Global business analytics, research and advisory firm Praxis Global Alliance has come out with 3 design principles for re-accelerating the trade digitization journey, which has been lagging because of several factors in spite of inconveniences experienced by customers. The firm describes the 3 principles as:
- Start with the customer: We need to start our thinking afresh, this time from the customer’s perspective. Are we really solving the customer’s issues – the most frequent and most arduous parts of their commercial dealings? Are we thinking through the end-to-end journeys and making a material difference to their lives by eliminating paper?
- Massification of the trade digitization initiative: While we may see trade as a transaction between a buyer and a seller it is one of the Lego blocks of an entire supply chain. At one end of the supply chain are large behemoths while at another end there are tiny businesses. Are we creating digital offerings that can operate at the scale, complexity, and costs that each of these archetypes can relate to? While we can certainly claim to have made a lot of progress for the larger players in the ecosystem, have we done enough for the small businesses?
- Ecosystem approach: Financial institutions see trade as a set of documents, and rightly so. However, these documents cannot be seen in isolation from the two real flows taking place – the flow of goods and the flow of money. Are we designing digital solutions that traverse all these exchanges of goods, information, and money? Many of the adjacent flows – of goods and money – are getting transformed as we speak, and the trade digitization journey must keep in step with these changes.
The company says it believes that what demonetization did to UPI, COVID-19 can do to trade finance. “As customers will clamour for ‘contactless’ banking, this is a golden opportunity for the financial services fraternity to rise to the occasion and design and deliver a truly state-of-the-art model designed in India and for India, it argues.
Towards accomplishing this, the company has proposed a three-phase approach to re-accelerate the trade digitization initiative:
Phase 1– Research: This phase comprises two parts: the first part is to deeply understand the customer journey across types of customers and for the multitude of processes that get done for a trade transaction to fructify – ordering, inventory management, transportation, documentation, and of course payments and financing. The second part is to map the ecosystem of platforms that customers are already using for these activities so that the final solution can collaborate with these to deliver a wholesome solution for the customer.
Phase 2 – Design: The Initial part of this phase is setting up ‘garages’ to adopt a holistic and collaborative approach for design wherein all stakeholders including the customer, of course, brainstorm to put together an ideal end-to-end journey. At this point, the participants do not assume any constraints whatsoever. The following part is about putting together the actual operating model, roles of all stakeholders, areas of collaboration required, and finally, changes required to the existing policies and regulations.
Phase 3 – Propagate: This is the final phase wherein the findings are shared with key decision-makers and policymakers and once there is a buy-in, with the public at large.
