The subject was innovation, the setting was a round table discussion at the Tata Management Training Centre(TMTC) in Pune and the participants were some of the brightest names in corporate India. Having a cast with impeccable credentials meant a freewheeling exchange of views on a topic that holds one of the keys to unlocking India's potential in the global economic marketplace.
Moderated by B Bowander, director of the TMTC, the innovation round table was focused on India and Indian companies, but it also took in global developments in the field, what it takes to nurture creativity, and the practicalities of making innovation an integral part of everyday operations in organisations.
||AS Abhiraman, director, Hindustan Lever |
||Bhaskar Bhat, MD, Titan |
||Deepak Ghaisas, CEO (India operations), CFO and company secretary, I-Flex Solutions |
||MS Mithyantha, VP, Rallis |
||Mathai Joseph, senior VP, Tata Consultancy Services, and ED, Tata Research Development and Design Centre |
||R Mukundan, COO, Tata Chemicals|
||S Ramkrishna, VP, Pfizer |
||V Subramaniam, intellectual property rights consultant |
||V Sumantran, ED, Tata Motors|
Moderator: B Bowonder, director, Tata Management Training Centre
Bowonder: The first issue we would like to discuss is innovation as a source of competitive advantage. Some circles speak of India as being far behind, while there are examples to prove the contrary. We would like to then move on to how companies can make innovation a part of their corporate philosophy.
Bhat: I read an interesting article that differentiates innovation and invention. Invention triggers this image of a mad scientist in a lab trying to develop something, and it implies that talent and access to a whole lot of knowledge is essential. Innovation, on the other hand, suggests a mindset that questions the status quo for a product or process. If innovation has to be a part of the DNA of a company, it should permeate the way you produce and market products and services. Having said that, innovation means different things in different industries. Innovation in pharmaceuticals may bear little resemblance to innovation in the fashion or automobile business. I don't know whether they converge in the same kind of outcome, processes and mindsets.
Mithyantha: To supplement what you are saying, innovation is invention plus exploitation. The application of new ideas need not necessarily be in the developing of a new product; it could be a new application for an existing product. For example, farmers in Punjab used a combination of insecticides to destroy a deadly cotton worm. That's an innovation.
Ramkrishna: India has a cultural problem, in that we fail to see our own innovations. We devalue the concept of innovation ever so often; we fail to see that something which is a product of our genius is capable of having commercial value. Serendipity is no longer a source for innovation.
Mukundan: Awareness about innovation is pretty poor. That became apparent recently when we, at Tata Chemicals, invited some people from the Indian Institute of Management, Ahmedabad, to do a study of our plant and our processes to see whether we could do anything innovative. In the first round itself, they came up with 67 different ideas that could be patented.
Sumantran: It's probably fair to say that, as a country and as a culture, we have had a poor track record in invention, but we have done much better in innovation. Sometimes innovation is thrust upon us by economic realities. Coming to the auto industry, it would be unimaginable for us at Tata Motors to outspend the global big names in terms of cutting-edge R&D. This has forced us to constantly innovate in terms of technologies and systems, and I think the observation is quite right that we don't recognise much of what we do. It's said that nothing breeds creativity like constraints. The thing to do, going ahead, is to catalogue the innovations that have happened and disseminate that information to create awareness.
Ghaisas: I have a different take on this. The pace of invention or innovation in technology is fast, but their commercial exploitation is slow. One of the disadvantages of a networked society is that every innovator is waiting for somebody else to come out with similar ideas, which are then combined and made a commercial success. The dot-com story is a good example. People said in the late 1990s that e-commerce was possible, but there was a problem with the bandwidth then available in the country. Maybe we were much ahead in terms of innovation to make a commercial success out of it. The pace at which innovations are coming up is fast, but the pace at which they are becoming successful or commercially feasible is slowing down. That's happening all over the world in the IT industry.
Bhat: There is a social and an economic side to innovation. Ours being a paternalistic society, questioning the status quo is not easy. Organisations can change this mindset only through empowerment. Innovations occur at an individual level; they do not happen at some esoteric 'company' level. Indians are creative, but whether they translate that into an organisational benefit by questioning the current status quo depends on the culture of the organisation and its structure. Empowerment, encouragement and recognition are needed to build a culture of innovation into the DNA of organisations.
Mathai: There are two aspects to innovation. The first we are very good at, which is making things work in the face of constraints. The fact that business has thrived in India for so many years in the face of several constraints is evidence of this. There is another side to innovation, the disruptive one, which challenges the way you do things. Culturally, socially and economically, we have been less empowered to take risks.
Sumantran: There's a trend that I'm sometimes concerned about. Empowerment is certainly important, but there's another contributor and that is the freedom to think. There is a dangerous side in our drive for efficiency. Many large manufacturing industries are not giving their people the time and space they need to think. We have to ask ourselves if we are allowing people enough time and resources to truly engage in creative ideas.
Ramkrishna: If we were to look at two kinds of people from whom innovations or inventions originate, one is the conventional or classical concept of an inventor: frizzy hair, slightly maverick, an intrinsic genius. Then you have a different set of people who work as individuals but within the confines of a focus group. They don't have the luxury of any wide-open system. They operate in fairly pressurised environments, but some of them are geniuses and do fairly well.
Sumantran: I wonder whether there would be a danger in identifying two species. Perhaps there is just one species, with a little bit of that fuzzy hair thrown in.
Ramkrishna: It's probably the personality traits. One doesn't like to be confined, so will perhaps be happier in a university setting, while the other takes home the challenge of needing to deliver.
Sumantran: I would push the point further. There used to be a time when organisations said quality is the responsibility of the quality department, but today we say quality is what everyone should do. If we talk about innovation in the same spirit, as a state of mind, then it is likely to seep into every part of the company. It's amazing how much time Japanese manufacturing companies give their people at the end of every shift just to talk about what has happened. It's not the unconfined space a researcher would have, but more like a 20-minute session to say what went right and what went wrong, or what could have been done better. This sort of elbowroom has triggered enormous innovation and productivity in a variety of areas. I've dealt with colleagues at my old company in Japan and it is not uncommon for them, for the entire department, to finish the day and then go to, say, a bar and spend a couple of hours in a different environment. They are still thinking and talking about work; that's their creative time and it shows in their products and systems.
Ghaisas: In the IT industry it's a little different. I-Flex has 3,000 people and it's an intellectually volatile mass. We don't differentiate between R&D and line people. We have an intranet where people can post their ideas. A committee of seniors goes through these and awards recognitions to those whose ideas are implemented. That delivers empowerment and encouragement. The flip side is: how does one keep the balance between process adherence and innovation? If I do not adhere to a process and everyone wants to innovate and beat the process, then that becomes a major task. In the final analysis, the customer must be happy.
Mukundan: Our dilemma has been how to make people question the big questions rather than the small ones. One of things we have institutionalised is the building of linkages with research institutions that are far away from our workplaces. We give them projects and ideas to work on that are disruptive to our processes.
Bhat: Do you really need disruptive innovations? The way we are organised and the economic output and pressures of day-to-day work force a large number of incremental innovations that occur across the length and breadth of the company. First of all, for disruptive stuff to happen we require a huge knowledge base. People dealing with current technologies are limited to that and often do not have the time to acquire new knowledge. Instead of a few people innovating, if a large number innovate you create an innovation culture in the company. At Titan, we want to encourage more innovation in our backroom activities such as supply chain, production, etc, and not just among people in marketing and branding.
Sumantran: All problem solving which leads to innovation starts with how you define the problem. If you define the same problem differently, you open yourself up to a new set of solutions.
There is always the balance between the less you know of it the better, to the more you know about it the better. The group which subscribes to the former theory is, no doubt, better at breaking down constraints. If you don't know the constraints, you see fewer of them. But, by the same token, for every single disruptive innovation, we need 99 incremental ones. I guess there has to be a constant balance between not knowing enough (or not wanting to know enough) and knowing enough.
In the American auto industry, it is common practice for the big three manufacturers to send their people to California, far away from Detroit, and set up an innovation studio there. They try to populate it with people who have worked in the industry before, and they give these professionals plenty of time. They are removed from some of the local constraints and yet have some relationship with the processes and the industry. In Europe they would send you to Amsterdam, a freethinking city where you can have fun and be creative.
Subramaniam: What the IT industry calls skunk works. Do you think one solution could be to have those who know very little about the problem listen to those who know plenty about it?
Sumantran: Actually, you made a very good point. At Lockheed, they were up against a tough problem and they sent a team to solve it. This was the time when the aviation industry was just learning how to manufacture jets. They framed the problem thus: I want to fly at 100,000 feet, non-stop for 22 hours and be undetected. This was an aircraft nobody even knew how to make and Lockheed pulled it off. That's how the word skunk works derived its origin.
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