Industry 5.0: Financial pivots in the future of supply chains

Industry 5.0, a fusion of AI, IoT, and human collaboration, is redefining supply chains as adaptive, regenerative ecosystems. For CFOs, success now hinges on ESG-integrated risk frameworks and real-time data agility to harmonise efficiency with planetary imperatives. Visionary leaders will thrive by funding innovation, embedding resilience, and quantifying societal ROI, proving sustainability and profit are symbiotic.

At the recent CFO100 Conference in Mumbai, industry leaders dissected strategies for volatile times in a session hosted in partnership with Vayana-Rubix. We were joined by three industry stalwarts, Ramesh Iyer, CFO, APAR Industries; Jogendra Singh, President – Finance, Hero Corporate Service; and Simantini Biswas, VP – Sales and Business Development, Rubix Data Sciences. The discussion, expertly moderated by our Director & Chief Operating Officer, Ms. Seema Menon, offered pragmatic insights into managing supply chain volatility through technological agility, financial recalibration, and ethical sustainability.

Technological ingenuity: Replacing physical bottlenecks with AI

Ramesh opened with a stark example of pandemic-era supply chain paralysis. APAR Industries, a manufacturer of precision aluminium and copper products, faced costly delays when customer inspections stalled production. “Inspectors would assess products physically—a process prone to delays,” Iyer explained. The solution? An AI system trained to replicate human inspections. By embedding machine-learning algorithms to detect defects in real-time, APAR shifted inspections from physical to virtual. “The technology halts production if flaws emerge, slashing lead times,” he said. While customer skepticism persists, he stressed that such innovations are no longer optional: “Certainty in supply chains is existential.”

From negative working capital to vendor empowerment

Jogendra recounted Hero Group’s decades-old playbook for resilience: a negative working capital model. By deploying a “direct online delivery” system, Hero’s suppliers delivered components thrice daily to factories, eliminating inventory buffers. “Disruption meant production stalled—so we built ecosystems where quality was assured upfront,” Singh noted.

During the pandemic, this model proved prescient.

Singh also highlighted Hero’s vendor financing partnerships, which reduced suppliers’ borrowing costs from 14–16% to 7–8%. “Banks trusted our ecosystem,” he said, emphasizing anchor-led financial inclusion for SMEs. Simantini Biswas expanded on this, advocating for data-driven vendor risk assessments: “Instead of blacklisting SMEs over bias, use analytics to partner with them.”

Rethinking supply chain financing in the age of Industry 5.0

Biswas critiqued the fragmented systems plaguing firms: “Procurement, sales, and finance often operate in silos. Companies sit on unused data goldmines.” She urged CFOs to integrate platforms for real-time insights, enabling dynamic vendor segmentation and proactive risk mitigation.

The panel unanimously warned against viewing technology as a substitute for human judgment. Biswas cited India’s looming Digital Personal Data Protection Act (DPDP) as a regulatory hurdle: “Even basic data, like vendor phone numbers, now requires navigating privacy laws.” Iyer added that upskilling employees is critical: “Automate mundane tasks, but empower teams to focus on strategic decisions.”

From compliance to competitive advantage 

Iyer detailed APAR’s ESG-driven overhauls, from sourcing molten aluminium (cutting furnace oil use) to investing in hybrid renewable energy plants. “Western clients now gatekeep tenders based on ESG scores,” he noted. “Recycling scrap metal and greener product design aren’t altruistic—they’re survival tactics.”

Singh revealed Hero’s “cradle-to-cradle” experiments, including a water-positive arts center in Delhi and zero-discharge steel facilities. “Sustainability KPIs must transcend carbon metrics,” he argued. “Measure impact on livelihoods, waste reduction, and cultural preservation.”

Conclusion

In closing remarks, the panel distilled priorities for CFOs:

• Ramesh Iyer: “Embed predictive technologies like digital twins to forecast disruptions.”
• Jogendra Singh: “Treat sustainability as ROI-agnostic—it’s an existential investment.”
• Simantini Biswas: “Collaborate, don’t antagonise. Technology should augment human ingenuity, not erase it.”

As geopolitical and climate uncertainties escalate, the panel’s message was clear: resilience hinges on marrying financial pragmatism with ethical foresight. In Biswas’ words, “Dynamism isn’t optional. It’s the price of relevance.”