Micro, small and medium enterprises (MSME) employ around 69 million people in India and account for 45 percent of the manufacturing output and 40 percent of the total exports of the country ( source ). The Micro, Small and Medium Enterprises (MSMED) Act, 2006 extended the definition of enterprise to include services sector as well. MSMEs play a crucial role in providing large employment opportunities at comparatively lower capital cost. Also by creating local opportunities, they help to reduce regional imbalances and equitable distribution of national income and wealth.
For India to be able to create a sustainable and socially inclusive growth story, focused attention from government is required to help SMEs gain the competitive advantage. This need not necessarily be restricted to subsidizing alone. The sector needs a lot from government in terms of technology up gradation and skill enhancement as well.
To identify issues inhibiting growth of the sector, a Task Force was constituted by the Prime Minister in 2009. In its report, the Task Force made 85 recommendations to unshackle the Indian MSMEs and lead them to their full potential. None of these recommendations however identify the need for project management as a skill that must be cultivated and nurtured. This is a skill that has grossly being ignored but is highly needed. SMEs especially on their transition journey from small to medium enterprises face challenges in this area. In most cases this transition is from sole proprietor to a partnership or a family based business expanding into more regions. It is at this critical juncture that structuring their operations to be focused and efficient will exponentially increase the success rate of these transitions.
MSMEs don’t need bureaucratic and traditional project management approaches practices in larger organizations. They need approaches that are quick to learn, simple and lightweight to use. They also need to be agile to align to the business practices, especially of a fast growing SME. They need to harness the power of information technology and widespread use of mobile and internet connectivity.
Government definitely needs to plan more and build the framework to facilitate in this direction but tremendous opportunity exists for entrepreneurs as well to address this needs of this very important sector and have a viable business model around it.