Flexible practices for mass production goals: economic governance in the Indian automobile industry

This paper explains the remarkable restructuring of the Indian automobile industry. It argues that firms have had to deploy new governance modes (flexible industrial practices) for economic coordination to overcome supply bottlenecks and meet expanding demand. Firms that failed to adopt these practices performed poorly, while firms that attained economies of scale were able to graduate to exploiting economies of scope. The industry experience suggests that new governance modes can serve mass production goals in developing economies and not just cushion market volatility, for which they were designed.