The panel discussion on “Fostering Innovation in the Next Decade,” organised in Chennai as part of the 10th anniversary celebrations of the Indian School of Business (ISB), featured industry stalwarts including B Muthuraman, Vice Chairman, Tata Steel, Lakshmi Narayanan, Vice Chairman, Cognizant Technology Solutions and member of the ISB’s Executive Board, and Vellayan Subbiah, Managing Director, Cholamandalam Investment & Finance Company. ISB Dean Ajit Rangnekar moderated the discussion.
The panelists stressed the importance of business environment on innovation. According to Vellayan Subbiah, unlike their western counterparts, the company leaders in India did not give the people enough freedom to innovate. “To drive innovation, Indian companies need to follow the more authoritative style of setting the broad direction and stepping back,” pointed Subbiah.
Quoting marketing guru Michael Porter to illustrate how companies innovate to stay ahead, Lakshmi Narayan asserted, “Do not run the same race, run a different race in a competitive world.” He illustrated this by giving examples from his company, Cognizant. While all other companies had used agreement clauses to retain employees in their organisations, Cognizant had decided not to enforce these clauses. These decisions, taken during the company’s infancy, have shaped Cognizant’s culture and set the stage for its success today. “We did some different things; since they worked, it is called innovation today,” highlighted Narayan.
The speakers also called for the need to create a culture that celebrates failures as this would motivate individuals to stretch their potential. B Muthuraman spoke about Tata Group’s “Innovista,” an event that celebrates innovative ideas, which also has a category for “successful” failures. Individuals are appreciated for their attempt to experiment boldly. He recounted how, in the first year, no one had applied for the award out of fear, but admitted that that has changed in recent times.
Muthuraman brought a historical perspective to the subject of innovation. He explained that while the term “innovation” might be recent, the activity itself had existed since time immemorial. “Every decade for the last several centuries has been an innovation decade,” he asserted. He talked about how, just 300 years ago, Napoleon Bonaparte drank wine from aluminium cups while everyone else in his court drank out of gold. At present, the trend has reversed – the status of aluminium has fallen considerably. This reversal can only be attributed to the last three centuries of innovation in metallurgy, thus affirming that the concept of innovation is not new.
Besides the corporate environment, Subbiah also spoke on the importance of competition in fostering innovation. “Competition creates an environment that causes you to want to innovate. It gives people ambitious goals to go out and achieve – that forces people to think out of the box.” To illustrate his point, he cited the example of how the financial sector in India is 23 times more productive than the agricultural sector – this, despite 60% of India’s workforce working in the agriculture sector. For productivity to increase in this sector, he believes, it must be opened up to competition.
