The Strategy Wall || 21st Edition

VOLUME 21

THE STRATEGY WALL

THE STRATEGY AND CONSULTING CLUB OF IIM ROHTAK

Special Purpose Acquisition Company(SPAC) Entrepreneurship in the Times of COVID-19

“Our Goals can only be reached through the vehicle of plan.

There is no other route to success” —Pablo Picasso

Content 01

Special Purpose Acquisition Company (SPAC) “The Strategic Alternative to an IPO”

04

Entrepreneurship in the Times of COVID-19

07

India's GDP

10

Financial Analytics

12

Are Sweet Sugar’s Bitter Days Over?

14

Marketing Innovations in Industry 4.0

SPECIAL PURPOSE ACQUISITION COMPANY (SPAC) “THE STRATEGIC ALTERNATIVE TO AN IPO” RAMJAS COLLEGE, UNIVERSITY OF DELHI

Imagine the front door of your house is locked. What would

WHAT IS A SPAC?

you do? Take the back door entry, if the house has one. Right?

As the name suggests, SPAC is a company formed by a

Likewise, the Initial Public offer (IPO) is the front door for

team of institutional investors, professionals belonging to

companies seeking listing. But entry through this door is

private equity or hedge funds, and high profile CEOs for the

subject to certain criteria. Now what would a company do if it

sole purpose of acquiring other company (called the target

does not meet the criteria? The company will take the back

company) i.e. the one who is seeking listing directly through

door. Here comes the concept of SPAC. Virgin Galactic,

the back door or the one who sought it through IPO (i.e.

DraftKings, Opendoor and Nikola Motor are some of the

front door) but failed. SPAC does not perform any other

companies which took this route to get listed. Around 200

function or operation. Then how SPAC get the money for an

SPAC’s went public in 2020 and raised $64 bn in total

acquisition? Here’s the catch. The SPAC arranges money by

funding. And this spree is continuing in 2021 with 359 SPACs

making an IPO.

raised a combined $95 bn so far. So what is a SPAC? How exactly it works? Why it has become popular?

PAGE 1

The SPAC makes an IPO, raises the public fund, get itself

WHICH OPTION IS BETTER?

listed, and merged with the target company. This way the

The paper ‘A Sober Look at SPACs’ concludes that the

target company becomes public & listed. The staggering

first option of swapping shares & remaining invested in

fact is that the investors in an IPO have no clue about the

the merged entity actually causes loss to the investors.

prospective target company. It’s altogether a blind

How? Because of the capital structure arbitrage, a

investment. Then why investors are pursuing it? It’s the

strategy in which market mispricing is used to make

convincing power of professionals with great track record

profits. On a closer look, the shares of SPAC have a nature

that lures the investors to give money even to the blank

of bond as investors can get it redeemed. Therefore, the

check company.

actual option value i.e. premium over intrinsic value lies in the warrants. But the innocent investors attribute

HOW IT WORKS?

higher option value to the shares as it represents equity

SPAC offers units (comprising of both shares and

(i.e. ownership) and carries higher volatility (risk) in their

warrants) in IPO. The proceeds of the IPO are collected

minds. This leads to over-valuation of shares and under-

and deposited in an interest bearing trust account. The

valuation of warrants and ultimately it causes mispricing

team of SPAC has 2 years after the IPO to find the target

of securities. Now, the investors on exercising option 1st

company. If they fail to do so, the SPAC is liquidated and

sell the warrants at a very low price and hold the shares

all the money is refunded together with interest. However

of the merged entity rather they should have sell the

on founding the target company, the acquisition deal is

shares and hold the warrants (actual equity). The

signed subject to the approval of the investors in SPAC.

institutional and professional investors (i.e. sponsor of the

Once approved, the deal is finalized. But if they reject the

SPACs) do the vice-versa and make a huge profit out of

deal, the quest of search goes on for another target

this mispricing. In my opinion, both the options could be

company.

used simultaneously by redeeming the shares and

On materialization of the deal, the investors can either:

holding the warrants to avoid the risk of loss.

Swap their shares for the shares of the merged entity or Redeem SPACs shares or warrants to get back the original investment plus the interest accrued in the trust account.

PAGE 2

WHY SPACs?

DISADVANTAGES OF SPACs

The SPAC model offers the following advantages:

Post-merger, the wealth creation depends on the

The Private Company is not required to follow

target company. As stated earlier, the investors have

strenuous path of IPO.

no idea about the target company. Therefore, inexact

No rigorous due diligence.

evaluation (due to absence of intense due diligence)

It helps in raising public funds quickly. Generally, the

of company’s functions by SPAC team can cause

deal is finalized within few months as compared to 6

investors in the long-run.

months in case of an IPO.

SPAC may end up paying more for the target

It saves time and cost which otherwise is involved in

company due to its bargaining power.

an IPO.

The target company may suffer if the SPACs

The target company enjoys negotiating power in

shareholders reject the deal.

relation to the terms of the deal especially the valuation. It can fix its valuation with the SPACs team.

WHAT DOES THE FUTURE HOLD?

This flexibility is not available in case of an IPO.

The growth of SPACs does not seem anywhere near to

As the target company can fix its valuation, it helps to

slowing down. SPACs are garnering more and more

reduce the risk of volatility and uncertainty which is

funds each year. Besides being the smart alternative, it

common on the day of listing.

can actually contribute to the real economy as it

The small and mid-size companies get influx of public

facilitates the listing of private companies (especially

capital for R&D or brand promotion which is

start-ups). One point of discussion could be the fact that

otherwise difficult for them.

the average return from SPACs merger during 2015 to

Access

SPACs

2020 fell short of the average return for investors from an

management team. This enhances the confidence of

to

professional

expertise

of

IPO. However, most companies decide to remain private

the investors.

due to the concerns over listing process. SPAC is solving this problem and thus it will continue to be backed by many companies in the near future.

PAGE 3

ENTREPRENEURSHIP IN THE TIMES OF COVID-19 SYMBIOSIS INSTITUTE OF BUSINESS MANAGEMENT, BENGALURU

The year 2020 brought one of the worst crises that

As soon as COVID-19 spread its reach globally and

humanity has ever had to face in the form of a virus

economies all over the world began to go downhill, the

called severe acute respiratory syndrome coronavirus 2

go-getters of the world grabbed the opportunity to

(SARS-CoV-2), which disrupted the globe's supply chain.

create something right out of the worst. Be it a group of

While there is a cry for help across the industry

high school students from Atlanta who started an

worldwide, this crisis presented itself as an opportunity

organization to deliver free meals for hospital workers

in

and

or a group of engineers from Colombia who build low-

opportunistic kind of all businessmen, whom we call

cost ventilators from scratch; innovators worldwide

Entrepreneurs.

started creating solutions to the problems encountered

A Mckinsey survey across industries mentions that more

during the pandemic. Indian MSME sector also found

than 90% of executives expected the fallout from

ways to sustain their market position by pivoting to

COVID-19 to change the way businesses operate in the

other products and services, which had newfound

past intrinsically. Moreover, 3 out of every four executives

demand and very little competition in the market-

agreed that these changes across industries brought out

hand sanitizers, masks and PPE-based kits, and other

by COVID-19 would pioneer extensive opportunities.

products, which suddenly found a spike in demand

disguise

to

perhaps

the

most

optimistic

and were short in supply while on the other hand, The other side of the coin is that the number of

doorstep delivery and Edu-tech were the services with

opportunities has increased tremendously, the risk-

a sudden ascended demand in the market. These Covid

taking capability or rather willingness to innovate has

inspired innovations are excellent business models and

witnessed an enormous decline (Pharmaceutical and

can be easily turned into sustainable businesses that

Medical

will continue past the immediate crisis.

being

an

exception).

Furthermore,

it

is

understandable since more and more companies would instead focus on recovering the losses and stabilize their short-term issue than explore the uncharted territories.

PAGE4

The businesses like online shopping, food delivery, video gaming, or video conferencing industries enjoyed the benefits of pent-up demand, which led them to exit their survival mode and get back into a profit-making mode. However, it is an entirely different story for businesses in the hotel, restaurant, retail, entertainment, or sports industries. These sectors are considered a big "NO! NO!" from an innovation or new investment point of view. Start-ups like Ethereal Machines (a Bengalurubased start-up), Helyxon (Based in Chennai), Staqu (From Gurugram) have paved the way to fight the pandemic back by providing cutting-edge tech-based solutions.

Lockdowns due to pandemic prompted us to devise a new way to carry on with the communication related to since

live

conferences

and

emerged as a significant market player in this pandemic. Zoom, the video conferencing service providers, stepped on the peddle and turned this opportunity to their favor by providing a relatively simple solution to a very complex problem. What differentiated zoom from the rest of its competitors is the simplification of its UI (User Interface) which made it easier for even a tech-novice to access it comfortably.

Sectors Confronting the Pandemic "The new normal," a slang widely used during the peak pandemic period. Let us look at some of the

The Age of Webinars

work

A company that was barely heard about before

face-to-face

engagement activities were out of the question for an inexplicit duration of time. Moreover, the obvious method to do that was through webinars and online sessions. Customer engagement was also made a part of these digital discussions. Furthermore, that is how a sea of webinars started emerging across industries. Hosting of events and even award ceremonies were organized in an online mode. Government officials began to use online modes as the only method to communicate even

sectors of the Indian economy which adopted the new normal, passed their survival test stoically, and now will be reaping the benefits that the pandemic has brought to themDigital and Internet Businesses- "Data is the new oil," this has never been proven righter than during a pandemic. Data analytics has always been a value proposition. With lockdown in effect and the world at a halt, people started spending a longer time on social media; advertising industries quickly utilized this opportunity by paying more attention to content marketing.

the official matters.

PAGE 5

Tracking consumer behavior patterns and their online traffic patterns and analyzing this data became essential data analytics elements that organizations can benefit from to boost their online sales.

FMCG and Retail- The supply chain disruption created a hefty dent in this industry, but the essential commodities sector is not one of those which would go down that easily. Post pandemic, this sector has found new and better ways to fulfill the demand for products by providing value-based services. Local Kirana shops were witnessed providing various e payment methods and athome delivery even in the country's remotest

Conclusion The COVID-19 pandemic was one of the worst events in human history. The virus may not have proven to be lethal for humanity, but it was undoubtedly fatal for the world economy. Nevertheless, remembering the Survival of the Fittest theory of Charles Darwin in a nutshell, "Whatever doesn't kill you, makes you stronger." Industries across the globe were able to adapt themselves, get into a survival approach, and adjusted/corrected how to do business. Furthermore, the world entrepreneurs once again proved that no matter how bad the situation, where there is a will, there is a way.

locations, boosting the slow pace of digitization within the nation.

Healthcare Sector- The healthcare sector showed us where exactly we were lacking and how this sector can be the perfect start for a budding entrepreneur considering the current challenging times. The demand for both products (Oximeters, PPE kits, Masks) and Services (Pharmaceutical deliveries, Mental Health experts) has witnessed a sudden necessity.

PAGE 6

INDIA'S GDP MANAGEMENT DEVELOPMENT INSTITUTE MURISHABAD

Recently new data was released about GDP of the

And second in 1979-80. When the GDP had fallen to

country. According to it, the annual GDP growth of

-5.2%. There were two main reasons. First, there was a

the country in the last Financial Year, in the Financial

drought in the country because of the Agriculture

Year of 2020-2021, has touched -7.3%. Since the

Production. Second, there was revolution in Iran

independence of the country, there has never been

because of which the petroleum supply to the country

such a terrible annual GDP Growth Rate in the

was quite disrupted. And event worse than these two

Country.

events was during the Covid-19 pandemic, when the

It was the worst GDP Growth Rate in the history of

country’s

our country. Ever since the Independence of the

Obviously, India isn’t the only country to be facing this.

country till today, the annual GDP Growth rate was

There are 166 countries around the world sees negative

negative five times only. Only two of them were

growth.

during major times. First in 1965-66, when the

The Government would like to shift the blame wholly on

country’s GDP fell down to -2.6%. The reason for it

the pandemic. But we know that even before the

was that we were at war with Pakistan. And because

pandemic, the GDP Growth Rate of the country has

of the war, the economic situation of the country

been falling after 2016-2017.

GDP

Growth

Rate

has

reached

-7.3%.

was terrible.

PAGE 7

But the good news is that the GDP Growth Rate of the

A year when the majority of the people became poorer,

last Quarter was positive (+1.6%). And the RBI expected

some were pushed in poverty, in the same year, the

that the growth rate of the Financial Year would be

multibillionaires of the country, become richer.

-7.5%, but it was only -7.3%. So that’s good news too.

Why did this happen? Lets discuss some basics. GDP is

And for the next year, it is being expected that if there

made up of four main components. Consumption,

is no destructive third wave in the country, things

Corporate

remaining as predicted, the outlook of the future looks

Exports.

positive. The GDP Growth Rate can be anywhere

In the last 1 year, the Private component was affected by

between +7% to +9% next year.

But the biggest question that We have ask here is this; What does this number means? Can this GDP figure reflect the burdens of a citizen, or the conditions and situations that a common man is going through in the country? A household survey was done by the CMIE, that showed that the income of 97% of the Indian population is less than the income of the last year.

investment,

Government

Spending,

Net

the most by the pandemic. People lost their jobs, or their salaries reduced. Because of all these, people didn’t have the money to spend. And so, private consumption fell a lot. But things like Government Spending depends on the government. If the government spends more, it will drive up the GDP. From here, you’ll start where things went wrong. The citizen is suffering through, the conditions that a common man is facing, how is it not reflected in the GDP figure, this is small example of it. If the government spends a lot of money and the private consumption falls by a lot, the GDP will not fall down as much because of the increase in Government Spending.

And the Government spending did increase last year.

The area on which the government spends matter a lot as well. P. Chidambaram, a former Finance Minister, says that the government should increase its spending. But not on any just project like the Central Vista, where a lot of money will be spent this year.

PAGE 8

Chidambaram suggests that the government should

The next problem is that from the perspective of the

spend in such areas which will put more money with

GDP, the bigger the thing is, the better. But in reality, is

the people. This will lead to an increase in the

it not always so. The more the financial sector kept on

Private Consumption component as well.

going and becoming out of control eventually leads to

Another interesting problem with the GDP indicator.

a financial crisis. An it is worse with perspective to

For example, to make a low-quality road again and

environment because most of the natural resources are

again due to corruption. But for the GDP, this is

limited. But to maximize the GDP we need to keep

actually a good thing. Similarly, there are numerous

increasing the consumption.

useless activities in the country and the world at

But GDP is still a very important indicator regardless of

large, that do increase the GDP but in reality, neither

the limitations and problems. Because the GDP gives

are the people benefitted by it nor does the country.

an overall idea of the economy, to judge the economy.

A problem related to it is that maximizing GDP does

It will continue to be the important indicator in the

not mean that the happiness of the citizens is

coming years as well. The things that the GDP hides to

maximized. Neither does it mean that efficiency or

uncover them, we need to examine the other

convenience is maximized.

indicators.

The next problem is that the GDP is only an aggregate. It does not tell you about the distribution of wealth in the country. If only 10% of the people are very rich in the country they earn the most and control the economy of the country, Their spending can lead to the rapidly rising GDP even if the 90% are extremely poor. This inequality can affect the average a lot. And it is likely seen in our country as well. If we check the GDP for the common people then that GDP might be way worse that it is now.

PAGE 9

FINANCIAL ANALYTICS IIT MADRAS

Some fancy terms like ‘Analytics’, ‘Data Science’ and

In addition to that, financial institutions and

‘Machine Learning’ never go out of the earshot and

companies use analytics not just to maintain

they definitely are not going out of fashion. All these

customer databases but also to provide them with

terms loosely connect to data and its analysis which

personalised suggestions and recommendations

caters to better decision making. So, what happens

regarding the financial products they might be

when such analysis is performed on financial data?

interested in next. This not only helps them retain

Let's dwell deeper.

customers by improving their experience but also

Major forms of financial data exist as assets, equity,

helps the company in analysing how their

liabilities, income, expenses and cash flows. But the

customers behave to the trends the former might

categories of data in their datasets could vary

be setting, how their customers behave in a

depending on the type of service or product the

specific financial condition, the choices of their

company is rendering. And what type of data is being

clientele while building a bigger one at the same

used for analysis depends on what the objective of the

time and in categorising people based on how

company is for involving ‘analytics’. Some of the key

much risk they are intending to take. This helps

objectives of performing financial analysis on these

them design better machine learning algorithms

datasets could be to accomplish set goals on time, to

which inturn can be used to better their existing

make informed decisions, to build dynamic profit loss

products, hence increasing the revenue. Apart

statements and to keep an eye on real time sales and

from that, machine learning is used to make

revenue generation.

interactive chatbots which can assist the users

To begin with, assessing the amount of damages and

through the necessary procedures to follow for a

worthiness, risk analysis and management are of

transaction, involve itself in knowledge transfer by

paramount importance to any given company. All

conveying the relevant information in a layman’s

these can be easily measured and predicted at any

language, maintain, sort and structurize data

given time with the power of data analysis. Making

inputs provided by the users for easy retrieval later

strategic

pertinent

and perform sentiment analysis based on the

interpretations from the analysis helps the company

feedbacks, suggestions and ratings provided by

change relevant criteria while paving the way for its

the customers with which the company can find

prosperity and better security.

out the liking by its customers of any specific

decisions

after

studying

the

product

or

service

being

rendered

by

the

company.

PAGE 10

Natural language processors which are auto

TBefore the advent of analytics or introduction of its

regressive models come in handy when in need.

usage in financial institutions, companies had to use

GPT-3 by OpenAI and Jurassic-1 by AI21 Labs are

spreadsheets to maintain databases and had to look

the biggest and the best language processing

after their compilation of codes that they used.

models ever made, with both of them being able

Harnessing the power of analytics has now given

to handle over 175 Billion parameters. One another

them an edge making their lives a cakewalk.

reason for financial institutions and companies to

Customers no longer need to stand in never ending

stick to analytics is algorithmic trading. This

queues to make transactions, all the undertaking

requires making predictions for future markets

and activities can be simply done online, hasslefree.

based on the inferences drawn from huge data

In conclusion, it can be stated that both the

sets. All this involves complex mathematical

customers’ and the financial service providers’ lives

formulae and accurate calculations which these

are basically a cinch. Financial analytics is not only

machine learning algorithms can compute with

catering to the present but its interpretations and

lightning fast speeds. Certain other reasons for

betterment is making the companies stay one step

financial analytics could include fraud detection

ahead, preparing them for the future. The progress

by looking for patterns and outliers in the

of the companies only means secure and effortless

transitions being made by their consumers and

lives for its customers. All these companies are yet to

clientele, customer data management, business

get more and more edges as ‘Financial Analytics’ has

reporting and for finding out its own and its

a long way to go.

competitors financial status.

PAGE 11

ARE SWEET SUGAR’S BITTER DAYS OVER? SHRI RAM COLLEGE OF COMMERCE, UNIVERSITY OF DELHI

Commodities have enjoyed a sensational year, be it

Why has this industry become an immediate

the stock market or the government schemes, they

target of the government in recent times? Is it an

have been the hot topic everywhere. One such

achievable target? Doesn‘t it affect food security

commodity that has enjoyed a remarkable run is

or is the government trying to kill two birds with

Sugar. A commodity despite being sweet, tasted

a single stone?

bitter for the investors because it had been on a

Before finding answers to these questions, let's

negative trend for many years. The turn of the

first understand Ethanol blending capacity. So

decade spelled misfortunes for many but it has

ethanol, made from molasses and grains, results

surely increased the sweetness of sugar for those

in fuel when mixed with petroleum. Thus, the

concerned. Global demand, rising prices and

government plans to increase the ethanol’s

increased government support are some of the

blending capacity with petroleum.

reasons that have led to these good times. Ethanol,

Now, the answer to the above questions lies in

a key by-product of the sugar industry, has been

the fact that the government plans to cut down

the center of attraction in major government

oil import bills and fight the climate change

rulings and this has impacted the sugar stocks and

battle by shrinking carbon footprint. Thus, this

sugar industry in a positive way. Will the sweetness

brings a great positive impact on the economy,

increase further or will it stabilize is something that

by promoting ethanol as an inexhaustible non-

everyone has their eyes on.

polluting fuel. A few government officials believe

To begin with, ethanol supply for the present year

that this helps in achieving multifold objectives

2020-21 is more than 300 crore litres which is a

while a few caution the government to maintain

remarkable achievement, considering it is only a

balance in food security needs.

by-product. Not only this, the central government also plans to achieve a blending target of 20 percent by 2025 by increasing the investment to at least Rs. 41,000 crore in the ethanol sector.

PAGE 12

Now let's quantify these facts and understand the

The turn of the financial year brought in a ray of hope

government's blueprint to achieve its set target. India is

for many sugar producing companies because of the

the third largest oil consumer in the world after the US

positive news that was floating around regarding this

and China with oil import bills of over $100 Million in the

sector. A sector that had witnessed a rigid 5 years in the

past two years. This clearly justifies the inclusion of the

stock market where little or no movement was seen,

Ethanol

the

suddenly saw a huge spike after 1 April 2021 and this

government's radar. The government plans to set aside

rally continued till Mid-July. Shares of all ethanol-sugar

sugarcane for the increased production of ethanol. This

producing companies touched new highs and a

solves

employment

deadlock seemed to have broken. Shares of Dhampur

opportunities in rural areas and boost in agricultural

Sugar Mills, Balrampur Chini Mills, Triveni Engineering

economy.

and many others doubled within a span of 4 months. A

The Union government modified a scheme in order to

sector that interested no investor saw trading in huge

promote ethanol production in the country. Under this

volumes. The shares surged almost 100% and the

scheme sugar mills will be provided cheaper loans to

brokerages continue to feel that there is a huge

set up ethanol blending factories. On the other hand, oil

potential that is still left to be tapped. So the entire EBP

marketing companies are going to be given assurances

clearly justifies this boom in the sugar producing

of buyers for the next 10 years. Interestingly, India is the

companies.

Blending

two

targets,

Programme,

firstly

EBP,

increased

under

second largest producer and largest consumer of sugar globally. This acts as an advantage for the country.

To conclude, if we go by the numbers, the demand for

However, in this extremely appealing process and

sugar is going to increase in coming years as India is

boom, the major problem lies in the fierce competition

being seen as one the young markets in sugar

between food and fuel crops for fixed resource, land. As

exports.Sugar production has touched all time high and

always, increase in production of cash crops for food

the companies involved in manufacturing are reporting

and not fuel is a matter of great concern. Another

unbelievable profits. This has spelled good times for the

problem lies in the interstate movement of ethanol. To

investors as well as the manufacturers.The government

ensure smooth transport of ethanol across the country,

support has regenerated a dead sector that was being

the central government made certain provisions under

looked upon by everybody. However, the government

the Industries Development and Regulations Act.

also has withdrawn the export subsidies that were

However, the problem lies in the fact that only 14 states

earlier given to this sector for the September quarter.

implemented it.

Although this news has little or no relevance in comparison to what the government is planning for this sector. However it definitely lays emphasis on the fact that the current benefits are being withdrawn from the sector for benefits that will be reaped after 4-5 years. So a similar pandemic like uncertain situation can shake this industry heavily. Will the industry continue to blossom on future prospects or will it lose its charm in the coming years, we will leave it for time to tell.

PAGE 13

MARKETING INNOVATIONS IN INDUSTRY 4.0 SYMBIOSIS INSTITUTE OF MANAGEMENT STUDIES

As of 2011, when a group of Germans pooled their

In Industry 4.0, Marketing innovations mean the

ideas

their

digitization of products and services, which helps

manufacturing industry, the term Industry 4.0 has

companies recognize how their services and products

been officially adopted by the professionals. To make

are being utilized, improve their current products,

this vision a reality, however, technology has only

create new ones based on usage data, and create

recently developed. Industry 4.0 or the Fourth

digital business models to enable them better access

Industrial Revolution refers to the new stage of the

to customer satisfaction.

industrial

on

Customers and other market participants, such as

interconnection, automation, machine learning, and

business partners or suppliers participating in a large

real-time data. Innovative interconnected technology

digital business ecosystem, should all be considered

has revolutionized the way parts and products are

as stakeholders of the ecosystem. Considering this,

designed, produced, and used. This is a combination

we can form 5Cs of marketing in Industry 4.0

of automated, improved communication and self-

(Nosalska & Mazurek, 2019):

monitoring, smart machines that can diagnose

a) Co-operation

problems without the need for human intervention.

b) Conversation

This Industry 4.0 is based on 6 key principles:

c) Co-creation

1) Interoperability

d) Cognitivity

2) Virtualization

e) Connectivity

to

improve

revolution,

competitiveness

which

mainly

in

focuses

3) Decentralization 4) Ability to work in real-time 5) Service orientation 6) Modularity and configurability

PAGE 14

Ways Industry 4.0 can change the ways of Marketing: Evolution of Sales Channels: Through Industry 4.0 technology, digital information from various physical

Enhanced Productivity through Automation and

and digital sources can be combined and shared,

Optimization: As manufacturers around the world

such as the Internet of Things (IoT), advanced

integrate automation and new technologies into

sensors, predictive analytics, artificial intelligence

their

(AI), or cloud solutions. By effortlessly integrating

Companies are working with higher efficiency and

with other systems, these technologies can capture

higher employee productivity. For employees, their

information and establish digital records, providing

work portfolio is becoming less repetitive and more

real-time

visualization.

demanding.

As

global

Predictive analysis can be coordinated with different

automation

and

new

other technologies Internet of Things(IoT), machine

operations, as can be expected, different innovations

learning, Software-as-a-Service (SaaS), and cloud

are impacting a variety of occupations and fields,

solutions

leading to major changes in workers and business

predictive

to

assist

analysis

and

traditional

manufacturing

operations,

the

results

are

encouraging.

manufacturers technologies

integrate into

their

companies to understand customers and determine

processes.

potential sales targets better.

Digital Marketing and Marketing Automation: Digital

Strengthened Direct Contact with End Customers:

mediums like search engine, social media, e-mail,

With such swift advancement of technology in this

marketing and others are used by businesses to

new world, the end customer establishes direct

communicate

contact with the manufacturer at the beginning of

customers. As a result, companies can reach a much

the purchasing process. This helps manufacturers

larger audience than with traditional methods, and

learn

avoiding

they can target the prospects who are most likely to

intermediaries. After initial sales, interconnected

purchase their product or service in the future. It is

products

economically

directly and

from

customers

technologies

provide

revenue

with

better

current

option

and

than

prospective

traditional

opportunities that were previously not easy to

advertising. In Industry 4.0, Marketing Automation

obtain. The Internet of Things expands relationships

helps us use marketing actions based on intent to

by providing seamless connections and using it now

convert site visitors into leads. It helps us to

to provide updates, service additions, and even new

individualize our messaging to reach out to specific

features throughout the product lifecycle; it has

customers. With the help of automated messaging,

vastly changed the way modern sales are done. Sales

we can nurture leads down the funnel. All-in-one

and marketing now interact directly with customers

marketing and sales platform increase online sales

after the sale and throughout the life cycle providing

and revenue through better sales processes and

important fixes and upgrades along the way.

targeted marketing.

PAGE 15

New Target Audiences: Marketing innovations

Incorporating

help to understand customers better. Through

process automation The introduction of 4.0 tools will

social networks, credit cards and other Internet

result in a significant shift in the workflow. This is

footprints,

relevant

primarily a matter of streamlining the production

information about everyone. By processing big

process. Workflows have changed as a result of

data, they can gain a close understanding of

changes in the way work is organized. As a result of

customer

all of this, companies' organizational structures will

companies

behavior

will

have

and

adjust

their

IoT

and

other

technologies

into

communication mix according to their needs,

change,

thereby gaining greater satisfaction. Improving

abandoned.

communication with the target group helps to

It

acquire new customers. Each marketer tries to

companies are focused on quality and precision

provide an enhanced consumer experience so

processing as a competitive strategy. The opposite is

that products and services can be personalized.

also true: Industry 4.0 increases production efficiency

Impacts: The impacts of Marketing innovation,

and lowers costs. The price may then be the

especially

in

Industry

4.0,

are

huge

and

will

and

traditional

increase

line

models

competitiveness.

will

be

Industry

4.0

competitive advantage for a company.

noteworthy. It would improve Productivity. Due to increased productivity, less time will be consumed. It's important to note that the entire production process, including development and post-production, is interconnected, which will ultimately speed up and refine the whole production

process.

It

would

help

in

the

Emergence of new business models. Business models based on new technologies and big data are

centered

on

new

services,

value-linked

ecosystems, and the customer's perspective, allowing for better user-focused design in the manufacturing process as well as to better align with the processes and contexts involved in creating value for the customer.

PAGE 16

THE STRATEGY AND CONSULTING CLUB OF IIM ROHTAK

snc@iimrohtak.ac.in

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FOLLOW US ON: DISCLAIMER: THE VIEWS AND OPINIONS EXPRESSED IN THIS MAGAZINE ARE THOSE OF THE AUTHOR AND DO NOT NECESSARILY REFLECT THE OPINION OF THE STAKE HOLDERS OF IIM ROHTAK