COVID-19 has not only destroyed the financial health of the country but also caused widespread unemployment and job losses. It has affected the MSME industry quite hard, with businesses running out of cash, and some even shutting down.
While India will eventually win the battle against the disease, the country also needs to make intense efforts to win the economic battle.
Companies and businesses — especially MSMEs — need to learn how to innovate and become agile, says Amit Kumar Alsisaria, Co-founder and Managing Director at Polestar Solutions & Services India. Founded in 2013 by Amit, Chetan Alsisaria, and Ajay Goenka, the Delhi-based analytics company provides technology-backed solutions to businesses.
Amit has expertise in supply chain management and data analytics, and has previously worked with Accenture Consulting. In a conversation with SMBStory, he explains how MSMEs can work to reduce the impact of COVID-19 on the supply chain.
Edited excerpts from the interview.
SMBStory (SMBS): COVID-19 has led to cash flows drying up and businesses shutting down. What was lacking in the business ecosystem?
Amit Alsisaria (AA): COVID-19 has proven to be a wake up call for businesses to become more agile. A lot of things were lacking. For instance, organisations did not know how to harvest data.
Everyone was too focussed towards transactions and how to get them right. This is where data analytics comes in, which is so important in today’s time. Analytics helps integrate operations into the business and ensures that everyone is speaking the same language right from the top to the bottom.
COVID-19 will hopefully teach businesses to connect these and further, I believe that something like data analytics should be democratised.
SMBS: Can you elaborate more on how data analytics can be democratised in a business?
AA: In simple terms, the democratisation of data analytics means putting the power of analytics in the hands of business users. No longer do business users need to depend on their IT teams to generate meaningful insights from all the data that the organisation has in their systems.
At Polestar, we make sure that we provide business users with a platform where they can generate their own KPIs by means of a simple drag and drop. Business users can easily choose models, run scenarios, and support their decisions with the insights generated by them.
SMBS: COVID-19 also saw the disruption of supply chains throughout the country and the world at large. What has been its impact?
AA: Supply chain starts with the demand and ends with the customer. The disruption happened at the demand side, which had completely dried up in the wake of the pandemic and this had a trickle-down effect on the entire supply chain.
Moreover, the supply chain will take a lot of time to recover because it is difficult for businesses to predict demand in the immediate future and even for the next few months.
For supply chains to recover, businesses will have to plan their production with a lot of agility. Catching up with the demand is going to be tough for MSMEs.
SMBS: Digitising supply chains seems to be the need of the hour. How can businesses achieve this?
AA: When it comes to digitising supply chains, there are a lot of technologies involved. Warehouse automation, Internet of Things (IoT), warehouse robots and much more.
Moreover, organisations need to focus on technologies that will capture data and will help in tracking logistics. They must also focus on building command centres where alerts will pop up indicating any discrepancy in the supply chain.
SMBS: The pandemic has also resulted in widespread unemployment, but businesses have to handle the costs as well. How do you argue the impact of this from the business’ point of view?
AA: The pandemic has hampered businesses. Sectors like the automotive industry have seen no revenue at all during these times. Everything is going through a tough time, and everyone is also trying to conserve capital.
Payment collection has become slower. For example, if the time for payment collection was 60 days in the pre-COVID-19 era, it is now 80 days.
Companies that have seen no revenue at all must focus on unlocking value from existing customers. While laying off employees might balance their Profit and Loss Account in the short-term, they need to see the trade-off and compare it with the impact it is going to have on the services they offer because of widespread layoffs.
Organisations must find ways to cut costs but at the same time must retain the best services as well.
SMBS: Now that work from home has become the new normal, how can organisations track the productivity of their employees?
AA: Firstly, all companies should create an environment where employees are engaged and motivated, and have clear roles and responsibilities. Then, they should create processes to assign responsibilities and measure the outputs in short periodic intervals.
To achieve all this, the digitisation of all HR processes will definitely help in monitoring employee productivity. Organisations should define short term key responsibility areas (KRAs) for employees to measure the effectiveness of the output.
Systems that can provide a learning and development environment will help in skilling employees to perform the job better. With digital onboarding, timesheets and other processes, companies can save many hours of work for all employees and provide a seamless experience.
At Polestar, we use the Vega HRMS tool, which helps us with monitoring employee productivity and provides a seamless experience to all stakeholders within the company. We also use Vega HR analytics to find actionable insights.
SMBS: What steps do businesses need to take to ensure that the road to recovery is sped up?
AA: All businesses across the globe are facing unprecedented levels of uncertainty, and it has become extremely difficult for them to keep their financial wheels running smoothly. Indian businesses have to work on multiple fronts to be able to ride through the storm.
Firstly, they need to design an agile and adaptive supply chain to help react to changing demand and supply scenarios better. This will help companies maintain their customer service without incurring high costs.
Secondly, they need to revisit the business model and find ways to innovate. Organisations will have to look at their traditional sales channels. In this new normal, new sales channels may have to be defined and focussed upon. With social distancing, customers will be more inclined to buy online. In such a scenario, create an environment for customers to give them a great online shopping experience.
Thirdly, businesses need to focus on knowing their customers better as it allows companies to design trade promotions better. It also allows them to know and execute cross-selling and upselling opportunities.
Last but not least, bring in technology that will help them achieve all of the above, and help them with decision making and tracking better.
Want to make your startup journey smooth? YS Education brings a comprehensive Funding Course, where you also get a chance to pitch your business plan to top investors. Click here to know more.