The conventional view on China in manufacturing is that low labor cost drive the competitive advantage. The conventional view on India in manufacturing is? Well, there is no conventional narrative, not least because we have not exactly distinguished ourselves in factory work.
Be that as it may, I recently heard an amusing story on how India stacks up versus China in manufacturing. I was having lunch with a friend who runs a packaging materials business out of Dubai. He procures most of his material from China.
“Ever tried sourcing from India?”, I asked him. He has but gave up after a few deliveries. “Was cost or quality an issue?”, I asked him. Not at all, in fact Indian manufacturing is apparently quite cost competitive nowadays, and quality is not a major problem. The real issue is reliability in delivery.
Place an order with a Chinese company and within a day or two, an email will arrive listing in some detail the process from when the payment is received, right down to the packing, shipping and delivery date. More often than not, the Chinese will stick to the dates. Very rarely do they default on commitments.
Place an order with an Indian company and? And well, very little happens, or at least you don’t get to know about it. You have to follow-up a few times to get firm commitments. And at every step of the process, commitments are unlikely to be met; dodgy, evasive answers, instead of clear communication, tends to be the norm.
It’s a cultural thing, according to my friend. A commitment is more a declaration of intent, and not really something that has to be honored. Interesting observation, and one that I completely understand… a commitment is a declaration of intent!
