No person, and no organisation for that matter, is an island. To be innovative, one ultimately needs a good ‘innovation ecosystem’ that comprises stakeholders ranging from educational institutions to investors. We do have such an ecosystem in India, but it could be improved. And you can play a key role in this regard.

Building an innovative and successful company requires the cooperation of a number of people and entities. These include research organisations, educational institutions, investors, banks, capable employees, law and finance consultants, and supportive government policies and tax structures!
Such an ecosystem is not just important for the creation of an innovative product, service or company, but also for its survival. So, when you think of the future of your company, you cannot do so without taking into consideration the health of the industry, which in turn would lead you to think about the maturity and dynamism of the country’s innovation ecosystem. Decades down the line, we will definitely have a vibrant ecosystem, but what will it be like in 2010? Every person who is on the verge of starting an entrepreneurial venture or at the helm of an IT company today would like to know the answer to that question. Well, we cannot claim to have all the answers, but we did consult a few experts in the field in this regard. Some of the indicative trends that emerged from our discussions are outlined below.

1. The economic slowdown will make innovation more important

Innovation will become more important than ever before. The reasons are many: growing global competition, rising opportunities and even the economic slowdown!

Areas such as telecommunications, nanotechnology, biotechnology, nuclear technology, sustainable/renewable technologies and infrastructure are rapidly growing in terms of innovation and adoption. With its knowledge capital, India is faced with unending opportunities to innovate profitably in these fields.

Apart from innovating to compete on a global scale, India also has a large domestic market to cater to. “Nationwide, innovations will be focused towards developing technology that will help in making products and services affordable and distributable to the masses at the bottom of the pyramid. Today, innovations like short message services and mobile telephony are being exploited to deliver simple solutions like market prices to millions of people across the nation in rural areas,” says Prakash Pai, president & head - Product Management Group, Nucleus Software.

The economic slowdown will not stall but will, in fact, spur innovation. “The economic meltdown, which we expect to be deep and protracted, will force companies to innovate, and do things better at a lesser cost,” explains Arjun Rao, CEO, ValueLabs. He adds that there are key considerations and opportunities before the business community—like environment-friendly/green growth, reducing dependence on fossil fuels, and so on. All of which call for an innovative approach.

However, it will not be smooth sailing, especially since the financial crisis may make it tougher than ever before to get private equity funding for R&D projects with long gestation periods. But innovators will not stop working; they will simply refocus. Rao feels that rather than focusing on new products, the innovation initiatives taken by organisations will now be market-focused and will look at improving existing processes, delivery mechanisms, cost structures, etc.

Pai echoes these sentiments: “In the core industries, innovation will be focused on setting up manufacturing plants at the lowest cost in the world to ensure that our manufacturers have an edge in world markets for the products they manufacture. The most celebrated examples are of Tata Steel and Reliance Industries.”

Forecast: Nascent technologies wait to be tapped by innovators, but funds may be scarce due to the financial crisis. However, the economic slowdown will not stall innovation—it will make it a matter of survival. At the moment, organisations might concentrate on market-facing innovations rather than new technologies.