Many MSMEs are still unaware of digital impact, they fail to build customer loyalty, retention
Technology for MSMEs: The increasing affordability of smartphones, rising internet usage, and growing digital media use are shaping the future of MSMEs and startups in India. India is amongst the biggest and fastest developing markets for digital users. As Digital India emerges, one can see a paradigm shift in the conventional ways of business. The small and medium scale enterprises understand the value of digital transformation for business expansion. They believe digital proficiency is vital to set foot in the online market successfully. Needless to say, digitalization has become a critical factor for all enterprises to survive.
Digitalization During Pandemic
The Coronavirus crisis and the lockdown was a phase of evolution for various MSME sectors. Digitization opened the gates for many local businesses to strengthen their operations and cope up with these stressful times. To begin with, local grocery stores that functioned traditionally have now embraced the doorstep online delivery trend and use ‘google sheets’ to record received orders and their stock. Further, digital payment modes were adopted to maintain social distancing as customers did not prefer cash payments.
Physically meeting with doctors was a traditional sales process in the pharmacy industry. However, this was replaced overnight by discussions over digital communication channels. This digitalization of sales force has changed their knowledge-base, skills, and execution during the pandemic. Agribusiness chemical distributors are utilizing online networking channels like Facebook and Zoom videos to connect with farmers in rural areas. Lastly, digital resources played a tremendous role in the education sector to provide classes and training to students online. Hence, many of the technologies became integral to these businesses. With the surge of technology and the prevailing Covid-19 dilemma, the future of the Indian economy will have everything to do with digitalization. No doubt, Indian startups, and MSMEs have perceived that technology can be a pivotal aspect for their ventures and even to bounce back post-pandemic.
Key Factors for Digital Transformation of MSMEs and Startups
MSMEs and Startups can make better decisions with the help of data analytics and business intelligence as they offer a more in-depth insight into consumer journeys. The acquired details help to gauge and foresee client needs. Further, with the rise of cloud-based solutions and freemium models of these services, businesses can create systems that can improve the customer experience. Besides, companies can produce new products or services that meet customer demands. It also advances the delivery process of the right products at the right time that too at a moderate price range. All these factors boost customer engagement for their business that is key for any enterprise to thrive.
Challenges to Overcome
Nevertheless, Indian MSMEs also have to clear some roadblocks to sustain on the path of digital transformation. The current challenges are:
1. MSMEs have limited growth capital that makes technology adoption and digital transformation demanding.
2. Buying the latest smart devices, best internet services, and retaining skilled employees to manage digital systems is also an expensive affair for them.
3. There are still many small and medium scale enterprises who are unaware of the impact of digital transformation and fail to build customer loyalty and retention as other e-businesses.
4. MSMEs are resistant to augment digital technologies because cutting-edge technologies evolve faster, and they sometimes may not be able to match up with that advancement.
5. Storing, analyzing, and managing crucial structured and unstructured data to make business decisions is challenging for MSMEs.
6. Data, cloud, and system management along with the training required to handle them, leave MSMEs uncertain.
Tackling the Problem
To make good use of digital transformation, micro-businesses today are taking help from tech-based start-ups. Their vision is acclimatizing the MSME segment with the digital world. Building a full digital ecosystem and rendering the best support will promote Indian MSMEs towards successful digitalization. From aiding Kirana stores to deliver grocery items through online channels to facilitate the building and launch of e-stores, these startups are providing all kinds of digital services and easing the digital transformation for MSMEs.
Exclusively Developed Tools
Many tech-based companies are building exclusive tools to support small and medium scale enterprises. These tools can enhance the business proficiency and profitability for these small and mid-sized companies. For instance, Google Advantage, an initiative by Google India facilitates MSMEs to use the growing online clientele base. Then there is Google My Business specifically developed to support startups, and MSMEs in India to succeed virtually. These tools are great free resources to create and restore the business data on Google Maps, Search, and Google+ in Hindi as well as English.
The users today necessitate things to be quick and free of errors. It is nearly impossible to deal with all the customers through manual processes smoothly. Digitalization will therefore prove to be the game-changer. Any job, whether small or big, gets easy to accomplish with the help of technology. Moreover, the core aspect of any business, that is, decision making becomes seamless when organizations have the right data accessible at the right moment. For an MSME or startup to flourish today, it must accept digitalization with open arms. Advanced technologies, including AI, data science, IoT, Blockchain, cloud computing, robots, and the development of new business models, will extensively transform the business models of Indian MSMEs and startups. Digitally transforming enterprises are the potential flag-bearers of the future.
PHD House, 4/2 Institutional
Area August Kranti Marg,
New Delhi 110016
+91-11-26863801-04 : 49545454