Enhancing SME competitiveness through CII Vendor Cluster at Godrej Interio.

Godrej Interio (GI) is part of the Godrej Group, one of India’s largest engineering and consumer product groups. GI is India’s largest furniture brand and firmly believes that its success is dependent on its partner’s success.

Around 2007, GI had a large unorganized supplier base, with more than 600 enterprises. However, the majority of these, which are mostly family run businesses, were facing capacity as well as capability issues. To address these issues, the GI Sourcing Team launched its flagship programme “Beyond Sourcing” with 3 goals in 2007, namely, building supplier’s capabilities, creating value propositions for both GI and its partner suppliers, and taking relationships with suppliers beyond transactions.

CII-assisted Vendor Cluster was one of the key initiatives by GI in 2009, under its flagship programme “Beyond Sourcing”, which uses the cluster philosophy, “GETTING TOGETHER, LEARNING TOGETHER & ACHIEVING TOGETHER” to establish systems and process management at the supplier’s end.

Uniqueness of GI Vendor Cluster: In 2010, GI became a pioneer by launching the first ever Vendor Cluster in the furniture industry. To demonstrate its commitment towards cluster methodology, GI’s own Bhagwanpur and Shirwal unit participated in its Vendor Cluster 3 & 4 respectively.

Methodology: A dedicated Vendor Capability Enhancement Cell was formed to drive the Cluster initiative. Under the guidance of experts from CII as well as industry, SME cluster suppliers’ competitiveness was enhanced in a structured way, through classroom trainings, handholding visits etc.  Cluster participants were trained in several concepts and tools such as 5S and 3M, various Quality tools, SMED, business key indicators, Safety Standards etc.

All the activities were planned, monitored and reviewed in the Monthly Review Meetings, wherein guidance was given by GI senior management and CII experts to each Supplier, based on their progress.

Journey of GI Cluster Programme: As of 2017, GI has successfully completed 5 Basic Clusters, 1 Advanced Cluster, and 1 Enhanced Basic Cluster (on-going), covering 41 SME Suppliers, and training at each level i.e. CEOs, managers and operators for each subject.

Results achieved:  GI Vendor Cluster through mutual cooperation has yielded significant benefits to both GI and its suppliers , resulting in Win-Win relationships between GI & cluster SMEs.

Benefits achieved:  Through the cluster inputs, GI has facilitated improvement in processes, systems and hygiene as well as safety aspects at suppliers’ facilities through Total Employee Involvement. Other key benefits include Mind-set transformation of CEO, Introducing & sustaining safety culture etc. In the past 6 years, GI’s SME suppliers have won 24 awards at various National Cluster Summits. Manufacturing excellence has also built a foundation for winning 5 prestigious awards at the CII-IQ SMB STAR ICON Performance Excellence Recognition competitions & 9 GreenCo certifications from CII.

Godrej Interio vendor cluster process has enhanced SME competitiveness by supporting, encouraging and strengthening the SME supplier base and  has greatly  contributed to nation building.

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