How MSME Industrialists Can Bridge Global Gaps And Win Big

Micro, Small, and Medium Enterprises (MSMEs) are universally recognised as the backbone of the global economy.

Worldwide, MSMEs account for around 90% of businesses, 60–70% of employment, and up to 50% of GDP, making them vital engines of job creation, innovation, and economic growth.

According to the World Bank, 600 million new jobs will be needed globally by 2030, highlighting MSMEs’ essential role in sustainable development.

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MSMEs: Catalysts for Inclusive, Sustainable Growth

Behind India's remarkable economic transformation are 63 million small businesses—MSMEs that serve as the backbone of communities across the nation. These enterprises aren't just production units; they're catalysts driving India toward becoming the world's third-largest economy by 2027, with GDP projected to reach $5 trillion.

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Their Impact is Extraordinary:

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• Economic powerhouse: Contributing 30% of India's GDP and 45% of total exports
• Job creators: Employing over 110 million people, with each rupee invested generating 4–5 times more jobs than large industries
• Community builders: Operating across 6,000+ clusters in rural and semi-urban regions, from Tamil Nadu's textile hubs (1.5 million jobs) to Pune's auto component clusters.

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While challenges like inflation and global uncertainty persist, these aren't just hurdles; they're opportunities for reinvention. 

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What Indian MSMEs Must Do to Bridge Global Gaps

To reach India's ambitious economic targets, MSMEs must evolve into digitally enabled, globally competitive enterprises. Here’s how:

1. Close the Productivity Gap

According to McKinsey, MSMEs in emerging markets are 30–50% less productive than large enterprises. Indian MSMEs can bridge this gap by:

• Adopting digital tools: Low-cost automation, CRM/ERP software, and predictive maintenance can significantly boost efficiency.
• Partnering with large firms: Being part of MNC and Tier-1 supply chains raises operational standards and opens international markets.
• Using sector-specific benchmarks: Assess productivity using regional cluster data (e.g., Tamil Nadu textiles, Pune auto parts) to drive improvement.

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2. Leverage India’s Manufacturing Momentum

India's manufacturing sector is gaining strength. The PIB press release outlines support through PLI schemes, the India-Middle East-Europe Economic Corridor, and major infrastructure upgrades. To take advantage:

• Align with Make in India, PLI, and Skill India initiatives.
• Register on the Udyam portal to formalize operations. Formalization is essential for global competitiveness. Benefits include access to CGTMSE and Mudra loans for funding, global certification standards like ISO and eligibility for global tenders and cross-border e-commerce platforms.

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Over 40 million MSMEs are now on Udyam. The ₹22,138 crore allocation to the MSME Ministry in 2024 signals strong government backing.

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3. Embrace Export-Led Thinking

As global buyers diversify away from China and Bangladesh, Indian MSMEs are well-positioned to fill the gap. There is rapid growth in high-value exports. MSMEs can:

• Target emerging markets via India’s growing Free Trade Agreements.
• Join cluster-level export councils to streamline international access.
• Use the Indian Trade Portal for tariff, logistics, and demand data.
• Improve manufactuirng process and upgrade facilities to meet international standards

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4. Upskill and Modernize the Workforce

Skill shortages—especially in automation, green tech, and digital roles—are holding MSMEs back. To solve this:

• Tap into government programs like Skill India for certified labour.
• Partner with ITIs, vocational colleges, or sector skill councils for customized on-the-job training.
• Offer internal skill incentives, such as certification bonuses or promotion pathways.

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5. Prioritize Innovation and R&D

India spends only 0.64% of GDP on R&D, far below the global average. As noted in Forbes India, innovation in sustainability and digital tech is vital. MSMEs should:

• Leverage Startup India for IP protection and R&D incentives.
• Develop dedicated capabilities focused on growth, evolving customer needs to build a culture of innovation.
• Differentiate through innovation in technology, product design, manufacturing processes, and even business models.

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The author of the Forbes India article, Hanna Luchnikava-Schorsch, says, “Manufacturing reshoring and trade regionalisation strategies on India could be positive over time. Companies are expected to relocate their operations to regions that offer competitive advantages, with India emerging as a key destination. Further, improvements in logistics efficiency, labour market deregulation, and financial resource availability would create a favourable environment for manufacturing investment. This, in turn, would lead to increased economic efficiency, greater manufacturing output, higher employment and stronger economic growth overall.”

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Why MindStep Consultancy Is the Right Partner

Overcoming these challenges requires strategic guidance. We provide customised solution tailored to your business needs. We work closely with you to ensure alignment and conduct workshops and trainings to ensure organisational readiness. Our solutions are simple and practical and designed for effective execution.

Here’s how MindStep Consultancy supports your MSME journey:

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Enhance Operational Excellence

• Implement lean tools such as 5S, Kaizen, and digital solutions.
• Improve productivity, reduce waste, and optimize inventory and costs.
• Redesign plant layout, enhance safety protocols, and strengthen quality control.

Build Strong People Practices

• Design clear organizational structures with well-defined KRAs/KPIs.
• Drive talent development, and performance management systems.
• Build an engaged, high-performance culture.

Strengthen Strategy and Scalability

• Identify growth opportunities and define market differentiators.
• Define strategic priorities, develop future-ready roadmaps aligned with your mission.
• Support GTM planning, customer insight, and execution.

Ready to build a globally competitive MSME?

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Book your 15-minute complimentary discovery call with our team via our website.
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