Collective dynamism and firm strategy: Study of an Indian industrial cluster

An attempt to contribute to the debate on flexibility-collectivity in small and medium enterprises, this study presents the complex character of a typical cluster in a developing country. It analyses various aspects of organization of production, the process of internal differentiation, competitive strategies of the firms, collective action and conditions of labour. Despite the growth of SMEs, technological advancement has been limited. Fast proliferation of business has given a boost to easy entry of entrepreneurs with the vested motive of making a quick profit. This has encouraged price competition based on using inferior inputs that would tarnish the image of the cluster. Importantly, the predicament of labour has remained a disturbing feature in such clusters. Promoting clusters would have to be based on mutual trust and networking, especially in the non-competitive areas such as ensuring product quality and enhancing standards of employment.