Work Redesign, Talent Deployment Key To India’s Manufacturing Productivity Growth: KPMG Report

New Delhi, Sep 7 (KNN) India's manufacturing sector is entering a new phase of productivity growth, with future gains increasingly dependent on redesigning work, restructuring organisations and deploying talent more effectively while leveraging digital technologies and artificial intelligence (AI), according to a KPMG report.

KPMG said traditional drivers of manufacturing productivity, including wage arbitrage, economies of scale and lean compliance, are beginning to flatten. 

“Productivity is Indian manufacturing’s most powerful growth lever. A sustained 30 per cent productivity gain could drive nearly 35 per cent of future output,” the report noted, as cited by ANI.

However, productivity improvements remain uneven across the sector. More than 70 per cent of large manufacturing companies would require transformative measures to achieve the productivity growth needed to meet India's manufacturing ambitions, it added.

Rethinking Work and Organisations

The report said the next phase of productivity growth would depend on how companies redesign work and create value across the manufacturing value chain.

It highlighted the need to eliminate non-value-adding activities, rework, delays and unnecessary handoffs, while also rethinking role architecture and job design. This includes grouping activities more efficiently and identifying opportunities to consolidate roles.

At the organisational level, productivity gains will depend on how value flows across businesses, with greater focus on decision rights and governance, including approval processes and delegation thresholds.

Workforce Productivity

KPMG also highlighted manpower productivity, measured by the number of full-time employees (FTEs) required for a given level of output.

The report called for the use of internal and external benchmarking and dynamic manpower norms to improve workforce deployment as companies restructure operations and redefine roles.

AI to Reshape Manufacturing

The report said AI would play an increasing role in reshaping manufacturing value chains, but its impact would extend beyond automating existing processes.

“Competitive advantage from AI will come from rethinking roles, workflows, and decision rights, not simply layering AI onto existing ways of working,” KPMG said.

At the same time, the report noted, “where judgment, dexterity, relationships, and accountability matter most, human-led work will remain essential.”

(KNN Bureau)