Innovation - An Indian Perspective
WHAT ROLE CAN INDIA PLAY IN THIS ERA OF INNOVATION?
Interview with Arindam Banerjee
India can play a role in using innovation to build large,
successful multinational companies. To do so companies in India will have to
dominate in one or two segments with products that are clearly identified as
Interview by - Pradip
ICMR (IBS Center for Management Research).
|Arindam Banerji is a scientist and
entrepreneur in the Silicon Valley. He took the usual route of going from
the IITs, through a PhD in the US, to finally working in Sundry Research
Some day, he plans to return to India, but for now, as time permits, he
writes on various geopolitical issues.
What is innovation? How will you define it?
Innovation can be defined in many ways, but I have a very different view
on innovation as a whole.
Innovation is more than just a great idea, it is the
entire process that makes an idea, big or small, commercially successful
Innovation is the enablement of creation of new ideas,
at a grass-roots level, in our schools and universities.
Innovation, is a numbers game -the better the odds for
our scientists to be successful-the better our chances of producing
commercially viable innovations.
Innovation is a key catalyst for India to take its
rightful place in the comity of developed nations.
Innovation, for us in India, must include a rural and
socially relevant focus. Innovation in India will probably have more to do
with problems in India, and countries in South East Asia or Africa, rather
than the US.
Innovation implies a kind of leadership, that will
hoist some of the best companies from just being competitive in niche
markets to broad household names.
Innovation is an attitude, that must be inculcated in
our students-the attitude to believe that they can change the world with
How critical is innovation for survival in the 21st
Innovation has always been critical -it was critical in the last century and
will remain so, this century too. Countries like the US and Germany drove
innovation in large parts in the last century - India has a chance to take this
leadership position this century.
We must realize that political and economic conditions change. The same
conditions that attract a lot of price-differential based work to India, may see
it go to other countries in the future for exactly the same reasons.
Depending upon cheap labor is not a long-term strategy for countries like
India. In fact, just last week, talking to some Indian executives of outsourcing
companies, I heard them complain about price-differentials for work done in
India becoming consistently thinner. Remember, Mexico has seen a lot of its
automobile component manufacturing move to countries like China, Brazil, and now
India and it was the unquestioned price differential leader for such outsourcing
only a decade ago. The price- differential based industries have a tendency to
So, the question is - what option does a nation have?
The answer lies in looking at another analogy. Look at the technology to make
commercial grade jet engines. The basic technology for jet engines was invented
in 1930, and realized operationally by the late 1930s. So, it is a technology
that has been available at least for 60 odd years, if not more. But, how many
countries can produce jet engines commercially today?
Very few-the reason- countries like the US, UK, France have built on the base
innovation that makes it impossible for any country to catch up and produce jet
engines, without huge investments. Essentially, they have managed to procure an
unfair advantage, that very few countries can take away from them. This shows
you the long-term nature of innovation.
Countries like the UK, US, France, Russia and others have long held on to the
jet engine manufacturing industry and it is not moving away any time soon. This
is a critical lesson for this century too.
Innovation based industries and intellectual property based industries can be
held on to. This is true even in the software industry, for example, a company
like BEA openly claims (in news.com) that it does all its key architectural work
and intellectual property creation in the US itself. Oracle, with its
productized intellectual property in databases, will be one of the strongest
players in databases for a long time to come. Now consider what will happen if
IBM's services arms move some of its operations to Mangalore and Bhubaneshwar,
what price advantage will Infosys, then enjoy?
For countries, as well as companies, long-term survival and sustained growth
comes only through innovation. Innovation is the unfair advantage that
countries, as well as companies need to grow over a long-term.
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