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Innovate to remain globally competitive

BANGALORE: Indian firms, which successfully navigated the first two phases of the business — Indian Information Technology-enabled and Business Process Outsourcing industry — based on cost advantage and brand consolidation, must now be prepared to innovate if they want to maintain their global competitive edge, Kiran Karnik, President, National Association of Software and Service Companies (Nasscom), said here on Wednesday after releasing the ‘Indian Innovation Report 2007,’ jointly prepared by Nasscom and the Boston Consulting Group (BCG).

The report estimates the additional opportunity for players who are able to create IT at around $50 billion by 2012. In other words, innovation can double their share of the cake.

The report finds that the biggest opportunity lies in innovating within the ITES-BPO sector itself — $17.3 billion, while engineering and R&D might provide another $9.2 billion. The balance can be mopped up by various product development opportunities. The report is candid when assessing the challenges facing the industry today.

The report saw a big scope to implement ‘bold changes in policies related to innovation’ — like patent and copyright laws and venture capital for the domestic sector

The association has not spared itself and records the need to scale up its existing initiatives to spur innovation. It has been asked to set up an India Innovation Fund for seeding promising start ups; and an ‘Indi Innovation Certification’ programme.

The report also recommends taking the ‘cluster’ concept much further than hitherto.

It recognises the existing clusters like Chennai for mobile and wireless; Pune/Navi Mumbai for automobile and the financial sector; Bangalore for semiconductors, Hyderabad for engineering services and integrated circuits and Noida for agriculture.

But in a special briefing for The Hindu, Nasscom Vice President Rajdeep Sahrawat pointed out that the mere presence of an IIT or IIM in these clusters was meaningless — unless these academic institutions were ‘talking 217; to the industry concerned... something that did not happen too often.

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