For the complete report, get in touch with us at : info@netscribes.com Need for maintenance of global standards is stimulating ICT adoption in manufacturing sector, finds Netscribes

1. ICT Adoption in Manufacturing Sector - India
August 2011

2. Executive Summary
India is ranked x in terms of manufacturing competence by US council for the year 200--
aa out of abc manufacturing segments in the industry are estimated to grow at xx%
Market
Manufacturing sector contributes around aa% of India’s GDP and ab% to the country’s exports
Industrial output registered a growth of xy% year-on-year during April-December 20--
LE
Drivers: Challenges:
Drivers & Operational Improvement Identifying Right IT Solution & Lack of Priority
Challenges
MP
Significant Cost Reduction
Global Competence
Recognition
Convincing about Financial Investment in IT
Lack of Awareness About Benefits of IT
SA Implementation
Top priorities for manufacturing sector in terms of business & technique are X and y respectively
The culture of using global packaged software applications is now prevalent even among the
bottom of the manufacturing pyramid
Trends
Solution 1, Solution 2, Solution 3 are the early adopted solutions in manufacturing whereas
Solution 4, Solution 5, Solution 6, Solution 7 solutions are relatively newer in adoption trends
SMBs which have lower value but higher opportunities as compared to large enterprises, are also
adopting ICT solutions for operation
Major Domestic Players Major Foreign Players
Competition • Company 1 • Company a
• Company 2 • Company b
• Company 3 • Company c
ICT Adoption in Manufacturing Sector - INDIA 2011.PPT 2

3. • Manufacturing Sector - Overview
Drivers & Challenges
• ICT Adoption in Manufacturing
Key Technical Enablers & Barriers
Scope of ICT in Manufacturing
ICT Need Assessment and Selection Criteria
ICT Solutions
Impact of ICT in SMB & SME Clusters
• Role of Cloud in Manufacturing
• Government Initiatives
• Major ICT Vendors
Profiles of ISV
• Major Manufacturing Player Insights
• Case Studies
• Future Trends
• Strategic Recommendation
ICT Adoption in Manufacturing Sector - INDIA 2011.PPT 3

4. … of becoming high quality global manufacturing hub
Market Overview – Manufacturing (2/2)
• All the segments under manufacturing are performing well, be it product1, product2, product3, product4, et al
• Industrial output registered a growth of f% year-on-year during month1-month2 20-- - --. Among the g major
LE
constituents of the index of industrial production (IIP), industry1 and industry2 recorded higher growth rates of h% and
j% respectively during this period
P
• India is set to become a global manufacturing hub for speciality1 over the next k years as manufacturing of speciality1
items predicted to become a INR r trillion industry during this period
SA
Core Manufacturing Sectors & Key PlayersM
Company11, compnay12, company13, Company41, compnay42, company43,
Sector11 Sector21
company14, company15 company 44
Company21, compnay22, company23, Company51, compnay52, company53,
Sector12 Sector22
company24, company25 company54, company55
Company31, compnay32, company33, Company61, compnay62, company63,
Sector13 Sector23
company34, company35 company64, company65
ICT Adoption in Manufacturing Sector - INDIA 2011.PPT 4

5. Drivers & Challenges – Summary
Drivers
Operational Improvement
Significant Cost Reduction Operational improvement is a key driver for all
Global Competence businesses whereas Cost Reduction is the
essential driver for Small & Medium Businesses
Government Initiatives (SMB, SME)
Better Customer & Channel
Relationship
Challenges
Identifying Right IT Solution & Lack of
Priority Recognition
For Enterprises, identifying the right solution is Convincing about Financial Investment
the biggest challenge whereas for SMB/SME, in IT
cost of IT Implementation remains a critical
barrier
Modification & Optimization of
Resources & Prevalent IT Infrastructure
Lack of Awareness About Benefits of IT
Implementation
ICT Adoption in Manufacturing Sector - INDIA 2011.PPT 5

6. Indian industries are embracing ICT to enhance their
growth & credibility
Market Overview – ICT Market Size and Growth
• ICT industry in India plays a major role in stimulating the
country’s GDP, thereby contributing to the growth of Industry30
the overall Indian economy by a large extent
Industry31
LE
• Currently, the industry in India is valued at more than c1%
USD x8 bn c2% Other
P
ICT industry accounts for x9% of the country’s GDP and
provides employment to more than x10 mn people directly
M
and x11 mn indirectly Total IT Market: INR 852.63bn
Per capita contribution of the industry in the country accounts
A
for USD x12 mn c3%
S
• The boom in the industry has also led to the
enhancement of various other sectors thereby adding
fuel to the growth of the country
The industry is all about connectivity and requires a lot of
product_a support thereby increasing the demand of sector20
tremendously
Components of ICT
• product40
• product41
It requires extensive man power and space for its operations v1 • product42
which in turn raises the demand for demand1 and demand2
significantly • product43
The industry mainly the youth for employment thereby • product44
providing ample opportunity to about x14% of the entire v2
population in the country which in turn enhances the • product45
employment status of India
PC shipment in the year 20-- was valued x15 mn • Product46
v3 • Product47
• product48
S/W – Software H/W - Hardware
ICT in Manufacturing - INDIA 2011.PPT 6

7. ICT adoption occurs in multiple phases starting from basic
solutions to intermediate, high-level & finally advanced solutions
ICT adoption trend in manufacturing companies SAMPLE
Basic Adoption
AAAAAA
Intermediate Adoption
BBBB
High Level Adoption
CCCCC
Advanced Adoption
DDDD
• ICT adoption for any manufacturing company takes place in series of levels in a sequence
• Usually adoption is started from basic level & over the time through multiple phases it goes up to high level or
advanced level depending upon operation size, requirements & affordability
ICT in Manufacturing - INDIA 2011.PPT 7

8. Focus shifting in India towards SMB segment as despite of
having lower industry value it has high growth opportunity
Value-Opportunity trade-off in manufacturing companies of varied size
LOW Value HIGH
SAMPLE
•X •Y •Z
Small Office & Home Office Small & Medium Business Large Enterprise
•A •B •C
HIGH Opportunity LOW
ICT in Manufacturing - INDIA 2011.PPT 8

9. SMB (Small and Medium Business)
About SMB
• Small and Medium Business (SMB) are privately owned and operated companies whose
SMBs are small
employee headcount or turnover is below certain limit (e.g. d1-d2 for business51 & d3-d4 for
operations having
business52)
LE
less manpower &
• In India, SMB accounts for nearly d5% of the total sector54 output & shows higher growth rate capital
P
in comparison to large enterprises in the sector
• The major advantage of the sector is its employment potential at low capital cost
M
• As per available statistics, the sector employs an estimated d6 million persons spread over d7
A
million enterprises and the labour intensity in the MSE sector is estimated to be almost d8 times
higher than the business55
S
ICT implementation in SMB
• SMBs are restricted by capital & hence cannot opt for individual applications for all business SMBs opt for
functions (function1, function2, function2, function3) unlike bigger companies solution based on
business function
FAfunction priorities
Mafunction
aHfunction
aPfunction
Mafunction
ICT in Manufacturing - INDIA 2011.PPT 9

10. Cloud Computing is catching up with the on-premises …
Key Cloud Based Trends (1/2)
•Cloud Computing market growth is expected at a CAGR of sol1
e1% from $e2 billion in 20-- to $e3 billion in 20-- globally
LE
•In 20--, the largest segment of the cloud computing market,
P
sol4, accounts for e4% of the total market’s revenue
Cloud
M
•Aspect1, Aspect2, and Aspect3 accounts for approximately
Computing
A
e5% of total sol5 market revenue
S
•The sol6 and sol7 markets currently hold a small share of the
cloud computing services market. However, it is expected to
grow moderately due to their flexibility and cost effectiveness
sol2 sol3
• sol9 means element1, instead of purchasing element2, outsource these element3 from element4
sol8 • sol10 involved delivering element5 and technology for computing, power, system as off premises on demand
services rather than dedicated as onsite resources
ICT in Manufacturing - INDIA 2011.PPT 10

11. Government Initiatives
Date Initiatives
India’s first ‘f1 Policy’, will soon be unveiled, which aims to increase the contribution of
11-XXXX-20--
manufacturing sector in India’s GDP to f2 percent by 20--
LE
From the Union Budget 20-- - -- proposals, industry experts believe there is stability in the indirect
20--
P
taxes which will lead to capacity building in the manufacturing sector in the coming years
10-XXX-20--
SAM
Establishment of National sector61 and Zone62 (ABBR63):
•A draft manufacturing policy, which aims to create f64 million jobs and increase the share of
manufacturing received an in-principle approval
•The policy will encourage foreign investment and technologies, while reducing the compliance
burden on industry.
•The government plans to earmark Rs f65 bn every year for the next f66 years to set up the first of
the f67 industrial cities along the city1-city2 zone69
Indian Government has implemented new Consolidated Foreign Direct Investment (FDI) policy
10-XXX-20--
document which attracts investments & will lead to improvement of infrastructure
ICT in Manufacturing - INDIA 2011.PPT 11

12. Manufacturing players in the domestic market (1/18)
Company Snapshot: Player 1
Corporate Information Business Highlights
LE
P
• dddd
Head Quarters a, India
Industry
M
b
Classification
A
Revenue (20--) c
No. of.
Employees
Mr. X
x
Ms. Y
Key Contacts
S Mr. Z
aaa bbb ccc
Professional History Professional History Professional History
ABC DEF GHI
Other Other Other
xxx ddd hhh
ICT in Manufacturing - INDIA 2011.PPT 12

13. Case Study x
Manufacturing Company ICT Vendor
aaaa bbb
Case: aaaaaaaaa
Requirements
LE Solution Benefit
P
•a
AM
S
•b •c
Technology Used
XXXXXXX
ICT in Manufacturing - INDIA 2011.PPT 13

14. Thank you for the attention
The ICT Adoption in Manufacturing Sector – India report is a part of Research on India’s
Information Technology Series. For more detailed information or customized research
requirements please contact:
Kalyan Banga Our other offerings in the IT Series:
Phone: +91 033 4064 6215 •ICT Adoption in Education Sector in India 2011
E-Mail: kalyan.banga@netscribes.com •ICT in Retail in India 2011
•Netbook Market in India 2011
Gagan Uppal •E-Governance Market in India 2011
Phone: +91 022 4098 7530 •Cloud Computing Market in India 2010
E-Mail: gagan.uppal@netscribes.com •VoIP Market in India 2009
Research on India is a product of Netscribes (India) Pvt. Ltd. Research on India is dedicated to disseminating information and providing quick
insights on “hot” industries in India and other emerging markets. Track our new releases and major updates in these industries on
About Netscribes
Netscribes is a knowledge-consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment & business research, business &
corporate intelligence, content-management services, and knowledge-software services. At its core lies a true value proposition that draws upon a vast knowledge base.
Netscribes is a one-stop shop designed to fulfil clients’ profitability and growth objectives.
Disclaimer: This report is published for general information only. Although high standards have been used the preparation, Research on India, Netscribes (India) Pvt. Ltd.
or “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes (India) Pvt. Ltd. and prior
permission is required for guidelines on reproduction.
ICT in Manufacturing - INDIA 2011.PPT 14