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Siddharth Zaveri's avatar

As a person wearing a hat of a MSME family business and a hat of investor I absolutely agree to all your points.

What we have found to be most challenging for software upgradation is not the choice of software, but the backend that we need to create - additional workforce around data inputs and data management.

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Jinay's avatar

With every generation, there's a new trend taking shape. It's the agile who survive.

My late maternal grand father started a small kirana shop in Matunga, Mumbai. He did good by opening one more shop for his 3 male children (my uncles). When the shop was started, access to money was a big issue, so Kutchi community came forward and helped him out. Slowly, he repaid the loan with 5 kids (3 males, 2 females)

My uncles then had to face a different challenge. They saw their business being driven away to Big Bazaar - Shopping Malls. Because the 90s, saw the emergence of BPO / KPO, IT service class who would only shop on weekends with food coupons given by their companies.

Unfortunately, my uncles didn't adapt to this business model and failed. The only money they made was outside of their business - investing in equity markets via the IPO route and staying invested for a 2-3 decades.

Now, in 3rd generation, my cousins (2 males, 2 females) are completely resisting the shop's business. Because they can't compete with the likes of E-Commerce, Malls and the dangerous Quick Commerce. Plus, their shops aren't big enough to be converted into dark stores and now are facing a huge liquidity challenge.

'Software' is a dreaded word for these guys because they haven't been exposed to it from an early age.

Plus, for Millennials and Gen Zs' - it's sensible to take up a job at a services firm rather than play the battle that's already lost. Because it's not just about the software alone.

Think about it - you don't need operations in one place but also data analytics and proper logistics to service your customers who think it's logical to get an iPhone of Rs 1.5 lakhs in 20 mins after punching an order from their phone and paying via UPI.

It's a complete range of work.

In last few decades - very few businesses have survived and thrived. They too need to get out of this ownership mindset of my son or daughter should take over. That causes another streak of failed MSMEs. It's better to sell it off or let the professionals take over.

An owner must decide when to step away from the game. Else, they end up spoiling it.

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Dharmesh Ba's avatar

Beautifully put. Agree with all your observations.

We developed a simple gauge to assess a business's health by posing the following question to owners:

'Would you be willing to have your children inherit and manage the company?'

A negative response strongly indicates the owner's lack of confidence and suggests the business may be stagnating or declining.

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Kapil Gorave's avatar

You see Indian Software companies complaining that Indian Businesses are cheap. What they dont understand is they don't have those margins or benefits after using your software. It does not make any sense at all that it should cost same in Silicon Valley and Bangalore.

Not trying to toot the AI horn. One big major factor is going to be Commoditization of software in near future with help of AI. Building simple software will become easy. Met a Pune based Entrepreneur who is building affordable software for Indian businesses. I guess the trend will pickup in other areas as well. At least I hope it does.

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Dharmesh Ba's avatar

True that.

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Tarun's avatar

I have seen a friend business who is a large scale distributor, some of the manufacturer started going direct and started creating their own digital platforms and hence now they are getting forced to digitize to compete in the market.

On the software side, many solutions are force fit to their business, every small business has their own needs hence they seek more custom builds options.

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Feb 25
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Dharmesh Ba's avatar

Can you share what digital transformation initiatives has had the most impact?

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Feb 26
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Dharmesh Ba's avatar

Nice. Thanks for sharing.

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