In the name of digital adoption, MSMEs are shifting away from the good old websites and emails and toward more efficient technology solutions. The shift has largely been visible due to improved affordability as a result of the growing on-demand, pay-as-you-go, or software-as-a-service (SaaS) ecosystem in India, which has liberated small businesses from the cost conundrum to some extent.
On Wednesday, India will observe National Technology Day to commemorate the country’s entry into the exclusive club of nuclear-weapons states with the Pokhran nuclear tests in 1998, as well as to remember the country’s achievements in science and innovation. While many MSMEs have yet to fully benefit from the technological revolution, some have certainly been warming up to new-age solutions such as artificial intelligence (AI) and using it for better growth.
AI is being utilized in various applications. For example, JCCI Logistics, a Delhi-based long-haul logistics services provider, has implemented AI and internet of things (IoT) solutions to manage its fleet of approximately 150 trucks. The company, which was founded in 2004, employs on-demand fleet management software for GPS vehicle tracking, fuel management, driver analytics, and route planning.
What matters is that vehicles run as much as possible. Before implementing this solution in 2020, our monthly cumulative running distance ranged between 8,000 and 10,000 kilometers. It has now increased by around 20%. I believe the increase is primarily due to the on-board diagnostics (OBD) device that you can fit in a vehicle to get data related to fuel consumption, driver behavior, whether there is unnecessary hard acceleration or not, and so on, Sachin Jain, Founder, JCCI Logistics, told Financial Express Online.
OBD is essentially a machine learning (ML) and internet of things (IoT)-based device that receives signals from various sensors in a vehicle and transmits them to the user’s dashboard using the software.
As the pandemic may have necessitated the use of software and digital for sustenance, JCCI Logistics was among the post-Covid adopters of deep technology solutions.
Because the labor force was locked up, Covid may have accelerated the transition to some AI/ML applications. AI/ML offers a significant opportunity to reduce input costs, particularly human capital costs. Edge AI/ML will accelerate adoption, especially as it is married to IoT on small devices and sensors that are available at scale and routinely used by businesses of all sizes, Utkarsh Sinha, Managing Director at advisory firm Bexley Advisors, told Financial Express Online.
Restaurants were among the top sectors where the use of AI accelerated during the pandemic, as the pandemic prompted eateries to look for ways to optimize their processes ranging from sales to inventory management and more.
Kabir Suri, the CEO of Azure Hospitality, which owns restaurant chains such as Mamagoto, Dhaba, and Speedy Chow, has been using AI in the company’s operations for the past five years, while Covid has only reiterated his commitment to AI for efficiency and growth. We have had a direct savings of 30% over the last five years, as well as customer insights from AI, which has increased revenue. We had around 10 outlets five years ago and now have 60 across India,” Suri told Financial Express Online.
The company has an AI solution in-house that displays live sales, total transactions, menus, items sold, total consumption per restaurant, and so on. The solution collects data from each restaurant in real-time throughout the day and consolidates it for analysis on its dashboard.
According to Suri, it is critical for restaurants with chains to understand consumer behavior patterns and the impact of different occasions on business, like Navratras in the north, Christmas in Goa, and some other festivals in the south.
Furthermore, the AI solution at Azure Hospitality assists Suri in controlling the HR module. Every day, whenever you want, you can access your salary component, leaves, attendance, holidays, payslips, and so on through a single system. Essentially, AI helps you make better decisions as your company grows by reducing the impact of any uncertainty, Suri added.
Tourism is another industry that heavily relies on technology, particularly AI, for a variety of purposes such as travel booking via chatbots, flight forecasting in terms of the current best price and future prices, recommendations for hotel and cab booking based on travel-related searches, and so on.
AI is present at every stage in tourism and aviation, said Subhas Goyal, Founder, and Chairman of B2B travel company STIC Travel. The company serves as the sole General Sales Agent (GSA) for 11 international airlines in India, including United Airlines, Air China, and Croatia Airlines.
STIC has been using AI-based Microsoft Dynamics CRM for the past five years to manage customer relationships, track sales leads, marketing, and so on, as well as streamline administrative processes in sales and marketing. In order to answer customer questions on its platform, the company is now implementing a chatbot assistant. Goyal stated that standard queries such as bookings and vacation searches would be handled by the AI bot, while further details and feedback would require manual intervention.
Following Covid, more MSMEs began to use primary technology tools, such as social media, online service aggregators, company websites, and so on. According to a Crisil survey of 540 micro and small businesses conducted in April of this year, more than 65 percent of respondents used or upgraded their utilization of online aggregators, social media platforms, and organization websites.
Manufacturing had the highest adoption rate, with 71% of respondents adopting or upgrading their use of digital platforms, compared to 66% of respondents in the services sector.
Good technology is imperceptible. AI/ML will soon form a foundational layer in all small business operations and interactions. As technology advances, it will soon be easier to get good AI to do certain tasks than it will be to get a human to do them. The effect on labor force utilization will be crucial, Sinha added.
