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The urge to do something different, unique, has given birth to
newer technologies. The Indian IT industry also needs to set some milestones,
which can only come through innovation
What
began with R&D and strategy has moved to the third, and probably the most
important phase in the history of innovation in the Indian IT
industry-products. However, the most effective combination of products,
R&D and strategy would bring out the best in innovation from India.
Innovation isn't the
first thing that one associates with the Indian IT. The Indian IT industry has
set new benchmarks in services and delivery. It's all about low cost and high
quality and a strong talent pool. But, innovation, we are not quite there.
Indian IT companies
have indeed been innovative, but unfortunately we have not been able to showcase
this innovative trait of Indian IT companies to the world. Innovation might be a
revelation to many of our readers but innovation is the path to growth and
sustenance and we are already on track.
What is innovation?
There are various definitions but they all point to one thing-innovation is a
process by which an invention, which is the creation of something new, becomes
commercially adopted. Put simply, innovation is the commercially viable form of
any creation. It cannot be separated from the market conditions in which it is
adopted. As Dean Kamen, the well known inventor who holds over 150 patents on
things like the Segway Human Transporter, shoebox sized dialysis machine, a
stair climbing wheelchair, and a portable water purification system says,
“...(if) you figured out how to get the Internet to a 100 times as many people
without tampering with bandwidth...that would be innovation...In some cases,
inventions prohibit innovation because we're so caught up in playing with
technology, we forget the fact that it was supposed to be important.”
Looking back at Indian
IT over the last two decades or so, one can see that it has had its share of
innovation, though in phases. I would like to characterize the different phases
of innovation in the IT industry in India under two categories: (i)
Engineering-based R&D and (ii) Strategy-based R&D. Let's take a closer
look at each of these to understand these categories better.
Pre 1991
Engineering-based R&D innovation: This phase occurred naturally in the
decade before 1991. This was the time when India was still a tightly controlled
economy. Indian companies did not have to worry about international competition
(IBM, for one, had been asked to leave the country in 1977) but had to deal with
high duties and restrictions, capital scarcity and high costs, License Raj, poor
connectivity (physical and electronic) and price-conscious Indian customers who
were not particularly updated with international trends.
This set of conditions
forced many Indian startups to focus on R&D engineering innovation to meet
business imperatives. Both had strong R&D groups (not least because of the
tax benefits that such expenses entailed), had professional executive teams with
a strong understanding of technology and an entrepreneurial mindset. These
startups had no choice but to be innovative. While there were many young
entrepreneurial ventures that emerged to take advantage of the opportunity, the
rise of HCL and Wipro, two successful companies from this era, illustrate this
phase of innovation.
HCL launched Motorola
microprocessor-based commercial computers with ROM-based compilers and undertook
bespoke application development for its customers due to shortage of talent and
unavailability of custom packages. It developed innovative programs including
menu-based screens (remember, we're talking of the pre-Windows era) and
application development accelerators for an entirely new segment, the small and
medium businesses (SMB)-an innovative approach to a market. Later, HCL used
its expertise in UNIX to offer multi-processor UNIX-based systems to its
customers.
Post 1991
Strategy-based innovation: The opening up of the economy in 1991 ushered in
the era of globalization. International technology companies entered India
offering the latest in technology, products and brands. Indian companies were
exposed to the global market for the first time. Indian companies faced
formidable competition from global players. While many Indian companies bit the
dust, the innovative ones took advantage of the new scenario and survived.
Clearly, given the constraints of capital, marketing, lack of international
experience among other things, R&D engineering-based innovation could not be
the only recipe for success for Indian companies on the international stage. So,
companies like Infosys decided to be innovative in their strategy. This was
reflected in their business model, hiring and retention plans, marketing and
management policies.
Since inception,
Infosys was focused on servicing the application development needs of
international customers. It was, therefore, well placed to take advantage of the
opportunity thrown open by globalization. Innovation occurred on several
dimensions-remote delivery of software services; globally distributed 24x7
software development and support; innovative mechanisms in human resources and
corporate governance to gain credibility and develop brand equity that helped in
hiring, winning customers, leveraging customer and partner relationships to
create domain knowledge and capabilities (eg software development for Reebok
that played a role in the creation of Yantra) and listing in the India stock
market and Nasdaq.
| In some cases, inventions
prohibit innovation because we're so caught up in playing with
technology, we forget the fact that it was supposed to be important |
2005 onwards
The next phase: It is interesting to note that the above-mentioned companies
were most innovative when they were either small or faced with apparently
adverse market conditions. Today, for the first time in many years, India is on
the brink of an innovation explosion. There are several small companies across
the length and breadth of the country that have developed world-class products
today. And, there are several more entrepreneurs who are brimming with great
ideas.
For the first time,
there is a large availability of global class talent, capital and partnership
possibilities. India is a well-recognized emerging market today. Indian IT is a
global brand. And there are strong linkages between India and the innovation hub
of the world, the Silicon Valley. There is increased association with other hubs
like Israel and Taiwan, and these relationships are getting stronger by the day.
The rapid cross-sectoral growth of the domestic Indian market is throwing up
huge opportunities for delivering technology-driven solutions in consumer and
enterprise markets. Indian academic institutes are setting up incubators for
nurturing innovative startups. Worldclass, IT-enabled legal, accounting, and
advisory services are available out of India today.
The concept of
innovation has changed considerably over the years now. The likes of Infosys and
Wipro have not only redefined innovation, but have also raised the bar
significantly. Innovation is no longer confined to R&D and engineering, or
strategy. Successful innovative companies emerging from India will have to
concoct creativity with R&D engineering and strategy. Other enabling
conditions exist and will only get better.
Already, a large
number of Indian companies have risen to the challenge and are delivering on
this promise in areas ranging from telecom software to business process
management to the use of cell phone technologies for consumer and business
purposes to healthcare and process automation. Industry associations like
Nasscom are working to get these companies to the domestic and international
platforms. I believe the opportunities ahead for Indian innovation is
unprecedented. And I believe that innovation will happen in the smaller Indian
companies that are unknown today, which could emerge to be the HCLs, Wipros and
Infosys of tomorrow.
The opportunities are
plenty; the only binding is our imagination and the lack of ability and desire
to innovate. Paraphrasing Shakespeare “...the fault lies not in our stars but
in ourselves...” All that is required is for Indian entrepreneurs to seize the
moment and make the best of the innovative environment in India.
Sanjay
Anandaram
mail@dqindia.com
This article is a part of an exclusive series with NASSCOM on 'IT Innovation
in India'
Authored by: Professor S Sadagopan director, IIIT Bangalore Page(s) 1
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