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By:

Rashmi Kulkarni

23 March 2025 at 2:58:52 pm

What AI Breaks First Inside Real Operations

Teams don’t resist AI out of fear. They resist confusion. Last week’s column made one thing clear: AI is not a cure. It’s a diagnostic. On paper, most leaders nodded along.  Of course systems matter. Of course tools amplify gaps. But this week, let’s leave ideas aside and step into the shopfloor, the back office, the ops WhatsApp groups, the Excel sheets that are “almost correct”, and the people who are quietly trying to make AI work inside real businesses. Because when AI enters day-to-day...

What AI Breaks First Inside Real Operations

Teams don’t resist AI out of fear. They resist confusion. Last week’s column made one thing clear: AI is not a cure. It’s a diagnostic. On paper, most leaders nodded along.  Of course systems matter. Of course tools amplify gaps. But this week, let’s leave ideas aside and step into the shopfloor, the back office, the ops WhatsApp groups, the Excel sheets that are “almost correct”, and the people who are quietly trying to make AI work inside real businesses. Because when AI enters day-to-day operations, it doesn’t break everything at once. It breaks  very specific things first.  And those breakpoints tell you exactly where your operating system is weak. Where AI actually fails  In theory, AI adoption looks clean. In practice, it lands inside a business that already has workarounds, shortcuts, and informal rules. Most AI initiatives don’t fail because the tool is bad. They fail because the business asks AI to operate inside undefined work. Here’s what that looks like on the ground. Where SOPs don’t exist In many SMEs, SOPs are assumed, not written. People say: “Everyone knows how this works.” “It’s obvious.” “We’ve always done it this way.” Until AI asks a simple question: “What exactly is the process?” Take something basic like order processing. One person checks stock before confirming. Another confirms first and “manages” stock later. A third relies on experience and intuition. When AI is introduced … whether for drafting confirmations, updating customers, or tracking orders… it needs a single version of the process. Without it, AI outputs start contradicting reality. The result? Sales thinks AI is wrong. Ops thinks AI is unreliable. Founders step back in. The real issue wasn’t AI accuracy. It was that there was never one agreed way  of doing the work. AI doesn’t tolerate fuzzy processes. Humans quietly adapt. That’s the difference. Humans are remarkably good at working with incomplete information. If a form is half-filled, someone calls. If data doesn’t match, someone checks WhatsApp. If details are missing, someone guesses and fixes it later. AI doesn’t do that. It takes inputs literally. So when AI is used for: drafting proposals, responding to customers, creating reports, prioritising tasks it surfaces a brutal truth: your inputs were never clean to begin with. Customer names vary. Prices are updated “sometimes”. Delivery timelines live in people’s heads. AI doesn’t fix this. It exposes it. Teams then label AI as “not practical”, when the real problem is that the business has survived for years on informal correction loops that AI cannot see. Broken handoffs  Every business has handoffs: Sales → Ops; Ops → Accounts; Accounts → Dispatch; Support → Resolution On paper, these handoffs exist. In reality, they’re fragile. Information leaks. Ownership blurs. Assumptions creep in. Humans compensate with reminders and follow-ups. AI cannot. When AI is used to automate updates or coordination, these handoff gaps become painfully visible. Customers receive confident updates that Ops can’t fulfil. Invoices don’t match what was promised. Support replies don’t align with actual resolution status. Teams then say, “AI created the problem”. It didn’t. AI just removed the human glue that was holding a broken handoff together. Why Teams Resist AI Founders often assume resistance comes from fear: fear of replacement, fear of technology, fear of change. That’s rarely true in SMEs. What teams actually feel is confusion. They don’t know: what the “correct” process is, which input matters most, who will be held accountable if AI output is wrong, whether following AI will get them into trouble later So they hedge. They double-check. They bypass. They keep doing things “the old way” on the side. Not because they’re anti-AI. But because the system doesn’t protect them yet. Until roles, inputs, and handoffs are clarified, AI feels risky to the people closest to execution. A Quiet Pattern  In businesses where AI does  stick, something very unglamorous happens first. Before AI: one workflow is written down, inputs are defined, ownership is clarified, review points are fixed Only then is AI introduced… not everywhere, but in one controlled slice of work. The team isn’t asked to “trust AI”. They’re shown how AI fits into a system that already makes sense. That’s when resistance fades. Not because AI is impressive. But because confusion is removed. What Leaders Should Fix  If AI feels messy inside your operations, don’t start by asking: “Is this the right tool?” Start by asking: Do we have one clear SOP for this work? Are inputs defined, or assumed? Is ownership explicit at handoffs? Does the team know what happens when AI is wrong? These are operational questions, not technology ones. And they’re solvable without buying anything new. The Uncomfortable Truth AI is not breaking your operations. It’s showing you where operations were already breaking quietly, informally, and expensively. Humans patched the gaps with effort. AI removes the patch and shows the crack. That’s not a failure. That’s a signal. Next week, we’ll talk about what leaders must redesign before  scaling AI across teams so that intelligence actually creates momentum instead of confusion. Because in real operations, clarity always comes before speed. (Rashmi Kulkarni is the CEO at PPS Consulting. She can be reached at rashmi@ppsconsulting.biz . Views personal.)

Indian Shipbuilding A Must Win Marathon

Shipbuilding

With a coastline of 7500 KM, it is hard to imagine, that for the first 20 years (1947-1967) India had no ‘shipping ministry’. In 1967 a Shipping ministry “coupled” with ROAD transport was established. Since then, this ministry has been on a name changing ride, not once, not twice but six times. In 2009 the “ROAD Transport and Highways” was de-coupled and ‘Shipping’ ministry was formed. Turning point came in 2015 with a clear maritime vision for 2030 and 2047. Ministry was re-christened, aptly to Ministry of “Ports, Shipping and Waterways” in 2020.


Why is Shipbuilding important for a country?

a. A Shipyard becomes an opportunity hub and like a queen bee requires the support of an industrial colony to manufacture machinery and equipment.

b. National Shipyards support fleet renewal needs of the Navy.

c. Contributes to national GDP, increases inflow of FOREX.


Korea shipbuilding is 8% of GDP. Japan’s automobile industry is 2.9% of GDP. India’s shipbuilding a meagre 0.000578% of GDP. In context, India’s pharmaceutical industry, ranked third largest in the world is 1.72% of India’s GDP.


International Shipbuilding Market

The market is estimated to reach around USD 200 billion by 2029, growing at a CAGR of 4.84%. While India is at bottom with 0.07% of world share, behind Philippines 1.5% and Vietnam 1%, however on the positive side, India has done well in taking care of its defence needs, with 37 of 39 Naval ships being built in India yards. Rear Admiral S Shrikhande researching on maritime as a Fellow at Wollongong University, Australia, says “Shipbuilding in India needs both, serious incentivisation and dogged determination and not harping on being a big ship breaking country. That Garden Reach shipyard has a $54 million order for merchant ships from a German owner, is a good sign.”


Were Shipyards of 20th century in Flight mode?

Prominent shipyards in India were built in the colonial period. Mazagon Dock 1774, Garden reach 1884, Hindustan shipyard 1941 to cater to British navy and merchant fleet needs. Cochin shipyard 1972, Adani Katupalli 2013, Reliance Naval and Engineering, Rajula Gujarat 1997 and others have limited capacity, hence a lot more work to do. Capt. Subhangshu Dutt (Singapore) a mariner and now a shipowner, says “GOI should hold hands in any collaboration till the marriage with the foreign entity is reasonably stable. He also suggests that “new shipbuilding sites should be given to existing successful shipyards since they have decades of experience and talent. Consortium of 3 or more parties may also be good idea”.


Shipbuilding GOLD

As per SPLASH report the demand for LCO2 carriers could reach 2,500 ships by 2050. As per other estimates, 40% of global fleet of ships could have wind propulsion by 2050. A surge in such vessels is due to an unparallel waves of decarbonization in the shipping industry. Demand for ships with ‘carbon neutral’ badges, such as Dual fuel, Wind assisted, Nuclear fuel ships, Hydrogen powered ships, Liquified CO2 (LCO2) carrier, is outstripping supply. A must in the ‘bucket list’ of every Shipyard. Pinning down a standard ROI in shipbuilding is not easy, but experts suggest it could range from 4% to 15% for the high demand ‘carbon neutral’ ships. While an LNG new build vessel could cost US$ 250 million upwards.


International collaboration

On China’s shipbuilding success story, Manoj Pandalanghat (Singapore) a mariner and ship owner believes that “China has around 50 active Shipyards. Each have a few large dry docks. In each dock two or more large vessels are built simultaneously. Thus, a single yard is able to roll out 2/3 vessels/month, 36 vessels/year and 50 shipyards roll out 1800 vessels/year”.


China could be a jaldi-5, but India needs a sturdy Mount Fiji. Besides technology, Japanese bring the most important hand baggage of soft-skills and culture, essential for success from keel laying to delivery. Maruti’s is a standing example.


Food for thought for New Delhi

a. Expertise: Hire Naval Architects and shipbuilding experts with current international experience.

b. Government assistance: Land, Financial support, subsidies and timebound clearances.

c. Monitoring: PMO should monitor the first 5 to 10 years till Shipbuilding takes-off on this long-haul flight to destination 2047.


India’s Shipbuilding is expected to grow to $237 billion by year 2047. On a back of the envelope calculations this works out to about 4% of India’s 2047 projected GDP of $ 5 trillion. While cars are driven on roads, however the Ministry of roads and transport has little to do with “Automobile manufacturing”. On a similar note, ‘Shipbuilding’ as an industry has little to do with Ports, Shipping and Waterways, thus it may be worthwhile to consider a separate ‘Ship-building’ wing in the Ministry of Ports, Shipping and Waterways headed by a dynamic cabinet rank minister. Since 2047 targets are stiff and an uphill task, so in all probabilities, the officials in Ministry of Ports, Shipping and Waterways are likely to push beneath the carpet, delays and failures of Shipbuilding with sweet success stories of “Ports, Shipping and Waterways” and if this does happen then India will not only miss the Shipbuilding bus of 21st century but a lot more from a national security and strategic perspective.


(The author is a Shipping and Marine consultant. Member Singapore Shipping Association and empaneled with IMO as a specialist consultant. Views personal.)

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