1 hr ago

KPMG Says Productivity Could Drive India’s Manufacturing Future

KPMG says Indian factories could make much more if workers and workplaces become more productive.

A 30% improvement in workforce productivity could produce nearly 35% of India’s future manufacturing output.

Productivity means getting more useful work and products from the same resources.

KPMG says productivity gains can last longer than growth based only on selling more or building larger factories.

The study looked at more than 130 large Indian manufacturing companies over 10 years.

Companies with stronger productivity growth earned profits and increased in value faster than average companies.

Many large manufacturers may need major changes to reach the country’s goals.

KPMG says digital tools, artificial intelligence, better organisation and changes in workplace culture could help.

Key facts

Projected output impact: A sustained 30% workforce-productivity improvement could drive nearly 35% of India’s future manufacturing output.
Companies studied: More than 130 large Indian manufacturing companies.
Analysis period: 10 years.
Profit growth: Productivity-leading companies recorded about 10–11% annual net profit growth, compared with about 7% for average-productivity companies.
Market-capitalisation growth: Productivity-leading companies recorded around 19% annual growth, compared with nearly 10% for average-productivity organisations.
Transformation need: More than 70% of large manufacturing companies may require transformative measures to reach the needed productivity growth rate.
Factory productivity gap: Small and unorganised facilities produce less than 20% of the output per worker achieved by large firms.

thehindubusinessline.com · 1 hr ago