used

for value added yarns • To become global leaders in melange

yarns • To be among the top five producers of

cotton dyed yarn in India • Quality Policy: 1. The firm is committed in providing

total customer satisfaction, both external and internal, with quality products and services conforming at all times to clearly established norms.

2. To achieve these objectives, we will promote the concept of personal development, team building and effective leadership.

3. We will strive for continual improvement by establishing and reviewing quality objectives.

4. We will ensure that our actions confirm to the values those T1 attaches to its role and responsibilities towards its customers, environment and society.

5. The Quality Policy will be communicated at appropriate levels and reviewed for continuing suitability.

Health, Safety & Environment Policy: T1 is committed to provide health & safe workplace for Associate, conducting business operation in an Environment Friendly Manner & operating its facilities in compliance with all applicable laws & regulations. T1 will promote the Health & Safety of All by working to continuously reduce our injury & illness by implementing appropriate Training & corrective action programs. We at T1 will strive continually reduce impact to the environment through pollution prevention activities. The Company will minimize emissions to air, water & Land, minimize energy consumption & develop sources of sustainable raw Materials. In keeping with this policy, Associates are encouraged to continuously improve Health, Safety & Environment awareness among all.

Appendix 5Documented Statements Leading to Organizational

Purpose (Textile Sector)

Appendix 4Key Features of Participating Textile Organizations



45

T2 Vision: we, at T2, will be global leaders in quality, productivity, Profitability and Market Perception by becoming extremely customer-oriented, socially committed, progressive organization built on the fundamentals of people growth and self-sustaining positive work environment Quality Policy: We, at T2, commit ourselves to strive for excellence and innovation in every product, process and service so that we have a clear competitive edge and our customers are enthusiastically satisfied. Our thoughts and act6ions, forever, will be characterized by our customers in focus, both internal and external. We will pursue initiatives that demonstrate world class performance in all what we do. This is done with dedicated participation of each individual and teamwork of all our people to improve continuously and create a self-sustaining positive work environment. T2 resolves to represent quality, integrity, reliability and excellence to its customers, suppliers, society and above all to ourselves.

T3 Mission: T3 Group on a learning curve will expand capacities in Textiles and reinforce Customer-delight by manufacturing world-class quality using state of the art technology Vision-2007: We at T3 Group will achieve a turnover of Rs 500 Crore by strengthening its core competencies and capacities in Textile and diversified businesses to create value for its stake holders. Values: Trust, Integrity, Teamwork, Adaptability, Winning spirit Guiding Principles:

- Customer Driven Enterprise - Quality has no comparison - Continuously innovating - Respect for Human Capital - Corporate Governance

Quality Policy: 1. Quality shall be built into the

company’s products to not only meet customer requirements continuously, but exceed them. The company shall achieve this through an interface with the market place, access to the state of art technology, R&D, Process Development and adoption of innovative manufacturing and marketing strategies.

2. the quality Policy shall be integrated with the Company’s main objectives

a) To remain market leader in quality

b) Increase market share with focus on niche segments

c) Improve productivity d) Cost reduction e) Reduction in percentage

in seconds These objectives shall be reviewed once in a year.

T4 Mission: T4 aims to be world class textile organization producing diverse range of products for the global textile market. T4 seeks to achieve customer delight through excellence in manufacturing and customer service based on creative combination of state-of-the art technology and human resources. T4 is committed to be responsible corporate citizen. Quality Policy:

1. Quality shall be built into the company’s products to not only meet customer requirements continuously but also to exceed them. The company shall achieve this through an interface with market place, access to the state of art technology, R&D, Process Development and adoption of innovative manufacturing and marketing strategies.

2. The quality Policy shall be implemented through a network of systems and procedures understood and followed throughout the Company.

3. the quality Policy shall be integrated with the Company’s main objectives

a) To remain market leader in quality

b) Increase market share with focus on niche segments

c) Improve productivity d) Cost reduction e) Reduction in percentage

in seconds 4. The management shall be

committed to provide capital and human resources to achieve the above objectives. A companywide quality culture shall be created through training and motivation of people at all levels of organization.

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Identifying Best Practices

Criteria 1 Criteria 10

Sub-criteria 1.1 to 1.5 Sub-criteria 10.1 to 10 2

H1 H2 H3 H4

H1 H2 H3 H4

Appendix 6

AHP Model for Selection of the Best Practicing Organization with respect to Healthcare Sector

Appendix 7

AHP Model for Selection of the Best Practicing Organization with respect to Textile Sector

Identifying Best Practices

Criteria 1 Criteria 10

Sub-criteria 1.1 to 1.5 Sub-criteria 10.1 to 10 2

T1 T2 T3 T4

T1 T2 T3 T4



47

Reflecting Applicability in Real Life

1. Review the definitions, criteria and formalization of strategy and competitiveness in your organization andcompare the results with relevant examples among some given in this paper.

2. Evaluate the competitiveness (e.g. mission/vision/objectives and performance) of the organization in light ofcountribution to country competitiveness (e.g. on employment, exports)

3. Review the competitiveness thinking and business model to identify areas of improvement

Sanjib Dutta is a Senior Counsellor in CII Institute of Quality at Bangalore. Hispresent responsibilities include Training and Consultancy in the areas of BusinessExcellence, Strategic Quality Management, New Product Development, QualityManagement System, and Tools and Techniques (e.g. SPC, DOE). Mr. Dutta is aRegistered Lead Auditor for ISO 9001: 2000, a qualified auditor for QS 9000 and anAssessor for CII EXIM Business Excellence Award.

Previously, he has worked with Hindustan Motors and IFB Industries Limited. Mr.Dutta, is currently doing PhD at Indian Institute of Technology, Kharagpur and haspublished/presented various papers in national/ international journals and conferences.

N. Srinivasan, is currently Director General of Confederation of Indian Industry(CII). Through his entire career, Mr. Srinivasan has been focusing on enhancingindustry competitiveness with special attention to areas such as technical education,industry-institute interaction, total quality management and technology. As a memberof the CII permanent staff, he played a significant and steady role in building bridgesbetween industry and higher technical education institutions in the country. Mr.Srinivasan was responsible for setting up the CII Institute of Quality in Bangalore in2001. The Institute is an International Center of Excellence for Training &Development on all aspects of competitiveness.

P. K. J. Mohapatra is a Doctorate from Indian Institute of Technology Kharagpurand a professor of, Industrial Engineering & Management at IIT Kharagpur. Hispresent research areas include:

· Software Engineering and Management· Strategic Management· System Dynamics· System Engineering

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