Manufacturing Stalwarts Vet AI’s Role in India’s Growth Story
India being among the fastest growing digital economies, is religiously adopting Artificial Intelligence (AI) across sectors. Banking, financial services and insurance (BFSI), manufacturing, healthcare, education, ad-tech are among sectors that are revolutionizing their business models, even as they increase efficiency and see a record-breaking growth in revenues using AI. According to the World Economic Forum, machines will perform 71 per cent of the tasks of the current workplace by 2025, compared to 29 per cent of the tasks accomplished today. To discuss the opportunities and challenges that follow, reputed industry leaders met at a round table discussion in Mumbai organized by BW Businessworld in association with Microsoft on ‘AI in Manufacturing’ in August 2019.
The forum, comprising senior leadership teams from various industries, met to discuss critical factors including customer engagement, product innovation, operational optimization, cost, quality and change in investment needed by industry, to drive sustainable growth while successfully adopting AI in the coming years.
Daya Prakash, Consulting Editor - Technology Projects, BW Businessworld, hosted the discussion on AI and its readiness in India and steered the participants to key industry issues. Daya said, “Employee productivity gains and the amount of innovation in the manufacturing space is going to double in the coming years. In order for organizations to remain competitive, at least in the next 3-5 years, they have to leverage AI, or they’ll end up losing their competitive touch.”
Commenting on AI readiness, Anindo Dutta, VP, Regional Business leader, Microsoft Services Asia, said, “The AI and digital push has been phenomenal in the manufacturing industry in particular. I have witnessed myself some manufacturing organizations such as heavy earth machinery movers who are absolutely disrupting their entire businesses on the back of AI and digital because they are paranoid that if they do not, then somebody cheaper, faster and more nimble was going to change the industry. Even the mining industry is being completely revolutionized using AI.”
Robert Hanegraaff, Global Sales Director, Digital Advisory Services, Microsoft, said, “AI is such a disruptive force in the economy and for companies, that organizations are now wondering how to leverage AI in order to survive, thrive and really drive that competitive advantage. A lot of our customers are asking us the fundamental question: how do I survive in the digital age? This is the core conversation that we have with a lot of our customers. Executives are wondering where their businesses are going to be in the next 3-5 years? AI is not going to be the same today as it is going to be in the next five years. It takes a long time to change the way of working with a lot of investments at stake, especially in the manufacturing space.”
Vikas Choudaha, SVP & Head, Innovation Centre, Godrej & Boyce Manufacturing Company Ltd. said, “The collective learning of an organization is far stronger that the learning of an individual. You start off with— how does AI or any of the digital technologies help my business processes to deliver business results. Eventually, you realize AI or any of these digital technologies are core to my strategy. Rather than looking at a single technology with the question, ‘Is AI my core strategy or part of a tool kit?’ the businesses need to understand that it is a journey. Realization needs to be at the core to see the value even if it starts with using AI as a tool to solve business problems and eventually get it embedded as a part of the strategy.” Anindo added to this thought, saying “The idea that AI needs to get embedded in the core resonates really well. I think that the key idea of
embedding AI in business processes gives you better return than using AI as just a fun side experiment. We are seeing more of that, not just in our business, but also in our clients’ businesses. Everybody gets the predictive analytics part of AI but we are trying to crack its next frontier.”
The huge availability of big data, evolving industrial IoT and increased automation are the factors fuelling the growth of Artificial Intelligence in manufacturing market. Artificial Intelligence is expected to grow from $1.0 billion in 2018 to &17. billion by 2025 in the manufacturing market, at a CAGR of 49.5 per cent.
Rajgopal Nayak, Head-Business Application & PMO, Marico Ltd., shared insights from the FMCG sector − an industry where sales and marketing rule. “We have an extremely strong backbone where we capture all the data that comes in from different marketing channels, third parties and sales figures on a daily basis. So we are spoilt for data. Our strategy to gain from this data is to predict the success of shifts that are happening in different regions for varied products. So we have a lot of demand for leveraging AI. There is a lot of scope of AI in the core manufacturing area and especially in the area of quality to predict shifts and ensure overall equipment effectiveness,” he said.
Anand Budholia, SVP-IT, Reliance Power, presented his views on using AI and other technologies for sales. “In terms of marketing, social media analytics help in understating customer behaviour to sale. Post sale also, it helps in keeping a customer engaged and solving problems if any arise,” he said, adding, “In my view, AI can play a role in highlighting the exceptions rather than only generating more information out of the already abundant data available.” It is not just the analysis of the data and customer service but you see a convergence of sales, marketing, production and customer service through data analytics.
Sukanta Kumar Nayak, VP-Group IT, Aditya Birla Management Corporation Ltd., spoke from a strategy point of view. “Today, without any digital journey, you may not even have a strategy. There is a lot of focus on IoT, AI and ML as these technologies are an integral part of any strategy devised for business. It is a matter of how effectively you execute it and make it operational on the field to maximize the benefit and increase the productivity.”
Bhupendra Bhate, CIO, L&T Technology Services, echoed the same, “Industrial transformation, change of mind set and overcoming internal resistance are of course some of the factors to be looked at if AI has to make more impact. However, from a technology perspective, for ensuring significant impact on manufacturing, it has to marry with digital twin technology and thereby control/optimize physical equipment’s by virtual means. For instance, now a days, AI is often applied individually to each of the core equipment’s (heat exchangers, boilers, rotary equipment etc.) of the factory which consumes the major part of the power or the cost. The purpose could be predictive maintenance or optimization of the parameters. Having a Digital twin of these equipment’s enable better usage of AI and eventually AI can be applied to the factory as a whole.”
Ashok Asawale, VP-IT, Mahindra & Mahindra Ltd., shared his thoughts on how successfully handling the de-learning aspects at the product, people and process level is the bottleneck that can help break free of the barriers. “De-learning of products, people and process; and relearning while creating alternatives, can change the discussion after a couple of years. Manufacturing has become a service industry because of AI,” he said.
Prabhakar Shetty, Global Head, Digital Manufacturing Services, L&T Services, gave a different take on AI from a strategy standpoint. “Whenever such dimensions of technology shifts happen, the obvious outcome is disruption, innovation and transformation. When you want to do that, you still need to touch your basic processes because if they are not aligned or able to leverage this technology, well then there will be many challenges. We need to decompose that into different process categories, such as the most commonly faced unplanned downtime. We can predict the known, as well as the unknown, and further extend their lifetime. So connecting all this in an AI scenario benefits."
People often ask the wrong questions such as, do you have a digital strategy or an AI strategy. Prasanna Pahade, Chief Strategy Officer, Mahindra logistics shares, “With my experience in strategy, I believe that all of this has to be embedded into the strategy. Instead of asking – Do you have a digital strategy, the relevant question is – Is my strategy based on digital?” More than just a buzzword, AI is a journey. It is a journey of understanding how best you are going to grow and move ahead as a business by using AI. It has to drive value for businesses.
Speaking of some of the barriers which hinder adoption of AI in enterprises of the coating industry, Dr V. Mohan Rao, VP, Pidilite Industries, said, “We deal with customers having varied preferences and architects who are especially very specific in their demand for a particular shade of a colour. On the other hand, in the decorative coatings business, a lot of time is spent in managing the material that goes into making these colours, since decorative coatings are made of a lot of material which is mined. Mining further makes it even harder to control the colour variation, so we have to manage the tints and shades during manufacturing. If there is a way where we can convert this into an intelligent machine which guides us, it can make a lot of difference in enhancing the quality. AI can also help in managing the time that goes into the manufacturing process and the data-backed process can contribute to productivity, as well as cost efficiencies.”
The biggest barrier is the persistent mind-set of people towards the use of technology. Many still believe that everything is in their mind and they are able to run business as usual while not realizing that this probably becomes an existential issue out in the market sometimes. Rachna Nath, Microsoft Services Lead said, “I believe that trust plays a huge role as well. How much do we trust a technology to be able to keep our data safe? With deep levels of hyper localization and personalization, there is a fear in people’s mind about how much a technology knows about them. This has also led to our biggest focus being maintaining trust and providing our services while complying with the customer’s permissions.”
Prasanna added, “The heart of AI from where it started was to make humans perform better. While AI was invented to aid humans perform better, humans themselves are facing barriers in its adoption. However, I feel that the solution, interface or process around AI are not intuitive enough for people to wholeheartedly embrace it and therefore, that results in a barrier to adopt it.”
AI is a technology on which Microsoft is betting on as an organization. Dr. Rohini Srivathsa, National Technology Officer (CTO) - Microsoft India explained, “We were seeing organizations across industries adopting AI in bits and pieces so we conducted a study with IDC to understand the barriers as well as enablers in a more systematic manner across Asia. The top two headlines that surfaced out of that study in India were: the strategy of approaching AI at the boardroom level is missing resulting in less than needed investment, and there is a lack of digital skills in people on the shop floors. Keeping these on ground challenges in view, we have been in the market working on initiatives for the last 4-5 months to address the developer ecosystem and train them with AI toolsets. We have been working with universities to launch digital labs and enable students to get access to AI tools, platforms and be skilled for it. Globally, we also launched AI business schools.”
Deep Thomas, Chief Data and Analytics Officer, Aditya Birla Group, said his enterprise believes that it cannot drive manufacturing efficiency without AI. For the Aditya Birla Group, AI is augmented intelligence or intelligence amplification. It is almost a business imperative for them. There is a filter that the Aditya Birla Group applies at the organization which Deep calls A-B-C-D-E, and if these five filters are not applied, then there is no way that AI application is going to be successful.
“If you do not do A-B-C-D-E then you are going to fail. ‘A’ being Awareness - people should know the potential of AI to get the value from it. ‘B’ is Business domain - it takes two to tango, so it is very important that the engineers as well as the data scientists know the processes. ‘C’ is Culture - if someone is not progressive enough to adopt then it is a challenge. ‘D’ is data and ‘E’ is for Executive sponsorship. You have got to have these,” Deep said, “and only then will you be able to adopt AI for your organization.”
_20240910143022_original_image_4.webp)
