An Investigation of Organizational Capabilities to Adopt Industry 4 in Select Indian SME

Abstract

This study investigates how Indian small and medium-sized enterprises (SMEs) can develop the organizational capabilities required to adopt Industry 4.0 technologies. SMEs, which contribute nearly 29% to India s GDP and employ over 120 million people, face challenges such as outdated technology, fragmented supply chains, and global competition. The research aims to assess their readiness for Industry 4.0 and identify the key enablers and barriers influencing adoption. newlineThe study was conducted in three sequential phases. First, an extensive literature review and expert consultations identified 14 enablers and 12 barriers, refined from an initial list of 23 and 27 factors, respectively. Interpretive Structural Modeling (ISM) and MICMAC analysis established the interrelationships and classified factors into autonomous, dependent, linkage, and independent clusters. Next, a survey of 243 SMEs tested the conceptual framework using Structural Equation Modeling (SEM) and Confirmatory Factor Analysis (CFA). Finally, three case studies from different manufacturing sectors validated the findings in real-world contexts. newline newline