Volume 1 • Issue 1 • july 2013 INDIAN T
RAL U G U INA SUE IS NGALORE BA
Indian Technology Congress
How Technology Can Blossom in India
NOLOGY C CH
Published by Indian Technology Congress
Collaborate to Innovate 1. What is Innoberate? Innoberate is a Crowd Sourcing Platform for Research Institutions, Academy, Industries and State Governments and State run Departments to seek Solutions from Research community, Academia and Entrepreneurs.
5. What is ‘Problem Wall’? Problem wall is an Application on Innoberate. Where at i. Industries, a. Large or Small, b. Public Sector or Private Sector, c. Public Interest or Commercial Interest
2. Who can be part of Innoberate? One could to be i. Researcher a. Public Institutions b. Research Labs (Public Sector or Private Sector) c. Academic Institutions ii. Representative of a Technology Enterprise (Public Sector or private Sector) a. Founder b. CXO c. Part of R&D team d. Part of Product Development team e. Part of Solution development team f. Part of Innovation team g. Incubation Centre h. Investment Firm i. Consulting Firm iii. Inventor iv. Innovator v. Policy Makers a. Bureaucrat (from State Government / Government of India) vi. IPR Experts vii. Public Institution viii. Enterprises ix. Academic Institutions x. Student
3. How can one be part of Innoberate? By Registering online at www.innoberate.com providing the necessary credentials 4. What can one expect by being part of Innoberate? One of the key features of the Innoberate is an application called ‘Problem Wall’. All the registered users get an access to Problem Wall, apart from being able to connect with the diverse Technology community from all corners.
Will post problems that demand Technology Solutions. These problems may be good to solve or critical to solve. The Institution or the Enterprise posting the problem, seeking solution may have already attempted at solving the problem more than once. Any of the registered members, Individuals or Entity may access the Problem Wall and look into the Problems posted and may nominate themselves or whom they deem appropriate to provide the solution.
6. Will Solution Seeker have to pay to post the Problem on the Problem Wall? Solution seeker need not pay to post the problem. The Entity or Individual posting the problem will have to offer a reward for the individual or team which offers to solve the problem on solving the problem 7. Will Solution Provider have to pay to nominate to solve the problem? Solution Provider need not pay to nominate or solve the problem. On solving the problem they can look forward to some reward from the solution seeker. 8. How does Solution seeker protects its interest, as announcing the problem into the public domain may have an impact on its Public standing and market? i. The Problem wall is not a Public Domain ii. Every registrant will be screened & validated, before accepting the registration iii. Every registrant signing up with Innoberate will agree for Non-Disclosure clauses required by the Solution Seeker Who will oversee the Solution development process? Solution Seeker (SS) will have to nominate a Project Manager (PM) to oversee the Solution Development Process
i. PM will have the understanding of the Problem the SS is seeking Solution for ii. PM will decide on who will undertake to solve the problem among those nominated to solve the problem on Innoberate iii. PM will share the critical information judiciously with the problem solving team as and when required and as much required in order to succeed in solving the problem and also protecting the interest of the SS
9. What is the least a Solution Seeker can expect in the process? Solution Seeker may least expect i. To identify some subject matter experts beyond their own team ii. To identify an enthusiastic researcher with fresh and out of the box thinking iii. A potential employee / team member / consultant / adviser How can Solution Seeker protect the Company critical information when announced in the Public domain? iv. Solution seeker will only provide a high level Problem announcement on the Problem Wall v. Detailed Critical information will only be shared with the identified team of Problem Solvers / Solution Providers vi. The information to be shared with them will be determined by the Solution Seeker appointed Project Manager 10. Can a Solution Seeker have many people to solve the problem? Innoberate prescribes a maximum of 3 teams to be setup to be engaged to solve any problem. 11. What role could a person offer to play in order to solve a given problem? An interested registered user can play the following roles; i. Mentor / Guide ii. Subject Matter Expert iii. Team Member iv. Researcher v. Intern 12. How will the team composition look like? i. Project Manager – 1 (from Solution seeker) ii. Mentor – 1 iii. SME – 1 iv. Team Members – 4 v. Researcher – 2 vi. Intern2 Total team size: 1 Project Manager + 1 Mentor + 8 Members
13. Who will take the cost of Prototyping or Proof of Concept (POC) while arriving at a Solution i. Solution Seeker will commit a budget ii. the Project Manager will oversee the spend on the POC efforts 14. What will be the remuneration for the team working on solving the problem? The team working on solving a problem will not get any direct remuneration for the efforts. Efforts will see rewards on success only. The remuneration will be in the form of; i. The rewards may be Cash or / and ii. Equity in the new entity which may get created iii. Co-authorship on the IP iv. License fee on the IPR usage 15. How will a Solutions provider’s rights / efforts be protected? Innoberate has a team of IPR specialists who will enable / facilitate a contract between the Solution Seeker and Provider to protect the interests of the Solution provider as suggested in response 15. 16. How does Innoberate benefit in the whole process? Innoberate will benefit by charging a percentage of success fee similar to what is mentioned in response 15. 17. What are the challenges for Innoberate to succeed? i. Fault Finding ii. Innovative thinking iii. Structured thinking on innovation iv. Solution Orientation v. Productization vi. Valuing IPR and Licensing vii. Tolerance to copyright violation viii. Solution oriented research ix. Public Research laboratories x. Lack of motivation to invent 18. How does Innoberate intend to overcome the challenges? Innoberate, by bringing together all stakeholders, does not bring any magic potion. Innoberate triggers, engages and energizes the Technology Community to participate in solving problems.
8 Sam Pitroda on the New Paradigm of Innovation
Vol 1 • Issue 1 • July 2013
Mission Enable lively debate, inspire and enrich the technology community of India Publisher & Editor-in-Chief L.V. Muralikrishna Reddy, PhD, FIE
10 Essence of Twelfth Five year Plan approach paper on innovation
New Technologies Digital Green Babajob Aspiring minds E Farm Desi Crew Social Entrepreneurship
Cover Story 16
How Rural Shore is turning village youth into BPO experts
Managing Editor Palecanda Nanjunda Pratap
Interview with S.M. Jhamkhandi, Director, MSMEDevelopment Institute
Editorial Consultant Benedict Paramanand Editorial Board Padma Shri Prof. R.M Vasagam Dr. M.P. Sukumaran Nair Dr. Ing. B.V.A. Rao Dr. U. Chandrasekhar Wooday P. Krishna
Rishikesha T. Krishnan on what India needs to do to urgently strengthen its innovation eco-system
Subscription & Marketing Uday Shashidhar Jeede Suhas Shiwangi Sahu Samar Pratap Singh +91 95388 90390 +91 98450 95532 firstname.lastname@example.org Address #5, Sri Vinayaka Towers, 7th Cross, KR Colony, Domlur Layout, Bangalore - 560 071 Karnataka, India. Design www.efilos.com
Printed at Pentaplus Printers Ltd. Bangalore © thetechnologycongress
Interview with Dr. Shailesh Nayak, Secretary, Government of India, Ministry of Earth Sciences
Thought Leader Interview 20 Kris Gopalakrishnan Acceleration, not incremental changes the need of the hour
Web Manager Satya Prakash Maddela Editorial Team Shanmugam Vijay Krishna
Corporate innovation 22
Rekha Shetty’s ten ways of strengthening India’s innovation eco-system
Sustainability is the Foundation of Innovation & Technology Development S.S. Rathore President, Institution of Engineers (India)
42 Case Studies 47
How video based learning is bridging rural-urban knowledge gap
26 Battle - Engineering versus Marketing 27 The power of stillness 28 Reverse Innovation, is India ready?
48 Shaping the National Innovation System: The Indian Perspective
Change the Game
30 Revolutionizing education through Online, the EduNext way 31 How football can light up a poor man’s house
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Letter from the Editor-in-Chief
Strengthening India’s Innovation Eco-system L.V. Muralikrishna Reddy, Ph.D
ncubators, venture capital and modern infrastructure help in exploiting the fruits of R&D and accelerate economic growth. Nurturing innovation and bringing out new products and processes characterize advanced economies. A modest beginning has been made in our country towards this end. To deliberate on the associated issues, the Indian Technology Congress is to assemble on July 24-25, 2013 at the NIMHANS Auditorium, Bangalore. Coinciding with the Technology Day Celebrations of 2013, the Congress will bring together eminent researchers, academicians, MSMEs, large industries, funding agencies, and policy makers. The Congress will focus on innovations emerging from institutions, laboratories of national excellence and their exploitation. Information on government initiatives for promoting sponsored research, entrepreneurship development and strengthening MSME linkages for promoting Indian technologies and products in the world market will be disseminated. Creating a Network of Collaborators The Indian Technology Congress (ITC) is a meeting of minds from across the world
aimed at creating a vibrant network of collaborations amongst people at the leading edge of technology innovation. At ITC, we believe that great ideas are born when people come together. The ITC brings together technologists, research scientists, academicians, entrepreneurs, investors and policymakers on a single platform enabling relationships that can take ideas from concept to reality via innovation. ITC aims to create an atmosphere where everyone from research scientists, global technology leaders to entrepreneurs will be able to exchange, refine and action ideas that will define India’s future place in the world of technology. The Government of India has declared 2010-20 to be the “Decade of innovations”; ITC seeks to make this happen. Global Participation, Local Perspectives Innovation knows no boundaries, and at ITC, we are committed to bringing together custodians of technological innovation from around the world to India. With confirmed participation from Israel, Thailand, USA, Canada, UK and Europe, the Congress will see leaders in various fields interact with Indian innovators, creating borderless innovation networks where ideas are enriched, refined and implemented. The ITC is committed to bringing in innovators who have demonstrated
excellence in India and will see participation from leading Indian infotech giants, Automotive and Engineering majors, Defence and Aerospace organizations,, and leading academic institutions, among many others. ITC’s Objectives Concept to Product to Commercialization A concept can be brought to life only when there is an eco-system of support that incubates nurtures and develops it until it is ready for the world. ITC seeks to create this eco-system by creating a network of innovation specialists who can enable the exploitation of a concept, create a product based on it and successfully commercialize it for sustainable economic gains for all stakeholders. Recognize Technology Achievements There are technological innovations happening all around us that often go unnoticed and unrecognized. ITC will honour and recognize exemplary work done in the field of technology innovation with the Indian Technology Awards, with the objective of encouraging excellence. The overarching objective of the Awards is to foster innovation as a way of life in work on technology. Taking on Challenges in Technology The road to innovating in technology today is potholed with challenges of various kinds. For example,
managing intellectual property and patents is a challenge that innovators face worldwide. ITC seeks to take on these challenges, creating and sharing knowledge that helps innovators address them. Nurturing and Sustaining Innovation Clusters To nurture innovation, we must invest in the clusters of interlinked knowledge-based organizations. These could be academic and research institutions that form consortia that are at the heart of the innovation process. ITC seeks to create this network by setting up innovation clusters through research focused institutions for global excellence. Funding and Promoting Technology To bring a technological innovation to life in the real world, its creator must know how to access and manage funding, whether it is sourced from the government or venture capitalists. ITC aims to share and enrich understanding of the complex world of financing a concept until it becomes reality. The Way Ahead: Escape Velocity for Ideas The ITC is a beginning of a journey and not an end in itself. Its objective is to spark conversations that result in projects that have technology innovation at its heart. The ITC is the centrifuge from where ideas gather momentum and escape velocity to take off, and define the future.
July 2013 | TIP
Letter from Chairman - National Advisory Committee
Feast for the mind
I Padma Shri Prof. R.M. Vasagam Chairman, Aerospace Division Board, IE (I)
ndia celebrates Technology Day on 11th May every year commemorating the successful Pokhran 2 nuclear tests. This year too we wanted to celebrate it as a two-day event, but owing to other constraints of the key participants coming from other parts of the country, we are holding the event on July 24 and 25, 2013. We are taking into account the convenience of all those interested in the event. India is emerging as a technology power but have a long way to go. China, our neighbouring country in Asia, is excelling in many areas ahead of India though we started our journey together. India is emerging as a knowledge power but the skill component is not good enough. In economic development, knowledge alone can`t do much. That is where we have to focus our efforts on multiple technologies of contemporary relevance. Hence the Indian Technology Congress aims at addressing strategies for making India technologically an advanced country at the earliest in partnership with like-minded professional bodies. The National Design Research Forum is one of the six fora which is operating under the Institution of Engineers (India) banner. IE(I) is the largest professional body of our country with more than 700,000 members from 15 engineering disciplines. We also have partners coming from Institute of Engineering and Technology (IET) UK, Institute of Electrical and Electronic Engineering (IEEE) USA,
TIP | July 2013
and we have many other professional bodies. Team Tech Foundation, which was running similar programmes with great success few years ago, is making an effort to bring the industry, academia and the researchers together in the ITC 2013. In addition, we are also attempting to bring people who are promoting entrepreneurship, setting up technology business incubators and supporting the bright people with venture capital support. We are hopeful that this event will be a feast for the mind since eminent speakers are participating from diverse fields. Focus on Youth Yesterday’s science becomes today’s technology and tomorrow’s engineering. Education makes one appreciate the findings of science and transform it to technology and engineering for meeting the societal needs in cost effective and timely manner. When technology is for benefitting commoners, it has to give consideration to cost, reliability and upward compatibility. To create new products or services, we need people who think and act differently. That is why we need to focus on the youth and create a spirit of enquiry. We need to nurture outofthebox thinking in our colleges and schools. Bill Gates dropped out from Harvard, Steve Jobs too was a dropout college. Today, they are iconic figures. Programmed knowledge and programmed and stereotype solutions cannot lead to innovation and creativity. India is the number one milk producer in the world thanks
to the pioneering efforts of Dr. Varghese Kurien, a mechanical engineer by training He could bring together more than 3 million farmers and their families in this mission through cooperative movement. On one end we have the rural community producing milk and on another advanced technology – plants for processing, packaging and marketing Indian made dairy products, value added in billions of dollars. Similar missions are required to make India grow. Unless technology and engineering start at grassroot level and build enterprises of the people by the people and for the people, we cannot make real progress. First and foremost, India has to attain self reliance in relevant technologies and self sufficiency in products and services and then try to get a share in world market through export. In addition to export of Engineering Goods, Textiles, Jewellery, cutting edge and emerging technologies should be pursued for making India a knowledge super power. How soon and how far we can succeed is entirely in our hands. Once we are determined, we can make head way and make our mark in international arena. The Indian Technology Congress -ITC 2013 - is one such attempt to put the spotlight on the status, path ways to overcome impediments, new initiatives and goal setting for the technology community of our country. Let us hope we achieve our objective and prove to the world that we are not second to none!
We Need a New Paradigm of Innovation â€“ Sam Pitroda 8
July 2013 | TIP
Sam Pitroda, IT and innovation advisor to India’s Prime Minister, spoke at INSEAD about innovation and the need for a new paradigm. Excerpts:
e cannot just rely on research and development departments and specialists to bring about innovation; instead we need to include as many people as possible in the process. That’s the view of Sam Pitroda, who is spearheading India’s plans to spend billions dollars to stimulate innovation in the country. “Our job is really to be cheerleaders,” Sam Pitroda told INSEAD Knowledge on the sidelines of the Global Entrepolis Summit held in Singapore. “We are saying innovation has to be a platform. We want to see innovation ecosystems. We want to emphasise drivers.” The chairman of India’s National Innovation Council says substantial funding will be going into several initiatives. “For example, one, we want to create a billion dollar innovation fund which focuses on inclusive growth-based innovations. So innovations from the bottom of the pyramid. It will be a fund of a fund. It will be a private fund. The government may invest some little money in seed capital.”
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Another initiative, he says, involves identifying some 20 innovation clusters in areas where the local industries are traditional. “It could be in machine tools, pharmaceuticals, the auto industry, auto parts, where we could seed innovation … and really build these 20 clusters as innovation clusters.” This will also involve identifying 20 universities to stimulate an ‘innovation culture’ and, in addition, Pitroda expects councils from sectors such as biotech, agriculture and auto parts to encourage domain experts to “put together a blueprint for a decade of innovation.” “At the end of the day, domain experts know their field better than anybody else. They will have to be active to give us a roadmap for the decade of innovation in their sector.” Although not all sectors will turn out to be successful, he says, “this way we will encourage innovation culture. It’s all about mindset. Our job is to change the mindset in the country; in a country of a billion people, it’s very difficult. It doesn’t come easy.” Pitroda says the National Innovation Council is also looking into awards and incentives – for example, a reality TV show on innovation. “You do lots of these things to really get everybody excited about innovation.” If innovation were to be measured just in terms of patents granted, India would not rank very highly. However, Pitroda argues: “Just because you have lots of patents doesn’t mean you’re the most innovative.”
There is a huge potential to innovate, but you can’t innovate based on the old paradigm. You’ve got to create a new paradigm “I would say diversity is a fertile ground for innovation,” he says, adding that India has great cultural diversity, as well as a tradition of innovation. “India invented ‘zero’, with which you could write a big number. Nobody could write a big number before. You put zero and now you can write a big number. It’s a simple idea.” As for modern innovation, India has some 550 million young people below the age of 25, he says, and with the internet adding a “new dimension to innovation,” you can access the world from a remote village. “So our job is to build the infrastructure for innovation by providing high capacity, broadband connectivity to our universities, libraries, to our R&D institutions, to lots of young people. And they in turn would use these tools to solve their problems.” In short, Pitroda believes innovation – whether ‘frugal’ (Jugaad) or ultra low-cost innovation for the very poor, or more hightech in nature – has to involve large numbers of people and not just research and development teams. Echoing Abraham Lincoln’s Gettysburg Address, Pitroda believes innovation should be ‘for the people, by the people.’ “Innovation should not be the domain of R&D experts and laboratories.
New way of looking at things “You need new institutions. You need a new way of looking at things.” For example, the ‘antiquated’ patent system needs to be fixed, he says. “As an inventor, I have to spend thousands and thousands of dollars in translating patents … So how can you say that you are a global economy, when you don’t have global patents?” “But unfortunately everybody, like the herd mentality, is focused on one way of doing it and not questioning the very foundation of how we are doing it today. I believe the 21st century offers a unique opportunity to change the paradigm, mainly because of the revolution in information and communication technology, mobile phones, high-speed computing, coupled with biotech, nanotech, genetics. There is a huge potential to innovate, but you can’t innovate based on the old paradigm. You’ve got to create a new paradigm.” “I am beginning to question everything we do and not that everything I question is right. But out of that will come answers. I may not be around to see the answers, but we’ve got to restructure this world for a large number of people who are the bottom of the pyramid (as well as) the young generation.” “We cannot continue the world the way it has been … Everybody wants to put a lot of money in the system to go back to what it was, as opposed to saying, ‘wait a minute, you can’t go back to what it was … You’ve got to go forward. And going forward, it is not going to be the way it was. Accept that.”
Twelth Five Year Plan Approach Paper on Innovation
Open Innovation Model for India F
or the first time, the Planning Commission included a chapter on Innovation in the 12th Five Year Plan (2012 – 2017) approach paper titled ‘ Faster, Sustainable & More Inclusive Growth.’ The paper favours an Open Innovation Model as against the in-lab model followed so far to strengthen the eco-system for innovation in India. Excerpts of the Paper: The role of innovation in spurring growth, overcoming natural resource constraints and unleashing Indian
energies and synergies are widely recognised all over the world. Recognising the importance of innovation, the President of India has declared this decade as the ‘decade of innovation’, with a focus on inclusive growth. Innovation is already contributing significantly to the growth of the economy and dynamism of industry. Indian entrepreneurs are developing novel solutions for the needs of Indian consumers that provide access to services and products at a fraction of the cost of the solutions
available from industrially advanced countries. Examples of such innovations are the delivery models of mobile telephony services that have expanded the reach of telephony with the cheapest call services in the world; extremely low cost eye surgeries which do not compromise on surgical standards at US $ 50 compared to US $ 1650 in the US. Other examples of affordable innovation are: a vaccine for hepatitis B at a fraction of the cost of earlier products, a peoples
car for less than US $ 2,500; an innovative refrigerator using thermo-electric cooling at a price less than US $ 75, a water purifier combining nano-technology and rice husks to provide safe drinking water for a family of 5 at US $ 0.02 per day; a solar lighting system for rural houses at US $ 200 and a solar powered ATM machine that has just 4.0 per cent of the total energy requirement of conventional ATMs. Three distinctions of the emerging Indian approach to innovation are worth noting. Firstly, it focusses on finding affordable solutions for the needs of people–for health, water, transport, etc.–without compromising quality. Secondly, in this Indian approach to innovation, desired outcomes are produced by innovations in organisational and process models that deliver to people the benefits of technologies that may be developed in scientific laboratories. Thirdly, there are innovations in the process of innovation itself to reduce the cost of developing the innovations. An example is the open source drug discovery process being applied by the CSIR to develop drugs for treatment of tuberculosis, based on a semantic search, web-based platform for collaboration developed by Infosys, an innovative approach that has cut down the costs and reduced the time for drug development. This new paradigm of innovation, focussed on producing ‘frugal’ cost solutions with ‘frugal’ costs of innovation, in which India may be emerging as a global leader, contrasts sharply with the conventional approach, mostly focussed on increasing inputs of Science and Technology and R&D and measurement of the numbers of papers and
July 2013 | TIP
patents produced. Frugal innovation is focussed on the efficiency of innovation and on outcomes that benefit people, especially the poor. Industrially advanced countries too are examining their innovation policies to incorporate this broader concept of innovation. For instance, Sweden, ranked as the second most innovative nation in the world in terms of traditional inputs of Science and Technology and R&D per capita, is formulating a National Innovation Strategy that is focussed on using innovation for not only enhancing growth and competitiveness of its industries, but 136 Approach to the Twelfth Five Year Plan also for addressing global challenges of inclusion, and for improving the delivering of its public services. Its national strategy broadens the scope of innovation to go beyond products to processes, services and new business models. Similarly,
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UK has also placed all types of innovation at the heart of its strategy to drive future growth and the country’s vision. Its strategy also highlights the need for Government policy to recognise the changing face of innovation. Thus the metrics of ‘innovation’ are shifting from an input oriented paradigm focussed on R&D investments and patents, towards an output oriented system that looks at impact in terms of benefits for people. Conversion of R&D to results for people requires an ecosystem of enterprises working in conjunction: entrepreneurs, researchers, finance providers, business enterprises and policymakers. Therefore, the national strategies for innovation, such as those of Sweden and UK cited before, focus on the need for various types of institutions in the ecosystem and for more effective collaboration amongst them. This must be
India’s agenda too if India is to accelerate inclusive growth through innovation. Role of Government Government has a critical role to play in strengthening the innovation ecosystem. It must provide the enabling policy interventions, strengthen knowledge infrastructure, create markets for innovations through the stimulus of Government procurement, improve interinstitutional collaborations, provide a mechanism for funding business innovations at all levels especially SMEs, and provide vision through a national level roadmap for innovations. To spur the Indian innovation ecosystem, the Prime Minister has set up a National Innovation Council (NInC) with the mandate to formulate a Roadmap for Innovations for 2010-20 with a focus on inclusive growth. Principal initiatives already undertaken by the Council and some other innovative programs of the Government are mentioned here.
Collaborations and Clusters Since innovation generally results from combinations of capabilities and collaborations, clusters have been globally found to be an effective means for more innovations. ‘Clusters’ can be physically co-located enterprises or ‘virtual clusters’ of enterprises connected through technology, or often a combination of both. In India the bio-technology industry is coalescing in several innovation clusters, combining research establishments and producers, the results from which are appearing. Several other clusters of industries - engineering products, garments, pharmaceuticals, leather goods, etc. - are operating around the country. NInC has outlined a partnership agreement with CSIR to connect the resources of CSIR with such clusters to promote innovation in them. NInC
Twelth Five Year Plan Approach Paper on Innovation
is also rolling out a ‘cluster tool-kit’ with guidelines and best practices for improving cluster performance. The Open Source Drug Discovery process, mentioned before, is a remarkable example of a virtual cluster formed by technology enabled ‘crowd sourcing’ of collaborators converging to respond to an innovation challenge. Such an Open Innovation Model, using an ‘open source’ and collaborative approach, can enable creation of affordable solutions which would not be likely with a conventional, ‘in-lab’ approach. Supportive Financial System and Mentoring There is no dearth of ideas in India. The ‘Honey Bee Network’ and the National Innovation Foundation have documented over a hundred thousand already, and only from ‘grass root innovators’. Innovators need financial support at an early stage to develop and test their ideas in the market-place. Venture funds are recognised globally as the most suitable form of providing risk capital for the growth Innovation 137 of innovative technology and breakthrough ideas. While India is amongst the top recipients in Asia for venture funds and Private Equity Funds, these investments are so far focussed on relatively large and ‘safer’ investments. Thus, despite the growth in the venture capital industry in India and some government schemes for supporting entrepreneurs, the seed funding stage in the innovation pipeline, where amounts required may be small but risks high, is severely constricted. To plug this vital gap in the innovation ecosystem, the National Innovation Council
is considering the need for a professionally managed India Inclusive Innovation Fund which will invest in innovative enterprises engaged in providing solutions for the ‘bottom of the pyramid’. It will focus on innovations that will produce socially useful outcomes for poorer people and enterprises which are focussed on delivering these. The Fund will also provide support for mentoring
participating in such a Fund if it were sponsored by the Indian Government. The structure of the Fund and its governance is now being designed. Innovative Enterprise Development Affordable and accessible products and services of good quality must be the primary outcome of the country’s ‘frugal innovation’ thrust.
Enterprises owned by the producers enable the producers to not only earn incomes but also share in the wealth created by the enterprise. Organisations like SEWA, and companies formed by the Chanderi
entrepreneurs to build their enterprises and achieve desired outcomes. The Fund will be built upon seed capital from the Government multiplied by contributions from various Indian public sector enterprises, banks, private investors, corporates and investment firms. Several international funds whose mission is to support social entrepreneurship have expressed interest in
Experience of successful innovations, such as the low cost eye and heart surgery models, as well in the microfinance industry, shows that the employment of the country’s low cost pool of skill-able people in the production and distribution of the products and services is a key to enabling their affordability and accessibility. Such innovative models also increase opportunities for
weavers in Madhya Pradesh, are such examples. Such enterprises require innovations in organisational and legal forms. The Planning Commission is examining changes that would facilitate the multiplication of more such enterprises. Through such innovations, businesses that are of the people (owned by them), and businesses by the people (in which people are a principal resource in
increasing employment and improving the lives of the people who are part of the production and distribution process.
July 2013 | TIP
production and distribution) can cost-effectively produce products and services for people at the bottom of the pyramid. Such innovative models of businesses can also very competitively produce products for the top of the pyramid and exports too, as do the Chanderi weavers in Madhya Pradesh and the carpet weavers in a similar, inclusive form of enterprise in Rajasthan. Platform for Best Practices and Innovations Currently, there are many enterprises across the country which are delivering benefits to citizens and meeting challenges of inclusion in areas such as health, education, energy, low-cost housing, sanitation, through innovative solutions. It is often said that India is a country with many successful experiments that do not achieve scale. Scaling up the impact of such innovations requires that such ideas be spread around rapidly so that others could emulate them. And it also requires that larger business organisations and venture funds become aware of them and support them. Therefore, the strengthening of the innovation ecosystem requires a platform for information sharing and dissemination. While some knowledge 138 Approach to the Twelfth Five Year Plan portals for innovations in specific areas already exist, the National Innovation Council is in the process of building an India Innovation Portal to enable easy access to these as well as to become a wider information repository on innovation and a platform for collaboration as well.
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Intellectual Property Rights Management of Intellectual Property Rights (IPR) has become extremely important in the new knowledge economy. Adequate rights on the intellectual property produced by an innovator enable innovators to recoup their investments and make profits: thus IPR spurs innovation. Good national IPR systems also enable knowledge of technological advances to be accessible through the patent system to others who can build on them. To obtain both these benefits, India must improve its management of IPR. The administrative machinery for IPR management must be considerably strengthened and professionalized and DIPP has taken up this task. Holders of IPR have incentives to strengthen and extend their monopolies. However, monopolies can restrain competition and further innovation, and thus tend to increase costs for customers. This is the fear even in the West, with respect to pharmaceuticals for example. The concept of monopolizing knowledge albeit for a limited period, that underlies prevalent models of IPR can have perverse effects when it is extended to areas of traditional knowledge, preventing poorer people from continuing to use their own knowledge without payments to those who have ‘patented’ it under IPR. Also new models of collaborative innovation are emerging, such as Open Source Drug Discovery, mentioned before. Concepts of IPR will have to be developed to suit such new models of innovation in
which, incidentally, India has great stakes because of their potential to produce ‘frugal’ innovations for inclusive growth. Therefore, as India aims to become amongst the global leaders in innovation, it will also have to be amongst the leaders in efficient management of IPR and innovations in IPR concepts and policies. Innovations in Government Innovations should also be encouraged within Government structures and processes to enable improved service delivery and create more transparency and accountability in the system. The Aadhaar or Unique Identity Programme which will create a foundation for more transparent and efficient public service delivery is internationally considered as a gamechanging approach to inclusion. By providing a clear proof of identity, Aadhaar will empower India’s poorer citizens in accessing services such as the formal banking system and give them the opportunity to easily avail various other services provided by the Government and the private sector. Government is also leveraging ICT to reduce pendency in the legal system, encourage a move towards e-governance, e-procurement and e-tendering. It is also undertaking an ambitious initiative to connect 250,000 Panchayats with fiber-based broadband to improve governance and service delivery at the last mile. GIS mapping will also be applied more extensively to improve land record management and delivery of services in urban and rural areas.
Other innovations are in the management of performance of government ministries. The Government has initiated a performance management system which requires every ministry and department to undertake a stakeholder consultation to assess the gaps between its’ stakeholders’ expectations and its actual delivery. Ministries must develop innovative strategies to bridge these gaps, and must accordingly specify the measures of its performance by which it should be judged. After initial trial Innovation 139 runs and adjustments in its design, this system, generally called the Results Framework Document(RFD), is now adopted by almost all ministries at the centre. Some State governments have also begun to adopt this approach. An extensive innovation ecosystem requires many lateral connections, often at local levels, between producers, sellers, and financiers, and the facilitating government machinery. Sweden has a region-wise process of participation of citizens and enterprises in formulating the innovation agenda. In a much larger and more diverse country, as India is, development of the innovation ecosystem must be even more widely devolved. Therefore NInC is encouraging the States to set up State Innovation Councils to stimulate the ecosystems for innovation in their states. Currently, 13 State Government have constituted State Innovation Councils. Using the broad templates suggested by NIC they will develop interventions to suit their state’s specific
Twelth Five Year Plan Approach Paper on Innovation
needs. In this way the national Innovation agenda will combine with other thrusts for improvement of governance and service delivery described elsewhere in the Approach to introduce more flexibility and innovation in centrally sponsored schemes and thus improve the efficiency and inclusiveness of the growth process. Information and Communication Technology Innovative programmes and policies are required at the Centre as well as in the States for ICT to permeate
rapidly in the country and enable India to achieve its goal of more inclusive and faster growth. The country must provide affordable and accessible education, skill development, healthcare, and financial services, very rapidly and on a very large scale. Moreover, citizens are demanding improvement of governance with greater efficiency in delivery of public service and greater transparency. Information and Communication Technologies (ICT) can enable the improvements and innovations necessary for providing affordable and accessible social sector
services. The expansion of Aadhar numbers through the UIDAI, and the associated opening of bank accounts, which can be accessed remotely opens up the possibility of transferring benefits to the beneficiaries directly. Pilot programme to apply this to kerosene, LPG and fertiliser are being designed. If successful, the experiment can be extended to the PDS. This will require improvement of connectivity and bringing broadband services to Indiaâ€™s villages. The development of innovative service delivery and business models will also be necessary. Indian
capabilities in the software industry are recognised around the world. However these capabilities have not been vigorously applied to domestic opportunities so far. Moreover, the large opportunity for expansion of ICT services in India should attract foreign technological capabilities. The Twelfth Plan must stimulate widespread deployment of ICT in the country to accelerate inclusive growth.
http:// planningcommission.nic.in/ plans/planrel/12appdrft/ appraoch_12plan.pdf
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From Jugaad to Sytamatic Innovation
The Way Ahead G
iven that modern industrial innovation is led by innovative firms, creating a set of organizations that can drive innovation would be the most significant enabler of industrial innovation in India.
Rishikesha T. Krishnan Professor of Corporate Strategy, IIM Bangalore Author of ‘From Jugaad to Systematic Innovation – The Challenges for India’
Where would these organizations come from? Given the in-built constraints of the public sector, it is unlikely that such a set of organizations can be created or sustained under public ownership. The problems in technology transfer and the primacy of the industrial firm as the agent of industrial innovation emphasised by Forbes and Wield make public research laboratories a sub –optimal setting for industrial innovation. Therefore, a priority for improving innovation in India must be improving the climate for innovation in Indian corporate organizations. In fact, I might go so far as to say that given India’s past over-reliance on the national laboratories, a deliberate de-emphasis of public R&D may be necessary to
enhance India’s industrial innovation performance. Besides creating a mass new, innovative, technology driven firms, other priorities should be enhancing the capabilities of existing MSMEs, the transformation of large private companies, creating an incentive system for institutions of higher learning that is more consistent with the strengthening of industrial innovation capabilities, continuing the dynamic reform of public R&D, restructuring the government’s innovation support structures and removing societal constraints to industrial innovation. Create a critical mass of new, innovative, technology driven firms Given the barriers faced by large (often family –owned) firms in adopting a culture of innovation, and the poor capacity of existing micro, small and medium enterprises (MSMEs),
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India’s best bet is the establishment of a new generation of organisations that is “born innovative”. Such organizations would be led by technology-savvy entrepreneurs. Many of them need to be manufacturing oriented. Even though India’s existing education system is not “ideal”, there is enough evidence that Indians can be innovative under the right conditions (for example, while working with the best companies and universities outside India!) several thousand Indian techies are employed by the world’s best companies in India and abroad. So the talent exists, we only need to create the right conditions for technology –driven new ventures to succeed. Hundreds of multinational corporations have set up R&D (primarily software development) centres in India. A major rationale given for attracting such foreign direct investment (FDI) is the technical and managerial skills that come with the investment. The benefits of such investments will be enhanced when these skills diffuse into the wider economy, and the value created by these skills is captured by entities owned by Indians. Providing support for the creation of new technology-intensive ventures would help this process and is therefore critical to moving to the next stage of capitalising on India’s FDI inflows. The most innovative companies in Indian industry, such as those in the pharmaceutical industry, are led by technocrat –entrepreneurs who combine an understanding of technology with an uncanny knack of finding and exploiting business opportunities. Hence, our best bet for leading the technological revolution is
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new or young companies who are not hamstrung by the administrative heritage of the past. Do such firms exist? Yes, but in small numbers, and unfortunately, they do not get to the required size quickly enough. Mortality among small firms is high everywhere, but in India we have another problem – companies remain at a small size, survive in a somewhat sub-optimal way, and fail to realize their potential. Therefore, to create a vibrant set of technology-based, dynamic ventures, three sets of policies are important to make starting of firms easier, reduce mortality, and facilitate growth.
In the meantime, efforts to increase the availability of funding for academic research through the newly created National Science and Engineering Foundation have made considerable progress. A legislation titled Protection and Utilization of Public Funded Intellectual Property Bill 2007 along the lines of the Bayh-Dole Act to give institutions of higher learning both the right and the duty to manage the intellectual property arising out of government – sponsored research is also at an advanced stage. But will these have a positive impact? David Mowery of the University of California who has done considerable research on the impact of the
In fact, I might go so far as to say that given India’s past over-reliance on the national laboratories, a deliberate de-emphasis of public R&D may be necessary to enhance India’s industrial innovation performance. Create new incentive system for universities & other institutions of higher education It is clear that the Indian higher education system is failing to undertake the quantity or quality of research that is necessary to provide the foundation for a modern industrial economy. To a large degree, the graduates of this system lack the knowledge, the skills and orientation to contribute substantively to industrial innovation in firms. We also noted that while India’s main rival China has made major strides in reforming its higher education system, Indian policy makers have been slow to realise that something needs to be done.
Bayh-Dole Act in the United States has pointed out that the success of this legislation has much to do with the structure and dynamics of the university system and funding systems in that country. The top universities compete with each other for the best faculty and the students. Research output is an important factor in prestige and rankings. The universities and departments with the beast ranking are in turn able to attract the best faculty and students. Faculty members are compensated handsomely and outstanding researchers can be wooed with specially designed compensation packages combined with lab infrastructure and facilities. Universities have a large cost
base and need to take on large number of federallyfunded projects so that the overhead component can cover other costs of the university. Professors who bring in large externallyfunded projects are treasured by the university presidents for the money they bring in and the research output that results. Technology that can be protected by intellectual property rights can be another source of revenue through licensing. University presidents who are successful in raising money and the prestige of the university are rewarded monetarily as well as by moving on to even more prestigious universities. It’s also worth remembering that the United States already had a high level of research output before the BayhDole Act was legislated. In contrast India is at a relatively premature stage of development. There is clearly not enough research capacity in our higher education system to effectively absorb the higher levels of funding that are being proposed for academic research. In short, neither of these initiatives will have much impact without some fundamental changes in the way our universities and institutions are governed. In recent times, the Knowledge Commission and the Yash Pal Commission have discussed reform of higher education in detail. Many of their recommendations such as replacing the UGC by a new regulatory body for higher education make a lot of sense. However, from the point of view of making the system of higher education better suited to supporting a dynamic Indian innovation system (i.e. is providing a large number of graduates with innovation supporting
knowledge and skills), I would consider the following to be priorities. Creation of well –defined sets of institutions with distinctive objectives The United States has arguably the most effective higher education system in the world. A distinctive feature of the structure of the American higher education system is the clear categorisation of institutions of higher learning. Each category- whether it be a research university or a community college – has a clear objective and aspires to meet the needs of its own stakeholders. Issues of quality and access are relatively easy to manage in such a system because the institutions designed to provide universal access are different from the institutions reaching for the pinnacle of academic and research accomplishments.
benchmarks like citation index and impact factorneed to be put in place. Only educational institutions with a consistent record of high quality research based on such external benchmarks should be give an A grade. To enhance transparency of the process, all the accreditation reports should be placed in the public domain.
exist. Most of them have been created through the deemed university route - private engineering and medical colleges that were created through the AICTE policies of encouraging the private provision of professional education have been transformed into university. However, these universities have significant quality issues.
Incentives given to universities such as special grants, creation of research centres, endowed chair professorships and the autonomy to fix higher levels of fees as well as payment of additional compensation to faculty should be linked to ratings on such modified accreditation process.
On the other hand there are several philanthropists and well endowed trusts formed by prominent industry and public figures that are willing to set up high quality universities on a non-profit basis if the regulatory framework can be made clean and transparent.
Transparent policies for the funding and management of private universities One crowning ironies of the Indian higher education system is that there is no transparent path to setting up a private university. Yet several private universities
A contemporary regulatory system for foreign universities Thousands of Indian students currently study outside India because of a lack of adequate courses in India. Foreign universities are known to be keen to set up shop in India. Some of them have already
entered even though there is no regulatory structure in place. There is a need for the government to create a transparent regulatory system that allows foreign universities to enter India, but preferably in partnerships with Indian institutions so that there is an improvement in the standards of existing institutions. The policy should seek to attract the best rather than mediocre universities by placing an emphasis on the quality and track record of the university in its home country. Create supportive societal conditions for industrial innovation Indian organisations face barriers to innovation that have their origin in Indian society and culture such as poor team work, the enduring importance of upward hierarchical progression, a brahminical attitude that gives brainwork
Better accreditation process for higher education system Several Indian universities enjoy ratings of “A” and A + from Indian accreditation agencies even though their faculty do not produce a high level of international quality research. These universities are nowhere on the map internationally. Clearly, the accreditation process is not designed to discriminate sharply between institutions or to create a path of excellence and continuous improvement. There is need to change the accreditation process to give a higher weightage to research. Clear criteria for the measurement of research quality such as ranking of journals based on internationally accepted
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a superior position over physical work, weak systems and strategic orientation( and the resulting paucity of appropriate change paradigms), low tolerance of failure , a lack of confidence in innovation capabilities coupled with a failure to positively reinforce innovation efforts, and a strong need for control that comes in the way of joint working with other organisations. India’s long term innovation prospects depend on its ability to overcome or at least mitigate these barriers. By creating a new generation of technology-driven innovative enterprises that last longer and grow rapidly, we can expect to have a set of new role models that will generate confidence in our innovation capabilities and act as a positive reinforcement to new innovation efforts. In a country with limited resources, failure was unacceptable because it signified wastage. As we grow in wealth, this aversion to failure (and, relatedly, to
experimentation) should come down. The importance of hierarchy can be expected to decline as well, as people will no longer require power to have access to resources. With increasing urbanisation, the lines drawn by the caste system (another important element contributing towards hierarchy) will hopefully be blurred as well. Teamwork and the willingness to work together need to be inculcated in early education. So do the willingness to experiment and the dignity of physical work. Unfortunately our current system of education emphasises rote learning, provides few opportunities for experimentation and team based learning and rarely promotes independent thinking. Reform at the level of school education will thus be needed to supplement the recommendations. One way to reinforce the idea that people can work in teams to overcome difficult innovation problems is to identify major national challenges and invite teams of students from all over the country to work towards solutions that address these challenges. Such solutions should be judged for their technical and managerial merit. This could ignite a competitive spirit among students, help them learn first-hand the power of working together in groups, and solve ticklish national problems. Though intellectual property protection has been strengthened by our new patent laws, a question mark remains about the extent of our commitment to intellectual property at societal level. The government and the political leaders have a role to play in upholding intellectual property rights
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through their discourse and behaviour! Important areas to practice this behaviour are in ensuring confidentiality of industrial innovation proposals submitted to the government for funding support and ensuring respect for intellectual property rights in public procurement. Lastly (and certainly not the least), industrial innovation abilities in India can’t be strengthened without a more widespread belief in the scientific method. The scientific method underlies research and all forms of systematic experimentation and exploration. Unfortunately, India remains stuck in a more unscientific paradigm of innovation, often labeled as jugaad. Jugaad (creative improvisation) is based on individual ingenuity. This individual ingenuity is displayed across sectors and contexts. The Honeybee Network (www.sristi.org/ honeybee.html) has identified thousands of creative responses by farmers and other untrained, grass root inventors to problems they faced. Indian’s, talent for jugaad is reflected in the ease with which we find our way around myriad rules and regulations posed by governmental regulation. Jugaad is not scalable because it does not have a science or engineering base. It does not have an organizational base or support. It tends to be a one-time activity with few subsequent improvements. It is not the result of an understanding of user needs spanning a wide spectrum of users. It is therefore likely to have only restricted application. Post –independence, India’s formal attempt to transcend jugaad was an institutional model that was more like that of
the Soviet Union in that it separated invention from exploitation and located the invention part of the innovation chain in specilaised government-owned and operated research and development institutions. These institutions were divorced from the market and the small inventors trying to solve their own problems. They got bogged down by the beurocratic administrative systems of the government. While this model has obviously failed; no new model has taken its place. While India’s first prime minister, Jawaharlal Nehru, had a vision of modernity that encompassed the scientific temper, later political leaders have backed the outcomes but not the spirit of scientific enquiry. They have treasured the prestige that goes with national scientific achievements such as space and missile programs, but have not put their weight behind diffusion of scientific enquiry in society. Some like Nandan Nilekani argue that change is around the corner since the new generation of Indians has grown up in a liberalized and relatively prosperous economy, and is unencumbered by the past. While this appears to be true in terms of their vision and the way they see themselves with respect to the rest of the world, it is not as clear whether this generation will transcend the limitations of the traditional Indian innovation paradigm, create new institutional structures, and foster an era of “enlightened experimentation” leading to breakthrough innovations from India. But, following the recommendations detailed here should improve the chances of such a transformation becoming a reality.
Thought Leader Interview
Acceleration, not incremental changes need of the hour
Kris Gopalakrishnan Executive Co-Chairman, Infosys Ltd.
hat’s your sense of how far we have reached in the innovation and technology space? Where do you think we are heading? The eco system for R &D and innovation has been created primarily on top of multinationals and Indian companies, especially the larger ones doing their in-house research and development, because a lot of these companies do innovation and research for their products, for their next generation of technologies. If you look at the background, let’s say HAL, DRDO, Philips, Dell, Intel, Texas Instruments and then of course the Indian companies,
the eco-system has been created around large companies. Just look at Bangalore for example, it’s like a virtual who is who in the world, everybody is present. All the way from the chip manufacturers to services, all of them are present here and a complete value chain is represented here, and they are doing very good research. Now what is missing is the linkage with academic institutions and academic institutions creating new technologies which can be then taken out to market. Missing link When you look at companies investing in R&D, they look at
a horizon of 3-5 years, they don’t look beyond that. We need the academic institution linkage to look beyond the five year period. And because risk of developing own products is higher, large companies tend to buy out a start up. Even this trend is missing or almost not there in India. However, in the last 2-3 years, especially in IT, we have had good number of start-ups. Most of them are created by people who have worked in large organizations. They are usually not breakthrough products because the academic linkage is missing in India. Now, that is our biggest challenge. We need to raise the level of research in our
academic institutions and have a vision or a goal to say that from that research we will build a company. In fact, we do some very interesting, very good research but there is no culture of taking that forward and building companies or there are very few instances of that. Are there good models for converting R&D in public institutions into marketable products? Look at the Silicon Valley, look at the eco system around MIT, there are models around Cambridge in UK. The other model is the research done by defence, they look at cutting edge technology. The only place we have done this in India is ISRO.
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This is because access was not provided to us for some technology, so we had to develop our own. Probably, in nuclear engineering as well as in space engineering we have done some cutting edge work. So the models are there, we just need to work with our academic institutions and actually create that linkage. Isn’t there a system in companies like Infosys or other private companies to go out scouting for technologies that are built in the public sector and R&D wings. Is it being done or is there a lot of resistance still? There is no resistance but there have not been too many examples. The process and the bureaucracy around that is kind of opaque at this point. It’s not very clear or transparent. Second, the Indian IT industry has been largely led by software where as many technologies that are coming out from research in space or in defence will have a combination of hardware and software. Again, there is disconnect between what the industries are focusing on and what the IT companies are focussing on. How do you think we can bridge that? What steps can be taken in the next 3-5 years? India is not a very large market for hardware products yet, though in the future it will be so because the technology penetration in our country, except for mobile, is very poor. Mobile phone technologies are amazing, where as if you look at PCs and other technologies, it’s not that high. So again, when you look at a business venturing into these areas, they will see a limited market unless the market is global and so they will probably hesitate to do that.
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There is one more constraint that Indian companies face. The minute you create a hardware product, you will have to start thinking about manufacturing and that is a challenge because of the limitations of our logistics among other things. India is one of the few countries where state to state movement of goods is limited even now. So we have to move to a GST (general sales tax) system to improve the logistics. Software companies like Infosys, TCS and HCL are beginning to focus on product development in a big way. I understand Infosys has made some head way already; can you speak about that a bit? We have focused on application products rather than system products; we are not developing another operating system or iPhone. Our focus is business
Pain points • Academic industry linkage still primitive • Culture of large company buying out start-up not there yet • Hardware manufacturing a big challenge • Closed education sector – open up to foreign universities • Not seeing sustainability as a mega opportunity for exports
application. There are innovations in developing business applications also. Finnacle is a good example of a large scale product that we have developed. And there are lots of innovations on how we are taking Finnacle to the rural areas - rural banking and how we have combined it with rural telephone. So, there are lots of innovations in developing such a product. Similarly, in the area of digital marketing, in analytics, we have a series of products now and that is an expanding portfolio. We want to get a third of our revenues in the future from products and solutions that we develop. Today, that revenue is less than 10 percent. We have a long way to go. Your new pet subject is Sustainability. How can India create an eco-system for innovation that focuses on sustainable products and applications? Clearly, we need a new model of development. If we develop the way the current developed markets have grown, we will be faced with a huge environmental disaster. We have to look for alternative energy vehicles. We need to look at higher efficiency homes, we need to look at drinking water, and we need all these at affordable costs. That’s the biggest challenge for India. Price points have to be affordable to 80-90 percent of the population. One of the best stories about our telecom is that it’s the lowest cost and highest in terms of innovation. If you are able to do it at lower costs the rest of the world could also benefit, and we create an industry that can export. I see this as a huge opportunity for India and it cuts across all aspects of our life – How we live, consume resources, how we conduct our
business, the supply chain associated with it, cuts across consumer products, every aspect of manufacturing, transportation network, and logistics. All of them will have to look at sustainability and it’s a large business opportunity for both the domestic and export markets. The biggest challenge we have is that of inertia. We know the problems, perhaps the solutions are already there, how do we bridge this gap? We have to open up the education sector. When I say education it’s all the way up to Ph.D. We need multiple models of engagement and that’s the way I see us accelerating this process. Right now, we are looking at incremental changes and incremental reforms. What is happening is that the system pushes back all the small changes we make. That’s why we are not making any progress. It’s like pushing a rock up the hill, you pause and it starts rolling backwards. We need some way to accelerate this. I believe in opening it up, allowing multiple models, allowing private universities, allowing foreign participation. There is no reason why we can’t allow foreign universities come here and start Ph.D programs. On the Indian Technology Congress, what are you expecting from it? As India looks at the future, we have to focus on creating our own innovations, our own products and our own technologies. So if the Indian Technology Congress can focus on the need for innovation, research and creating our own products, I think it will be a fantastic platform for all the stakeholders to come together and discuss this topic and identify solutions.
Ten ways to Strengthen India’s Innovation Eco-system
nnovation turns problems and inconveniences into profitable elements of a business. The mightiest of modern organizations has been built in a few short years through the power of information and the human mind. Helping to manage human imagination to develop creative solutions will be the secret of winners in the future. Innovation can be seen in every field and every sector. When the first pre-paid telephone cards were released in Japan, it was heralded as the best innovation of the year. It was an example of a simple innovation offering tremendous benefits, both to the consumer and the telephone companies. There are no limitations to the possibilities of the human mind. “Microsoft’s only factory asset is the human imagination,” wrote Frank Moody. Corporations that adopt innovation as a way of life never need to compete. Theirs is the path where no one has gone before; the path which leads to untold success.
Here are 10 ideas to create the eco system of innovation in companies. Fortune at the bottom of the pyramid "I consider constraints as a source of innovation. I believe in the 'Fortune at the bottom of the pyramid' says Ravi Venkatesan, former CEO of Microsoft India. Look at the seemingly insurmountable obstacles: The big challenge is cost. In rural schools, we have created computers with 5 mice instead of one mouse per computer which reduces the cost of access. 10 people can share a single computer and there is the additional benefit of team work. A split screen makes it easy for people to work on different problems. Many do not speak English so Windows is available in 14 languages. Let's dream, big dream. Let's go change the world. Have a high tolerance for failure. Fear, for failure discourages people from trying. Here we have no limits. People are free to explore. Curiosity has
no genetics, nationality or gender bias. India today, is focused to be the innovation capital of the world. Create Incubators for Innovation
Dr. Rekha Shetty Author of bestseller ‘Innovate Happily’ and ‘The Happiness Quotient’
who burnt all the boats and bridges once his army was on enemy territory. This meant that the commando force was infused with a do or die attitude. There was no way back. The only way was forward to victory. “The idea is first incubated in an Incubation cell. They report directly to me for 2 years. It is dismantled once their role is completed. Today, for example, the Kaya Skin Clinic is a flourishing new business. Each of my product teams identifies their innovation agenda as part of strategic planning.”
Mr. Harsh Mariwala, Chairman, Marico Industries, believes his corporate social responsibility is spreading the message of innovation as the practice of innovation can build the Nation. He believes that innovation flourishes in an open, empowering culture, a prototyping culture. “We give a new business idea to a team and empower them to implement it. We then remove the escape button”. How like the Greek leader
“We are driven by our concern for the environment and preventive natural good health.” To us, a customer is a person with constantly rising aspirations. Our suppliers are our partners in business. “We believe in orbit shifting innovation. To be acceptable, innovation should translate into cash flow. We have experienced that in our company.”
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Build the young executives system
When Mr. Ramaswamy Seshasayee, the CEO of Ashok Leyland, found that young executives in Ashok Leyland felt alienated at times by the legacy system and red tape, he came up with a comprehensive Young Executives system (YES). Championed by that redoubtable team of Shekar Arora, Director, HR and Kalpana Ganesh, they created an efficient youth organization with its own website to share ideas, sometimes directly with the CEO. They were given actual responsibility to come up with a budget. They were also involved in creating a model truck. Both tasks were concluded with massive benefits. Transform spectators into participants
Tata Steel in Jamshedpur, which, after economic liberalization, saved Rs. 700 crores merely by turning the whole population into
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participants. Mr. Muthuraman, MD speaks about their programme 'Manthan ab shop floor se', which means churning up the energies of the shop floor. ‘Every few weeks workers from different departments get together for a 3 hour meeting, with no one from management, except facilitators’. These worker driven gatherings have spawned a hundred innovations which are rewarded at the 'Innovation Exhibition'. where the workers get to talk about their work to Mr. Rattan Tata himself.
Her ideas on innovation are interesting. “One needs to be able to generate ideas, grow them and finally disengage from them when the time comes!” It reminds me of good parenting. Nurture the baby, help it grow, and finally, Let go! The last may be the toughest!
Make your product exciting to customers and employees
There are a lot of employee fun activities: the Treasure chest, Holi, Dilwalla, A bell to record a Wow! Experience, Leaders Day Out! Town Hall, Heroes Day. Employees are urged to play the lead, play to win, think beyond the possible and speed forward, together further.
Featured as one of the most powerful women in corporate India, Naina Lal Kidwai, Group General Manager and Country Head of HSBC India predictably says “Innovation is the key!” The cheerful HSBC Bank branch at Bombay’s Flora fountain, seems a hot spot for out of the box thinking. Visually, it is bright and full of activity – a real hi-fi market place. The 35, 000 strong workforces with an average age of 30, crave change and innovation. “The worst thing we can do is shut them out. They believe in themselves, they are so passionate about their ideas. They need to know where the idea is going. Just generating ideas is not enough!” says Naina.
“The New Employee Induction Roadmaps, also called the Jungle Book, helps integrate new employees into the family. Archana Chaddha a winner who has attended every convention for the 4 years except when she was expecting her baby says, “This is my family.”
Customers too can look forward to an unusual experience. The Bank is not a branch but a Mall. There are Saturday surprises which include food and ice-cream for visitors. There is a charity sale. NGOs sell their products at the Mall. All festivals call forth decoration and celebrations. There is a ‘May I help you’ desk and a special lounge to give high net worth individuals an extraordinary experience. This is presided over by a relationship manager. Focus on markets ignored by others “Empowering people is the most effective way to create profitable companies’ says Mr. Thyagarajan, legendary founder of the Shriram Group of Companies in Chennai. He brought workers into management, spent a lot of face time with them. ‘They
made it happen,’ he says. His methods are simple” • Cut out all non value added activities • Engage each one of the workers, including the contract labour, by uniting them for a common cause. The company decided to focus on truck operators whom no one wanted to deal with and considered them as financial partners. They collect no collateral. ‘We help them develop the business, because we are co-creators of value. We give truck operators a vision of themselves. We treat them with respect. We support schools for drivers. We support AIDS prevention with the Melinda and Bill Gates Foundation. We try to deal with their total credit needs. We are rewarded with total loyalty!’ The company’s volume of business is Rs.27,000 crores. They have 1,000 offices dealing with all areas of finance. ‘We have an emotional bond with 20 lakh customers over the years.’ Be a good corporate citizen Yes Banks CEO, Rana Kapoor’s focus is on Knowledge Banking. Industries have financial products created by industry experts. An agricultural expert with core knowledge of the field helps the Bank create financial products for this core sector. The whole banking process has an unusual sustainability model, with the business focus being people, planet and profit, instead of profit, profit, profit. The Bank believes in Responsible Banking. Their model for sustainable investment banking has resulted in the creation of a bank for the
poor. Their motto People, Planet and Profits, rather than profits alone! Do not benchmark: Be the benchmark A start up with five people and an investment of Rs.10,000, Infosys is now a US$3 billion company with 90, 000 people. Mr. Gopalakrishnan, Executive co-chairman, Infosys , has the peaceful air of the corporate yogi. ‘Infosys needs to innovate to meet the needs of the new emerging markets in our own backyard - India and China, with two billion people whose rising expectations have to be met. Products have to be created for this market. We can leapfrog over the mistakes of the developed, mature economies. We can start on a much higher platform, without repeating the mistakes they have made!’ The barriers to innovation? ‘Indians are content with small improvements. They are afraid to think global or about the quantum changes that innovation is all about. We are restricted by the modesty of our dreams. The poverty of our aspirations. It is this lack of confidence that stands in the way of our becoming a world power’, says Kris. He echoes the words of the German CEO of the Indian business in Alcatel. ‘Indian engineers do not have the confidence to differ with their European clients, to go beyond the brief to question status quo. That is why their products lack the originality which only confident dissent can create’. Simplicity is key The usual tendency is to always move towards greater technological complexity. However, the Kirloskars used simpler methods and technologies and replaced
multi-nationals. Originally the Kirloskars were buyers of outdated technology from multinationals, two decades later they are today one of the most successful players in a global survival area – water management. With a company that started in 1888, they are now stars on the Indian corporate scene. Today they hold the key to food security by providing pump sets for water irrigation projects across the world. Replacing metal pumps with practically unbreakable concrete pumps they have created systems that would last forever. To illustrate their contribution to the complete agricultural operations of a country, the youngest of the clan, Alok Kirloskar, recalls ‘six years ago the rice economy in Laos was bad. In comparison, with a unique system of pump sets mounted on boats, Laos had a surplus of rice in 2005-2006.’
Slimmer than the best – the competitive edge ‘It cannot be done!’ said the Swiss watch makers. In the watch industry, the Swiss are the ultimate court of appeal. The way the Titan Edge, the world’s slimmest water resistant watch was produced, is a lesson in persistent and patient problem solving innovations. It was an example of an Indian company’s refusal to give up. What were the challenges? 1. To instill self confidence in the team. 2. Ensure buy-in from key people. 3. The engineering challenge. When everyone heard that the Swiss could not-do it, the virus of self doubt was rampant. This was overcome by the infectious confidence of top management.
Watch manufacturers in the past had been copycats. Since the 1950s, Indian companies had never manufactured a watch all by themselves. Titan attempted this from 1992. The Edge was an answer to the reigning lifestyle mantra, verbalized by a famous Hollywood queen who said ‘You cannot be too rich or too thin!’ It was a close collaboration between manufacturing, technology and research. Marketing took three years to embrace it. Between movements, cases and assembly, the challenge was to create a delicate watch, which was tough enough for the challenges of daily wear. It is one of India’s major product innovation, putting us on the world map! These 10 ideas can create an eco-system and a culture that can make innovation thrive in India.
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Innovation battle – Engineering vs. Marketing by Braden Kelley
hat are the roadblocks and critical relationships between marketing and engineering in the cause of advancing innovation? So in the future, with the problem at hand, you might want to ask yourself – “Is the problem best solved by changes to the real value, redefining the intrinsic value provided, or a bit of both?” Of course it is very hard for people to ask these questions
Build a Fortress You build complex written rules of engagement for your department, saying that it has to be this way because you’re too busy and these rules will help you tobe more organized. Omission You take the inputs but then you don’t do anything with them (marketing doesn’t promote a feature, or engineering doesn’t fully develop it. The biggest danger to the cause of advancing innovation when it comes to the engineering and marketing departments is that the relationship develops into one without constructive conflict and without healthy collaboration. For innovation to be repeatable in an organization these two sides must share openly, have their perspectives valued, and contribute to a conversation. Marketing and engineering hear different aspects of the voice of the customer in their interactions with them, and they approach solutions to problems in different ways.
honestly as they have a default response, but asking them in a crossfunctional environment may yield a more holistic and informed response. And after all, many of the barriers that people tend to erect in the achievement of something are often because they didn’t feel involved in the decisionmaking process. So, what are some of the barriers that people erect in a sometimes tension-filled environment?
Isolation You just avoid communicating with the other side as much as possible. Stonewall You just do what you would do anyways and ignore the input from the other side. Passive Aggression You consciously choose to behave in a way that will cause the effort to fail, so that ideally you get your way instead.
I would even argue that there is probably no more important set of crossfunctional relationships than those between marketing and engineering, and that their health will determine the future success or failure of the organization. The executive team should consciously monitor the health of these relationships, because when they start pulling in opposite directions, the entire organization could be ripped apart. What directions are these two functions pulling in your organization? www. innovationexcellence.com
July 2013 | TIP
The power of stillness
Head of Bell Labs India, shares his random thoughts on what is influencing innovation today at EmTech India 2012
inety nine percent of the innovation these days is exploiting an existing platform. You leverage the platform and you add that extra thing that can be worth a lot of money. So, my belief about the future of innovation, not just in the online space but also in other spaces, will depend on how you make use of and exploit huge platforms and focus on the incremental value that you bring and leverage the entire strength of the platform.
What we have done at Bell Labs is essentially taken this base station and shrunk it into the size of a rubix cube TIP | July 2013
We have become very good consumers of information and new innovations don’t come from consumers if you are always in the consumption mode. At some point you got to stop and say ‘enough of this information, you have got to internalize, let me think and come up with something new.’ A lot of people ask me how you come up with new ideas. Ideas coming
out of brainstorming or with gathering lots of information and churning it away or applying lateral thinking techniques. These are the ways of the past. The new method is what India has been preaching for centuries - tell people how to slow down. Stop talking, stop reading, calm down, sit and think - that’s how the ideas are going to come. Most brilliant ideas in the world have come by contemplating and not just by constantly reading things. I think people will discover there is power of stillness. Steve Jobs was a huge believer in meditation, and taking time off to sit quietly and think to tap into inner creativity is important. What we innovated before were products that looked reasonably good, with great functionality. So, in the past what people innovated was all about price, functionality and utility but then when you come into the iPhone
world, today it’s not just about functionality, it’s about design. They pay a lot more for design. So what is it going to be in the future, it’s not about utility, price or the beauty of it, it is important to have all these but you should also have sustainability. Democratization of education, where if I am an expert in electric vehicle design, I don’t need to be at a university teaching, I can be at home and running a class over Skype and if I have talent, people will pay for it . So if you look at how companies are hiring people these days, IT folks, it’s not anymore about whether you are from an IIT. So, suddenly everything has become democratized, where it’s only talent that matters, it doesn’t matter what the pedigree is. I think we are going towards a highly personalized world where cars, phones, services, everything is going to be designed for the individual.
Reverse Innovation Is India ready?
hen reverse engineering hit industries in the 1990s, there was tumult. It took the manufacturing sector nearly two decades to avail of its immense benefits. There was churn. Now, it appears to be the turn of ‘Reverse Innovation’. This could be a game changer and its impact is global. Reverse innovation simply means that large organizations seeking growth in emerging markets will invest in innovating products and services there
and take them to the global market place. The same could apply to big emerging market companies like the Tatas who, after acquiring or developing products in the developed markets could introduce them in the emerging markets. While this trend was recognized and reported in 2009 by Tuck School Profession Vijay Govindarajan while he was consulting with GE, it is now assuming a fully blown discussion. He, along with his colleague Chris Trimble, released a book with
the title ‘Reverse Innovation’ early 2012. Here’s the synopsis: When it comes to innovation, the gap between the developed world and the developing world is closing. Understanding this fact—and knowing how to “reverse innovate” to stay in front of global demand-is critical for any business with growth in its future. Enter Reverse Innovation, an important book that helps leaders and senior managers understand what it means to
develop in emerging markets first, instead of scaling down rich world products, to unlock a world of business opportunity. Written by Vijay Govindarajan and Chris Trimble of the Tuck School of Business at Dartmouth, Reverse Innovation provides a needed next step for organizations looking to derive long-term value from emerging markets. The book highlights strategies from some of the world’s leading companies (General Electric, Deere & Company, Procter & Gamble, PepsiCo) that emphasize innovations
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have interest in the needs and opportunities in the developing world in order to thrive in tomorrow’s global marketplace. The new reality is that the future is far from home. Whether you are a CEO, financier, strategist, marketer, scientist, engineer, national policymaker, or even a student forming a career aspiration, reverse innovation is a phenomenon you need to understand. This book will help get you there. Here, the authors summarize the most crucial recommendations of the book.
Strategy 1. To capture growth in emerging markets, you must innovate, not simply export. 2. Leverage opportunities to move emerging market innovations to other parts of the world: to other poor countries, to marginalized markets in rich countries, and, eventually, to mainstream markets in rich countries.
that “flow uphill” - that is, successes that were adopted in the developing world first. In the past, reverse innovations have been the rare exception to the rule, but the phenomenon is becoming ever more common, and the implications for multinationals are profound. In particular, thanks to the rise of reverse innovation: 1. You must innovate, not simply export, if you want to capture the mammoth growth opportunities in the developing world.
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2. The stakes in emerging economies are global, not local. Passing up an opportunity in the developing world today may invite formidable new competition in your home markets tomorrow. 3. Legacy multinationals must rethink their dominant organizational logic if they are to win in an era of reverse innovation. There is no one industry that needs to reverse innovate; instead, all industries must
3. Keep so-called emerging giants on your radar screen. These small but rapidly growing companies, headquartered in the developing world, have global aspirations that could one day threaten your own.
Global Organization 1. Move people, power, and money to where the growth is - the developing world. 2. Create a reverse innovation mindset
throughout the corporation. Put the spotlight on emerging markets through the use of expatriate assignments, immersion experiences, corporate events that are held in emerging markets, creative board appointments, and highly visible CEO actions. 3. Create separate business scorecards for developing nations with full income statements and an emphasis on growth metrics.
Project Organization 1. Commission Local Growth Teams (LGTs) with full business capabilities for each reverse-innovation opportunity. LGTs should act like brand new companies:
• They must conduct clean-slate needs assessments
• They must develop clean-slate solutions
• They must practice clean-slate organizational design
2. Enable LGTs to leverage your company’s global resource base through carefully managed partnerships. 3. Reverse innovation initiatives must be managed as disciplined experiments, with a focus on resolving critical unknowns quickly and inexpensively.
To see toolkit, go to http:// www.tuck.dartmouth.edu/ uploads/people/vg/vgreverse-innov-toolkit.pdf
Change the game
EduNext Anand Sudarshan, Former MD & CEO of Manipal Education Services
oday, one can successfully take advantage of the enormous opportunity that is there in the market place from the masses. Also an important point to consider is, if the starting point is idea to personal wealth in the shortest possible time, and if that’s the fundamental construct of business, then benefiting masses profitably is probably an area you shouldn’t be in, because this is going to be a long haul. To benefit from the masses profitably I think the masses first have to benefit, and for that to happen, we have to start looking at them as consumers. Six years back, Manipal Global Education, was about 30,000 students who wanted to pursue long distance education. Today, we have around 350,000 registered students - a tenfold growth. We have an alumni base of about 400,000 and every year we have roughly around 120140 thousand joining in and graduating. So, it’s basically a wide spread education entity. By any stretch of imagination, in the higher education sector,
these are large numbers. We have today 350, 000. The ability to scale an operation in terms of numbers from about 30,000 in 6 years and knocking at the doors to becoming the largest, the top 20 world wide. In some point in time we will be able to service more. That’s the growth spectrum that we are looking at. It’s currently growing at about close to 20 percent students with diversity of programs from about 25 programs to 60 now. I believe one of the fundamental reasons behind this transformation is because
We took a decision 5 years ago that technology is the only way we will be able to truly scale the business and started investing in building technology architecture to deliver education
we took a decision 5 years ago that technology is the only way we will be able to truly scale the business and started investing in building technology architecture to deliver education. Today, we have built a platform called Edunext. About 200,000 students are already started using it. The number is going up by around 50 percent and the platform went live about 18 months ago. Mass does not mean cheap. People have discerning sense of value and are willing to pay for it. Compared to our competition, we are 30 percent more expensive but we are the largest. Our growth rate is three times our nearest competitor. Out of the 626 districts that are there in India we have 850 learning centres in about 300 districts which means less than 50%. In less than 50 percent of the footprint of the country, we have been able to establish a rapidly scalable business which has got the characteristics, the foundation elements for growing much larger than what it is today at a price point that is 30 percent higher than the completion. Think Scale So if you think about wanting to do business with the masses you have to think scale. For example, take Datawind, 3.6 million people have reached out for the Akaash tablet. That’s scale and their numbers are
going to go far. From one factory they will set up five more factories. That’s the conceptual difference between doing business otherwise and doing business for the masses. You have to start with providing propositions that are going to provide values and is sustainable and be able to provide it to more and more people. The first assumption that we always make when we work with the masses is that - we have to be cheaper. You don’t have to be cheaper but you have to provide the value at a price point that the consumers will be willing to pay especially in services. Are you able to provide value in a sustained consistent way? Second lesson is that it’s important to look at the masses as a consumer segment that needs to be benefited; we will realize eventually that we are more profitable. We are realizing that the model that we have created benefits the masses elsewhere also. Thirdly, when you want to deal in this segment, you have to be able to identify the right kind of investor. The right kind is one who has tremendous amount of patience, if you have the patience not to look for personal returns quickly and you are able to identify somebody who can support you, who will be able to be patient with you in this journey, then you recognize value delivery on a consistent basis, you would have identified the right formula to benefit masses in a profitable way. You do good work, you feel good and you make good money. Excerpts from his presentation at IIMB recently
July 2013 | TIP
Change the Game
Power from football
new football that captures energy created when it is kicked and transforms it later into electricity, is all set to help provide a power solution for developing countries.
Named as the Soccket, the revolutionary ball builds up enough energy to power a light for three hours from just 30 minutes of play.
Named as the Soccket, the revolutionary ball builds up enough energy to power a light for three hours from just 30 minutes of play. The invention is made from materials found in developing countries and costs only slightly more than a normal high end ball to produce. It is the brainchild of Harvard students Jessica Lin, Julia Silverman, Jessica Matthews, Hemali Thakkaras and Aviva Presser. "It's an off-grid solution that gives us a way to bring power and improved quality of life, working capacity and learning capacity. The idea combines football, the world's most popular sport, with the huge need for electricity in developing countries - a staggering one in five people around the globe are without power. The ball, whose trial was held in South Africa, is waterproof, durable and doesn't need to be inflated. It uses inductive coil technology, which involves having a metal coil and magnetic slug that goes forwards and backwards. Silverman and Matthews have gone on to develop the mass-produced version of the ball through their own non-profit company Unchartered Play. In many developing countries, reliance on kerosene lamps has led to numerous health problems. The World Bank estimates that breathing the fumes created from burning kerosene indoors equates to the harmful effect of smoking two packs of cigarettes a day. The special ball can currently be used with an ac adaptor but the designers hope this will be expanded in the future to enable other products to be charged by it. Their initial inspiration came from hi-tech dance floors, which can capture energy from dancers' movements. Soccket, the founders think, has a huge market for safe, sustainable and immediate power access.
TIP | July 2013
igital Green builds and deploys information and communication technology to amplify the effectiveness of development efforts around the world to affect sustained, social change. The Digital Green system combines technology and social organization to improve the cost-effectiveness and broaden the community participation of existing agricultural extension systems. The unique components of the Digital Green system include (1) a participatory process for local video production, (2) a human-mediated instruction model for video dissemination and training, (3) a hardware and software technology platform for exchanging data in areas with limited Internet and electrical grid connectivity, and (4) an iterative model to progressively better address
the needs and interests of the community with analytical tools and interactive phonebased feedback channels. Unlike some systems that expect information or communication technology alone to deliver useful knowledge to farmers, Digital Green works with existing, people-based extension systems and aims to amplify their effectiveness. While video provides a point of focus, it is people and social dynamics that ultimately make Digital Green work. Local social networks are tapped to connect farmers with experts; the thrill of appearing "on TV" motivates farmers; and homophily is exploited to minimize the distance between teacher and learner. The Digital Green system combines technology
and social organization to maximize the potential of building the capacity of farmers on improved, sustainable agriculture and allied livelihood interventions. The videos that are produced by farmers, of farmers, and for farmers across our field locations are periodically synchronized with our global library of videos on our website. Data associated with the videos, including their reach, the feedback of viewers, and the ultimate take up of the featured practices or techniques, is also aggregated and analyzed in near real-time on our analytics dashboards. These analytics dashboards are built upon an data management framework, called COCO, which allows even remote areas with limited Internet and electrical connectivity to exchange data with the world.
abajob.com is a job website and mobile portal dedicated to connecting informal sector workers – cooks, maids, drivers, guards, etc.- and employers within India and eventually worldwide. It is based on the simple idea that everyone deserves to get a better job even if you work in another’s home and can’t read English. The aim is to ultimately make the informal labor market worldwide more efficient by aggregating 100,000s of jobs and millions of job seekers, appropriately matching them based on proximity, price, and social connections (via the social networking site babalife.com as well as others) and then pushing these matched connections to both parties via the web and mobile phones (voice, SMS, UssD, etc).
spiring Minds is an employability assessment company that brings credible and genuine assessment to various aspects of education, training, and employment. It strives to help institutions and
companies choose the ‘right’ individual rather than the ‘best’ individual. Aspiring Minds’s Computer Adaptive Test (AMCAT), the company’s flagship product, provides standardized employability benchmarks to students and
enables employers to evaluate students for effective job placement. The company uses proprietary technology in AMCAT, statistical benchmarking, and jobmatching algorithms.
July 2013 | TIP
E farm O
ne of the key problems for Indian farmers is the marketing of their produce to end consumers. It often goes through several middlemen, in very inefficient manner, which contributes to over 40% of wastage. Also, most farmers being less educated, lack proper planning and market inputs to properly plan their cultivation. Often the decision on what to grow, when to harvest are all based on adhoc decisions rather than a well planned approach. The end consumers are often hit by huge variations in prices and quality and availability, that food security is one of the biggest problems facing our nation today. Though several modern retailers have been operational for over a decade, owing to a combination of factors such as high operational costs, localized presence in metros, and low margins have forced even many large chains to shut operations. There is hence a critical need for an efficient, low cost agri supply chain mechanism to connect farmers with the
end markets. eFarm is a young social enterprise firm based in Chennai . efarm is India’s first end-to-end agri supply chain platform , providing a combination of technology solutions and on-ground distribution mechanism to enable farmers reach end markets in an effective manner. eFarm ties in farmers, intermediaries, logistics providers, distributors, small time retailers, all the way up to your local road side vendor into a single chain backed up best of breed information systems to deliver fresh, clean, low priced farm produce. In simple words we are a ’hi-tech’ subjiwallah’ connecting farmers, business consumers and intermediaries (such as transport operators, storage providers etc) using a more organized supply chain mechanism. eFarm’s solution takes a more holistic approach , addressing the key needs and pain points of all stakeholders in the agri supply chain - farmers, transporters , intermediaries end consumers - to evolve a sustainable , transparent
and efficient new distribution mechanism. It operates in the B2B space and serves bulk consumers of agri produce such as hotels, caterers, retail chains, food processing industries and vegetable vendors, and also runs a retail outlet for the Indian army. eFarm’s solution is based on following key strategies: • Develop a IT based backbone for data gathering, analysis ,planning and monitoring the entire operation • Setup low cost collection centers close to villages in partnership with farmers
for organized collection and grading • Setup distribution centers in metros , close to customer location , for final delivery • Train intermediaries like transport operators in proper handling of perishables to reduce transit wastage • Map the demand and supply and ensure just in time distribution eFarm is currently operational in Chennai and sources from over 1500 farmers in surrounding areas of Tamilnadu.
he DesiCrew story is of a rural BPO pioneering a new vision for stimulating inclusive growth in India. With a decentralized business model providing competitive outsourcing solutions to clients and meaningful employment opportunities, we have established a technology driven, profit making social enterprise. The DesiCrew rural delivery model is a network of micro-
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centres strategically selected across rural and semi-urban locations. Each centre is professionally run with a 25 seat facility working in 2 shifts to provide back-end services to global clients. Locations of the micro-centres are identified in those territories with a population in the range of 10 to 100 thousand. The workforce manning these centres is built up by training the educated but under
employed. The benefits of this model include: 1. Creation of computer based/knowledge related jobs in communities where there are no similar jobs. 2. Lower attrition rates for the industry, as people are less
inclined to leave their jobs given the improved quality of life and option of staying with their families. 3. Lower costs for clients as overheads at these centres are far cheaper as compared to the urban counterparts.
Social Entrepreneurship - Rural Shore
Technology helps rural BPOs shine
Ganesh Rengaswamy, Partner, Lok Capital, talks on the challenges and lessons of running a rural BPO for the last seven years at a recent conference on ‘Benefiting the Masses Profitably – An Opportunity for Indian Technology Industry’ at IIM Bangalore Venture Capitalists’ experience in investing is social businesses don’t know the answers yet. I have been in the VC business for the last seven years. What I can tell you is how we approach it. I used to be a VC in Silicon Valley and have the benefit of comparing and contrasting and why I do what I do at Lok. There are certain opportunities around which you can create a model, which incidentally can be for profit.
If you are talking about basic education or healthcare or basic financial services or livelihood opportunities whether for urban poor or rural, models can be created and the profit here is largely used towards building sustainable businesses. To use a micro finance example, it started off with the right intent and we saw investors coming in, even those with commercial interest. All of them came because they liked the model. But once
they came in they were trying hard to change the model because the profit wasn’t good enough. There is a fine distinction between the nature of capital, the intent with which you provide that capital and how firmly you are driving it. I think it’s still a grey area. One of the things that we try to emphasize is the customer satisfaction approach and actually merge social and business intent in each enterprise so that you don’t treat social as a byproduct. We always come back to saying it starts with the people and ends with them. In our case, it’s more important because the social alignment stuff we talk about is a very ambiguous thing and no one has the right answers. It takes significant engagement between the entrepreneurs and investors to get to an understanding where both are coming from. That’s why we tell companies not to rush into the process
because it’s pretty much like marriage - you can get a divorce but a divorce here can be pretty messy. So the reality is both parties should get into a relationship after a lot of deliberation, it takes effort to understand the whole social motivation alignment, inclination and your philosophy – what you think you are going to do to make a difference which takes a lot more time. It takes a lot more time evaluating opportunities and enterprises in this segment than in the technology field. We place a lot more emphasis on distribution as we know the last mile especially when it comes to reaching the target segment – we spend a lot of time on ascertaining how we do distribution in a cost effective manner. Clearly, as an investor, we would like to figure out how you can exit this opportunity because we have a finite life fund and even though we have patience of 5-7 years.
At the end of this we have to see how viable this organization will be. Even though we don’t look for the same kind of returns as in commercial deals, it still needs to be a viable entity. Experience with Rural Shores One of the companies that I worked with closely is Rural Shores. They are based in Bangalore, a BPO company. If you look at several lower end BPO employees they come from semi-urban and rural areas and try to make a living here. The inspiration for the idea came from the fact that the CEO and other 32 founders actually realized how much of a constant struggle it was to get good talent and to retain them and to deliver. Instead of coming from rural to urban area to work, they decided to actually take their business to the rural areas. Rural Shores essentially has only rural centers and employ from those communities. They have a center in Tirthahalli, a few a kilometers from Shimoga in Karnataka. They have a center in Chand in MP; in Bagepalli which is 2 hours from Bangalore, Nagerkoil in Tamil Nadu. The tough part was to convince large corporates and clients to give business. Our clients include Airtel, IDBI, HDFC, WNS, First Source, Infosys, and Wipro. So the biggest success is we have been able to prove that this can be done with the same quality as in urban centres or better quality in these places. Another derivative we are working on is how to bring other services to these villagers because the Rural Shores center holds a prominent location in these villages so you can also use these centers for trying to provide other services. Other service providers and business
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The challenge is most social enterprises are not started by people who are tech savvy so a lot of times things get out of control before you can really put the right kind of technology framework system in place enabled providers are approaching us. Everything can’t be captured in a metric, but that is what keeps you going, not just the metrics, yes somewhere it’s probably making a change. Now the whole drive is how you can make this change in a structured way at scale and that is always hard. Bringing technology to the masses The initial hypothesis was that we will have a very hard time having good connectivity, slowly that is not the issue. The issue is logistics for bringing connectivity to a center. In several cases we have fall back options, uptime is a big filter criteria. In the foreseeable future we will not be saying we are out of locations because
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of connectivity, there are probably 5000 locations where we can do this today. Profitability Unfortunately, we don’t have a buffer in life. We are fortunate that we have likeminded people who think this model of development for profit is possible. We also have people coming from the corporate world saying that ‘I have reached a point where I want to do this and whether we can make a difference.’ Thankfully, we are able to seek more of these entrepreneurs. We have a separate portfolio management team which works on specific opportunities of the companies. Understanding the customer, customer acquisition and distribution, operational efficiency, are key to any social enterprise. We not only help at strategy level, board level, but sometimes when deeper engagement is needed we actually bring in special teams either internally or from our network, so that is very key to what we do. Also, figuring out the symbiosis between business and social side, we are trying to balance both, so this is something that goes into each debate. You have to work at it; there is no easy answer. Of course, making sure the company doesn’t run out of capital whether its debt or equity, business
development efforts, product development, all this is at the board and strategic level. Equally more important is what we do at the portfolio management level, we want to make a significant difference, and that is why we say we will work with lesser number of portfolio companies. We will probably won’t do more than 12-14 investments each might mean Rs. 20-25 crores kind of range. It’s very hard to work with 50 companies. Technology Rural Shores is using cloud which was not possible three years ago. In terms of where we see real opportunities with technology as a game changer, I think the number one is understanding your customer better, having a robust system. The kind of technology interventions we are seeing, especially in healthcare and education, can bring services to people who would never be able to experience these services. Whether we debate about telemedicine or education, but all this might not have reached scale today but the point is they do have an ability to make these services available to people who would never have had that opportunity. The third is the operational process and system efficiency that have the ability to understand data well and the kind of decisions that help the company is phenomenal. The challenge is most social enterprises are not started by people who are tech savvy so a lot of times things get out of control before you can really put the right kind of technology framework system in place and that is a challenge we always see. It could delay the process but those are probably the broad areas where we see technology interventions happening.
About the author
Ganesh joined Lok Capital in 2010. Ganesh was cofounder of Travelguru (now a Travelocity company), the leading online travel company for hotels and vacations in India and South Asia. Ganesh holds a Bachelor’s degree in engineering from IT-BHU/ IIT Variance, MBA from Harvard Business School, and a graduate degree in finance and systems strategy from IIM-Collate. About Lok Capital The Lok Capital initiative was launched at the end of 2000 with the support of a grant from the Rockefeller Foundation. Lok Capital means People’s Capital. Lok Capital defines itself as a hands-on financial investor with social performance goals and standards, dedicated to promoting financial and social inclusion through all its activities. Lok Capital manages two Bop funds with over $85mn under management. The funds are the central entity of the Lok group structure. Lok Foundation, the charitable trust at the heart of Lok Capital, was set up in 2003 to promote financial and social inclusion, principally in India by means of targeted grants, technical support, research and advocacy.
SME friendly initiatives S.M. Jamkhandi
Director, MSME-Development Institute, on building innovation eco-system in the SME sector
hat is the new thinking in the Department of Small industries about the state of the SMEs in India today - both economically and technologically? The Indian SMEs today contribute almost 40-45% of India’s GDP and almost half of the engineering exports are from the SME sector. Their contribution has increased massively and many of the SMEs are technologically so advanced that they can be compared with the SMEs of the West. Secondly, it is the biggest employment generating sector in the country after agriculture. What is the department doing to address the issue of technology obsolescence among SMEs? How should the present schemes be tweaked to make them more effective? The Ministry of MSMEs has been specially created to see that the sector gets specific importance in terms of both finance and technology. One of the first objectives was for all public sector banks to target a minimum of 20% of the credit flow to go into SMEs. This is being monitored on a continuous basis, and I am glad to tell you that many of the public sector banks have exceeded this target. Secondly, the ministry is quite aware that SMEs have grown from a very
small area to a dominant position. We have WTO and the Free Trade Agreement with various countries and this will result in competition which would make Indian SMEs globally competitive. With this in mind, the Government of India has already planned and executed a new program called National Manufacturing Competitiveness Programme (NMCP). It assists the SME sector right from incubating an idea or a business process to marketing the product at international exhibitions. It addresses the issues of the SME sector at various critical phases in its maturity process like technological upgradation of its manufacturing process, purchase of latest machinery, energy efficiency, marketing and packaging. In all the critical phases, technical as well as financial assistance are available to the SME sector. This way the government is trying to eliminate technological obsolescence that exists in certain sectors of the SMEs. I’m also happy to add that there are a large number of SMEs in India that are technologically very advanced. Many SMEs participated in Chandrayana Mission providing critical components and technologies and even developed software to monitor the mission modules.
What is the Department doing to improve the eco-system for innovation among the SMEs? One of the major factors affecting the SME sector is finance. We have instructed all the public sector banks to see that 20% of credit flow goes to the SME sector. Also the NMCP program helps the SME sector to improve, they are now in a stage where they are not only dominating the Indian industry but should continue to do so. The NMCP program helps the SMEs sector either as a unit or as a cluster to become globally competitive. The environment for the SME sector is continuously improving. The State governments have taken proactive steps; organizations like KIADB and KSSIDC are really a boon to this sector. If the SMEs have the passion to grow the ecosystem will help them further. What is the Department's vision for SMEs by 2020? The SME sector’s contribution in terms of GDP will continue to increase and by 2020 it will cross 60-65% of GDP. Engineering exports today are already at 45%. I think they will cross 60% and the credit will be taken by the SMEs sector. This will catapult the Indian industry to a prominent role could become the largest employment creator beating agriculture by 2020.
July 2013 | TIP
Keeping India alert The Ministry of Earth Sciences (MoES) plays a very important role as it creates a framework encompassing national programs in ocean science, meteorology, environmental science and seismology. In an interview to TIP, Dr. Shailesh Nayak, Secretary to the Government of India, Ministry of Earth Sciences talks about the impact his department is making on the lives of Indians How has your ministry created an innovative ecosystem so far? The innovation ecosystem is in-built in the programs which is reflective of the innovative framework that the Ministry is supporting. The establishment of stateof-the art Tsunami Early Warning System, catering to Indian Ocean is one such example. This system is capable of acquiring seismic data throughout the world in near real time, process it to generate earthquake parameters, assess its tsunamigenic potential, simulate travel time and non-height, analyze sea level data to confirm tsunami and generate advisory and disseminate through web as-well as location-based services to all concerned within minutes. This was possible due to innovative use of GIS, computing and communication technologies. The Potential Fishing Zone Advisories generated thrice a week utilizing satellite data for fishermen communities for the country has helped save time and fuel cost. Most fishermen are using this advisory. As per the study of the National Council of Applied Economic Research (NCAER), the benefit to GDP is Rs. 34,000 crores. Agrometeorological advisories provide information on maximum and minimum
temperature, wind, rainfall, humidity and cloudiness for five days and crop-specific agriculture advisories to farmers. NCAER study reported that 24% farmers are using this service including 3 million farmers through mobile services. The benefit to GDP is Rs. 50,000 crores. Low Temperature Thermal Desalination (LTTD) plants uses temperature gradient existing between the sea surface and the deep sea water to desalinate water. Three plants have been commissioned in Lakshadweep Islands at Kavaratti, Minicoy and Agatti each with a capacity of generating 100,000 liters of freshwater every day and serving the local population. This has also significantly reduced the incidences of water borne diseases. What five significant steps you suggest to make this system more dynamic in the next 5 years? We believe that the synergies among various disciplines contribute significantly to the innovative output and accordingly, we need to promote such experiments. The focus should be on encouraging creativity. The projects are to be executed in a mission mode. Team building to execute such projects is another area. We
need to motivate them for high quality output. Data and information forms the backbone in this era of information technology. We need to organize observational data through GIS. Data Centres for ocean, weather and climate, living and non-living resources, cryosphere and geosphere are being built. Computational and processing facilities are basic to the needs of earth system sciences, so high performance computing systems are required for improving forecast for weather, climate and other hazards. We believe that trained and skilled manpower form the backbone of innovative research and development. We need to attract the best talent in science and technology, and adequate
We need to attract the best talent in science and technology, and adequate incentives need to be provided in terms of career and promotional avenues
incentives need to be provided in terms of career and promotional avenues. We have started a training school in Earth System Sciences in Pune. What according to you still needs to be done â€“ policy wise â€“ and also from the industry side to create a stronger eco-system for innovation in earth sciences. We need governance structure which promotes diversity and out-of-box thinking. We need to have an environment where freedom of thought is promoted. Is funding the main constraint and what the government is supporting enough â€“ what can be done to make funds easily and in good measure available for innovation. Funding is an essential prerequisite and sufficient funding is available. Since Earth Sciences is a wider and complex subject, how can India make a stride? Yes, we have already made major impact in developing services for hazards such as tsunami, cyclone etc. The weather forecast, especially short-term forecast, is substantially improved which lead to improved weather services to society, farmers and aviation.
July 2013 | TIP
National Design & Research Forum
For more information visit
www.ndrf.res.in Phone: 080-22264336 Tele Fax: 080-22352193, Email : email@example.com, firstname.lastname@example.org
National Design and Research Forum The Institution of Engineers (India), #3, Dr. B.R. Ambedkar Veedhi, Bangalore - 560 001.
Sustainability is the Foundation of Innovation & Technology Development
President, Institution of Engineers (India)
Late Prof. C.K. Prahalad said, “Four billion people want to be part of The global marketplace - this will have a profound impact on sustainability.”
hat this statement implies are – if four billion people aspire to have even one tenth the quality of life as the rich have today, we will need a few more Planet Earth. So, the challenge facing humanity today is – you cannot deny the poor a decent lifestyle as economic growth brings them into the mainstream. At the same time, you cannot allow the Earth to turn into a cesspool of environmental degradation. It doesn’t help even if the rich reduce their conspicuous consumption by small percentages. The only solution to this conundrum facing us is discovery and invention of game-changing technologies that balance both. However, it may even be too late for balancing the needs of both the poor and the rich, yet we have no choice. It is therefore clear that only powerful technology supported by aggressive government policy, a vibrant eco-system involving dynamic entrepreneurs, government funding and private capital can result in sustainable development and growth of not only India but the world.
So, let us see what kind of technologies that could achieve this objective with focus on Indian technologies. An alternative to fossil fuel will be the most impactful technology that the world will be grateful to. Hydrogen technology already exists but is held up due to cost factor. Reliance Industries is investing in technology to make fossil fuel from algae. The most recent technology breakthrough coming from India is a new variety of bamboo developed by Hosurbased Growmore BioTech. The bamboo named Beema Bamboo, is promising to transform India’s renewable energy sector, provide environment-friendly wood for the paper industry and also help reclaim lost forest cover in two years. Unlike other biomass based power options which require thousands of acres of trees to generate one mega watt of power, Beema Bamboo requires only 200 acres. It is a wonder bamboo which can help paper industry’s dependence on plantation of trees. The bamboo has high appetite for consuming carbon-di-oxide thereby making the area rich in oxygen.
Alcatel-Lucent’s Bangalore R& D centre announced recently the launch of Light Radio, a breakthrough in mobile and broadband infrastructure that streamlines and radically simplifies mobile networks. Pioneered by Bell Labs, Alcatel-Lucent’s unique research and development arm, the new Light Radio system will dramatically reduce technical complexity and contain power consumption and other operating costs in the face of sharp traffic growth. This is accomplished by taking today’s base stations and massive cell site towers, typically the most expensive, power hungry, and difficult to maintain elements in the network, and radically shrinking and simplifying them. Bell Labs research estimates that base stations globally emit roughly 18,000,000 metric tons of CO2 per year). Also, Light Radio provides an alternative to today’s jungle of large overcrowded cell site towers by enabling small antennas anywhere. Prof. Stuart Hart, currently the world’s most renowned
sustainability guru says technology to solve a lot of our problems is already here. “We’re talking about technologies which are sitting and doing nothing at places like Cornell, for instance. These are disruptive technologies that the corporates don’t come looking for, and this is exactly what we’re interested in.” Prof. Hart has founded a Sustainability Institute in Bangalore to take these technologies are offer it to entrepreneurs here. “Our plan is to become a green leap technology bank, get those technologies here, to India, allow entrepreneurs to build business models with them creatively and disruptively. We plan to build an ecosystem for them to thrive in – with financing vehicles, incubators and cluster networks. The effort is to put together this innovation ecosystem to drive next generation sustainability.” At the end of the day, if sustainability has to succeed as a mission, technology go only a certain distance, people and individuals need to embrace it emotionally and spiritually.
July 2013 | TIP
Indian Sustainability Congress - 2013 www.isustainability.in
Internationalization l Sustaining Bangalore
Water l Energy l Waste Management l Urban Transport Green Growth l Climate Change l Social Engineering
October 2013 Bangalore, India ORGANIZER
Using QR code for benefiting the masses AuthorsRachit Murarka, Ankit Parasher, Gokul Ravee Ramanathan
uick Response code is a two dimensional code capable of storing alpha-numeric characters in the form of names, contacts and hyperlinks which can be scanned using a suitable device (e.g. - camera enabled phone). Over the years, it has gained popularity as a marketing tool. However, it has enormous potential to be used for benefiting the Indian masses. In this paper, we propose some scenarios in Indian perspective where it finds relevant application - Railway Ticket management, Lost Luggage Retrieval, Currency Notes, Rural Accessibility, Information Dissemination and Public Awareness. Each of these uses is dealt in detail in terms of application, implementation, impact and practical issues. A brief idea of the above mentioned scenario will be given in this paper.
Cost Effective, strategic business applications (messaging services) using USSD Author - Janagoudar Sanganagouda
his paper addresses the “Why USSD” question - from an operator’s perspective, end user’s perspective and from technological perspective. It also examines the economic viability, profitability and ease of implementation of messaging services using USSD. As of March 2012, population of India is more than 1.22 billion and the total numbers of mobile subscribers has crossed 881.40 million. Indian telecom market is adding nearly 18.94 million subscribers every month. With the projected teledensity of 1.159 billion which is nearly 75% of population by 2013, Indian telecom network stands as the fastest growing network in the world (source: http://en.wikipedia. org/wiki/Telecommunications_ Statistics_in_India). Such is the potential telecom market, the operators and service providers can eye on. Nowadays, value-added services (VAS) are becoming an indispensable part in the range of products and services offered by the mobile operators, especially for urban users. Also, the untapped rural areas with low penetration rates, low income and cost-sensitive pre-paid customers are fueling the future growth. Thus, operators must be diligent in how they price the existing and new services. Hence, operators are looking for faster and economical technologies. USSD technology is the key solution in all aspects. It is a messaging technology that is almost seven times
faster than SMS. The operations involved using USSD are simple and handset independent, which means that the services can be accessed from almost all the mobile devices (starting from older hand phones to the latest smart phones). An elaborative comparison between implementation of services using USSD and SMS in this paper, suggests that USSD services are much more efficient, require lesser CAPEX and minimal OPEX. In today's world of stringent “Time to Market”, USSD services can be very quickly rolled out at effective rates, at the same time enhancing operational efficiency and generating incremental revenues by delivering practical value to the customer base. With more innovative and attractive low cost services, the Churn-Rate can be controlled/ reduced. Also, due to the lesser actualization costs of USSD services, ARPU of the operator increases significantly. From the core network to internet, the reach of modern USSD services is rapidly transforming the “telecom cloud” into a “services cloud”. Modern operators see their stature quickly changing
from mobile line providers to innovation super-market, always wanting to provide new and easy network services and applications. This paper enlists 3 such applications of USSD based on current conceptualization of service quality, profitability, scalability and empirical ways of implementation. One of the proposed approaches not only uncovers the dynamics of business strategy, but also contributes towards CSR activities by operators. The proposed applications are 1. Spreading awareness about Epidemics and Fatal diseases 2. Mobile banking using USSD 3. Updating mobile software over the AIR The ability of USSD to cohesively trust different segments of service providers is a major advantage in implementing above applications. It closely binds the third party interfaces (such as service providers, banks, medical advisors, rehabilitation teams and enterprises etc), USSD Sponsors, Content providers, Advertising & Marketing crew and many others.
July 2013 | TIP
Technology Revolution - In Depth Analysis: Trends, Success Stories and Opportunities in India Author - Usha Seetharaman
his paper is an attempt to explain the reverberations the Technology Industry has set off and how it can benefit the masses in a profitable way. Indian Technology Industry has a lot of untapped potential that it can explore and can collaborate with government and academia to invest in projects that can benefit the Indian economy. As per the ‘Internet world stats’ The Digital Divide, or the digital split, is a social issue referring to the differing amount of information between those who have access to the Internet and those who do not have access. Broadly speaking, the difference is not necessarily determined by the access to the Internet, but by access to technology applications and to Media that the different segments of society can use. While Information Communication Technology has made a huge impact in the urban centers, its overall growth can only happen when every section of the society gets access to the benefits of this technology. The accessibility of rural areas to the Internet, mobiles and other technology will act as a catalyst in the growth of Indian economy. More than 70% of the population resides in the rural areas but majority of them are unaware of the benefits that technology can
TIP | July 2013
Unleashing technology to benefit the masses profitably Authors - Thiruselvam Rajagopalan, Sekar Mookan
provide. Advancement in technology such as use of Power lines (PLT and PLC) and satellite communications offer new possibilities of universal access to the Internet, and lack of telephone lines will not limit access and has made the technology application feasible. Major software companies in India have a significant contribution in automating and maintaining most of the government systems in North American, Japan and European countries but the same systems in India are still in very rudimentary stages. The document analyzes various success stories in this regard like the Bhoomi project, E-Choupal, CARD, Simputer, AMCUs. Other e-systems like railway reservation systems, online tax submissions also have done away with many middlemen, improved the efficiency, also reduced the chances of errors and hence reduced cost. The paper explores different sectors where technological application like supply chain, solar energy, rural wireless communication, distance learning, improving traffic systems, e-governance can improve the quality of life of the masses in India while reaping economic benefits.
ver the decades, Indian technology industries have matured and gained respect around the world. Majority of the contribution can be attributed to products and services it provided to developed world. A simple analysis of its balance sheet would reveal that they have been looking at the industrialized world for growth, revenue, business and market. Digger little deeper, and we will find that all the efforts have gone in improving and simplifying the lives of the people in developed economies - more specifically the western world. To put it in simple words “The Indian technology industry is yet to create a difference in the lives of the masses”! Interestingly, all these years, we, the Indian technology, have been servicing the needs and wants of our global customers; the voice of this huge customer base around us has been largely ignored so far. The pain points and hassles faced by majority of the world population are largely ignored as they don’t make a business case and don’t have promising return on investment (ROI) Trading the telescope with a microscope will do wonders. All that the industry has to do is to see how to use the technology to transform the life of the billions of people in our own backyard and be financially successful as well. Here is an example: IRCTC centralized online ticket has helped millions of common person, reduced the waiting
time at counter, eliminated the middle man and cut down corruption. Today an average 9 million tickets are booked online, yielding revenue of 90 million rupees to IRCTC. The available technology if used to its potential can do benefits to education, medical, law enforcement, judiciary and governance to name a few. It could solve many of hassles, which general public is faced with. The buying power of this emerging class has increased in last decade or so. It is an enormous market to tap into. Our paper focuses on what we call “Hassle less” governance. A “G-kiosk” would be the future window for common persons to interact with the government for their day to day needs. Today ATM has reached every nook and corner of India including small villages. Using the same concept, people would be able to get all the work with government agency done. The interaction with government can be done effectively as simple as doing a bank transaction. The benefits are many fold; age old government processes will be refined, ineffective staff wouldn’t be the bottle neck, consistent quality of service and, best of all, reduce, if not eliminate, corruption wherever possible. In today’s growing economy, people wouldn’t mind spending a little money to get a better service.
Technology Based Initiatives by Indian Commercial Banks towards Financial Inclusion Authors - Dr. Shweta Anand, Ms. Deepika Saxena Purpose Financial Inclusion is a key determinant of sustainable and inclusive growth of a country. Access to affordable financial services - especially credit and insurance - enlarges livelihood opportunities and empowers the poor to take charge of their lives. It is critical to connect the banked and the unbanked sectors and enable the unbanked to become vibrant and productive participants in the process of economic growth. Commercial Banks play an important role in financial inclusion and growth of the country. Banking Sector in India is now being pushed by the RBI to use technology to include the masses in the folds of banking services. Without banking services catering to them, the masses in India are at the mercy of the village moneylenders and pawn brokers for their basic saving, borrowing and money transfer needs.
REMOTE - An Opportunity for Indian Technology Industry to benefit masses profitably Authors Vikram Bodavula, Aswin Palanivel
Design / Methodology / Approach The methodology used is to analyze the various initiatives which are being introduced and implemented by Indian Commercial Banks towards financial inclusion. All technology based initiatives that came up from secondary sources were put in three buckets: 1. Harnessing technology for better servicing of banking customers. This section discusses technological solutions such as internet banking/ online/ net banking, mobile banking/
M-banking, tele-banking, ATMs, biometric ATMs, mobile ATMs, Common Service Centers (kiosks), smart cards etc. 2. Harnessing technology to spread the reach of Banking: distribution channels such as Business Correspondents Model and Business Facilitator Model are being used to bridge the gap between the banks and the unbanked masses. 3. The initiatives being taken by banks in the area of financial education for raising the level of
leverage the ICT network to improve the effectiveness of the education system.
ver the last few years, the Central and State Governments have been proactive in funding ICT infrastructure at government schools. Through an outsourced model, they have hoped to take computer education to all government schools. The outsourced model focuses on using outsourced trainers for computer training and does not involve the existing government teachers. While this addresses the need of students to be computer literate, it does not adequately
Our approach looks to tackle the 3 key issues affecting
financial awareness and literacy among the unbanked masses which is actually the root cause of the exclusion. Findings Considering Indiaâ€™s vast population and its varied geography, this challenge cannot be met without appropriate technology. Technology has also facilitated reduction in cost of banking transactions, both for the customers as well as for the banks. Also the cost of setting up branches in unbanked areas is also removed. Piggy backing mobile network to put banking services in the hands of the masses is becoming a revolution. Originality / value Various initiatives taken so far by the Indian Commercial Banks are being analyzed in this paper and it will actually benefit to those banks who have not yet implemented any of the initiative, and will also be beneficial to the general public to make them aware about the steps/initiatives which are being taken for them and to spread out the reach of banks to the unbanked masses.
the government education delivery system: 1) Reducing absenteeism - of teachers and students 2) Enhance teacher training and improve the skills and capabilities of the teacher 3) Improve the learning experience The model proposed by us, uses existing ICT network and other government infrastructure along with customizable last mile delivery systems.
July 2013 | TIP
TelePresence – A future in the making Author - Rishu Aggarwal
incorporates TelePresence network which it widely uses in its operations in middle-east Asia. Many other situations where human presence is hazardous like bomb disposal, de-mining, deep sea exploration, fire-rescue etc., defense forces can use TelePresence thus while improving the operational capability of security forces, nullify the risk to human life. Education - TelePresence has made it possible for distance learning to become similar to on-site learning, thus benefitting a large student community while also enabling the academicians to spread learning faster. Now same can be used to benefit the rural and sub-urban masses that cannot access quality education owing to distance and remote factors. Indian Government can incorporate the e-learning schools where teachers cannot be posted and can connect students and faculty community to interact over video conferencing to share knowledge and experience.
oday technology rules the world, transforming various aspects of life, revolutionizing the some aspects of life and redefining some others. Masses of India should also benefits from the same. We would touch upon a latest addition of a new technology from many in the world of Information Technology – TelePresence, to look for how it has changed the life of many and also how it can be incorporated further to boost the life of the masses. Technology reaches out to the masses in the following ways: E-Governance – Transformed the way Governments operate and communicate, improving the access and quality of public services,
TIP | July 2013
education and healthcare. Governments incorporate the Information-CommunicationTechnology (ICT) strategy to widen the reach and making the response more effective and rapid. The technology has increased the operational efficiency many-folds, enabled to take missioncritical communications and decision making to maintain law and order. TelePresence has been widely used in Judiciary to expedite the process and faster disposing of cases by remote disposing of witnesses and convicts. Healthcare – TelePresence has been revolutionizing the healthcare sector. It is being widely used for tele-medicine, distance training and sophisticated monitoring of patients etc. With healthcare
facilities are disillusioning the Indian villages, we should use it for remote treatment and diagnosis by specialist doctors of the masses in remote villages with no medical infrastructure. Defense – Security agencies have been emerged as a major transformational consumer for TelePresence. With diverse operational locations, language and cultural barriers and heavy hierarchy of command and control, defense forces required TelePresence to boost their command and control and coordination among the operating forces and remote monitoring the observational areas with minimum requirement of humans. NATO, an amalgam of 28 countries, recently
TelePresence – future in India • Initiate e-Governance in India where offices can use the TelePresence to cut travel and other costs thus fastening the process and also increased the reach of Government to far off places where concerned infrastructure has not been developed. • Judiciary can make increasing use of TelePresence where witnesses, convicts can be attended remotely thus reducing security risk and also fastened the process. Indian Judiciary is already very high on backlog of cases and implementing TelePresence would go in long way to reduce the same. Tele-courts could be
Benefiting the two worlds Winning the supply chain
Case Studies held at remotes places like interior regions or far-off villages to save travel time as well as convenience for masses. This would have a cascading effect as with judicial services coming near to masses via TelePresence would have decisive effects on law and order scenario in the country. • Defense forces and Police can be equipped with TelePresence systems to enable their remotely deployed units to react effectively to contingency situations and also to well coordinate their efforts to rapid reaction capability. It would help in clear command and control from military’s top leadership which would make the response of defense forces more mature and faster. • Like STD booths, TelePresence kiosks can be set up in countryside and remote villages of the country which can be used by masses for tasks like panchayats involving multiple villages, direct coordination between citizens and government officials to supervise the development work and other issues thus reducing the communication gap and having better control and monitoring mechanism over government initiatives. • E-schools to be set up where teachers and students can attend from their respective locations. In India, owing to remote locations of
villages, many children couldn’t attend schools as teachers are not ready to be deployed in such locations and it becomes infeasible for students to travel long distance for attending schools. Implement TelePresence solution would undo the limitation and would take the benefits of education to the remotest village of the country. It would have a revolutionary effect on India’s education system. • TelePresence kiosks set up in the villages would make it feasible for farmers to gain knowledge from far off resources like other farmers, market analyst and agricultural scientists to make the maximum, learn new technologies from agriculturalists and decision making for selling of products. It would greatly help in bringing prosperity and sophistication in remote areas and villages. Hence TelePresence have immense opportunity for the Indian Government as well as private sector in India to benefits the masses profitably by incorporating ‘remote work’ feature. While initiatives have been already started in this direction especially by judiciary but the need is to make it on large scale so as to take the benefits to masses. Huge initial and susceptibility to technological failure are still bigger challenges which can be overcome by extensive Research and Development, sound financial planning and an effective strategy and management.
Authors - Akshay P. Sangaonkar, Abhishek Kishore Gupta, Shamik Bhattacharya
he aim of this paper is to highlight impact of Technology on dayto-day life of the masses. This paper also tries to bring out subtle aspects of business models which are generating profits and at the same time helping masses to leverage benefits of technology. Part I explores various capabilities of technology and explains vegetable retail sector scenario in brief. Part II demonstrates a successful business model which has leveraged technology to benefit its
Courtesy : IIM Bangalore
customers in fresh fruits and vegetables supply sector. Basis for this model is integration at the demand side. Part III focuses on limitations of current models and a study of successful models which have overcome such limitations with an entirely different approach by integrating supply side. Part IV proposes an integrated model which combines best of previous two models and showcases benefits of technology by integrating end to end supply chain.
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Two IIT Madras students Prashanth Karthick and Balaraju Kondaveeti have literally taken engineering education to the bottom of the pyramid. In over three years, they have managed to bridge the huge gap in standard of the teaching between IITs and rural engineering colleges. Their company, BodhBridge Educational Services Private Limited, is a revolutionary platform for video based training through online and offline channels. It generates collaborative open source content which helps students help themselves and is also an online platform for jobs and internship. They also provide free online material. Ninety five percent of BodhBridge ESPLs service is free, only 5 percent are paid for services which support the running of the business. Here’s an excerpt of Technology Innovation Productization's interview with cofounder Balaraju Kondaveeti TIP | July 2013
How video-based learning is bridging rural-urban knowledge gap IITians should start their own ventures instead of taking up high paying jobs What led you to start BTechGuru? I did my M.S (Entrepreneurship) from the Department of Management Studies (DoMS), IIT Madras. Along with my IIT friends, I started BTechGuru in 2008, while I was doing my MS. I studied in a rural engineering college in Andhra Pradesh. I personally went through lot of difficulties in acquiring further knowledge to secure a better career. After I came to IIT, I got the best set of professors and resources to learn. Then, I started to think of creating a common platform for all the students across the country and enable them to have access to high quality knowledge and training. This thought was translated into BTechGuru. Now, we offer various products and services through BodhBridge Educational Services Private Limited. A bit of it as an entrepreneurial venture - who funded it? Is it profitable already? BTechGuru/BodhBridge initially got incubation support from C-TIDES (Cell for Technology Innovation and Entrepreneurship Support), IIT Madras. I got the seed capital by winning various business plan competitions. Eventually,
after I started to make small revenue, I was able to get funding from angel investors and friends to go to the next level. On a micro scale, we have financially broken even. Since we need to grow big, we invest in new products and services. Tell us about your experience after starting the portal? I started the portal when I was a student. Starting from managing a team to managing working capital is a fantastic learning experience. I also had to change social thinking (at least among my close circle) that IITians should start their own ventures instead of taking up high paying jobs. I learned to handle uncertainty and overall, I am happy doing what I like doing. What’s the next stage in technology to make it work better? I strongly feel that a lot of learning in the future will happen through video. BodhBridge has already created more than 2,500 videos. Our experience also shows that video-based learning has greater reach and can achieve a huge scale. With video you can bring the best expert in a particular
domain to any student from any part of the country/world at any point of time. With improvements in technology, more interaction will easily happen. What have been the results of the students who have used it in their exams? Has any assessment been made? Students use BTechGuru for academic exams, competitive exams and job opportunities. Thousands of students have benefited by using this. We have recently added self assessments also into the platform to monitor the student's learning over a period of time. Students also value these assessments as it’s of great help in understanding where they stand. What do you think is the next level of entrepreneurial challenge? In 2011, BodhBridge was selected for NASSCOM Emerge 50 Awards. I would like to see BodhBridge reach more than three crore students who are in higher education in the next five years. I want BodhBridge to help and mentor every student to get into the best career, based on his/her skill set. I am sure this is possible with technology, innovation and the right mindset.
Shaping the National Innovation System:
The Indian Perspective I
Yagnaswami Sundara Rajan Indian Space Research Organization
nnovation in India is becoming a part of public discussions, business forums, and media announcements more often than it did in the past. However, the term ‘innovation’ carries multiple meanings, and is often used in the narrow context of shortterm relevance. This usage is so frequent that even a temporary solution—which could be considered a ‘workaround’ or ‘Jugaad’, as it is known in India—carried out to overcome serious inadequacies of a system is praised as innovation (see Box 1). What ‘innovation’ means in India Thus the answer to any question about ‘innovativeness’ in India varies considerably, depending on the sector and the context under discussion. Many analysts, business planners, and researchers now recognize that macro indicators—such as national investment in research and development (R&D) (also known as gross expenditure in R&D, or GERD), R&D expenditure by industry as a percentage of sales turnover, the patents filed in a year, or number of research papers and number of PhDs in science and engineering, for example are inadequate to capture the realities of innovation system in India. These indicators alone are not suff icient to provide policy
makers with the necessary evidence to take concrete actions to stimulate and accelerate innovation in academia and the industry, agriculture, and services sectors. Multiple elements need to be considered in totality in order to address the challenges of innovation. It will not suffice to address a few specific elements—such as tax incentives, additional funds for R&D, or excellence in education—regardless of how important they each are, in isolation. Recently attempts have been made to understand Indian Box 1:
Jugaad: A nuanced term There exists no colloquial word in Indian languages for ‘Innovation’. Jugaad in India is pejorative, as is Gambiarra in Brazil and Zizhu Chuangxin in China. Yet emerging market problem-solving is becoming exemplary. India could give the world a new form of innovation, just as in 1966, India gave the world, Yoga, Sitar and Carnatic Music. SOURCE: R. Gopalakrishnan, Director, Tata Sons, Sons, personal communication, 2 May 2012.
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affect certif ication. All these elements or drivers, shown in Block 1 of the figure, must be addressed. The 4th driver shown in Block 1 is finance; finance is the first element in Block 2, facilitators, and appears there as government funding bodies. The only specif ic banks or venture capital funds shown in this block are the Small Industries Development Bank of India (SIDBI) and the National Bank of Agriculture and Rural Development (NABARD). This is because the policies and processes in place for f inancing innovation by banks and venture capital funds are highly skewed towards commercial and foreign consultant–backed ventures; this problem needs serious attention. Similarly, the elements of Block 3 of the figure, which comprise the intermediate outcomes, show serious disconnects that prevent them from moving towards Block 4, the final outcomes. For example, most publications from even elite science and technology (S&T) institutions are not even vaguely oriented towards solutions. Even for those few that do attempt solutions, there is no follow up by the groups or institutions involved. Similarly, most patents are not commercially viable. Many of these patents result from the policies of funding S&T departments, national science academies, and the personal/promotion policies of research institutions that often work against those scientists/academics who work for marketable solutions, start-ups, prototypes, demo services (except when they are provided by big companies). They often flounder because of a lack of government or private-sector funding.
An innovator’s struggle Indian policy-makers and leaders in innovation have been experiencing an innovator’s struggle in the past ten years. Since the innovator’s idea is different from the prevalent dominant idea, it is dismissed, or not even noticed. A new paradigm of innovation has been growing in India: with a focus on simplicity and frugality in the process of innovation itself in contrast to the dominant paradigm wherein innovation is expensive and requires large resources of highly qualified personnel and finance and facilities. In the dominant paradigm, the principal, or even only measures of the innovation capacity of a system were the amounts spent on R&D, the numbers of scientists engaged, and the numbers of patents produced. Whereas in the new paradigm of innovation that has emerged in India, the measures of a system’s innovation capability lie in the production of solutions (products and services) that are affordable and accessible to people with very low incomes. In this paradigm, innovations are outside the laboratory mostly. They are in institutional and organizational innovations that enable co-creation and co-operation to create reach, reduce costs, and deliver solutions that are useful to masses of people at the ‘bottom of the pyramid’. This paradigm of innovation is being acknowledged now as a legitimate and useful innovation. Policy-makers charged with stimulating a system’s innovation capacity, and evaluators of international innovation capabilities need to factor in insights from this emerging paradigm and replace conventional views. SOURCE: Arun Maira, National Innovation Council, personal communication, 5 May 2012.
The facilitation mechanisms shown in Block 2 of the f igure are often too poorly funded or too small to cater to a large number of such intermediate outcomes, which in turn must evolve into the Block 4 outcomes shown in the figure. It is beyond the scope of this chapter to deal with each of the elements depicted in Table 1 in detail. Hence the following section provides an overview of the actual Indian innovation scenario and illustrates a few select industrial sectors in which Indian innovation activity is relatively high. In the process we also point out areas of serious gaps. One of these is the gap in the innovative ability of micro, small,
and medium enterprises (MSMEs), which is important in the mediumand longterm interest of the Indian economy and society because these enterprises provide employment for millions of Indians. The chapter provides a view of some of the thriving ’green gardens’ of the Indian innovation system and also some of the ‘dry desert’ areas needing innovative attention. In the following section, we take stock of some innovation-facilitating mechanisms and driving factors. These range from government f inance systems, hand-holding systems that work with the innovators at every stage until they mature, and intellectual property rights (IPR) facilitation to
Global Innovation Index 2012 – Stronger Innovation Linkages for Global Growth Table 1: Idea-to-market curve Drivers (Block1)
1. Policy 2. Procedures for implementation 3. Knowledge inputs/access 4. Finance
Facilitators (Block 2)
Intermediate Outcomes (Block 3)
1. Government funding bodies Examples: DST, DBT, TDB, TIFAC, NSTEDB, SIDBI, and NABARD. Ministries have some upgraded funds.
• • • •
2. Technology R&D centres Examples: Central government-funded national laboratories such as CSIR, ICAR, DAE, DRDO, ISRO, CPRI, CMTI, and so on. About 300 such centres exist in India. Industrial R&D centres including in-house R&D units, SIROs (NGO), foreign R&D units or centres, elite institutions, such as IITs, IISc, NITs, and central universities
• • • • •
3. Certification/standard approval and other formal accreditations Examples: BIS, RDSO, food and drug controllers, national testing laboratories, IPO (for patent, design, and other IP components) design-related support, to name a few. We also address macro indicators of innovation such as technology intensity in Indian manufactured exports, and compare these indicators in India with those of a few other countries. Pockets of excellence As can be guessed by any discerning observer of the Indian innovation system, although a number of pockets of excellence have emerged over the last several decades, there are few interconnections among them even at the policy level, let alone at other facilitating levels. It will not be wise to leave these pockets of excellence to fend for themselves. As can be seen, in almost all areas of a desired national innovation system, India has had at least some level of experience for over a decade. Hence it will be possible to speed up the process of establishing
a fully functioning system of innovation by connecting those pockets of excellence with each other and with other necessary components. The correct policies must be put in place, and the right implementation mechanisms must simultaneously be enforced. These elements need to be sustained for a long time for the laggards in the system to catch up speedily so that they are ready to innovate in products and services. Sectoral green gardens India has shown high growth and innovation capability in few sectors, called ‘green gardens’. Two of India’s fastest-growing sectors are described below. Pharmaceutical The Indian pharmaceutical industry plays an important role in promoting and sustaining low-cost, affordable, and innovative pharmaceutical product development in major markets.” Globally,
Publications Patents New designs Performance improvement in existing products/ services Start-ups Skill upgrades Joint R&D projects Prototypes Demonstration services Technology-intensive products and services made in India
India ranks third in terms of manufacturing pharmaceutical products by volume. The Indian pharmaceutical market is expected to reach more than US$ 55 billion by 2020 (Box 3). Automobiles India has been the world’s second-fastest-growing car market since 2010.% The Indian automotive industry has successfully introduced a range of new products in the domestic as well as the international market. The Indian auto component industry, which is dependent on the automotive industry, also has a distinct global competitive advantage in terms of cost and quality and has become the competitive supplier for the global market. It is one of the fastest-growing industries in India, with a compound annual growth rate of 23% during 2005 to 2010 and has reached US $19 billion in the year 2008–09 and is expected
Final Outcomes (Block 4)
Production of solutions (products and services) that are affordable and accessible to: • People with very low incomes • People in the middle class • People in aspiring upward mobile classes Products and services distributed to global markets
to grow to US$ 40 billion by 2016.5 The automotive industry is also one of the largest R&D spenders within India’s industrial establishment, second only to the pharmaceutical industry. R&D expenditures for domestic and multinational firms have increased considerably over the last decade. It is the domestic f irms that have registered faster growth rates in absolute levels of R&D investments of Rs 2,400 crore (2010) than the multinational corporations, with Rs 210 crore for the same year. Some dry deserts ‘Dry deserts’ are those areas that are facing challenges in their attempts to incorporate innovation in their functioning. Micro, small, and medium enterprises MSMEs cover a vast
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segment of Indian economy with the employment of nearly 60 million Indians, distributed over 26 million enterprises. MSMEs generate a share of around 45% of the nation’s manufacturing output and 40% of exports.: Challenges in the input side, such as the high interest rates of 13–15% (much higher than rates for other Asian economies, which are 6–8%), rising raw materials costs, and labour costs coupled with tough competition—both in domestic and foreign markets—have added to the woes of the sector. In terms of growth, the sector has taken a hit. As many as 91,400 micro and small units had shut down their operations as of March, 2011. The reasons cited for the closures were f inancial non-viability, slowing demand pull, obsolete technology, nonavailability of raw material, infrastructural constraints, inadequate and delayed credit, and managerial deficiencies. The other big issue related to the sector is that about 98% of MSME units in India have very little interaction with big industries. The result is a gap in knowledge exchange between these two sectors. Almost 85–86% of MSMEs use traditional knowledge in their production units, and domestic R&D organizations have a meagre share (5–7% of the technical knowledge transactions are made with public R&D) in provisioning knowledge. The government is beginning to address the issue of the lack of f inancial resources for MSMEs, and it has recently
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Paradigm shift in pharmaceuticals The pharmaceutical industry has experienced a paradigm shift as a consequence of variable trends in globalization; the emergence of new markets; changing industry dynamics; and increasing regulatory, intellectual property (IP), and competitive pressures. India has become a preferred destination for R&D work because of the country’s high-quality drug development, educated and skilled human resources, vertically integrated manufacturing capability, differentiated business models, and significant cost advantages. Recently the industry has demonstrated good innovation skills in the fields of genetic research, biosimilars, vaccine development, contract research and manufacturing services, and new chemical entity development. Some instances are: • Innovation in biosimilars: Biocon and Pfizer have entered into a strategic global agreement for commercialization of Biocon’s biosimilar versions of Insulin and Insulin analog products: Recombinant Human Insulin, Glargine, Aspart and Lispro. • Innovation in vaccines: Indian biotech players are actively engaged in developing challenging vaccines. For example, India’s first vaccine against H1N1 was developed by a major Ahmedabad-based pharmaceutical research company, Cadila Healthcare. The Serum Institute of India has launched the indigenously developed intra-nasal H1N1 vaccine under the brand name Nasovac®. Bharat Biotech has developed HNVAC, a novel vaccine that is the only developing world flu vaccine to be manufactured in a cell culture instead of eggs. Notes 1. See http://www.bloomberg.com/news/2010-10-18/biocon-sells-rights-to-insulin-to-pfizerfor-upfront-200-millionpayment.html. 2. See http://www.zyduscadila.com/press/PressNote03-06-10.pdf. 3. See http://www.biospectrumasia.com/content/150710IND13091.asp. 4. See http://www.bharatbiotech.com/
authorized the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) to open a dedicated exchange for small and medium enterprises. As a policy measure, the Indian Cabinet has also approved a public procurement policy for MSMEs. Recently the Ministry of MSME has proposed its plan to increase its innovation corpus from Rs 100 crore annually to Rs 2,500 crore. Technology intensity in manufactured exports Among all merchandise exports of countries, manufacturing constitutes the lion’s share. For India this is 61.5%, compared with 93% in China, for example. In spite of India’s potential strengths in technology, and with the focus shifting to newer products and newer markets as encouraged by the government’s Foreign Trade Policy (2009–14), currently
the average technology value-added in manufactured products by Indian industry is around 8%—very low, even compared with that of other emerging developing nations (In 2009, Brazil’s value-added share was 14%, China’s was 31%, Germany’s was 18%, Mexico’s was 21%, and that of the United States of America was 23%). The reason behind this trend is that India focuses more on assembling and sales than on design and development, making the process very ‘shallow’. Some policy reforms that are possible solutions are listed at the end of this chapter. The slow pace of building up the value-added in India’s manufacturing sector has been an area of concern for a long time, and now it has to grow really quickly in order to fulf il India’s dream of becoming an innovation powerhouse.
Drivers: Facilitating mechanisms and implementation experiences Drivers for innovation in India have traditionally been weak. Be it policy, funding, infrastructure—in all areas, India has been a laggard. Since economic liberalization in the early 1990s, the government has taken some measures to improve the situation. The primary objectives of these measures are to attract more foreign direct investment, remove licensing monopoly control, encourage growth in imports and exports, revisit the policy framework, and encourage innovation capacity within industry and society.!” However, government purchase policies and offset echanisms to induce privateand publicsector industries to invest in R&D design are still not in place.
Global Innovation Index 2012 – Stronger Innovation Linkages for Global Growth Government bodies Since its independence, India has established institutional mechanisms to address its scientif ic and technological development. These mechanisms include R&D labs, such as the Council of Scientific and Industrial Research (CSIR); government departments, such as the Defence Research and Development Organization (DRDO), the Indian Space Research Organization (ISRO), the Department of Science and Technology (DST), the Department of Biotechnology (DBT), and the Department of Atomic Energy (DAE); and autonomous bodies, such as the National Institute of Design (NID). These institutions have been instrumental in providing a platform for innovation to f lourish. Although the DRDO,
the ISRO, and the DAE have been able to create stateof-the-art technologies and innovations, the DST and the DBT have been geared more towards the facilitation of innovation (see Box 4). For example, the Biotechnology Industry Partnership Programme of the DBT is a new scheme for promoting innovation in industry.!# It provides government support for 50% of the total cost of a project under this scheme, leaving the remaining 50% to the industry. Out of this 50% government support, 30–50% is given to industry as grant-inaid and the remaining is given as a loan. The benef iciaries of this program are the industries whose discoveries are linked to innovations in futuristic areas, transformational technologies, and product development of public goods.
Nongovernmental organization facilitators Different nongovernmental organization (NGO) bodies contribute towards developing industrial capability for better growth. For example, CII Centers of Excellence (CoEs) work with MSMEs at the grassroots level. One of these, the Avantha Centre for Competitiveness, has secured more than 200 successful interventions in clusters, impacting more than 2,100 companies. Other niche associations— such as the Indian Machine Tools Manufacturers Association (IMTMA), the Automotive Components Manufacturers (ACMA), and the Society of Indian Automobiles Manufacturers (SIAM)—work for the betterment of their respective sectors.
Funding Various funding mechanisms for R&D and entrepreneurship are available both within and outside the government. Government R&D labs—such as the CSIR, the Central Manufacturing and Technology Institute (CMTI), the DRDO, and around 300 others—spend a great deal of money for in-house research through various schemes and fellowship programmes. Other government bodies, such as the DST and the DBT, fund research work through grants and subsidies. Other than government, in the last decade many Indian and multinational enterprises have developed their R&D facilities in India where cutting-edge research is taking place. Along with Indian giants such as Tatas, Birlas Mahindras,
The Department of Science and Technology: A key facilitator of innovation Launched in the 1970s, the Department of Science & Technology (DST) has since established policies and schemes for funding, managing, and monitoring innovative initiatives across the ecosystem covering individual innovators, entrepreneurs, small and medium enterprises, and institutions. In its proposal for the 12th five-year plan (2012–17), the DST has included a major focus on innovation and proposed doubling private-sector engagement in R&D by promoting a public-private partnership model. By its own estimation, the DST will support 3 million Indians directly through its programmes over the course of the next five years (2012–17). It has identified R&D investment as a priority and suggested increasing it as a percentage of GDP from its current levels of roughly 1% to roughly 1.5% of GDP by 2017, keeping in mind the global competitiveness in science, technology, and innovation. The DST works through different functional
bodies that each have defined independent goals. For example, for the past 23 years the Technology Information, Forecasting and Assessment Council (TIFAC),2 under the DST, has been trying to address issues of innovation and commercialization through its various programmes. Three such programmes are listed below: • The Home Grown Technology Programme (HGT). This programme aims at encouraging SMEs to carry out significant innovations at the pilot production level, thereby covering some distance towards final marketing of a product. About 59 projects were undertaken under this scheme, and approximately 38% of them reached the commercialization stage. The loans were returned. Taxes from new businesses more than offset the initial government expenditure. • The Technopreneur Promotion
Programme (TePP) is a mechanism to encourage individual innovators to become technology-based entrepreneurs (‘technopreneurs’) by helping them network and forge links with other constituents of the innovation chain, thus supporting the commercialization of their developments. • The Technology Refinement & Marketing Programme (TREMAP) is designed to support the country’s innovation pool by pushing innovative technologies from the prototype stage towards a viable commercial product. In the short span of two years, TREMAP has transferred five innovations / technologies to the industry of commercial use. Notes 1. DST, 2011. 2. Detail on TIFAC is contributed by Mukesh Mathur, Scientist D, TIFAC-DST, and Sajid Mubashir, Scientist F, TIFAC-DST, Government of India.
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and Godrejs, global multinational corporations such as Nokia, Xerox, Bosch, Philips, GE, and IBM have invested in India for their R&D programmes. The Department of Scientific and Industrial Research (DSIR), under the Ministry of Science & Technology, recognizes non-commercial scientif ic and industrial research organizations (SIROs). Under this scheme, institutions or nongovernmental bodies such as NGOs, associations, and universities that undertake scientific and/or industrial research are granted recognition for their work. Each year DSIR compiles a list of SIROs in the country (575 in its 2008 report). SIROs contribute significantly towards the funding of R&D. The National Skill Development Corporation (NSDC) and the Global Innovation and Technology Alliance (GITA) are some of the public-private partnership mechanisms that provide funding for initiatives in skill development and bilateral or multilateral joint R&D programmes, respectively. The government anticipates establishing more models of public-private partnerships to enhance the functioning of its programmes. Intellectual property rights While maintaining global standards and practices and ensuring a robust IPR system, the Indian legal and administration systems have been undergoing constant modif ications. Indian companies protect and maintain their IP assets in India and elsewhere to their competitive advantage. For example, United Phosphorous, a leading Indian company manufacturing agrochemicals, successfully fought a trademark infringement case in the USA and a patent infringement case in Germany.
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Good IP management practices followed by Indian drug companies have enabled them to gain a strong position in the generic pharmaceutical market all over the world. The IP assets of these drug companies, along with the provision of foreign direct investment in the sector, have attracted many foreign companies to look for stakes in the Indian companies. IPR awareness in India has remained generally low; however, the central government, through its various forums, is beginning to educate people on this topic. Industries, through their confederations, associations, and federations, have also been engaged in creating awareness about the issue for over a decade now. A recent example of strong legislative enforcement for patents that is taking shape in India is compulsory licensing—invoked for the first time in 2012—to facilitate the production of a particular drug (Nexavar, a drug used to treat kidney and liver cancers) and make it available to the Indian population at an affordable price. Design Design is extremely important for the future of India. It is integral to national competitiveness because it contributes signif icantly to India’s culture, environment, and economy. The government has already announced a national design policy and is implementing it through the India Design Council. The policy’s priorities are to deploy design to boost exports, strengthen design education, enhance the quality of life, and increase industry competitiveness as well as to create design centres to act as innovation hubs. The Ministry of MSME has promulgated the design clinic scheme as a part of a national manufacturing
competitiveness programme to assist MSMEs to become competitive by providing partial funding support, expert advice, and costeffective solutions to real-time design problems, resulting in continuous improvement and value addition for existing products as well as new product development. India needs many more such interventions to upgrade its design skills. Challenges and the way forward India, because it is a pluralistic society and a democratic country, has an inherent inertia that resists accommodating change. The political environment is far from open and transparent, and the governance system is plagued with bureaucratic hurdles. Among many other obstacles hindering innovation and growth are the poor condition of the country’s urban and rural infrastructure, its very low industry-academia linkage, its low GERD, and a noninnovative MSME sector. Far-reaching policy reforms are needed to address all these issues. The list that follows provides some guidance to the types of policy reform that, if carried out successfully, could help ameliorate some of these pressing issues. Policy initiative 1: Increase R&D spending The government should formulate policy with the aim of increasing total GERD to 2% of India’s GDP. Policy should also assist in implementing mechanisms to encourage industry to spend 50% of its total R&D, up from its current level of 20%. India’s national innovation infrastructure should be revisited, and reforms need to be incorporated to improve governance and make it more
transparent (through the use of e-governance) and to upgrade infrastructure with projects to develop roads, energy distribution, water availability, for example. Policy initiative 2: Global partnerships in innovation Global innovation partnerships need to be strengthened. Policy can address this need by enhancing public-private partnership mechanisms such as GITA, and increased public funds should be earmarked for joint industrial R&D projects that include more countries and larger projects. Policy initiative 3: Offset production Policy may also be effective in extending the concept of offset production in India, not merely for defence purchases—where India’s offset policy requires foreign suppliers to carry out some production in India or some R&D in collaboration with Indian firms—but also for other major sectors such as energy infrastructure, transport, and other broad sectors. It is important, however, to avoid making these policies too rigid and unapproachable. Foreign investment, especially in MSMEs, that is undertaken to upgrade the capacity of the enterprise to take on such offset production responsibilities may also be counted as offset fulfilment. The aim of such foreign direct investment is to bring some focused, continual ‘irrigation’ of innovative capacity to a vast sector that was previously a dry desert in terms of innovation. Policy initiative 4: Idea-to-market challenge When considering the movement of ideas towards markets in India (see Figure 1), several problems at the
Global Innovation Index 2012 – Stronger Innovation Linkages for Global Growth
Mature Purchase/License from abroad
Fragile period for fast growth and spread New Genetic defects
Quick to close by founder
Full cycle from “New” to “Market” is Innovation
Multiple goals Idea
Early euphoria Time
idea stage itself become evident: the understanding of user needs and market needs, as well as the costs of bringing an idea to market, is generally poor. Other elements important to success, such as knowledge about competitors, are also lacking. In addition, most projects tend to be poorly organized, and multiple goals (often contradictory) are frequently assigned to a single project, leading to confusion. In spite of these hindrances, some innovative projects— especially those that begin in national labs or academic institutions—are launched with good results, leading to an early euphoria on the part of the innovator and other project stakeholders and sometimes media (if the innovation is large). These euphoric early successes give way either
to technology transfer or sell-offs, when the innovator sells off the enterprise/ idea rather than making the effort to grow the venture. Even government funding schemes do not encourage further efforts to scale up initiatives that are successful in their early stages. For these projects, ‘science’ or R&D has been completed, and they are conveniently left to the mercy of users and industry. Venture capitalists who join the project at this stage often expect a quick return and tend to leave immediately thereafter, not remaining to support further R&D. This period, in which everybody forgets the idea and the work and starts assuming that success has been achieved, is called the ‘fragile ellipse’. The consequence is fewer
idea-to-market innovations originating from India. Those who dare to enter markets with their innovative technology and desire to meet a user demand and make a successful business are usually forced to look abroad for licensing their technology, (although they may not be the best fit for India), in absence of a well-established Indian procurement system. These entrepreneurs will often be near the mature stage of the innovative solution and thus close to being obsolete in business, practically surviving at the top of curve, with only marginal shallow innovations in marketing and pricing. To address these challenges the government needs to create a special fund to help Indian innovations, wherever
they originate—in public or private sectors of industry, laboratories, or individuals— to advance beyond the fragile ellipse. Such a fund will require a special, f lexible system of management. As a step in this direction, the government’s National Innovation Council plans to establish the India Inclusive Innovation fund with US$1 billion. Path forward In spite of all the drawbacks, weaknesses, and challenges facing India’s innovation system, India is presented with an opportunity to become a global innovation hub and eventually transform itself into an innovation-driven economy using its existing resources. To be successful in this endeavour, the country must make the right institutional, industrial, and policy reforms.
The author gratefully acknowledges the contributions of all the people who have assisted in this work. Special thanks go to Mr. Arun Maira, Member, Planning Commission, and Mr. R. Gopalakrishnan, Director, Tata Sons, for providing their thoughts and insights to this piece. The author wholeheartedly welcomes contributions from Dr. Goutam Muhuri, President, R&D – Dosage Forms, Jubilant; Mr. Hrridaysh Deshpande, Director, DYPDC; Mr. R. Saha, Senior Advisor, CII; Mukesh Mathur, Scientist D, TIFAC-DST; and Sajid Mubashir, Scientist F, TIFAC-DST in the areas of Pharma, Design, IPR and various DST initiatives, respectively. The author thanks Mr. Anjan Das, Executive Director, Technology, and Ms. Seema Gupta, Director, CII, for providing necessary contacts and sharing thoughts. Last but not least, the author gratefully acknowledges the assistance of Mr. Jibak Dasgupta, Deputy Director, CII, for providing insight, collating all the information, helping shape the chapter to its current form, and editing as and when required.
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Reinventing India by Raghunath Mashelkar Sahyadri Prakashan, 2011
einventing India by one of India’s most iconic science leaders Dr. Raghunath Mashelkar is a book on recapturing the glory of India. There are six sections in the book. The first is titled Dreaming India and it articulates an Indian dream of becoming an intellectual and
global power of the 21 century. The second deals with Indian Science and reiterates the importance to raise the bar and lead. In the past there were scientists with great ideas. The author questions why we could not recreate the magic created by the Ramanujans, Ramans, and Boses in the early part of the century. The third section deals with the role of technology in the developing world. He brings about the disparity in achievements amongst the Indians. On one side of the spectrum there are great achievements like the construction of supercomputers, satellites, missiles, and nuclear reactors while on the other side, there are millions of people deprived of basic education and food. The fourth section is all about building and changing the institutions. Transformation is the key to achieving higher goals. The fifth section deals with building an innovative India that the people of India dreamed of. The author emphasizes that the Indian way of thinking and the Indian way of doing things will
Farm Innovators 2010
part from innovations and scientific package of practices developed and transferred from R&D institutes, innovations in the form of grass root level technologies and methodologies developed by some of the innovative farmers and rural youth are benefiting farmers and have also been accepted across the system.
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bring about a major change. The last section deals with the protection of the Indian knowledge systems with emphasis on synergizing the ayurvedic knowledge systems. Reinventing India by Raghunath Mashelkar not just presents the challenges of India but also provides a workable solution to it. The book formulates the ‘Panchsheel’ that traces the road map for India’s bright future.
About the author: Raghunath Mashelkar is a leading architect of India`s science and technology policies. He is a pioneer in polymer science and engineering which earned him international laurels. He is the recipient of the J.R.D. Tata Corporate Leadership Award. Raghunath Mashelkar revoked the US patents on turmeric and Basmati rice and licensed patents based on modern knowledge of Indian laboratories. He has coauthored a paper in Harvard Business Review and his research papers have appeared in International journals.
Such innovative technologies and methodologies are largely confined to some locations. Benefits accrued from such innovative ideas need to be widely shared across the country. And the scientific talents behind such grass root level innovations need to be encouraged and recognized. Valuable ideas and techniques generated by them largely go unnoticed owing to lack of proper documentation and opportunities for wider dissemination. An initial and pioneering attempt in this direction has been made by the Division of Agricultural Extension, ICAR, to document such innovations developed across the country in the form of this publication “Farm
MoonShot India by Srinivas Laxman Navneet, 2009
oonshot India is a book written by a well-known space enthusiast and Indian space related efforts journalist Srinivas Laxman. It is a good buy for any Indian interested in human activities on the moon. The book is mainly targeted at the student community. Significant portion of the book deals with moon projects of other nations.
Innovators – 2010” for the benefit of various stakeholders. Out of 196 farm innovations received 139 were finalized under eight thematic areas—Crop improvement (13); Crop production (16); Crop diversification (8); Crop protection (14); Farm machinery (61); Water Management (8); Live stock and fisheries management (10) and Post harvest technology and value-addition (9). These 139 selected innovations have been documented and presented in this publication in a uniform format giving details of innovators, innovations and their applications illustrated with suitable photographs.
Jugaad Innovation: A Frugal and Flexible Approach to Innovation for the 21st Century by Navi Radjou, Jaideep Prabhu, Simone Ahuja, Sam Pitroda Random Business, 2012
ugaad is a word often heard in general conversation in India. Whether to find ingenious solutions to problems or turn adversity into opportunity Indians swear by it. In this seminal book, Navi Radjou, Jaideep Prabhu, and Simone Ahuja challenge the very way a traditional organization thinks and acts. Leading companies such as
Facebook, Future Group, GE, Google, PepsiCo, Philips, Renault-Nissan, Siemens, Suzlon, Tata Group, and YES BANK, among others, are already practicing Jugaad to generate original ideas and pioneer growth. In the midst of rising global competition and swelling R&D budgets, Jugaad
Innovation presents ways to innovate, be flexible, and do more with less. Peppered with examples of innovative entrepreneurs in emerging markets such as Africa, India, China, and Brazil, Jugaad Innovation illuminates paths to engender breakthrough growth in a complex and resourcescarce world.
hy should people be happy? How is the pursuit of happiness relevant to the corporate world? Studies show that happy people are the most innovative, and more productive. The happiness quotient is therefore integral to a successful corporate strategy. In Innovate Happily, bestselling innovation guru Rekha Shetty’s new book, Junie, a bright young executive, meets Rags, a wise, hi-tech coach. Together they discover the secrets that create progressive and happy communities during a visit to Bhutan, the modern-day ShangriLa, a land that actually measures its Gross National Happiness. Through a series of analytical and self-actualization exercises, Innovate Happily shows you how to innovatively increase your Happiness Quotient and take it to your own town and organization.
The Game changers:
20 extraordinary success stories of entrepreneurs from IIT Kharagpur by Yuvnesh Modi, Rahul Kumar, Alok Kothari | Random House India, 2012
IIT Innovate Happily by Rekha Shetty Penguin Books India, 2012
The Age of the Platform:
How Amazon, Apple, Facebook, and Google Have Redefined Business by Phil Simon | Motion Publishing, 2011 This is both a book and a big idea book about how Google, Apple Facebook and Amazon created platforms that allowed small businesses to play big. Phil Simon explores how these HUGE companies leverage their respective technologies to create entire virtual ecosystems that consist of developers, partners, users and communities. Simon takes the reader on a journey through these platform technologies in order to show the value of participation across platforms and how even small businesses can create their own platforms
ians in India are a privileged lot. They toil to enter the portals of India’s most prestigious engineering college, but once their education is complete, seven figure salaries and blazing career paths await them. However, there are people who break the mould – IITians who have rejected cushy jobs because their inner instinct told them that bigger and better things awaited them if they took a different path. This book traces the story of 20 such individuals from IIT Kharagpur. The book covers the stories of some quite well-known figures. They include Krishna Mehta, Ventakata Subramaniam, Sunil Gaitonde, Arvind
Kejriwal, Anuradha Acharya, Vikram Kumar, Bikash Barai, Praful Kulkarni, Anand Deshpande, Vijay Kumar, Arjun Malhotra, Sam Dalal, Suhas Patil, Kiran Seth, Bikram Dasgupta, Prabhakant Sinha, Ranbir Singh Gupta, Vinod Gupta, Sridhar Mittal and Harish Hande. Dr. Damodar Acharya, director, IIT Kharagpur, has written the introduction. There is also a foreword by Dr D Subbarao, Governor, Reserve Bank of India. The book gives the reader a peep into people who have made a success of their life by taking the path less trodden. In addition to this, there are also valuable insights and advice from the people featured in the book.
July 2013 | TIP
A specifically delineated Investment Region planned for the establishment of production facilities for petroleum, chemicals and petrochemicals sector in the state. Spread over 453 sq. km. of Brownfield area in the Gulf of Khambat, in Bharuch District in South Gujarat ONGC Petro additions Ltd (Opal), a joint venture company promoted by ONGC, GAIL & Gujarat State Petroleum Corporation (GSPC),) is the anchor tenant in Gujarat PCPIR Excellent infrastructure – road, rail, [port, power, gas, water – in place Existing industrial units have given direct employment to 13,000 persons. Further, it is expected that additional 30,000 persons will get direct employment in the units underway.
Gujarat Petroleum, Chemical and Petrochemical Investment Region (PCPIR)
PROMOTED BY GIDC
Government of Gujarat
2nd Floor, Block No.4 Udyog Bhavan, Sector 11 Gandhinagar 382 017 Gujarat, India Phone: +91 79 23250636/37 Fax: +91 79 23250705 email@example.com www.gidc.gov.in
(A Government of Gujarat Undertaking)
Gujarat Industrial Development Corporation