Indian SMEs need Automation baby steps

August 1, 2022 11:54 am

Automation is not meant only for large corporations to benefit. It applies to smaller and mid-size micro-companies. The only difference is distinguishing the level of Automation they need at the entry level.

The Automation and use of robots in the Indian manufacturing sector have revolutionised traditional manufacturing. Automation is transforming how brands operate, allowing them to do more with less since Automation is the key to operational efficiency. Industrial Automation plays a vital role in improving manufacturing efficiency and productivity. Digital Automation can be an essential tool that small and medium-sized enterprises can leverage to increase productivity and save time.

India aims to be a $5 trillion economy by 2025. The Indian SME sector is deliberating on making the transition. However, motivation is the key as there is an impending need for small businesses to invest in Automation compared with large industries. According to CII, SMEs account for around 35 per cent of total manufacturing output and over 45 per cent of exports. With the evolving needs of the growing business in an increasingly digitised world, companies should focus on picking the technology while switching processes to Automation.

Automation will allow small businesses to increase output and be more data-driven. Prominent industries and SMEs seeking growth must adopt automation tools for data-driven decision-making. Furthering Automation and focusing on hyper-automation is essential. Hyper-automation combines technologies like robotic process automation, AI, machine learning, advanced analytics etc. Flexibility, ease of use and easy programming are the most critical criteria that robots fulfil to help businesses to meet future production challenges. For manufacturing companies, Cobots are an economical alternative to expensive industrial robots. They make Automation affordable, especially for SMEs, as they form the base of the Indian manufacturing industry.

Specifically for SMEs, some of the more significant players have advanced to the point where connectivity becomes critical. Digital transformation is still in its early stages, says Mr. Zurvan Marolia, Sr. Vice President, Head Product Supply, Godrej & Boyce and a member of the National Manufacturing Council, “Automation and digitisation lead to each other. A point is yet to achieve where having a 5G network over an existing 4G network would provide a cutting-edge advantage. The ultimate goal is digitisation and interconnectivity, but many preparatory steps still need to be taken in the SME sector. We are still in our infancy today.” And, there is a need for essential techniques or features that might encourage SMEs to adopt Automation.

The initiative must be undertaken with the ultimate goal of benefiting the customer in mind. Recognising the automation adoption opportunity, he adds, “We must recognise that, in the end, it is the customer who can make or break us. Thus everything must be done with the customer in mind. Customers today have high expectations regarding quality, delivery, and price. Hence, analysing processes and prioritising areas of work is necessary.” For that, the cost has to be streamlined by removing non-value-added components of cost. It requires improving quality through consistency which Automation provides, to improve delivery. These things are inextricably linked. The non-value added cost must be stripped away repetitively. Certainly, Automation offers greater consistency, predictability, and visibility.

Sprucing up, Mr. Himanshu Sharma, Head of Marketing and Corporate Communication, B&R Industrial Automation, suggests examining the requirements for adopting Automation, especially for people who want to attain the global level. Different manufacturers have implemented different automation levels, whether micro, medium or small. They first consider consumer requirements they need to cater to. Also, to find what investments they can make and what other things are available for adoption. Though a lot of technology is available, they are unaware of it

First and foremost, SMEs should be educated about the technologies required at the workplace to compete globally. Primarily focus on the training needs to take advantage of Automation indigenously. Upon knowing only how localised Automation can benefit their systems, they will help the end user eventually. Hence, SMEs are expected to advance, supplanting Industry 4.0 and 5.0 technologies and forging global alliances.

Global technological alliances 

Quipping with remarks on global technology alliances for Indian companies and moving ahead with industry 4.0 and 5.0, Mr. Rajesh Nath, Managing Director, VDMA India Services Private Limited, deliberated: that India has nearly 63 million MSMEs, with 99 per cent of them employing fewer than ten people. In the Indian context, it is essential to know that MSMEs and SMEs are the backbones of the Indian industry. These account for nearly 35 percent of GDP. Another critical factor is that they employ 220 million people in our country. 

Adding further, he emphasises viewing the bigger picture. The country wants to become a $5 trillion economy by 2025. However, the pandemic took a few years, with manufacturing accounting for about 15 to 16 percent of GDP. This contribution should be increased to 25 percent of GDP. So, on reaching a $5 trillion economy, the manufacturing share will be around $1 trillion. This is a tall order because, currently, it is approximately 392 million. Hence going from 392 million to a $1 trillion contribution from manufacturing is a huge challenge, especially in the next five or six years. 

“The manufacturing industry as a whole is changing. The manufacturing business is changing. Looking at the level of Automation in manufacturing, it is approximately eight to ten per cent in India”, Mr. Rajesh remarks. However, the pandemic boosted Automation in India. Today, the automation market in India has been consistently growing. A CAGR of about 10 to 12 per cent in automation market growth is expected in India.

Talking about industry 4.0, combining physical and cyber ethics becomes prominent. There are a lot of connectivity matrices for connecting machines. Now data is an ongoing phenomenon. India cannot succeed without SME growth, so the growth of all SMEs is valuable. There are many misconceptions about Industry 4.0. It sounds like a big black box that is very complex. SMEs shirk embracing Industry 4.0. for want of enough knowledge and skilled labour. However, it is a gradual process

Mr. Rajesh has a solid point in mentioning that Industry 4.0 is not a destination but a journey that must be undertaken in small steps. “The way forward for Indian MSME is to analyse to determine the level of Automation. After all, the cost factor is significant. In the Indian context, getting a faster investment return is needed.” So, identification of steps is necessary to implement basic Automation and get a quick ROI. A contributory step may be the incentives coming to aid Automation for SMEs. Besides the Skill India, Make in India and Atmanirbharta campaigns, the government has released various schemes. One such scheme, the PLI, encourages the adoption of automated solutions for SMEs and MSMEs. 

The PLI is more focused on local manufacturing. Expressing his views on localised Automation in manufacturing, Mr. Gajanan Jadhav, Senior Manager – Channel Marketing, Factory Automation and Industrial Division, Mitsubishi Electric India, Pune, stated that we are attempting to make inroads into IoT and call it an e-factory. Industry 4.0 instead, society 5.0 refers to how this IoT is used for organisations in Japan. Implementing IoT projects for larger companies is easy, but for SMEs and MSMEs, local solutions need to be found. However, besides localised gateways, cloud solutions are also required as secondary steps. However, one of the PLI goals is to show how India can play a more significant role in the global supply chain with improved manufacturing. Today, the contribution to the worldwide supply chain stands around two percent.

Mr. Rajesh added that improving manufacturing and exports would be one of the primary triggers that can help Indian companies. Also, good quality products and efficient manufacturing practices are essential for export. Smart manufacturing will result from the CESS (cost-effective, efficient, sustainable and safe) aspects. Automation is not meant only for large corporations to benefit. It is also applicable to smaller and mid-size micro-companies. The only difference is distinguishing the level of Automation they need at the entry level.

PLI will play a significant role in India’s growth story. Precisely, this will help India’s manufacturing sector grow. Automation will be one of the strong pillars of the Indian manufacturing sector. Putting Indian companies in the orbit of the global supply chain requires a lot of cost-cutting to compete with international or multinational companies. Moreover, robotics and Automation must go simultaneously to mark the cutting edge.

Cobots and robots in Indian space 

Cobots and robots are tools to create more efficient processes, especially for SMEs and MSMEs. The robot is scary to few concerned about its cost and how it can help. This creates complexity in the automation industry. Many SMEs and MSMEs businesses think AI, Ml, robots, and Cobots are alien due to some elemental limitations. It is better to start by familiarising them with Industry 4.0 and other technologies. It adds value, especially since considerable employment is created in small and medium-sized businesses. The first job in the automation industry is to create awareness of basic ways of thinking. Once some primary data is tracked, how to put it on the cloud is the natural outcome. According to Mr. Bipin B. Jirge, Managing Director, ifm electronic India Pvt. Ltd., “Robots and Cobots are the efficient ways to achieve the next step in the Industry 4.0 journey along with some kind of accuracy and data reliability.”

Robots and Cobots are striving to add a significant contribution. It is our collective responsibility in the field of Automation. It’s all about implementing these baby steps in homegrown Indian SMEs and MSMEs, remarks Mr. Bipin. Awareness is a primary concern that will contribute to the baby steps. Much work has been completed as a foundation for the growth of automation processes. Resultantly, indigenous automation techniques are emerging for these kinds of facilities. Any organisation can perform methods using Automation with little or no human intervention. Elucidating the point, Mr. Mahesh Gurav, Product Manager, Exor India Pvt. Ltd., says, “Automation can power a range of equipment. It can fulfil various objectives in a wide array of manufacturing environments. Automation is effective because it increases quality, output and efficiency. It also reduces human assistance, dramatically reducing the risk of error.”

Future bubbling 

Cobots are transforming the manufacturing and production processes for SMEs. The flexible integration of Automation into design and manufacturing is the progressive step in accomplishing the goal. Mr. Zurvan is optimistic that more systems incorporating the IoT and interconnectivity are being developed for the future. The adaptation and adoption ways in the scheme of things are focused on the vigorous implementation of technology. The automation process is a continual one. It is happening in the industrial arena, leading to the burgeoning edge of technology, which is what the industry contemplates