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21st Century Innovation Hubs February 15, 2008
Thats the title of the paper we wrote to serve as a framework for discussion of Nasscom’s 2nd P2P breakway session. The group, moderated by DataQuest Chief Editor, Prasanto Roy, discussed whether the globalization of innovation was for real. He started off by giving the much talked example of innovation from India ( not from the IT sector though)- the Nano.
The premise of the discussion was that Israel, India and China were emerging innovation springs- Israel being a proven player while India and China are strong emerging contenders.
The nature of the topic being broad, and being one that almost everyone present had a point of view on, the discussions were lively and brought to the table both theoretical frameworks as well as anecdotal data.
There were some that felt that innovation should not be limited to IP creation- India had pioneered numerous process innovations on the way to becoming the most preferred IT outsourcing hub. There was another point of view that the tech innovation being seen today is mostly being seen in R&D labs of MNCs.
My view on this was as follows- for innovative products to be created, access to, and knowledge of the market is critical- with the markets exploding in both India and China, there are a lot of below the radar start ups that are focusing on developing IP led solutions for these markets. Ashwin from Nasscom added that it was also necessary for the market to have early adopters for innovative ideas to succeed.
We also discussed the need for the right social mind set for the creation of an innovation ecosytem- in the Silicon Valley for example, the value chain that supports a start up is willing to share the risk of th start up. In India on the other hand, the risk of failure and need for a secure job often result in good ideas not seeing the light of day. In this connection, the contrasting example of Israel was cited- the country has leveraged adversity to create some of the most innovative products.
Another interesting point brought up by the CTO of KPIT Cummins is that the education system, starting from primary school, must focus on kindling curiosity and encourage enquiry rather than over emphasize “rote learning”.
There were others who argued that just as much as India needs innovation, Innovation needs India - to underscore the point that with the combined purchasing power of India and China in the foreseeable future, innovations tailored for these markets are inevitable.
Prasanto summed up the session with time running out- but not before sufficient threads had been created for further debate and discussions to continue….
Reviewing Tarun Khanna’s Book, ‘Billions of Entrepreneurs’ February 15, 2008
China and India are home to one-third of the world’s population. And they’re undergoing social and economic revolutions that are capturing the best minds–and money–of Western business. In Billions of Entrepreneurs, Tarun Khanna examines the entrepreneurial forces driving China’s and India’s trajectories of development. He shows where these trajectories overlap and complement one another–and where they diverge and compete. He also reveals how Western companies can participate in this development.
Each chapter compares China and India on a broad range of factors in entrepreneurship, including access to capital, freedom and reliability of information, governmental involvement, and infrastructure. Khanna examines the landscape of big, medium, and small entrepreneurship, including rural health-care initiatives and even Bollywood.
He also describes how indigenous and foreign entrepreneurs could get a foothold, how China and India relate to their own diasporas, and how entrepreneurial activity is reshaping both countries for the better.
Engaging and incisive, this book is a critical resource for anyone working in China or India or planning to do business in these two countries.
You can listen to the podcast or read his interview at Harvard’s Working Knowledge website.
Tarun Khanna is the Jorge Paulo Lemann Professor at the Harvard Business School in the Strategy group. He is a co-editor of the Journal of Economics and Management Strategy and the Journal of International Business Studies. He works with entrepreneurs, companies, and NGOs in emerging markets worldwide. In 2007, he was elected a Young Global Leader by the World Economic Forum.
Freelancing Our Way to Tech Leadership February 8, 2008
I was recently talking with Rene Trescases, the founder of Scritplance, one of the better known project bidding sites and he told me an interesting fact. India has the highest number of tech freelancers in the World…. more than US, UK, Australia put together.
Sure, we all know about the domination the big Indian IT companies (Infosys, TCS, Wipro etc) have in the global marketplace. But not many realize that there’s a very vibrant and successful freelance market and that we dominate this space as well.
The freelance world is a different world by itself. This is how it works. Many small businesses worldwide, who typically can’t afford the rates charged by bigger companies, are on the lookout for individuals or small companies who charge less. They post their requirements on sites like RentACoder.com, eLance.com or Scriplance.com. It could be anything from a complex e-commerce shopping site to a logo design. Freelance Programmer from around the world then quote their rates for a particular project.
The business owner then gets to choose the freelance programmer based on their rates, testimonials from other clients and their previous projects. And this is the area that India dominates and how!
Forget the fact that the net value of the projects aren’t big. Forget the fact that the main reason why the Indian freelancers get the projects is because they quote very competitive rates. The important thing is the entrepreneurial drive in them.
Most people start off moonlighting. After coming back from their full time job, they work on projects in the evening. It’s a healthy extra income. Some people talk about this as unethical which is why you never to get hear of many who moonlight. Some argue that what they do during their free-time is their prerogative. Whatever be the stand, there’s no denying the fact that freelancing forms the seed for entrepreneurship.
I have known many instances where people have quit full time work in software companies to pursue their own operations. Most start off with just a single computer with broadband connection in their bedroom.
I have also seen such people grow. They eventually get more clients than they can handle on their own. To meet the demand, they expand their set up and hire more people. And therein lies the power of Entrepreneurship…the power to generate jobs.
When I spoke with Kanwal Rekhi , who many call the Father of Entrepreneurship, during the TiE Entrepreneurial Summit, I asked him why focus on entrepreneurship? He said, if India has to be successful and strong, then it should encourage wealth generation. And that’s possible by creating more jobs. And who generates more jobs? Well, its the entrepreneurs, he says.
Keeping the Innovation meter running! February 6, 2008
Innovation will continue to be the underlying theme at the NASSCOM India Leadership Forum 2008. It will reiterate the necessity of building an eco-system of innovation in the country. The fact that the Indian IT-BPO sector has weathered some of the challenges they faced during 2007 successfully, the tool of Innovation, has only emphasized the fact that Innovation will drive the next wave of growth of the industry.
In order to spotlight the extensive innovation that took place during 2007 and applaud the companies, especially, SMEs that used out of the box thinking to combat pain points, at the event we will be hosting the fourth Innovation Awards.
As in the past, using a rigorous selection process, NASSCOM has identified eight Innovators within the Indian IT-BPO industry—organizations that have created new benchmarks in the area of Innovation in the last year.
Eight of the special organizations, short-listed for the Innovation Awards, will be recognized at the NASSCOM India Leadership Forum 2008 at an exclusive ceremony. The winners include Comat Technologies (P) Ltd., Financial Technologies India Ltd., Mango Technologies Pvt. Ltd., MediaLab Asia, Mindtree Consulting, Mistral Solutions Pvt. Ltd., MeritTrac Services Private Ltd. and Texas Instruments.
The Innovation engine – firing on all cylinders February 4, 2008
Speaking at the launch of the NASSCOM-Boston Consulting Group report on the Innovation plans for the Indian IT and ITES sector, eminent scientist and administrator Dr Mashelkar rightly pointed out that the biggest mistake people make is not when they aim too high and fail but when they aim too low and succeed. While this altruism applies to all fields of human endeavour, it could really be appropriate in the third wave that the knowledge sector is now embarking on. Innovation has the potential to add over fifty billion dollars of revenue to the industry by the year 2012 and it would be a shame if all the partners in the Innovation eco-system do not pull their weight in enabling this to happen.
Who are these partners and what are they really contributing to the movement at this point of time? Unlike in Cuba and Singapore, where innovation is almost entirely Government led and funded, it is now a matter of folklore that Indian IT has had very little dependence on the Government. NASSCOM has done yeoman work in the last few years with the well received and publicized Innovation awards attracting the attention even of President Kalam and Prime Minister Manmohan Singh and attracting participations from a wide cross section of multinationals, large medium and small firms and even entrepreneurial startups. Other associations like the CII have also done their bit in promoting the cause of innovation across all industry sectors. The real weak link continues to be the academic and research institutions that have been mired in their own red tape and in the case of private education, in their need to make money by holding out promises to more and more classroom and distance learning students. And of course for a very long time the availability of finance for innovative startups in the form of angel or VC money has been a small trickle resulting in the innovative ideas in the minds of many entrepreneurs not seeing the light of day.
At the firm level too, the focus on innovation has been more in the form of continuous improvement, necessitated by operational excellence and quality initiatives rather than conscious search for discontinuous benefits. As James Abraham BCG partner pointed out at the presentation to the industry in Bangalore, the fear of failure and short term profit concerns in many listed firms has inhibited their entrepreneurial or intrapreneurial initiatives and while some process innovation has happened, the focus on new product innovation and business model innovation has not been at the pace that many industry analysts would like to see. New product creation in intellectual property oriented firms and process innovation to look at new delivery methods and collaboration with customers and partners should be attempted in all services firms. To start the activity, diagnostic exercises on the present state of innovation activity and the path to reaching a desired state of extensive innovation need to be undertaken so that serious projects are planned and executed.
The other key recommendation of the study concerns all the participants in the eco-system – the Government, Research and Academic institutions, financing agencies in addition to the firms and the association need to work in concern to build an enabling environment for innovation. The formation of innovation clusters – IT for automotive innovation in Pune and IT for Telecom innovation in Chennai for example – could be one step in the right direction where the ability to multiple the velocity of innovation can be demonstrated and then proliferation through chosen clusters in a variety of locations and industries. The focus on engineering services has already demonstrated that there are new vistas of opportunity that hold great potential and the best way to build significant domain understanding could well be to partner with traditional incumbent industries to build new value propositions for the domestic and global market. The outstanding work done recently by Professor Michael Porter of the Harvard Business School has amply demonstrated that the cluster approach could transform the fortunes of any industry or country and needs to be embraced in a collaborative format in our own industry to see breakthrough success!
Where does the future lie for the innovation movement and what are the solutions to the malaise that seems to pervade the eco-system? The hundred crore innovation fund announced by NASSCOM is one step that will surely boost the confidence of innovator wannabes in the industry and we can seriously expect that companies – new and old in IT and BPO will embrace innovation as their new mantra for profitable growth in the months to come.
