Lean Manufacturing Competitiveness Scheme

The Government of India (GoI) has upscaled the Lean Manufacturing Competitiveness Scheme (LMCS) for Micro, Small, and Medium Enterprises (MSMEs) to reduce waste in the manufacturing process and improve global competitiveness in the MSME sector. The outcome of implementing lean manufacturing technologies in the MSME sector will lead to:

Cost reduction production per unit
Increase in the productivity of the MSMEs
Enhanced competitiveness in domestic and overseas markets
Better working environment, adding more experts to the firm and managerial competencies
Creating a demonstration effect
Result in rejection
Standardization of process and
Better layout of machines reducing the transportation process

Objectives of the Scheme

To enforce Lean manufacturing techniques for creating healthy global manufacturing competitiveness among MSMEs
To increase productivity by reduction of wastage in the manufacturing process
To achieve the highest level in quality of products with very low operational expenditure
To enhance Inventory management for a better flow of goods from manufacturers to warehouses
To create better Space management
To create better management systems to eliminate direct waste and
To create a culture of continuous improvement through innovative practices

Salient Features

The Lean Manufacturing Competitiveness Scheme was initiated as a pilot process during 11th Five Year Plan. National Productivity Council was selected as National Monitoring and Implementing Unit (NMIU) for facilitating implementation and monitoring of the Scheme. The Lean Techniques started in 89 Mini Clusters and successfully completed work in 59 Mini Clusters. The Scheme was again vigorontly implemented in September, 2013 considering the recommendations of the evaluation report conducted by Quality Council of India. The evaluation report on pilot process of LMC Scheme has recommended the continuation of the Scheme as the units was able to acheive benefits with 20% increased in productivity. NPC and QCI have been selected as National Monitoring and Implementing Units (NMIUs) for the up-scaled scheme. GoI along with Lean Manufacturing Consultants (LMC), work with MSMEs to provide educational and financial support for better productivity and to create more awareness across the country. GoI has started programmes and allotted funds to promote LMCS; they are:

S. No.	Topic	Title/Allotted Members	Funds allotted
1	Awareness Programme (one day)	For mobilization of MSMEs and other stakeholders	Upto Rs.70,000/per programme
2	National Workshop (one day)	On Lean Manufacturing for all stakeholders	Upto Rs.5 lakhs/per workshop
3	Residential Training (3 days)	For implementing agency officials	Upto Rs.3 lakhs/per programme
4	Orientation/Training Programmes	For Lean consultants	Upto Rs.2 lakhs /per programme
5	Visiting clusters	For IAs/NMIU/SSC	Upto Rs.10 lakhs/per visit

Other programmes include:

Collaborations with various International Institutions for Consultants specialized inputs for MSME-Dos, NMIU, Consultants, Mini Clusters, International Training/Study of Global Best Practices, etc.
Newsletters, Web site, Publications, Best Practices, publicity, etc.

The following institutions will implement LMCS:

National Monitoring and Implementation Unit (NMIU)
Project Monitoring and Advisory Committee (PMAC)
Implementing agencies (IA) identified by MSME ministry

Eligibility Criteria for the Scheme

All MSMEs as per MSME Act 2006
MSMEs included as per executive orders issued by the office of AS&DC (MSME)
Approval of PMAC, NMIU, and IA

Implementation

The LMC Scheme is implemented through the agencies similar to PMAC, NMIU, and IA by following methods:

Awareness programmes and workshops are being organized to create awareness among the entrepreneurs and motivated to form mini clusters comprising of 6 to 10 units.
Lean Management consultants will work with the specially formed team Special Purpose Vehicle (SPV)/Distinct Product Group (DPG) for Lean Management in the unit for 18 months.
The 80% of hiring cost of LMC is reimbursed through NMIUs to SPVs/Units and 20% of the cost has to be borne by the SPVs/units.

Application Procedure

To access the government portal. The webpage will contain three parts for filling the application Part-I (Udyog Aadhaar Related) The following details have to be entered in Part I:

UdyogAadhar Number
PAN Number (As per MSME DataBank)
Verification Code (it will be displayed below)

PART-II (Scheme Related) The following details have to be entered in Part II:

Company Details - Enter multiple company detail such as Name, Type
Name of Lean Manufacturing Technique - Select name of Lean Manufacturing Technique
National Monitoring and Implementing Units (NMIUs) - Select National Monitoring and Implementing Units (NMIUs)
Enter SPV Name - Enter the name of SPV
Enter Act, Year - Enter Act, Year

PART-III (Upload Related) The following details have to be uploaded in Part III:

Upload MoU (As per scheme guidelines, Annexure-1) - Upload copy
Upload Power of Attorney (As per scheme guidelines, Annexure-2) - Upload copy
Upload copy of SPV Registration/DP6 resolution (as applicable) - Upload copy

The interested companies can also approach the National Productivity Council (NPC), Delhi. The guidelines are attached here for reference:

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Frequently Asked Questions

Common questions about Lean Manufacturing Competitiveness Scheme for Indian MSMEs.

The LMCS is a Government of India scheme aimed at reducing waste in the manufacturing process and improving global competitiveness in the Micro, Small, and Medium Enterprises (MSME) sector. It aims to enforce lean manufacturing techniques, increase productivity by reducing wastage, achieve high product quality with low operational expenditure, and promote continuous improvement.

The main objectives of the LMCS are to enforce lean manufacturing techniques for creating healthy global manufacturing competitiveness among MSMEs, increase productivity by reducing waste, achieve the highest level of product quality with low operational expenditure, enhance inventory management, improve space management, eliminate direct waste, and create a culture of continuous improvement through innovative practices.

The key implementing agencies for the LMCS are the National Monitoring and Implementing Units (NMIUs), the Project Monitoring and Advisory Committee (PMAC), and the Implementing Agencies (IAs) identified by the MSME ministry.

All MSMEs as per the MSME Act 2006, and MSMEs included as per executive orders issued by the office of AS&DC (MSME), are eligible for the LMCS, subject to approval by the PMAC, NMIU, and IA.

The LMCS is implemented through awareness programs, workshops, and the formation of mini clusters of 6 to 10 units. Lean Management Consultants work with these mini clusters for 18 months, with 80% of the consultant's cost reimbursed by NMIUs and 20% borne by the units.

Interested MSMEs can apply for the LMCS through the government portal, which involves filling out an application form in three parts: Udyog Aadhaar-related details, scheme-related details, and uploading required documents like MoU, Power of Attorney, and SPV Registration/DP6 resolution.

The LMCS supports various programs, including awareness programs, national workshops, residential training for implementing agency officials, orientation/training programs for lean consultants, cluster visits for IAs/NMIU/SSC, collaborations with international institutions, and initiatives like newsletters, publications, and publicity.

The outcome of implementing lean manufacturing technologies under the LMCS includes cost reduction per production unit, increased productivity of MSMEs, enhanced competitiveness in domestic and overseas markets, better working environment, addition of more experts and improved managerial competencies, and a demonstration effect.

The National Productivity Council (NPC) was selected as the National Monitoring and Implementing Unit (NMIU) for facilitating the implementation and monitoring of the LMCS during the 11th Five Year Plan and the upscaled scheme.

The LMCS provides funding support for various programs, including awareness programs (up to Rs. 70,000 per program), national workshops (up to Rs. 5 lakhs per workshop), residential training (up to Rs. 3 lakhs per program), orientation/training programs for lean consultants (up to Rs. 2 lakhs per program), and cluster visits (up to Rs. 10 lakhs per visit).