INDIA possesses extraordinarily skilled talent but fails to create innovative products and services on a substantial basis. The author feels that despite the richness of technical skill and a talent for jugaad (creative improvisation), India has seldom produced world-renowned products, disruptive technologies or paradigm-changing research. India is currently ranked 58th in the international innovation list provided by the Economist Intelligence Unit.
Why is it that India is unable to become a source of major innovations on a sustained basis despite possessing some of the most talented persons? The author tries to answer this question by arguing that innovation is different to creativity. While individuals display creativity, transforming individual creativity into innovation in a social and collective process, organisations and social networks constitutes the arena where this process takes place. Though government policy can provide incentives to overcome some of the barriers to the social process, other barriers that are embedded in the social, cultural and political fabric are more difficult to overcome. Hence the reason why India remains “an uneven innovator” is that it has many such barriers which continue to persist.
The author feels that some of the most successful companies have reached great heights because they have innovated right across the value chain. Their innovation starts with the business model and continues into the business processes they follow. For instance, Dell’s direct-to-customer, made-to-order model in the computer industry enables it to maintain low levels of inventory, reduce the risk of obsolescence and provide attractive prices to customers. Dell’s successful implementation of this model is the outcome of innovations in sales and marketing, production and management of the supply chain.
Here the core of the argument is that companies are the primary agents of industrial innovation. While the incentive for innovation has increased after the liberalisation process, the inputs (funds, trained people and basic research and development) for innovation have not kept pace with the companies’ needs, nor has their capacity to innovate. Here the author suggests that the government has to play a proactive role in making the inputs available. Here he explains the government’s shortcomings in terms of the political economy. In the final chapter, he suggests that we need to move from jugaad to systematic innovation by creating a critical mass of new, innovative, technology-driven companies; enhancing the technological capacity of existing micro, small and medium enterprises; transforming large enterprises; creating a new incentive system for universities and institutes of higher learning; continuing and enhancing the process of dynamic reforms of public R&D; changing the structure of government involvement in supporting industrial R&D and creating supportive societal conditions for industrial innovation.
(The Utpreraka Foundation, Bangalore,Email: [email protected])