Growth Opportunities For SMEs And Startups In the New Normal
The rapid growth and almost overnight adoption of all things digital is one change that we have and will continue to carry into the post-COVID world
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
India is always recognized as a people-driven economy, but the pandemic changed all that. The Atmanirbhar movement and the Economic Relief Fund's INR 3 lakh crore allocation for the MSME sector are helping startups and small enterprises get back on their feet. The rapid growth and almost overnight adoption of all things digital is one change that we have and will continue to carry into the post-COVID world. In the history of technology, we always aimed to prepare ourselves for all scenarios—what if bandwidth wasn't available, what if power wasn't available; but it never occurred to anyone—what if people are not available?
This pandemic has brought in a lot of automation and online/mobile banking into BFSI. We are seeing enormous growth in digital transactions in India which is expected to touch $60 trillion by 2022. The opportunity to innovate lies in how we can increase the physical distance between the banks and the people—for example more teller machines, CRM automation—essentially reducing the human touch, or even branch offices. Being a service industry, the challenge is finding how to reach customers where physical presence, reaching a certain location, etc., is not possible. Therefore, for seamless operations online, backend operations that can be conducted digitally must exist. ATMs have existed for a long time now, and now we may see the entry of cash deposit machines or cheque writing machines. In addition, machine learning will become a great tool for logistics operations and remote access management.
Healthcare has undergone rapid innovation during the last few months and the sector is expected to increase to $132.84 billion by FY22. However, there still exists a need to provide healthcare to patients: without compromising the care that patients need. Furthermore, automated devices that sanitize and disinfect patient wards, hospital equipment, medical devices, tools, etc., is also one way to reduce risk of infections within a hospital. We have seen startups in the health sector take up the opportunity to serve during the pandemic, with the development of remote management tools for monitoring patients through a centralized location system, monitoring ICUs through telehealth desks, etc. Due to extremely high demand and not enough supply, this is a field where the need for a lot of innovation and automation will arise in future, changing healthcare practices forever.
India's Edtech was the most funded sector in 2020 H1 and online learning is booming: from K-12 to high end. Online classes have become a great opportunity for educational institutes to offer various distance learning courses. Students who want to go to a specific institute but couldn't because of distance can now access that institution as per their ability and convenience. There also exists the possibility of creating hybrid courses of online and physical classes together. This will again lead to the need for a backend automated structure to be in place at all times. Laptops and devices, not only those used by students, but teachers and professors will require troubleshooting assistance at any location. SMEs and startups are needed who can provide not only learning platforms but also backend tools and infrastructure to support this change.
The manufacturing sector has one of the biggest opportunities for the SME sector due to the huge demand of automation and machinery. The manufacturing sector of India has the potential to reach $1 trillion by 2025. Manufacturing has always been a labor intensive industry which is now shifting towards lean manufacturing and simplification of processes through automation. There is also a huge demand in remote management of these machines and decoding their complexity for new users. AI-enabled/automated machines will have a crucial role to play in various stages of production. Supply chain management is one such area. Similarly, these technologies will now be more automation dependent rather than labor dependent. Other areas that can automation can address are power consumption, temperature control, etc.
Traditional retail has been hit hard by the pandemic, giving rise to online retail and e-commerce portals booming including the local kirana and mom and pop stores that have joined the online race. Automation hasn't always fared well in the retail sector due to attraction that brick and mortar stores held for buyers. Today the demand for online buying is high but there is a lack of resources to be able to fulfill them all. Timely processing of requests is of utmost importance; no delivery or service operator will now wait for too long to pick up an order. It has to be an instant process, or at least one conducted in the shortest time possible. This is not possible unless a high level of automation exists in one's stores, in all aspects of the store: right from stocking goods, tagging inventory and even taking out one specific item off the shelf on a real time basis. As per reports, it is expected that the global retail analytics market is expected to reach $8.64 billion by 2022
With retail stores moving to cloud, instead of a hard-to-miss shiny store, one will now be in a virtual mall which is actually in a data centre or in someone's home that function off RFID based readers and barcode scanners for every item and every rack. This reduces human intervention, reducing the risk of infections, reduce package preparation, creating more flexibility and agility in the retail supply chain. There is a huge opportunity for SMEs and startups to provide these services, and essentially make remote access management as a backend process a possibility.
Although there are questions of security when it comes to remotely accessing machines or backend operations, there exist cryptographic models, customized access tools and such where the physical presence or biometric smart cards are needed for authentication, so that only verified personnel have access.
The SMEs and startup sectors need to come up with agile solutions for sectors that need innovation to capitalize market opportunities in the post pandemic world. Remote access management may have come as a means to an end in an emergency in many industries, but it is here to stay for good. How well and quickly it becomes the norm, will depend on how innovative all players in the ecosystem can be!