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Thursday, April 10, 2008

Innovation in IT in India

I was introduced to Charu Bahri by Balaji.
Charu writes in various magazines etc on many subjects, For an article she is writing she asked me very interesting questions: I am reproducing the questions and my responses verbatim below. Thanks Charu for asking these questions and Balaji for introducing me to Charu.

The top three challenges to (IT) innovation in India today?

1. Indian IT companies past success is the biggest challenge. This success> has created a set of managers whose mindset is to continue the old ways> which led to explosive growth that Indian IT companies has seen. These> managers do not allow a new initiative or change by new engineers. There> also is an element of insecurity which may have its genesis in the problem> of being stuck in old technology, old ways, old methods or even old mindset.> Anything different is considered a threat and systematically snubbed.>>>>

2. Companies used to triple and double digit growth are now finding new> ways to keep the growth going by various means. For example, employing> non-engineers to carry out the work carried so far by engineers. This> strategy is based on a belief that the work that the companies get or will> get will continue to be low-end and hence the cost of employing an engineer> is unnecessary. Further problem is that employees who join these programmes> are continuously reminded of their status (as non-engineers) and thus they> can not focus on thinking beyond the confines of what is told to them.>>>>

3. IT Services companies are so used to USD-INR conversion business model> that they do not have any inclination for investing in anything that does> not comes within the confines of this model. Hence even if there many> instances of ideas that can become products – the IT companies subdue it> under the motherhood statement of we are a services company. Many of the> ideas thus are stillborn. However, recently there is a streak of> entrepreneurship emerging in Indian IT scenario – which should be encouraged> and in fact is a welcome change.

Problems existing enterprises are facing in launching innovative> initiatives.>>>> ·

The problem lies in the mindset of "Launching Innovation> Initiative". This is considered something beyond and above the regular work> that employees are engaged in. Since employees don't get any understanding> of how these initiatives will be connected to their regular work, they don't> contribute and the so called initiative fails. Some companies which realize> that Innovation as much of our work is actually a social phenomenon whereas> invention can be an individual mind's work, are able to create structures> and processes that create opportunities for innovation in the social> interactions. These are coming up as possible ways to innovate in the> enterprises.>>>> ·

There is a psychology of fear of failure syndrome that is very> acute in old-timers in the enterprises. These cliques are so powerful that> the scuttle the innovation initiatives politically.>>>> ·

Too much of process orientation and forcing people to follow the so> called processes have created what I call "Process Junkies" out of IT> engineers. It is difficult to imagine how systematically the processes keep> on killing innovation under the tutelage of Quality, delivery repeatability> and delivering predictable, repeatable and regulated processes.>

What are the external/internal environmental factors that deter a tech> start-up firm? How may these be overcome?>>>> ·

The biggest issue is the irregular cash flow. The VC-Model and the> Angel Investor models are already there, but I think, if the start-up can> get a potential customer to pay for the product cost with a possible value> in the product profits, it will be fantastic.>>>> ·

Second is the lure of external opportunities for key members of the> team when suddenly one of the key members leave for green pastures offered> outside. Despite the friendship basis that tech start-ups start, it will be> pragmatic to keep in writing as an agreement how long the team should be> committed (say two years or for the sale of first product).>>>> ·

Third problem is not protecting the IP. This is where the ignorance> of the start-up comes as a major constraint. It makes sense in getting IP> advice upfront from a well-established IP firm.>>>> ·

Passion, belief, vision and a sense of doing something together in> the team has to happen in the order. If any of these is missing potentially> the long-term viability may be questionable.

The Management of Innovation, not the invention/techie part, is> actually a social phenomenon. People adapt in social engineering need to be> brought in to propel the tech start-up.>>>> ·

Cash flow management is typical weakness of start-ups. There has to> be clear cash-flow management strategy and execution team should be there to> focus on cash flow.>

Who makes a good founder of a tech start-up?>>>>

Anyone who is passionate about the technology, ready to invest deep effort> and long hours is developing his technology and who believes that what he is> doing is actually relevant for the world at large.
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