If there’s one human trait that has seen mankind through the Earth’s tumultuous history, it is the ability to innovate.
If there’s one human trait that has seen mankind through the Earth’s tumultuous history, it is the ability to innovate. The ability to make fire ensured that man no more died of cold; the invention of wheel took him to safer and more bountiful places on the planet; and everything else that we see around us today— from the printing technology that made this magazine possible to the computer on which the editorial was written to the jet engine to telecommunications— has enriched our lives in one way or another.
Yet, not everyone values innovation to the same extent or is even capable of innovation to the same extent. India, for example, spends a mere 0.8 per cent of its gross domestic product (GDP) on research and development; Fortune 100 companies alone possibly spend more. Also, the bigger investor in R&D in India is the public sector, which accounts for Rs 8 of every Rs 10, although it is quite possible that the private sector, which accounts for the other Rs 2, gets more bang for the buck.
We believe the private sector investment in R&D will rise in the years ahead. Yet, more than R&D budgets, it is the change in India Inc.’s mindset that reassures us about innovation within the country. The Tata Nano, to be marketed at Rs 1 lakh, is perhaps the best example of it, but there are several other examples of breakthrough.Cipla and Ranbaxy’s low-cost AIDS therapy, Bharti’s outsourced “least-cost business model”, Citibank’s low-balance Suvidha savings account (now launched in several other countries), ICICI Bank’s ‘factory’ model for banking, and Aravind Eye Care’s stunning success in ultra-low-cost cataract surgeries are all examples of those.
Often, companies tend to view innovation from the narrow sense of invention. They do so to their detriment. As the Business Today-Monitor Group study reveals, innovation can be anything as long as it is about new ways of creating value—value for your customers, vendors, employees, shareholders, or even the society. Such innovations, when taken together in a company, can be extremely powerful. However, to do that, companies must make innovation a way of life.