As India rapidly moves into the digital era, leading Indian businesses are changing their business models to capture the opportunity.
India is quickly becoming a digital country. The evidence of rapid change is staggering. For example, the number of smartphones shipped in the Indian market is expected to surge from under 28 million in 2013 to more than 155 million in 2017. In e-commerce over the same period, the value of physical goods purchased online will grow from US$2 billion to US$8.5 billion. And to fuel this digital transformation, the number of software developers is expected to increase by 90 percent to 5.2 million – 700,000 more than the United States will have – by 2017.
None of this has escaped the attention of corporate India. In a recent Accenture survey of more than 100 Indian senior executives, nine out of ten said “being digital” is a strategic imperative for their companies over the next five years. As one CEO of a large insurance company succinctly told us, “If we don’t go digital, we won’t exist.”
That sense of awareness, however, has not necessarily translated into the right strategic focus. Many businesses are concentrating too intently on plucking the low-hanging fruit. When we asked the Indian executives which business priorities their firms were addressing through digital technologies, their top response was to increase the efficiency of existing IT systems (58 percent), and their second choice was to enhance the efficiency of the supply chain (48 percent). Of course, those two objectives are important, but they are merely the start. To avoid missing the “digital bus,” companies have to transform digital resources and technologies – including social media, cloud-based software, and machines equipped with digital sensors – into new sources of profitable revenue.
In other words, companies shouldn’t just concentrate on process efficiency. They should also focus on growth, developing closer connections with customers and offering new products and services by digitalising their business models.