Can technology bring change in value-chain partners’ lives?
Taxes, retirement, and death are the certainties we live with. The timing of our exit from earth may not always come with a forewarning. The first two inevitabilities can be planned though. Taxes can be managed with sound investment strategies, and retirement needn’t be as daunting as we make it to be.
With the discipline of savings, long-term investments, and the safety net of social security, we should find purpose in waking up each morning in our retired life.
A rewarding career allows salary-class professionals to march into retirement. They work in an organised sector where real-time rewards are aligned to performance. Post 60, they can even acquire sentimental assets like land.
This is quite unlike the case with value-chain partners, by the time they reach retirement age, they don’t have a basic safety net of social security, a bare minimum necessity to survive in old age.
A far bigger layer of value chain partners in the bottom half remains neglected. A kirana store keeper may have a truck with scores of business entities, yet remain in oblivion all his life.
In the absence of an association, realistically they can’t be brought in one pool. So, can technology be the answer to address this issue?
Before we go there, let’s acknowledge how acute this problem is. From experience, I could share numerous examples of how value-chain partners are perpetually under-served. Recently, I chanced upon 2021 data, cited by Homenet, which revealed that homeworkers in Tamil Nadu’s Tirupur earned a monthly average of Rs. 2183, which is 77% lesser than the minimum wage specified for the tailoring sector by the Tamil Nadu State Government. However, since home-based work is not specified as a category, such sections of the value chain fail to get their due. Let alone social security benefits like Mediclaim policies, family insurance, pension funds and monthly-income plans, the must-haves after retirement, can they even have fairness and dignity in their livelihoods?
And let’s admit that to this day, value-chain partners remain the most cost-effective mechanism model even as businesses keep evolving. From inventory management and transportation to flow of information and customer service, value chain partners contribute to all business-related activities to not just impact growth at a national level but also contribute to the global economy.
According to the India Brand Equity Foundation, this sector accounts for approximately 14.4% of the GDP, with over 22 million individuals deriving their income from it. Not too long ago, our nation’s logistics sector was valued at Rs. 15.1 lakh crore. The unorganised sector comprising small-scale warehouse owners, those affiliated to transport companies or brokers, freight forwarders, etc. accounted for 99% of the entire sector.
This informal sector, claims a leading business portal, employs approximately 80% of our country’s labour force and produces 50% of its GDP. However, value-chain partners that work in manufacturing, construction, and other non-agricultural sectors continue to live hand-to-mouth and are least equipped to handle unexpected shocks.
The government is doing its bit to extend schemes such as Pradhan Mantri Suraksha Bima Yojana (PMSBY), Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), and Atal Pension Yojana (APY) to this sector but more ought to be done in this regard. Businesses have the financial heft to make a difference to our value-chain partners; it’s just that they need a platform to get started.
This brings us back to the question I raised earlier. To what extent can we leverage technology in this sphere? The age of digitalisation is long upon us. The world has already shifted to virtual experiences. Industries are becoming knowledge-intensive and complex. Surely, common platforms can be created to record value-chain partners’ transactions and reward them with social security benefits, which is the priceless gift they dream of to plan their retirement
If new technologies like AI, ML and IoT can be streamlined in this segment, then having an all-inclusive platform to incentivise value-chain partners shouldn’t be wishful thinking.
platform like HUMBEE has made an honest attempt to create automated receipts of value-chain partners’ transactions, introduce a system to document their work and, finally, incentivise these players with long-term rewards.
I won’t end my message with soft words and say, ‘technology can be a solution’. It has the potential to be a game-changer in this space. The onus is on us to ensure it gathers pace.