Technology for MSMEs: As India observed National Technology Day on Tuesday amid pandemic for the second consecutive year to celebrate the technological prowess it has accomplished across many fronts particularly to fight Covid, its MSME base has witnessed the most significant behavioural adjust towards technologies usage and adoption. The shift towards digital channels for communication, promoting, group collaboration, payments, hiring, procurement of goods and services and storage, registration of new organization verticals, and so forth., was more evident than ever or even for the duration of the post-demonetization phase. The move towards technologies, therefore, has been by selection rather than by possibility. According to professionals, whilst this shift is bound to progressively move up, the transformation may possibly take more time to be drastically visible in foreseeable future.
“Last year, new norms of doing business evolved that also affected MSMEs. Technology adoption became a necessity to enable businesses to survive in a remote working environment. The majority of MSMEs started using technologies in areas such as communication, e-commerce, marketing, and sales. Select MSMEs with access to knowhow on the internet of things (IoT) had adopted it for manufacturing processes as well. However, most of these enterprises continue to work on Jugaad mechanism where they have been using varied technology platforms for their survival,” Sandeep Gupta, Managing Director at Protiviti Member Firm for India told TheSpuzz Online. Protiviti is a international network of independent consulting firms focusing on options in finance, technologies, operations, governance, danger, and internal audit.
To corroborate the enhanced adoption of digital suggests of organization amongst MSMEs, many surveys have been carried out in the previous couple of months. For instance, 82 per cent respondents, in a survey of more than 250 modest firms released last month by Dun & Bradstreet, stated that they have digitized their every day operations for the duration of the pandemic which helped in price reduction for 54 per cent of them and enhanced competitiveness for 51 per cent. Likewise, a Crisil survey published in December last year noted that the adoption of digital channels such as on-line aggregators or marketplaces, social media, and mobile promoting has enhanced from 29 per cent micro-enterprises utilizing them prior to Covid to 47 per cent as of November. Another study released in September last year by technologies organization HP focusing on SMEs’ outlook for the post-Covid situation highlighted that 73 per cent SMEs stated they would survive the Covid downturn in comparison to typical 60 per cent SMEs in Asia. In truth, a healthier 61 per cent SMEs claimed that they would thrive in their operations in the post-Covid world.
Among current digital tools, cloud computing has been the prominent go-to remedy for modest firms for the duration of the pandemic to safe their information and allow a remote work atmosphere. “Cloud adoption by MSMEs was already reasonably healthy before the pandemic as many were using cloud-based file-sharing or backup solutions. However, implementation of cloud services and solutions increased by double digits during the pandemic across all categories including video or web conferencing and security. This shift helped MSMEs as they lacked the technical skills needed to integrate cloud services with their existing IT infrastructures and manage their IT Security,” Suresh Venkatachari, CEO, SecureKloud Technologies told TheSpuzz Online.
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Importantly, SMEs are probably to play a considerable part in the government’s $5 trillion economy vision by 2025 as effectively, offered technologies adoption becomes the essential concentrate for enterprises ahead. In truth, SMEs are probably to add $158 to $216 billion to the country’s gross domestic item (GDP) by 2024 on the back digitalization of their firms, a Cisco study in July last year had stated. Here, the part of technologies providers also assumes excellent significance with a vastly untapped market place chance. From an estimated $30 billion in 2019, the market place size increasing from digital technologies adoption amongst MSMEs will develop at about 25 per cent CAGR to about $85 billion in 2024, according to a December 2019 Zinnov study.
However, lack of measurable return on investment (ROI) on higher capital expenditure, unavailability of proper technologies talent, and fundamentally getting averse to the adoption of the newest technologies to enhance current organization practices have been and would stay amongst essential challenges. “Every small business first thinks of ROI. MSMEs in both manufacturing and services will not move to the information technology bandwagon except for taxation and basic accounting purposes if they don’t have scale-up requirements. While there will be more transition towards the adoption of technology but it doesn’t mean that MSMEs will become 90 per cent digital right away. MSMEs will increase their usage for compliance. What has got accelerated due to Covid is the retail connect with customers digitally such as food or medicine delivery. If MSMEs don’t work on it, they will lose out. Video or web-based interaction is another big example of this disruption due to Covid and it has become a very critical component in terms of digital adoption,” Naresh T Raisinghani, CEO and Executive Director at India division of international consulting firm BMGI told TheSpuzz Online.
On the other hand, there has been a slew of services in location for MSMEs by the government towards its Digital India vision such as delayed payment tracker MSME Samadhaan, public procurement policy monitoring portal MSME Sambandh, placement portal for MSME Technology Centres trainees MSME Sampark, new registration portal Udyam Registration, grievance registration and management portal Champions for MSMEs problems about finance, raw supplies, labour, regulatory permissions, and so forth. and more. “Indian MSMEs generally operate as a mini community, hence to take any technology solution which is complex needs to be taken at their group forums. Pilot projects success is generally quickly replicated across the community members. MSMEs mostly prefer solutions that are less complex to operate and have low maintenance cost,” added Gupta.