Collaboration in Indian SME Clusters: A Case Study

Clusters of small and medium enterprises have been very successful in promoting the growth of MSMEs (Micro, Small, and Medium Enterprise) all over the world. The success of these clusters is largely due to the individual small firms of the cluster closely collaborating and sharing resources. Sharing is the theme of our paper, where we focus on understanding how productivity and efficiency of an SME cluster in developing region can be improved by furthering collaboration among its units. The hypotheses of our study were that (a) there exists limited sharing and collaboration through informal networks among SME cluster units in emerging regions, (b) these clusters could be more productive by improving the collaboration among cluster actors, and (c) the sharing and cooperation within the cluster can be improved with formal networks among the cluster entities. To validate our hypotheses, we undertook a field study of the SME jeans cluster in Bellary, Karnataka. In this paper, we have put forth our findings from the study, followed by importance of collaboration in MSME clusters.