India’s mass of small family firms could miss the IIoT revolution
Few of India’s myriad family businesses have adopted any advanced manufacturing technologies like the Industrial Internet of Things (IIoT). And worse, most don’t plan to in the future.
An article by Live Mint discusses the results of a recent survey by Tata Strategic Management Group and industry lobby group Federation of Indian Chambers of Commerce and Industry (FICCI).
The study, which surveyed executives at more than 50 leading Indian engineering companies, focused on the adoption of advanced manufacturing technologies such as IIoT, advanced robotics and additive manufacturing. The survey highlighted these three areas of advanced manufacturing because of their anticipated role as major drivers for future manufacturing growth globally.
The researchers found that only 10% of family run businesses have currently adopted any form of advanced manufacturing. However, future prospects for manufacturing are a bit better for family businesses, though these companies still will lag other types of businesses.
“More than 50% of family-owned businesses do not plan to adopt advanced manufacturing within the next three years, in comparison to both Indian and foreign corporations where less than a quarter plan not to adopt in the three years’ time frame,” the report said.
This economic backbone needs strengthening
Any numbers around family-owned businesses in India is especially significant as these types of companies form the backbone of the country’s economy. Such businesses comprise almost two-thirds of India’s GDP and employ nearly half of the country’s work force.
India’s governments are proving keen on adopting connected technology to develop smart cities, but studies like this raise questions that some economic sectors are not keeping pace with the new technological revolution.
Manufacturing remains a key sector of the Indian economy. It is responsible for employing nearly 12% of the country’s workforce and contributes almost 18% of India’s gross value-added production.
Many obstacles to the adoption of advanced manufacturing technology were identified in the study. Chief amongst these perceived barriers is industry’s difficulty in quantifying its return on investment once the technology has been implemented.
“The industrial internet of things definitely enhances ability of companies to receive real time information about plant equipment thereby reducing downtime and improving productivity,” said Forbes Marshall CEO Jehangir Ardeshir. “However, companies need to ensure that they build a solid business case and check feasibility before adoption.”
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