Innovation in India

The morning of 17 September 2009 dawned bright and sunny in Bangalore, a city widely regarded as India’s Information Technology (IT) capital. Amitava (Amit) Roy, COO of the Indian operations of Symphony Services Corporation (Symphony), a provider of outsourced product development solutions in the software sector, was in his office poring over Zinnov’s (a leading management consulting company) latest R&D Service Providers Rating. Alongside him was C. Mahalingam (known to all as ‘Mali’), the chief people officer and head of human resources. Zinnov’s report was indeed gratifying. This survey was conducted in 100 companies in India, China, Russia, the Ukraine, and Central and Eastern Europe (CEE), and Symphony Services emerged as the top-ranked player in its chosen vertical, software product development. Amit considered the result a vindication of the organisational structural changes he had initiated in 2007, which had enabled Symphony to respond faster and better to changing customer expectations. Nevertheless, Amit wondered whether he had done all that was required to position Symphony appropriately for the challenges ahead.

Ever since Abhijay Verma graduated from the Indian Institute of Technology (IIT), Madras in 1999, he has been in the US. A brilliant student, Abhijay was also an intelligent and hardworking scientist. He worked in a well-known research and development centre in New York as a scientist. His boss and MD, Steve, was quite happy with him and was even considering promoting him. Married to a north Indian lady for the past six years, Abhijay has a three-year-old daughter. He was often spoken about as a happily married man with a high-paying job. His work provided him with the freedom to concentrate on research and the centre’s infrastructure was comparable to the best, and he didn’t have to deal with administrative matters. His company’s high-performance culture laid emphasis on high-integrity business practices, along with work–life balance. The ‘yes boss’ culture was almost non-existent. Everything seemed just fine for Abhijay but often he would look sadly out of the window and reminisce/wonder about his home country. Going back to India and settling down there was always on his agenda. The option was always there, but would he get the same kind of work environment that he had at his R&D centre in New York? Would he get a high-paying job there and an understanding boss like Steve? These were some of the questions that were going through his mind. He asked some of his IIT classmates to search for a research centre in India that would give him the kind of job satisfaction that he was getting in the US. One day he received a phone call from his scientist friend, Anshuman, in Bangalore (India), who informed him about GE’s John F. Welch Technology Centre (JFWTC) in the city.

Srinivas Pingali, executive vice-president of new product development for Quatrro, and former head of Accenture India’s insurance vertical, considered the challenges facing the company in its quest to become a leading knowledge process outsourcing firm. Though the company had grown 300 per cent in the past year to achieve a turnover of US$70 million in 2008, it had projected its revenue at US$160 million in 2012 at a compound annual growth rate (CAGR) of 92 per cent.

When American Express launched its Indian rupee card, the operations at its Indian division were revealing. The company found that the cost per transaction from India was significantly lower than those of the more advanced markets and that the quality of the output was also significantly superior. According to Raman Roy, touted as the father of the Indian outsourcing industry, who was in charge of the operations, ‘The real gains were greater because of our execution efficiency, the number of first-call resolutions of customer problems, and the ease with which we resolved the issues (which was purely a function of our more qualified and better educated staff)’ (Knowledge@Wharton, 2003). Realising the substantial advantages of the Indian operations, John McDonald, the controller at American Express, soon added more responsibilities and the Indian unit became a key part of American Express’ global operations. Overcoming a number of technological hurdles, Raman Roy, in charge of the Indian unit, was able to show superior work and also the resultant cost savings that were possible.

Overwhelmed by escalating pressures to reduce health care costs, elevated R&D budgets, diminishing numbers of new drugs as against leading blockbuster drugs going off-patent, coupled with numerous regulatory challenges in the West, global pharma companies were increasingly exploring low-cost options but highly skilled destinations for offshoring their pharmaceutical services in order to attain maximum efficiency and productivity. Consequently, in the race for survival, major pharma and biotech companies were seeking to keep hold of their drug discovery and portfolio management, while outsourcing their manufacturing and research processes, thus developing a cost-effective business model in the highly competitive arena and substantiating an ever-growing demand for contract research and contract manufacturing services.

Bangalore has long been known as India’s information technology hub, and just a five-hour drive away from the city is Chennai, the southern metropolis of India and the capital of the state of Tamil Nadu. It was an unusually extended summer morning for 32-year-old Sakthivel Venkatraman, the managing director of operations of the New York headquartered Cobra Legal Solutions LLC (CLS), one of the leading legal process outsourcing service providers. Sakthivel was busy streamlining the operations in India and spearheaded the expansion plans. He had just moved to their new facility at Ascendas International Technology Park and was pondering over various strategic opportunities and challenges of the promising new business landscape. The increasing acceptance of outsourcing legal processes in the West had pumped up the growth rate of this new opportunity and also invited several new players to enter. Nevertheless, it also threw up unique challenges for the service providers in India and especially for the fledgling ten-year-old company. According to Sakthivel, the way the Company started was an interesting story in itself, since CLS did not originate in USA or India’s major business or law schools.

eInfochips, an Indian IT company based in Ahmedabad, is an internet protocol (IP)-driven product development services company conducting global business activities in electronics design services and providing solutions in chip design, embedded systems and application software. The service and manufacturing capabilities of the company extends from specification-to-silicon-to-system to Chip/ASIC/SoC design and verification, physical design, board design, embedded system designs and testing, IP core and application development.