Building Supply Chain Competency to Strengthen India’s Opportune Position Globally
Interview with Rohit Bhayana, Co-Founder & Managing Partner, Lumis Partners and Co-Founder, Oister Global.
Currently, India is holding an opportune position in the context of current global geopolitical dynamics. Things are going well for India but it also needs to play the cards right. This is primarily because while India is emerging as a viable manufacturing alternative to China, the competitive pressure from Mexico, Indonesia, Brazil and southern European countries is rising.
Hence, India must operate on tight capability. It must execute well, execute to scale and execute to repeatability and reliability across everything, be it product quality, price points, logistics, fulfilment timelines, business model or technology.
This is possible only when India fixes its global value chain. Value chains have a very unique attribute that they cut across industries. Any investment that India makes in the value chain can clear initial hiccups and streamline everything to beat policy, technology, competence and sector creation.
Supply Chain Resilience for Legacy Companies
The supply chain is usually a pain point for legacy companies due to their size and speed of adoption. However, they were shaken up during the COVID-19 pandemic when they had to move and respond on the go across countries, continents and business verticals. That was the first time when legacy companies not only proved supply chain resilience but also showed how swiftly they adopted change management. They were also agile in implementing an omni-channel model to blend multimodal, delivery fulfilment and D2C capabilities together.
Legacy companies that embraced supply chain resilience have surged forward in competition and the ones that struggled are still catching up.
Partnership Between Legacy Companies and Startups
Large companies are increasingly opening up to collaborating with startups for innovation, digitisation, technologies and new business models. They are now internally equipped with this thought process and collaborate actively with startups through venture programmes, hackathons and other initiatives to bring their technology in-house. Legacy companies are also eager to invest capital, time, efforts and resources in understanding what startups are doing while being mindful of intellectual property security.
It is a fertile ground for both legacy companies and startups to embrace technology and innovation. However, the conflict arises when legacy companies expect startups to lower the prices, enter into an exclusive agreement or extend warranty periods. These barriers can crush startups and their innovations.
At the same time, startups will also need to make legacy companies comfortable buying their technology and services, at least on the pricing factor. They will have to give legacy companies an assurance to manage challenging situations when their business continuity is at risk. Every startup has several competitors and building a 360-degree ecosystem around their product will be a crucial differentiator to work with legacy companies.
Conclusion
Legacy companies and startups are instrumental in fostering India’s economy and its aim to become a global leader. Startups can bring innovations and agility for big companies to respond faster to market changes. Traditional companies can provide resources and legitimacy to startups. Hence, both need each other for successful collaboration.
Caret Capital (Formerly known as Supply Chain Labs) is a Venture Capital fund that backs category building startups making India’s value chain efficient. Website link — www.caretcapital.in
Caret 360 is the CXO community initiated by Caret Capital to help tech startups and industry discover each other. Collectively, the mission is to make India’s value chain efficient.
