Turn Ideas into economic growth

Kiran Mazumdar-Shaw 
Member, National Innovation Council, & CMD, Biocon

In today's knowledge-driven economy, innovation is the prime driver of progress. India's ability to generatewealth and create social good will come to naught unless we monetise innovative ideas by unshackling entrepreneurship. For innovation to flourish, we need to fund ideas to take them to market. Without capital, even the most transformative ideas can die before they take wing.

India's economic agenda is being shaped to deliver high growth based on an innovation matrix that cuts across social and economic activity. This approach is expected to result in economic reforms and value-added products and services that are key drivers of India's progress. Whilst the strategy is sound, the process of implementation is pivotal to its successful outcome.

Financing the innovation ecosystem: What India needs is a national innovation ecosystem that puts in place a financing cycle: academia generate ideas, especially those based on science and technology, which are incubated to proof of concept through government-sponsored seed and incubation funding and then taken to market through businesses backed by venture funding. India's ecosystem is not only suboptimal but it also lacks a some enabling mechanisms that can help innovation germinate and take root.

Let's start with academia's role in generating ideas. While government funding supports this phase of the innovation value chain fairly adequately, it falls short in nurturing ideas and growing them to a proof-of-concept stage where business can intervene. The notion of incubating start-ups within academic institutes is still nascent. The regulatory reforms that permit researchers to unconditionally assume dual roles as academicians and entrepreneurs is yet to be fully implemented. Academic entrepreneurs have virtually built the entire US technology sector and are continuing to do so despite the economic recession. India urgently needs to emulate this aspect of the US innovation ecosystem.

It is when the proof of concept is taken to the market through a process of commercialisation, that venture funding makes the critical difference between an idea and successful business. Venture funding relies on a regulatory framework that encourages risk-taking. Today, venture funds in India typically steer clear of risk-ridden small business ventures, leaving a huge funding vacuum in the commercialisation process. Venture funding in the US, on the other hand, is at the heart of driving innovation to the market. A sobering statistic offers food for thought: Venture capital investments in India reached $658 million in 2010, a 19.8% increase over 2009, according to data collated by Venture Intelligence. Compare that with China where venture capital investments reached $5.4 billion in 2010, a 79% increase over 2009.

A secondary stock exchange: I strongly believe the disconnect lies in lack of access to capital markets. Technology companies that do not have revenues are not eligible under Sebi guidelines to apply for listing. Such companies are stuck in a loop in terms of availing venture funding: venture capitalists won't fund technology companies that don't provide exits to capital markets and capital markets are not available to such companies owing to listing regulations. Industry bodies such as the Association of Biotechnology-Led Enterprises (ABLE) have been pushing Sebi for differentiated eligibility criteria for technology, research and innovation-driven companies for several years to no avail. Unencumbered entry and exit will be the catalyst in taking innovation to the next level.

So, how do we create an enabling innovation ecosystem that enables entrepreneurs to propel ideas into a sustainable business that adds value to our economy? The only option is to set up a secondary stock exchange to allow technology-driven, revenue-less, innovative companies to access capital markets, emulating the role Nasdaq plays in the US for technology companies and London's AIM for technology companies in the UK. This will spur innovation and unleash an entrepreneurial avalanche that will transform the pace of value-added growth in the Indian economy.

Drip feeding innovation will not build a sustainable technology sector, nor will risk-averse investors build a credible innovation ecosystem. Innovation requires sustained capital infusion both by the government and private sector. Unless investors are willing to back innovation, it will not create a credible knowledge-led economy that delivers high value to the economy. This is the underlying rationale for a secondary stock exchange for technology/innovation-driven companies that do not generate revenues but drive value creation as they approach the market.

Beyond capital markets: The ecosystem must also facilitate curiosity-driven research across academia and business. India's diverse social and economic challenges provide a substrate for innovative solutions that can create innumerable business opportunities based on affordability and accessibility. The size of the Indian market adds to business opportunities. But the optimal financial model to catalyse innovation is missing.

The government has initiated the investment process through some financing mechanisms that cut across grants, seed and incubation funding. The private sector now has to bring in the next level of funding through venture capital and access to capital markets. We need regulatory reforms that enable the creation of another exchange to spur innovation. Ideas abound in India. The challenge is to monetise these ideas through successful ventures. Only then can India move rapidly up the value chain to achieve faster, more sustainable growth.

Team India Needs to Turn It Around Like Corporates

Source : The Economic Times    

5 Reasons for India's loss to Australia :

1. Poor Hiring Policy (Hiring without competency based practices)

2. Poor Succession Planning

3. Failure in Leadership

4. Poor strategic planning and execution

5. Lack of Team Work                                                                                                                                                                                                                                                                                                                                                                                                                                   
Former Australia captain Steve Waugh once told his bowlers ahead of a Test series against India: "If you get (Rahul) Dravid, great. If you get (Sachin) Tendulkar, brilliant. But if you get (VVS) Laxman, it's a miracle". The Aussies managed to achieve all the three in the recently-concluded series in which they blanked out the Indians 4-0.


What makes a star-studded team that seems invincible on paper flop? It's a question that not just the legion of frenzied followers of the flannelled fools are grappling with; pinstriped promoters in boardrooms and corner rooms of India Inc time and again are confronted with a similar dilemma, particularly when growth isn't a given and competition is cut-throat. After all, the problems are not dissimilar.

Failure in leadership; conceiving poor strategies and executing them even more poorly; the sudden realisation that yesterday's stars don't glitter anymore; and the sinking feeling that inadequate attention was paid to planning for their succession during the win-win days are some of the parallels that can be drawn between India's down and out cricketeleven and sections of corporate India that are in the wars.

Team India today resembles a once-successful corporation that rested on its oars when the going was good and then got caught out by a near-fatal combination of complacency and harder-working competition.

To complete that corporate analogy, Indian cricket is a bit like Nokia, the Finnish handset multinational that could do no wrong in the 90s, but has since been on the decline thanks to the ascent of nimbler smartphone players like Apple and Samsung.

The Indian team's decline mirrors Nokia's, albeit over a shorter span of time - it became the number one team in Test cricket two years ago, and won the World Cup in 2011. But it's been pretty much downhill since then, with eight overseas Test defeats on a trot.

Nokia brought in Microsoft heavyweight Stephen Elop to stem the rot; and has since aligned with the makers of the Windows operating system to script a comeback. Who should the wise men at the Board of Control for Cricket of India (BCCI) turn to?

Or, more importantly, what should be the way ahead? Let's start with leadership - it's time for a change.

Succession planning should be priority of BCCI

"The role of a team leader is to get things done through their team and obviously this is not working," says Amit Nandkeolyar, assistant professor-organisational behaviour at the Indian School of Business (ISB), Hyderabad. The professor adds that a captain needs to highlight and define "collective" goals, and guide team mates towards achieving these goals.

"When team members believe they can achieve their goals, they are more likely to engage in pursuit of a task. A low level of belief works against the team," he adds.

The immediate priority of the BCCI should be succession planning.

Experts point out that the exercise should have begun yesterday. Says TV Mohandas Pai, director, Manipal Universal Learning, "In the corporate world, succession planning spans many years. We have an ageing superstar cricket team." He adds that it doesn't help that many of them are in the same age bracket and will retire at the same time.

"There is clearly a lack of strategic planning, risk assessment and succession planning. Especially, when the cricket calendar is known for the next three years," adds Pai.

A predicament related to age, and overachievements in the past, is the lack of passion to win. That's when complacency, and the famed Indian 'chalta hai' attitude, seeps in. "You have to be desperate to succeed," says K Sudarshan, managing partner of search firm EMA Partners. "What chances are there for this desperation to exist when you have been there, done that, with an array of achievements to boot," he asks.

The BCCI could also go back to the drawing board and stress the virtues of team work - planning and executing strategies is rarely the work of one individual.

The Indian team is blessed with super-talented individuals who aren't quite jelling as a team. "You can have a great individual performer, but if he cannot work well for the team, it just does not work. The team is paramount," says Ajay Srinivasan, group CEO of Aditya Birla Financial Services.

Management gurus also explain it is extremely important to acknowledge that team success is accorded the topmost priority and individual records are kept subservient to that goal.

Elango R, chief human resource officer at MphasiS, has often seen in the corporate world teams failing when there are too many stars. "A star - at the work place or in the cricket team - is a star as long as the team wins," he says.

Many of Team India's 'stars' are guilty of overstaying the party. That can prove suicidal for a second rung of leaders in the context of India Inc. In the context of Team India, it is suicidal for the next-gen players like Virat Kohli and Rohit Sharma.

"There are examples of senior executives overstaying by 7-8 years in a company and in the process killing a generation of future leaders by not giving them an opportunity. There's a lot of fatigue in such experienced people," Sudarshan says.

Bidding adieu to yesterday's super-achievers may be an imperative, but it is also a delicate matter. "We are talking about firing legends," says Nandkeolyar. "The first step is to acknowledge their experience and let them know that there is a problem," he adds. Also, if the captain has to be sacked so be it; he can still stay back as a player, if he is good enough.

The ISB professor points to scenarios in the corporate world where "younger people are managing much more accomplished but older employees".

Finally, it all boils down to hiring and appraisal.

"To me, it's a hiring issue. The mental make-up is tested only at the time of failure," says Abhijit Bhaduri, chief learning officer, Wipro. "People are hired for competency and fired for (lack of) mental make-up." Is the selection committee listening?

Mobilizing the Population

SAP Citizen Connect, a new app for the public services sector, empowers citizens to connect with public agencies using their smart phones.

Source : SAP AG


You’re walking along a street in your city or town, and you see a piece of dangerous debris in the roadway. Or maybe you spot an overflowing trash can, or some offensive graffiti. You’re a good citizen, but – really – how likely are you to head home, research the appropriate government agency, look up contact details, and then spend time on the phone connecting to the right person to report the issue?

Now, imagine yourself on that same street coming across graffiti, roadway debris, or teeming trash. You snap a picture with your smartphone, and just a few taps later the issue is reported to your local government – complete with the exact location via GPS – and directed to the right department. Later, you can track the case with your mobile phone to monitor how the local authority responds.

You’re a lot more likely to take action in the second scenario, and a new mobile app from SAP makes it possible. SAP Citizen Connect is a self-service channel for citizens to report public issues to local authorities. It connects to SAP CRM and SAP ERP back-ends, enabling municipalities to enhance the value of an existing SAP infrastructure.

“Mobile reporting gives citizens a quick and convenient way to interact with local government,” says Andreas Muno, SAP solution manager for Mobility in the public services sector. “For governments, it offers a contemporary way to engage and connect with citizens; convey a fresh, modern brand; and improve efficiency by reducing call-center workload and streamlining processing.”


Examples of the kind of issues citizens might report via SAP Citizen Connect include graffiti, potholes,  flooded streets, felled power lines, overflowing trash, and  broken playground equipment. GPS built into smartphones automatically transmits a physical location, and built-in cameras allow mobile users to submit photos. When reporting, citizens tag their issue in pre-configured, custom categories for automatic processing in the city’s backend system.

Citizens can then track their issue, which Muno says can help improve government services generally. “In effect, citizens use the app to monitor the city’s performance, which is incentive for municipalities to make their processes more streamlined and cost-effective.”

Meanwhile, SAP Citizen Connect addresses two key trends driving change in citizen-centric service agencies: efficiency (doing more with less) and the demand for municipal services that are intuitive and easy to access. “Citizens expect the level of service they get from interactions with private sector entities like Amazon.com and online banking,” says Muno. “And they expect this better service despite diminished resources and revenue.”

SAP customers running ERP 6 or CRM 7.01 can implement SAP Citizen Connect in a matter of days.   Once deployed, the customized SAP Citizen Connect mobile app can be offered to citizens via the local agency’s web site.

When a citizen initiates and categorizes a report, a case (CRM) or notification (ERP) is created, capturing the data and initiating a workflow. The categories are configurable in the SAP backend, as are the associated workflows.

“It is quite flexible and easy to brand,” says Muno. “An organization can put its ownbrand on the start page of the app and that makes SAP Citizen Connect a very powerful marketing instrument for dealing with citizens and consumers.”

SAP Citizen Connect is relevant not only to public service agencies and governments, but any business that has facilities and/or physical assets to maintain. Enterprises, for example, might use SAP Citizen Connect to allow employees to quickly report issues on corporate campuses to facility management.

SAP Citizen Connect was released in October 2011. “We based our development on research we conducted in cities that have successfully deployed mobile reporting applications, including San Francisco, Toronto, and Boston,” says Muno.

Anyone can download the SAP Citizen Connect application free from the Apple iTunes store. Of course, unless the mobile app is connected to a backend system, it’s just a “sandbox.” Customers can learn more and download the SAP Citizen Connect application from the SAP EcoHub or ask their sales representative for a live demo.

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Management One 

CEO - Next Destination of the HR Professional

Management of Intangibles is emerging as the main challenge in any transformation program in an organization

Source : People Matters

An interview with Dr. Khandelwal - CEO of Bank Of Baroda

The HR explosion all around is evident, given the number of conferences, seminars, books and papers that have been published and presented on the topic, but most often than not the topics and the narrations come to us as rhetorical sermons. In the emerging business environment, the core of the HR function cannot be restricted to employees alone. It has to also include customers – the very reason for business, culture, processes, governance, technology, issues of quality, etc. Together these can be clubbed as ’Intangibles‘. Numerous research studies world over suggest that intangibles contribute 40 percent of the market value of the company. Management of these intangibles is emerging as the main challenge in any transformation program in an organization, and is the new agenda for HR professionals.Introducing a column which shares the rare story of an HR professional becoming a CEO. As CEO, Dr. Anil K. Khandelwal, was able to achieve dramatic business outcomes because of his extensive HR experience. In his subsequent columns, he will share his journey from being an HR professional to becoming the CEO of Bank of Baroda

Remaining quarantined on ‘employee’ issues alone can lead to stagnancy of both the function and the HR professionals. The precise challenge ahead is how HR professionals can prepare themselves to take charge of the intangibles and promote their intrinsic value to the organization – professional preparation as well as soiling hands in the new business functions and demonstrating success.

My own professional journey from being an HR professional to becoming a CEO could be facilitated only when I took up the challenge (after initial reluctance) to banking operations in a difficult industrial relations environment. It brought me in touch with the real world and real business issues such as customers and their aspirations, problems and a host of concerns impacting the business. While the transition from HR to mainstream operations was challenging, it was also equally exciting. It was during this time that I discovered that the main challenge of any operations manager was ‘people management’. My learning in operational assignment had been phenomenal and that helped me to understand how employee attitudes affect customer acquisition, retention and loyalty; how communication culture affects business growth, what are the key concerns of analysts, investors, key customers and how they affect business growth; and how competitors’ strategies impact our business. In fact, my operational exposure helped me immensely to discover my own innate potential for other disciplines like marketing and technology in particular. I would emphatically say that the most effective and durable learning takes place when one is in field assignments.

One can never get to know ground zero realities by merely attending business meetings or being part of strategy groups. I believe that HR professionals should increasingly volunteer to take up business roles.

In my role as Chairman of Bank of Baroda, my continuous emphasis on building intangibles such as rebranding of the bank including logo change, customer-centric initiatives, deployment of technology, improving internal processes, talent and leadership development, and engagement of staff, resulted in dramatic business outcome and in turn, a major positive change in the perception of analysts and investors. Connecting with the people and speaking the language of business all through ought to go hand in hand, in my view, to get best outcomes. I am happy that even after my retirement, the bank has continued to perform exceedingly well on the different pillars of intangibles. This amply suggests that when we assiduously work on intangibles, performance of the organization improves and is sustained on a long term basis. My HR background helped me to diagnose and design appropriate interventions and lead execution with precision.

Mere number crunching CEOs are increasingly becoming irrelevant as CEOs who are visible, accessible and hands-on, are becoming more popular to lead organizations. In an environment where customers and employees are becoming increasingly vocal about the issues that affect them and their retention is a greater challenge, corporations need leaders who can engage with both employees and customers alike and can build seamless relationships with both. Maverick leaders who are creative, are open to take on new initiatives and can engage stakeholders in a new way will have greater chances of business success. Thus, a HR background is increasingly turning out to be a competitive advantage for the CEO role.

A CEO with a substantial HR background is in a better position to take long term steps to shape the organizational culture, identity and brand, and focus on building capabilities for future as well as set effective governance structure. The journey of HR to CEO will, however, depend on many factors such as willingness of HR professionals to accept an operational position, demonstrating a different style of management, continuous learning and experimentation with new ideas and methodologies in managing business. While at present, there may be only few HR professionals becoming CEOs but the trend is encouraging. 2012 will perhaps see many more HR professionals occupying the corner office and other top management positions.

Dr. Khandelwal is an HR professional who made it to CEO of Bank of Baroda (BOB), a staid large public sector bank and turned it out in a short tenure of 3 years. BOB today is a powerful and valuable banking brand. In this column, he would share his code of leadership that helped him achieve extra-ordinary business results. His book Dare to Lead (Sage 2011) captures his experience of the turnaround. Dr. Anil Khandelwal can be contacted at akk1948@gmail.com

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