The buzzword in the Indian corporate circles these days is “Make in India”, which is receiving a tremendous boost from the Narendra Modi-led NDA government.
While much of the focus is on how India can emerge as a hub of “ma-nufacturing”, there is no discussion about developing products and global brands. Product-centric innovation, development and sales is the key for creating higher value and drive demand for healthy manufacturing.
Over the last 15-20 years, while India focused on services through the likes of Infosys and TCS, China – though initially into manufacturing – turned towards products. As a result, it is not only the manufacturing behemoth but also home to many fast growing global technology brands like Lenovo, Huawei, Xiaomi, ZTE, Kingsoft, Alibaba, and Baidu spanning hardware, software and e-commerce.
With Make in India in the horizon now, things shouldn’t be just about manufacturing but also about designing, developing and selling various hardware and software products right here for India and the world. In addition, we should emphasise on building products and global brands through component, device, system and software level innovations. The country is yet to produce a strong technology global brands like Samsung or Xiaomi or IBM.
So where exactly do we stand in terms of innovation and design for local markets? Take the cheaper smartphones that have flooded the Indian market for example. Many of the top Indian brands are simply importing Chinese-made handsets and labelling them with their logo and retailing them as an Indian product. It may fetch them dividends in the beginning, but in the long run, that strategy will certainly not work.
For thousands of years, India was known for its great inventions and discoveries in the areas of agriculture, mathematics, sciences, medicine, infrastructure, transportation and defence. Somehow, over the last few centuries, we have lost our way. It is time now to rise and innovate again at a global scale.
India is home to millions of brilliant minds, who contribute their innovations to create value for many multinational companies like IBM, Intel, Microsoft Google or Facebook. But we must now to leverage this huge talent and market to build our own IBM or Intel or Google.
Of course, it is easier said than done. There are many challenges in achieving this goal. India fundamentally lacks robust innovation infrastructure in terms of social appreciation for entrepreneurship, availability of risk capital, market maturity and conducive government policies.
The idea of building or funding a company for three or five or 10 years without revenues and profitability is still a foreign concept for most of the entrepreneurs and investors. The ecosystem will have to evolve to enable the possibility of creating the next industry giant.
We are not there yet compared to countries like China, Taiwan and the US. While the private sector has insulated itself against risks by blindly following the global trends and focused on services and body shopping, the government has taken a laidback approach showing no sense of urgency in creating the ecosystem to foster local product innovation.
That said, as an entrepreneur, I am an optimist and opportunist. There are definitely some encouraging trends. We have recently seen some great success stories in the area of e-commerce with companies like Flipkart and Snapdeal. India has become the hottest destination after China for investment in technology.
Every global PE firm and early stage investor is eyeing potential Indian firms in e-retail, app-based business, e-commerce and online ventures for long-term investments. At present, not many of these firms are even in the revenue generation cycle, but their valuation has already surpassed the revenue potential attracting hordes of investors. India must take advantage of this and duplicate e-commerce success across all product segments from hardware to software to social media to apps.
Finally, India must leverage the power of crowd innovation to accelerate the pace of innovation. It has a huge opportunity to ride the momentum of Internet of Things (IoT) and Smarter Planet enabled by smart devices, big data systems, sensor networks and renewable energy.
There are going to be tonnes of opportunities, as all these smart devices talk to each other and become more autonomous with the integration of artificial intelligence and robotics. This is a huge opportunity for startups to innovate and disrupt the market with a variety of products, platforms, and services.
(The writer is co-founder and Chief Executive Officer, Soft Machines, California, USA)