Technology for MSMEs: There aren’t many silver linings in this pandemic. History will place it in its proper perspective, but in our lives, there has been nothing as devastating— nor is there likely to be. The one silver lining has clearly been that we have leapfrogged many years in terms of digitization and technology. It has the power to solve many of the most pressing issues our world faces. And those who have adapted and embraced technologies have clearly benefited the most.
Even though India is the home of so many wonderful technology companies, the rate of technology adoption by the domestic industry remains extremely poor by any global standards. The use of personal technology has accelerated substantially driven by low data prices and highly accessible content. But small to medium scale industry hasn’t leveraged this technology to improve productivity or distribution. This is tragic. Lack of high-quality broadband is a serious inhibitor, and we may often not realize this major problem as it gets buried under the facts and data around mobile phone penetration levels. The availability of cheap human resources in India often drives us to make highly ineffective and unproductive choices—without recognizing how transformative technology can be.
And yet every SME and start-up should grab hold of this opportunity to transform their business models. Interestingly the myth around the usage of technology is also being busted. Certainly in the past, technology was clunky and hard to use. But now, technology is available the way it always should have been, almost like electricity with a plug and play capability. And customer behaviour has changed enormously going beyond their discomfort with online business and adapting to using technology.
Let me use a few examples of how Covid has already reshaped our world:
- Online counseling by doctors, dentists, and physiotherapists is becoming the new norm. Why expose yourself to a doctor‘s office if you can do it on zoom?
- Hairdressing salons are providing private counseling sessions to help their clients with DIY solutions and with appropriate criticisms and applause.
- Online education is here to stay. It’s much easier, you can access the best teachers in the world, you’re not limited to the physical faculty presence and you save enormous time.
- The quality of conferences has improved enormously. The number of attendees is larger online, the speakers are global and world-class and access is easier. The downside is, of course, the lack of networking but somehow I think technology will find a way for that as well just as it has with dating apps and matchmaking services.
- Every neighbourhood grocery store has become an e-commerce business providing the ability to order online and deliver conveniently. I cannot imagine many businesses that would not be able to convert some of their key elements into the online presence.
- Garment manufacturers have pivoted to making PPE, masks, and uniforms. Taxis will convert perhaps to ambulances and schoolchildren carrying vehicles. Perhaps with partitions to promote safe travel.
- New innovation and business models are required in so many areas post-Covid— better analytics in the future, better contact tracing. Platforms to connect service providers with demand, online education, training, and simulation in all kinds of areas.
- Hobbies will change and along with that, the areas where people spend money. Domestic tourism will rise as people worry about traveling overseas. Movies and Netflix type services can gain enormous traction.
- Every restaurant is a delivery platform for great food. This will change the way families and youth think about food and their quest for a higher quality of food will be accelerated. With better margins and better quality.
For the old fashioned SMEs, this is a chance to change dramatically. Change their business models, use technology to gain access to markets all around the country not just their neighboring territory, drive productivity, and increased profitability because this enforced staycation has suddenly provided unique insights into how much fat our companies often accumulate.
We are currently going through the shock of the pandemic—with stress and fear and some panic. But the optimism of the human race will be resurgent, and as this happens these new models should get created. And there is a lot of money waiting to be deployed for many startups. The world remains awash with money looking for a home. All the right deals will get the right money chasing them. Good ideas are far more rare than money, and all entrepreneurs should always remember that!
Pramod Bhasin is Chairman of Clix Capital and Former President and CEO, Genpact. Views expressed are the author’s own.