Dr. Chandan Chowdhury, Executive Director in conversation with Col. Rajiv Bhargava, Associate Director at ISB.

 r. Chandan Chowdhury is Associate Dean and Practice Professor of Operations Management and Information Systems at the Indian School of Business. He is also Executive Director of the Munjal Institute for Global Manufacturing (MIGM) and the Punj-Lloyd Institute for Infrastructure Management (PLIIM) at ISB. Prior to joining ISB, he served three top multinationals as Managing Director and Country Manager (CEO at IFS India, a 100% subsidiary of IFS AB listed in Stockholm; Country Manager, Strategic Accounts, IBM India; and Managing Director, Dassault Systemes-India). Prior to joining the corporate world 17 years ago, he served as Professor, Dean (Academy), Chairman (Board of Research) and Member (Board of Governors) at the National Institute of Industrial Engineering (NITIE), a joint initiative between the United Nations and the government of India. Dr. Chandan believes that ‘theory without practice is sterile and practice without theory is futile’.

Col. Rajiv Bhargava is an Associate Director with Munjal Institute for Global Manufacturing and Commercials at ISB.
Industry 4.0
Col. Rajiv Bhargava: What is Industry 4.0? Can you explain it in layman’s terms?

Dr. Chandan Chowdhury: The 4th Industrial Revolution (popularly called Industry 4.0) is expected to transform the entire value chain by leveraging state-of-the-art digital technologies. The objective of such digital transformation is to make manufacturing and other business processes agile to meet the changing needs of customers, that is, the demand for personalised product and services. The government of India is also integrating Industry 4.0 in its new industrial policy. Indian companies are no longer isolated and will go through disruptions because of Industry 4.0.

Changes in the Manufacturing Ecosystem leading to Industry 4.0
Col. Rajiv Bhargava: What has necessitated changes in the manufacturing ecosystem today that has led to the demand for Industry 4.0?

Dr. Chandan Chowdhury: In an increasingly global and competitive environment, it has become imperative to transform the way we look at our value chain. Customers today expect increasingly personalised products and services, frequently through varied modes of service delivery (e.g. online, brick-and-mortar stores, hybrid). Companies, in response, are having to adapt their business processes to these changing consumer trends and demands. Companies are increasingly seeing their products and services becoming commoditised, with customers expecting them to deliver ever more personalised offerings. In this context, the competitiveness of these companies becomes increasingly dependent on the overall effectiveness of their value chain. Organisations today are experiencing fundamental changes that include shifts from:
  • Mass production to mass customisation
  • Make-to-stock to make-to-order
  • Simple ‘product delivery’  to ‘personalised experience and services,’ where the products are often bundled value-add services and unique experiences
Overall, there is pressure on the value chain to be redesigned and reengineered, keeping in view the frequent changes in market and customer demand. There is also pressure to make factories and business processes more agile. Many organisations today have broad geographical spreads — not only multi-site but multi-country and continent — and often see a high degree of variation in specific customer requirements across geographies and regions. All these aspects have put new demands on the way value chains are designed and managed. Industry 4.0 can act as an enabler to handle many of these challenges.
Enabling factors that make Industry 4.0 a huge success
Col. Rajiv Bhargava:: Any concept can only thrive in an amenable ecosystem. What are the enabling factors that can make Industry 4.0 a huge success, or, by their absence, make it a failure? 

Dr. Chandan Chowdhury: Industry 4.0 typically is technology-driven business process reengineering where the application of Internet of Things (IoT), cloud, big data, robotics and predictive analytics are quite common. The success of such projects will be greatly influenced by:

  • Our ability to treat Industry 4.0 not as automation but as a business process and often as a business model transformation project
  • Our ability to manage the change process where the roles and responsibilities of people would go through a major change that requires them to be prepared for new types of skills (for instance, robotics)
Impact of Industry 4.0 on Jobs Situation in India
Col. Rajiv Bhargava: What is the impact of Industry 4.0 in combination with robotisation on the job situation in India?

Dr. Chandan Chowdhury: Our population is more than 1.25 billion, and it is expected that 63% of our population will be in the working age group by 2022. Job creation will be an important aspect of our nation’s sustainable growth. On the other hand, full scale implementation of Industry 4.0 would probably result in massive job losses in the traditional sectors. One of the major reasons will be the impact of robotisation. At the same time, Industry 4.0 will also create many new job roles. Thus, Industry 4.0 is also an opportunity for new type of jobs both in India and overseas.

Industry 4.0 is a realistic possibility and we are no longer isolated from the international market. Therefore, both Indian and multinational companies will adopt Industry 4.0 in India and globally. We need to conceive a high-end skilling programme to prepare our young population to contribute to the Industry 4.0 movement globally. 

Handicraft industry in India
Col. Rajiv Bhargava: Perhaps we can shift for a moment from repetitive to non-repetitive work. How about the handicraft industry, which is unlikely to be taken over by the computers and robots of today. What are your views on that?

Dr. Chandan Chowdhury: The Indian handicraft industry is a big opportunity for job creation. This industry needs immediate intervention from the government and private sector. There are reports indicating that seven million artisans are engaged in craft production, however, unofficial figures put this number closer to 200 million. The major strength of this industry is intellectual property (IP), which in the current context refers to niche skills inherited through generations. However, this industry suffers from low productivity and the lack of an enabling environment. We need to adopt modern management practices, including environmentally responsible material usage, adoption of internationally accepted safety practices and adherence to good trade practices, as well as technology enabled business processes to increase market reach and improve the effectiveness of the value chain.

Vision and Mission of the Munjal Institute for Global Manufacturing
Col. Rajiv Bhargava: I’d like to shift focus a little now. What is the vision and mission of the Munjal Institute for Global Manufacturing and how can we become thought leaders in this space?

Dr. Chandan Chowdhury: The Indian manufacturing sector contributes only 17% to our GDP, which is much below the aspiration of the nation (25%). India’s double digit growth in GDP would involve a substantial increase in manufacturing’s contribution to GDP.
As part of ISB, MIGM’s vision is to be the premier academic institution for operational excellence and innovation in the manufacturing ecosystem in India and beyond. In order to achieve our vision, we are scaling up our activities and adopting a robust execution strategy to implement our mission of thought leadership, knowledge sharing with industry, informing government policy and grooming future leaders. 

Munjal Institute for Global Manufacturing promoting Industry 4.0
Col. Rajiv Bhargava: What is MIGM doing to promote Industry 4.0 as of today?

Dr. Chandan Chowdhury: We have conceived an applied research proposal that aims at understanding India’s readiness for Industry 4.0 and its impact on employability. We are looking for an industry collaborator to undertake this project on a big scale. We have recently collaborated with our PGP students on organising a national level competition to understand how business processes would be transformed in the automotive and fast moving consumer goods (FMCG) industries when Industry 4.0 is deployed and the potential impact on job loss. This competition also seeks to identify potential new jobs that are likely to be created for deploying Industry 4.0 and the skill sets that would be necessary.

About ISB Alumni
Col. Rajiv Bhargava:: Finally, is there something that you would like to tell our alumni?

Dr. Chandan Chowdhury: Our alumni are one of the most important pillars for the growth strategy of our school. They can make great contributions to help ISB become the number school in Asia and one of the top 10 globally. We would like to increase our collaboration with our alumni. 

Also read: Rishi  Raj in conversation, PGP Co 2011 in conversation with Sameer Khetarpal, PGP Founding Class