India has around 30 unicorns—companies valued at $1 billion and above. They command a combined valuation of over $80 billion. Looking back a decade, would you have been able to tell how these digital native firms that use technology to run businesses around customer experience would impact business?
At the Fortune India Next 500 Summit-West on Tuesday, a panel discussion titled “Technology—Disruptor or Catalyst” explored exactly that and what lay ahead for businesses. “Effectively, in the last decade, we have gone from zero to 4% of India’s market capitalisation [Nifty 50 is valued at $2 trillion] being represented by these new set of companies,” said Krishnan Chatterjee, chief customer officer and head of marketing, SAP Indian subcontinent, who moderated the discussion.
The panel comprised stakeholders from various industries: Ullas Kamath, joint managing director of Jyothy Laboratories, represented fast moving consumer goods (FMCG) manufacturing and distribution, Devita Saraf, founder, chairman and chief executive officer, Vu Technologies, represented new-age manufacturing and sales of electronics. The panel had digital natives, too: Sreevathsa Prabhakar, founder, Servify, and Nachiket Pantvaidya, CEO, ALT Digital Media Entertainment, which owns and operates the over the top (OTT) platform, ALTBalaji. Each shared how technology has changed the way business was being done.
Chatterjee highlighted that SAP India, which has 8,500 customer engagements in the country, believes that everybody is thinking digital native and that includes larger bricks-and-mortar businesses. The discussion opened with Ullas Kamath of Jyothy Laboratories—ranked 38 in the Fortune India Next 500 list 2019—sharing his perspective of being an FMCG company with a digital native mindset. Kamath said data and technology are very important as decision making becomes much easier for Jyothy Laboratories, whose products are placed in 3 million outlets, with its sales’ personnel hitting 75,000 outlets every day. “When you are moving 8,000 trucks of FMCG products a month, and 1 lakh trucks a year, saving ₹100 will mean a lot,” said Kamath. “Data can be captured with technology alone, and anybody running business without technology is a disaster,” he added. Kamath was also of the view that going forward, the biggest investment in any business, aside of land, building and machinery, should be in technology.
Sreevathsa Prabhakar of Servify, that uses its unified technology platform to stitch together an otherwise unorganised after-sales experience ecosystem, was the next to weigh in. Prabhakar said after-sales service has never been a strategic priority for most brands and seen as a liability and run as a cost centre. “There are very few technology brands that can manage customer service end-to-end,” Prabhakar said. “But today it is not just about products as customers are buying experiences,” he added. Customers want minimal friction, and control in their hand as its costs more time than money to reach a call centre and wade through the time consuming interactive voice response (IVR) menus and then finally hear that their call is important and they be on the line. Drawing on ideas presented by Bain & Company on consumption earlier in the evening, Prabhakar said: “You have to start thinking digital because millennial are going to drive your businesses.” He further added that technology helps to reduce lot of inefficiencies, especially in customer service aspects of businesses.
Vu Technologies’ Devita Saraf chimed with Prabhakar’s view, saying this was an opportunity for businesses, as “Indians … are very fast to adapt to technology”. Saraf, whose company makes one of the world’s fastest growing luxury television brands, explained that when your company is high-tech and your customer is high-tech, then technology can give you a cool edge. “From an enterprise viewpoint, technology has always been seen as an efficiency provider,” said Saraf. “To me, that sounds more like the 80s-90s era of Jack Welch and Michael Porter,” she added.
“Today, in the era of artificial intelligence and machine learning, by deploying technology you are not keeping up with your competition but with your customer,” Saraf said. Today businesses continue to have that traditional consumer and also aspiring and tech-savvy consumers. She said the former still insists on having an engineer sent to fix problems, and then there is the millennial who rings up Vu’s 24/7 call centres in the middle of the night and insists upon not sending any technician to their homes, but send a self-help video to fix the issue. “Successful companies will be those who can balance both,” said Saraf.
The panel next dwelled on intellectual property in digital times with ALT Balaji’s Nachiket Pantvaidya expanding on the thought process behind the need for ALT Balaji: “When we are making great stuff, why is somebody else making the money?” He said two things reordered consumer behaviour in the last three years: demonetisation and Jio-fication. The first, how one paid, and the second, which made Internet practically free of cost, how one consumed entertainment. Both of these meant that content producers’ dream of selling mass programming directly to customers by bypassing TV channels and cable operators could become true. “And that too very quickly and with very low entry cost,” said Pantvaidya.
But that was not possible to do all alone but piggy-back on someone else’s multi-crore investment. “Our ride was on the back of telecom companies,” Pantvaidya said. He also recalled naysayers doubting whether Indian consumers would pay for content. “Today we are the third largest paid OTT platform and that at one-twentieth of the cost of anybody else,” he said.
Chatterjee then drew attention to what lay ahead for businesses and what businesses should do to remain relevant. Pantvaidya said being a user and early adopter of technology is important. “That helps the cause that much more,” he opined. “And second, you should have a strong guiding ambition to overcome the early naysayers,” Pantvaidya added.
Saraf advised that one has to listen to their younger generation, who take to newer tech faster, as knowledge has to flow both ways. “You must build a ring of people who bring fresh ideas and insights on the table as mere expertise to run the business will not suffice in a high-tech world,” Saraf said.
Saraf also pointed out that it is good to have the right systems and processes in place at the earliest, rather than attaining a particular size. “Make sure that your supportive technology grows with your business,” she added. Saraf is of the view that India is a hotbed of technology—akin to what manufacturing is to China. Pointing to the high valuations that tech firms fetch, Saraf said that if one finds people who raise lot of money in technology business, then they must make sure those people are either collaborators or customers. “Having the right partners in tech industry helps the business to propel in the right direction,” Saraf added.
Servify’s Prabhakar said for him he sticks to his ‘six C’ strategy: ‘curiosity’, which compels one to learn and brings ‘clarity’; these two together help build ‘commitment’, which leads to ‘conviction’ and ‘courage’; and finally one “‘conquers’ their aspirations”.
Besides predicting the eventual wipeout of 3G and then 2G phones by 2023, Prabhakar observed that voice will be the primary mode of transactions, while screens for content consumption only. “You will not tap the screen to book an Uber, you will tell Uber to book a cab for you,” he said. Prabhakar believes that ecosystem scores will replace the current credit bureau scores of customers. “You cannot let go 96% of your potential customers just because they do not have banking history,” Prabhakar added.
Jyothy Laboratories’ Ullas Kamath insisted that any product, service or idea which is better, cheaper, faster and convenient than the existing one should always be a good one to go for. “And to do this you always need technology,” Kamath said.
The discussion ended with SAP India’s Chatterjee summing up that every business problem has a technology solution: “If that is the first port of call, you begin to play the digital native game. And with the culture which is oriented towards change, youth and much more dynamic the process can become smoother.”