'Indian companies better managed than Chinese firms'

'Indian companies better managed than Chinese firms'


'Indian companies better managed than Chinese firms'

 George Eby MathewFrom the concept of zero propounded by Aryabhata, to the milk revolution started by a quiet scientist in CFTRI, to the many uses the common man had of the Luna moped, India’s lead in innovations is endless. Thanks to the relentless efforts of the National Innovation Foundation, many innovations are changing the stereotype perceptions of rural India. Following this thought, George Eby Mathew, who works as senior principal business consultant with Infosys in Australia and has authored ‘India’s Innovation Blueprint’, spoke to N Niranjan Nikam of Deccan Herald about India’s potential in becoming an innovation superpower. Excerpts:

Why are you so optimistic about India for the next 40 years?

There are several reasons for this. First, if you look globally, it is the demographics. India has got the youngest population which even a country like China does not have. If you train them properly, they could become a huge asset. Second, after Independence, India has been involved in R&D innovation implementation as an objective and it has been an asset for us. Institutions like the IIScs, the IIMs and the IITs were set up to nurture indigenous technology. Third, the mindset of the younger generation is flexible. Unlike in the past, they are connected to the world.
However, I must say, it is still a trickle. We need to focus on the rural market. That is where a lot of employment opportunities are generated. That is why I am bullish about the country.

You discuss innovation in your book ‘India’s Innovation Blueprint’. Why is it that it gives you so much hope in India’s innovation capabilities?

There are two things. One is the physical and the other is the mental infrastructure. Smart people come to India for mental infrastructure. We have this huge capacity to think. Our ancient systems of knowledge like ayurveda, vedic mathematics, yoga and music constitute knowledge industries that are dependent on mental infrastructure which is a given in this country. More than 100 R&D institutions set up in the country belong to multinationals.

What we need to do is to nurture the eco-system and that is something that is missing at present. This is also something I see as a challenge.

We often hear about superpower China being 50-100 years ahead of us. Where does that leave us?

I am using the word innovation in perspective. It is not just about a new product or service. It is a creative, problem-solving process. It is a creator of wealth. For instance, there can be wonders if in a village a drinking water or congestion problems or infant mortality can be sorted out innovatively. This is what I describe as inclusive innovation.

China adopted free market forces much earlier and hence it is ahead of us right now. It is not 50-60 years ahead of us; just about 30 years. India’s population problem has hurt the country and the burgeoning numbers have magnified the impact. And yet, India’s population has been the reason for its growth.

China and India’s journey in the next 40-50 years will be a fascinating one, full of opportunities and pitfalls. Yasheng Huang, a professor of political and economic and international management at Sloan School of Management at MIT points out that Indian companies use their capital far more efficiently than China’s. They benchmark to global standards and are better managed than the Chinese firms. Also, I learnt in a conversation that China’s one-child policy is coming back to bite the Chinese in a unique way.

On the other hand, India has a growing number of entrepreneurs who want to make money. And somehow they find a way to do it, overcoming the obstacles and bypassing the bureaucracy.

You have closely studied the National Innovation Act that was drafted in 2008. What does it envisage?

The National Innovation Council led by Sam Pitroda set up the NIA. The objective was to establish a framework to create new ideas. America is way ahead of us in this. There, all innovation ideas are private funded and hence it has more successful R&D centres, unlike India where it is all government funded.

With no institutions left untouched by corruption, there is a feeling of despondency. But your book dwells on a lot of issues that give us hope.

It is unfair to evaluate a country of India’s size and complexity before at least 100 years of sovereign history has passed. In fact, all G7 countries have had at least a 120-year history of sovereignty, with the US leading with 233 years of development history behind it. Many ignore the fact that India has more favourable metrics than many developed countries for the same time elapsed since establishment of their independent sovereignty. For example, telephone exchanges in rural India run on more advanced technologies than those of the G7 countries. All these issues make me feel bullish about our country.