View from India: Digital shift creates economic opportunity
Investments in intelligent process automation, touchless experience and public safety are likely to increase. Innovative business models are expected to emerge from this, along with new trends in the tech world.
Skill for better incomes
Large scale digital transformation spurred by the pandemic continues across industries, prompting companies to migrate to cloud-based models from the traditional server-based ones. Hence there’s a felt need for professionals to handle cloud-based skills, be it data analytics, AI or DevOps (a portmanteau of development and operations). Those companies that deploy AI-ML (artificial intelligence and machine learning) prosper, while those that don’t probably perish. Development tool and product design are enablers for topline and bottomline growth of companies.
Seen futuristically, there could be bountiful opportunities in virtual reality and voice recognition. A digitally trained agile and creative workforce is required as organisations increase their digital investments.
Had it not been for the pandemic, the digital transformation would have spanned out through this decade.
A pandemic outcome is that the already digitally updated companies have gone that extra mile to enhance security systems and improve connectivity. Probably we could look forward to investments in security systems and matters related to connectivity. That could include contactless measures as well as enhanced automation, which means openings in software solutions and services. Neutral libraries for software components could spring up.
According to the NASSCOM report, ‘India’s Software Product Ecosystem– Accelerating Growth,’ the software product sector has evolved substantially to reach $13.3bn in FY2022. The market has grown at over 10 per cent CAGR (compounded annual growth rate) from 2019-22, enabled by SaaS (software as a service), Enterprise Digitisation and SMBs (small and medium businesses.) The enterprises’ movement towards cloud has intensified software product adoption. Global enterprises are embracing Indian software products like SaaS, digital banking and cloud enterprise solution.
Factories and manufacturing units have begun to become smart, and their numbers are likely to increase. Smart manufacturing is likely to give a new outlook as technologies such as AI, big data analytics, and human-machine interface are expected to give it an edge. There could be a greater emphasis on robotics and advanced automation on shop floors. Auto modelling and simulation may be executed through digital technology. Engineering and smart manufacturing could merge for better outcomes. Digital tools may be deployed for monitoring the production output and real-time inspection.
Legacy factories and manufacturing units will have to replace their machinery with automated ones that could do away with many tedious manual operations. Shop floor maintenance, also manual, is expected to happen through tablets and mobiles. Paper-based checklists are being replaced by tablets, where dashboards offer real-time updates. Apps will trigger an alarm depending on the circumstances. Silo operations will give way to an integrated approach, which could help in deriving predictive downtime, and hasten large-scale delivery in a less cumbersome way. The tangible benefits could be understood as predictive maintenance and lower downtime.
Coming to the small factories and manufacturing units, they could perhaps begin with basic digital operations and then move on to digital maturity. Whether it’s a small one or old big one, the digital procedures in factories and manufacturing units could give scope for coding experts to write software. This may unfold new streams of learning and earning as well. This can be taken forward through reskilling across the board and this includes the shop floor staff as well. Then coming to warranty issues in manufacturing units. Usually warranty makes for 2-4 per cent of the company’s revenue. Creating a digital twin could help in lowering warranty costs.
When it comes to the manufacturing industry, the cost of manufacturing in India is much lower than many South East Asian countries. The country also has human capital. So then, manufacturing infrastructure could be scaled up, thereby opening up the domestic market. Probably it could be understood as more job openings and more innovation. Could it be an opportunity to scout around for unexplored raw materials and create a value-add to the supply chain? Perhaps it could attract venture capitalists.
Let’s face it, humanity drives the purpose of work. So going ahead, machines will be fitted with sensors that can be plugged into a data-rich environment. This may be important as data is the fuel for commerce, and could be channelled to bridge gaps in services. To that effect, the future will be more participative and inclusive in nature. Products may become more complex and serve more than one purpose. People and processes need to be equipped to handle this. Or else, efficiency levels may be hit.
Cloud bursts across enterprises continue. It makes economic sense as companies can access AI-ML. Distributed cloud and IoT could lead the way for the next evolution of enterprise. This could result in the global evolution of everything smart and connected. Almost all organisations have accelerated their investments in cloud, as it is considered an ideal platform for a distributed workforce to operate. It also means that a skilled workforce is required to handle this level of cloud maturity.
Post Covid, organisations have chalked out various strategies. These are being fulfilled by strengthening the ecosystem. And partnering with the rest of the ecosystem members such as vendors and manufacturers, technology and industry partners. Business strategies have changed as time-to-market cycle has come down, plug-n-play products are on the rise, as much as the thrust is on reusable or repurposing components. Factories are also working on a circular economy system. This not only makes them green but also helps in lowering operation costs.
In order to reduce risks and retain customer loyalty, newer innovative resilient strategies could be in the offing. In fact it’s not just that, but it’s also vital to build resilience into the ecosystem. Software agility is critical for resilience. Most organisations are vertically organised, whereas digital operations are a horizontal capacity. Ergo, people should transfer work horizontally for the company to be agile and take advantage of it digitally. There will be vast amounts of data emerging from the vendors, suppliers and other components of the ecosystem. This could be an opportunity for data scientists to manage data and glean it for just the required information.
India has leapfrogged from telephone landlines to the mobile revolution. Cloud opportunities are in the mobile. For instance, mobile platforms can track services, transport and logistics real time. The user behaviour can help companies fine-tune their offerings to clients. Then, cloud is a facilitator in the ready-to-use services category. Innovation and collaboration can bring in new openings in the consumer services.
Besides cloud, semiconductor manufacturing could also open out new avenues. Value creation can probably be created in the semiconductor industry. This could happen by bringing the semiconductor manufacturing under the gamut of the Self Reliant India mission or Atmanirbhar Bharat. After all, the global market size of semiconductors is $500bn. And the sector is estimated to grow potentially. With IoT, chips will become significant for India. Semiconductor design capabilities can become a strategic self-reliance act by encouraging local design aesthetics. To develop an ecosystem, the engineering education system may perhaps include semiconductor design skill courses. It can be an employment generation effort.
Apart from the electronics industry, semiconductor wafers and chips could be used for mobile phones, LED bulbs and in automotive. The government has already announced a production linked incentive (PLI) scheme to create an ecosystem for semiconductor manufacturing, testing, packaging and design. The aim is to encourage the domestic production of components rather than importing them as many firms tend to do. It could be an investment opportunity as vertically integrated semiconductor facilities may expand their footprint nationally. As well, it could be an income-generating measure.
Disruption and progress
Covid is an example of disruption, wherein it created a dire need for vaccination across age groups at the national level. Mass adoption of online services is another example, whose thrust has been on online education and remote healthcare. Otherwise, it may have taken many more years for the online world to catch up with offline services and brick and mortar stores.
So far, science and engineering have been leveraged for a number of reasons and this includes the building of cities and sending rockets to space, among other explorations. Now we could take it to the next frontier. Science and engineering may help lower the impact of societal problems such as healthcare, nutrition, education, poverty and employment. To that effect, research could be encouraged in these areas. Investments in these areas could follow suit.
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