What is the ZED Framework?
The Zero Defect Zero Effect (ZED) Framework is an initiative by the Ministry of Micro, Small, and Medium Enterprises (MSME), Government of India. It aims to promote quality and sustainability among MSMEs by emphasizing the production of goods that are free from defects (Zero Defect) and have minimal negative impact on the environment (Zero Effect). The ZED Certification Scheme is designed to encourage MSMEs to adopt best practices in quality management, environmental sustainability, and social responsibility, thereby making them globally competitive.
When is the ZED Framework Needed?
The ZED Framework becomes essential when MSMEs aim to improve their operational efficiency, quality standards, and environmental sustainability. It is particularly relevant when:
- MSMEs seek to enter international markets that demand high-quality products with strict environmental compliance.
- There is a need to reduce operational costs through better resource management.
- MSMEs want to align with national and global sustainability goals and regulations.
When Was the ZED Framework Started?
The ZED Framework was launched in line with the vision of the Prime Minister of India on the 68th Independence Day to promote the concept of “Zero Defect, Zero Effect” in the manufacturing sector. It was later developed and implemented by the Ministry of MSME with the assistance of the Quality Council of India (QCI)
Who Owns and Introduced the ZED Framework?
The ZED Framework is owned and introduced by the Ministry of MSME, Government of India. It is implemented with the support of the Quality Council of India (QCI), which is responsible for establishing the standards, guidelines, and the certification process for the ZED Scheme.
For Whom is the ZED Framework?
The ZED Framework is specifically designed for Micro, Small, and Medium Enterprises (MSMEs) in India. Initially targeted at the manufacturing sector, it has expanded to include service sector MSMEs in its later phases. The scheme is applicable to MSMEs registered with the UDYAM Registration portal and aims to support them in achieving higher levels of quality and sustainability.
What Does the ZED Framework Cover?
The ZED Framework covers 20 key parameters across three certification levels—Bronze, Silver, and Gold—that assess an MSME’s performance in areas such as:
- Leadership
- Swachh Workplace (Clean and Hygienic Workplace)
- Occupational (Workplace) Safety
- Measurement of Timely Delivery
- Quality Management
- Human Resource Management
- Daily Works Management
- Planned Maintenance & Calibration
- Process Control
- Product Quality & Safety Testing / Certification
- Material Management
- Energy Management
- Environment Management
- Measurement and Analysis
- Supply Chain Management
- Risk Management
- Waste Management (Muda, Mura, Muri)
- Technology Selection & Upgradation
- Natural Resource Conservation
- Corporate Social Responsibility
Difference Between ZED and ISO Standards
While both ZED and ISO standards aim to improve quality and sustainability, there are key differences:
- ZED Framework: Focuses specifically on the Indian MSME sector with a broader approach that includes quality, environmental, and social parameters. It offers graded certifications (Bronze, Silver, Gold) with financial incentives and handholding support for MSMEs.
- ISO Standards: These are international standards that focus on specific areas like quality management (ISO 9001), environmental management (ISO 14001), and occupational safety (ISO 45001). ISO certifications are globally recognized but do not offer direct financial incentives or a structured support mechanism like ZED.
Benefits of the ZED Framework
- Enhanced Competitiveness: Helps MSMEs improve quality and operational efficiency.
- Financial Assistance: Subsidies for certification, testing, and handholding support.
- Market Access: Facilitates entry into national and international markets.
- Sustainability: Encourages the adoption of green and sustainable practices, reducing environmental impact.
- Branding and Promotion: ZED-certified MSMEs are promoted as reliable and sustainable business partners.
Addressing the Cost Concerns for MSMEs
One of the major challenges faced by MSMEs in adopting certification standards like ZED is the cost associated with implementation, certification, and maintenance. Many MSMEs operate on limited budgets and cannot afford to maintain dedicated teams to manage these activities. The ZED Framework, however, offers several financial incentives and support mechanisms to ease this burden:
- Subsidies on Certification Costs: MSMEs can avail significant subsidies on certification costs. The government provides:
- 100% subsidy for certification costs for women-owned enterprises.
- 80%, 60%, and 50% subsidies for micro, small, and medium enterprises, respectively.
- Additional 10% subsidy for SC/ST-owned MSMEs and an additional 5% for MSMEs part of specific government schemes like SFURTI or MSE-CDP.
- Financial Assistance for Testing and Certification: MSMEs can receive up to 75% of the total cost for testing and certification, with a maximum subsidy of ₹50,000. This helps in reducing the upfront cost burden of getting certified.
- Handholding Support: Up to ₹2 lakhs is provided for consultancy support to help MSMEs meet ZED standards and achieve certification. This assistance covers training, documentation, and process improvement activities, making it easier for MSMEs to adopt and maintain ZED practices without needing a dedicated team.
- Support for Technology Upgradation: MSMEs can get up to ₹3 lakhs for technology upgradation related to Zero Effect solutions, which helps them invest in new technology to meet ZED standards without a significant financial burden.
How is the ZED Framework Helpful?
The ZED Framework helps MSMEs by providing a structured approach to improve their processes, reduce defects, and minimize environmental impact. This not only enhances their marketability but also boosts customer confidence and satisfaction. Moreover, the scheme offers financial incentives and handholding support to guide MSMEs throughout their ZED journey, making the certification process more accessible and beneficial.
How to Adopt the ZED Framework?
MSMEs can adopt the ZED Framework through the following steps:
- Registration: Register on the ZED portal using the UDYAM Registration Number.
- ZED Pledge: Take the ZED Pledge to commit to quality and sustainability.
- Gap Assessment: Conduct a self-assessment or get assistance from ZED consultants to identify gaps.
- Certification Application: Apply for the desired certification level (Bronze, Silver, Gold).
- Assessment: Undergo an assessment process, which may include desktop verification, remote assessment, or site assessment.
- Certification: Achieve the certification after meeting the required standards and parameters
How Can BTCAAS Consultants Help?
BTCAAS Consultants can play a crucial role in the successful adoption of the ZED Framework by providing:
- Gap Analysis: Conducting detailed assessments to identify areas that need improvement without incurring high costs.
- Training: Providing cost-effective training modules that are designed to be implemented without requiring extensive resources.
- Implementation Support: Assisting MSMEs in implementing the necessary changes to meet ZED standards in a cost-effective manner.
- Handholding Support: Guiding MSMEs throughout the certification process, including documentation, process changes, and assessments, thereby reducing the need for a dedicated internal team.
- Post-Certification Support: Helping MSMEs maintain and upgrade their certification levels over time, ensuring that the benefits of ZED certification are sustained.
Contact BTCAAS Consultants
BTCAAS Consultants are committed to helping MSMEs navigate the ZED certification process, providing expert guidance and support at every step to ensure successful implementation and sustainable growth—all while keeping costs manageable for budget-conscious businesses.