By Deepshikha Kumar
Micro, small and medium enterprises (MSMEs) stay at the helm of the Indian economy due to their valuable contributions. They account for more than 40 per cent of the country’s manufacturing output and above 45 per cent of the total exports. That’s why whenever something disruptive happens in this sector, the rest of the economy witnesses its cascading effects. Industry 4.0 – the technological medley of physical and digital infrastructure, is all set to revamp the manufacturing sector. Once again, MSMEs are at the forefront while shaping this transition.
Crisis as tech catalyst
Many times, the crisis emerges as a catalyst for change. The Corona breakdown has not only shaken the economy but also compelled the competitive enterprises for rampant digitalisation. Today, the biggest rescuer for a business is not a bailout package or venture capitalist, but the technology that enables them to adopt new trends and survive the crisis. A business cannot be exempted from risks and being small in size, MSMEs are more vulnerable to shocks and challenges. Though it is a testing time for small entrepreneurs, with their receptivity to technological up-gradation, they can overpower every threat.
Immunity improves competency
MSMEs have always strengthened the economy and even in these critical conditions, they are considered the backbone of the manufacturing sector. Products like face masks and hand sanitizers, which are the hottest selling items in the present time are coming to the market, majorly from small enterprises. On the other hand, their role is also indispensable in the pharmaceutical and healthcare sectors, which are under the acute demand pressure due to COVID-19 pandemic. But, there are enough evidence which show small companies reluctant to embrace modern technologies, especially digital technologies have succumbed to current market crises. In fact, adaptation to Industry 4.0 is not only quintessential to make them competent but also to make them immune against various unforeseen threats.
Appetite for upskilling
With the easy accessibility to business-oriented e-learning programmes, organisations are now better equipped to raise employees’ productivity. MSMEs who were devoid of formal large-scale learning and training processes can now be seen moving towards e-learning modules to reskill the workforce at a remarkably low training cost. A few years back, only larger organisations were availing these sorts of training programmes, now, with better digital infrastructure in the country, MSMEs across sectors and pan India are also benefitting themselves with these courses. What remains to be seen if e-learning organisations can keep pace with this demand and provide more and diverse learning in local languages as well.
Opportunities unlocked
From the procurement of raw materials to receiving payments from customers, Industry 4.0 has revolutionized almost every process in the business world. Backed by ICT, IoT, Big Data, Digital Automation, Artificial Intelligence, and Cloud Computing, the new-age MSMEs are thriving phenomenally in the domestic as well as international markets. Also, one more significant change took place in the MSME landscape is there a growing nexus with e-commerce players who are providing them with useful digital platforms to display and sell their products. Moreover, such collaborations are not restricted to revenue generation but are also productive in technology sharing. Consequently, with these technological advancements, MSMEs are successfully incorporating newer and better business models.
Better business models
The formation of the Centre for Digital Transformation and the DXL by CII are also great platforms for reinforcing digital transformation in the Indian business ecosystem. Nowadays, large companies which outsource materials from small and medium enterprises seek partnerships with firms which may help them to provide great value for money to their loyal and repetitive customers. Hence, to maintain their associations with big brands, MSMEs must invest in building new business models to untapped emerging markets and potential customers. They should harness cutting-edge technologies to develop innovative solutions for existing customers and prospects. There is also an urgent need to contemplate on new ideas and dedicate some resources specifically for R&D activities.
Vocal for local
Recently PM Narendra Modi started “Vocal for local” campaign with the very aim of making India self-reliant, or ‘aatmanirbhar’. One of the key objectives of this campaign is to promote indigenous businesses. This campaign is a good push to Indian brands and offers tremendous growth opportunities for MSMEs who serve to these brands. Besides, as MSMEs are spread across the length and breadth of the country and not concerted to metros or big cities, their modernisation will also play a significant role in reducing economic disparity. They will help to generate more employment opportunities in tier II and III cities as well. All in all, in the post-COVID scenario, it is the degree or level of digitization decides the sustainability of a business, and MSMEs will be primarily responsible for India’s technology-led transformation.
(The author is Founder & CEO of SpeakIn)