SMEs AND INDUSTRY 4.0 

The fourth industrial revolution is making headway globally. However, in India, SMEs being the backbone of the country, still have a long way to go.

There has always been a technology divide between SMEs and large companies in the past and there will continue to be one in the future – that’s the nature of the beast. Technology is expensive and SMEs often do not have the scale to justify the investments. Many times, they are also not technologically savvy enough to be up to date with the latest trends.

But technology is not an end in itself. The basic objective of any manufacturing enterprise is to make goods of a particular standard at the lowest possible cost. If there is technology avail- able that makes this happen, it is adopted, otherwise it is not. SMEs are the home of low cost automation and frugal innovation—they are often able to use low cost methods to achieve the same objectives that technology does when operations are on a larger scale.

Feasibility of IoT 

The term ‘Industrie 4.0’ was coined in Germany to describe a strategy of the German government to promote the computerisation of manufacturing.

The basic principal is that by connecting machines and everything else in the factory one can create intelligent networks that control each other autonomously. The automation that this involves has two implications—it disinter- mediates humans and, as a result, it also drives up quality. It is an appropriate strategy for Germany, which is a high wage country and one that does not have enough manpower. The question is: Is it an appropriate strategy for India?
We have 12 million young people entering the workforce each year. What we need is a strategy that achieves the improvement in quality of Industry 4.0, without displacing people. In fact, we need a strategy that drastically increases employment. Instead of blindly copying the West’s Industry 4.0, we need to evolve our own version of it.

The technologies that currently encompass the fourth industrial revolution propelled by automation include internet of things, data analytics, augmented reality, artificial intelligence, 3d-printing, robot- ics, wireless, cyber security, etc., and further could get extended as the computing power of the machines get continuously enhanced. It is very difficult to predict ‘factory of the future’, and thus, the profile of jobs and what precise skills will be required. Therefore, it is essential for the stake-holders, Government, Industry, Academy and Thought leaders to keep abreast of the evolving requirements of various skills that keep changing in tandem with rapidly emerging technologies and converge into taking corrective actions across the value chain on a regular basis.

It is ironical that the biggest hindrance to large scale job creation in our country are the laws that cover employment. They are designed to protect workmen in the organised sector who form just 10 percent of the national workforce. And in doing so, they discourage employment of the remaining 90 percent who are not so fortunate. The orientation of our labour laws should change to actively promoting employment.

Future forward 

Having said all of this, there is no doubt that technology is important and that it is imperative for SMEs to stay abreast of what new technologies are available. Given this scenario and looking at the present situation wherein CII is on a ‘Mission-Mode’ approach to skill 500 million people to meet India’s development objective to move up from a lower-middle income to an upper-middle income country by 2030, the association is devising strategies to sustain an ecosystem for life-long learning and skill development.

In order to help SMEs do this, CII has recently launched its Technology Facilitation Centre, which serves as a platform for bringing together SMEs with providers of technology. It is hoped that this initiative will improve the technological literacy of SMEs and will enable them to better meet the challenges of the future.

 

 

Source: CII Manufacturing Champions May 2017

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