What is your outlook on the current business scenario and what are the changes anticipated in this year? How optimistic are you in terms of the economy bouncing back on track?
India’s GDP growth has been on a continual decline and expected to settle somewhere around a growth of 5%, from a spectacular growth of above 9.0% experienced a couple of years ago. The GDP seems to be experiencing a resistance from the government’s ambitious call for a double-digit growth towards propelling India to a $5 trillion economy by 2024-25. The manufacturing sector, regardless of size and category, seems restless and has a very little impression on the time frame when the economy could see the most sought reversal of this downward trend. The factors contributing to this fall are many, especially at the global level, like US-China trade war, BREXIT, etc. The revival time would greatly depend on the proposal to switch over from BS IV to BS VI being effective April 1, 2020, the electrical vehicle push being effective from 2030, the NBFC fiasco, heavy withdrawal of FDI back home, higher provisioning and the NPA clean-up efforts by banks and how fast they are dealt with and addressed.
Credit squeeze and impact on consumption due to rural distress, job cuts due to industrial downturn and a dismal job scenario have resulted in the pulling down of demand, further fueling India’s economic slowdown (from what has been predicted earlier by many agencies). A mix of policy decisions and demand dynamics could decide how India withstands the economic slowdown. It is expected that with the dawn of the new decade and as we have entered the new year, there are emerging signs that the economy could be on a better footing than what it was in the year gone by. With the proactive measures taken by the government and the Reserve Bank of India (RBI), the industry believes that the slowdown will be overcome and a gradual recovery will soon be in place. We are quite hopeful of this recovery in the next few quarters.
What is your agenda / plan-of-action for the year 2020, in order to be competitive and stay relevant to customers and catch up with the growth momentum? Upcoming challenges can no longer be met using conventional methods. What's your take on this?
Industry leaders should focus on reversal & agree on a plan of action on reversing the trend immediately. To maximise flexibility and preserve cash, we must align our strategic and operational priorities, such as protecting our employees and maintaining profitability while addressing customers’ needs in shorter lead times. We have to demonstrate agility and speed to combat the slowdown. We need to focus on growth rather than cost-cutting measures. We, as a company, are using this slowdown towards reskilling ourselves and preparing for the growth phase.
Coming to the second question, upcoming challenges cannot be met by conventional focus. We need to be more customer-centric and get closer to them. Winners will be those companies that gear up streamlining operations, enter new businesses and form smart partnerships to seize market opportunities.
How should a company effectively bridge the gap between optimising existing technologies & investing in advancements? Would you like to share examples from your organisation?
To bridge that gap, a company should focus more on in-house R&D efforts to further strengthen existing technology, complemented by new methods of manufacturing. Our company has embraced this current slowdown as an opportunity to get employees upskilled on digital marketing, use of IT & digital technology, to complement our traditional way of reaching out to customers in a much cost-effective manner in order to enhance the customer experience. Our focus on innovation is intensified for continual improvement of both, our products and process.
How can India build sustainable breakthrough ecosystems for nurturing global businesses and achieving manufacturing-driven growth? At the same time, how can the industry respond to uncertain economic cycles and technological disruptions, simultaneously?
India needs to develop breakthrough ecosystems that nurture global businesses. Diverse stakeholders need to collaborate with each other towards a bigger vision, build new business models and adopt digital technology & contemporary Industry 4.0 practices. Digital ways of manufacturing and supply chain management such as AI, AR & VR learning and block chain, need to be consciously adopted now, while improvising traditional ways of doing business. The government’s reforms of demonetisation, GST, digital India and Make in India have given the much awaited digital push to the economy, tapping many unexplored areas.