94% of senior business executives in India believe that innovation is a strategic priority for their businesses according to GE’s Global Innovation Barometer 2013. The report’s India centric insights also reveal what innovation means to senior management in Indian businesses.
Development of new products, improvement of existing products and a process’ ability to improve profitability were seen as benchmarks of innovation from a business perspective. 75% of the respondents saw development of new products as most evident in driving business performance.
Innovation pertaining to development of new customer services and development of eco-friendly business models was least attributed to the performance of a business. Only about half the respondents felt that innovation in these two areas drove business performance.
What does it take for an Indian business to innovate? 81% of the respondents in GE’s Global Innovation Barometer 2013 report believed that understanding customers and predicting the evolving market is critical if a business wants to innovate.
Understanding customers, anticipating markets, having innovative staff on payroll and developing new technology emerged to be some of the top drivers of innovation in the eyes of senior management. Only 45% of the respondents thought that coming up with new business models was necessary to innovate.
The report also highlighted a change in the mindset and approach of senior management towards innovation. On the upside, 83% of the respondents believed that the society in general had a higher risk appetite for innovation and that the public understood the value addition aspect of innovation in day-to-day life.
On the down side, less than 6 out of 10 respondents believed that the government allocated an adequate portion of the budget to support innovative companies.
World Bank recently gave India a low rank of 132 in its Doing Business Report 2013 in which getting relevant permits for construction and setting up of facilities was seen as major hurdle. Only about 7 out of 10 respondents said that trade regulations were not preventing firms from being commercially successful.
Opining on policies and administration, business executives believed that overcoming bureaucratic hurdles and aligning education with business needs were among the top priorities that need to be looked up if innovation was to be supported.
The opinions of senior business executives may very well be stemming from an organic change in the Indian business environment. Infusion of young blood with a higher risk appetite and a fresh perspective towards growth may see innovation being given increased priority in company budgets.
Recent Indian start-ups have not been shy of innovating. The last decade has seen many new entrants taking the risk to create unique products and services even in infant industry segments, especially the e-commerce domain. The Cash on Delivery model in India can be seen as a classic example that ticks boxes that are benchmarks of innovation from a business performance perspective.