New-age skill sets and out-of-the-box thinking can help them step up and boost productivity. According to a ILO-OECD report last year, workforce skills are a major driver of MSME productivity growth at sector level, as many job-related skills are sector specific. “For example, the OECD finds that structured work-based learning schemes, such as apprenticeships and dual-training programmes have a strong impact on the productivity of participants, although the correct design of these programmes, for example in terms of duration and time split between on-the-job training and classroom training, is key to maximising benefits for both workers and employers,” the report stated.
It also added that those who need training the most, train the least – low-skilled workers train less than high-skilled workers and older people train less than younger ones. “This bias also extends to MSMEs, as there is strong evidence that staff in small enterprises train less than in larger companies, although there are strong cross-country differences across OECD economies. Some of the reasons behind the low participation of MSMEs in training include the lack of dedicated human resources departments, the fear of having trained workers poached by other firms, incomplete information on the quality of available training and on the returns of the training investment, high transaction costs involved in the purchase of training services, or training services simply not being available nearby,” the report said.
Taking a cue, companies are trying to make training more inclusive for the MSME sector. Rakesh Krishnan, Vice-President and Head-Marketplace, Flipkart, says that it is important for MSMEs to have a clear strategy for a smart workforce. “Technology has emerged as a key proliferator of growth addressing the demands of MSMEs. As they progress in their digital transformation journey, they should also look at building an innovative mindset,” he says.
The e-commerce player is focusing on various initiatives for MSMEs, including skilling through programmes such as Flipkart Ignite — a training and incubation programme for sellers; introducing new features such as 10-minute onboarding and easy settlements as some of the tech capabilities for them to leverage the digital revolution in their entrepreneurial journey.
Similarly retail giant Walmart’s programme – Walmart Vriddhi – aims to work with over 50,000 MSMEs in India to expand their domestic capabilities. Focusing on offering MSMEs with the necessary tools and training to thrive in the digital era, the programme educates such enterprises about the latest trends in the online market. “From streamlining supply chains to implementing data-driven insights, these skills enable them to make informed decisions, identify emerging trends and seize opportunities for innovation and expansion. Such learning opportunities can ensure that MSMEs not only survive, but also thrive,” says Jason Fremstad, Senior Vice-President, Supplier Development, Walmart.Watch: Regional Summits and the Virtual Conclave of ETRise World MSME Day 2023The programme offers modules that educate MSMEs about the latest trends in the online market. It also assists them in learning effective delivery management techniques. This includes understanding logistics, supply chain management and last-mile delivery solutions.
MSMEs say that learning skills such as analysing data and developing new products as per the demand of the market is something that small enterprises need to pick up. “MSMEs are agile and adaptive. But now they require further skills to position themselves as leaders and major contributors of the economy. These can be people skills which promote a team culture. For growth, an effective and motivated team is required. Besides this, in the age of AI, MSMEs must learn the importance of analysing data and driving important factors relevant for their businesses,” says Rahul Agarwal, CEO of Jutex India, a manufacturer and exporter of jute products.
Agarwal highlights that their company is actively moving towards creating a culture-driven organisation. Besides this, they explore innovative products from time to time as well. “Either we develop new products or we produce the same kind of goods with a better customer proposition,” he adds.
For India’s 63 million MSMEs, building internal self-sufficiencies by developing the right skills will prove beneficial in helping them stay ahead of the curve. Government support on making blue-collar jobs more attractive with a skilled workforce joining the pool will make this sector more dynamic and futuristic in scope.
