Before we go into India’s top innovative companies entering the top 25 of global companies we would like to give some genesis on the subject in the following few paragraphs.
Global competitive pressures, emerging economies, saturated domestic markets and demanding customers have brought companies to a dire crossroad – innovate or die. As companies embark on their innovative journey, some adopt innovation as a tag line in their advertising; others appoint executives in charge of innovation. Nearly any and every action taken by a company is now loosely labeled as innovation. However, very few companies actually innovate!
Innovation is not invention either. A lot of smart companies are very good at developing new offering in the hope that the customers will buy them. This “engineering-friendly” view of “build and they will come” innovation is no longer going to cut it.
Customers demand products that suit their notion of what is valuable. This requires engaging the customer in the products/ service design process and observing how they would use the “potential” innovation in their context. Some of the best innovations meet not only the needs expressed by customers, but also their unexpressed needs.
India’s two leading conglomerate, the Tatas and Reliance Group, have made it to the league of the world’s 25 most innovative companies riding on the cheapest commercial car Nano and an aggressive growth path respectively. In the list of World’s 25 most innovative companies released Tata group is ranked at Sixth, while Reliance industries (RIL) is 19th.
The list, published in the edition of Business Week magazine that hit the newsstands has been compiled by the US financial publication in collaboration with Boston Consulting Group.
Both Tata and RIL have made it for the first time to the annual list topped by Apple Computer, the maker of iPod music players and Mac personal computers. Apple is followed by internet search giant Google. Japanese auto major Toyota, industrial conglomerate General Electric (GE) and software behemoth Microsoft are in the top five.
About Tata group, Business Week said: (The) Mumbai based conglomerate jumps onto our list for the first time, fuelled by its paradigm-busting $2,500 ‘Nano’ car for the masses.
The car from its Tata Motors unit is the world’s cheapest, thanks partly to a distribution model that sells the auto in kits to entrepreneurs who assemble them for buyers.
About RIL, the magazine noted that “the Indian petrochemical giant made it onto our list this year thanks to plans of its aggressive growth. But its ambitious plans to reach into grocery retailing, dominated in India by small shopkeepers who have rebelled against corporate entrants, have faltered.
Tata group, at its sixth position, has been ranked higher than global majors like Nintendo, Procter & Gamble, Sony, Nokia, Amazon.com, IBM, Blackberry maker, Research in Motion, BMW, Hewlett Packard, Honda Motor, Walt Disney and General Motors.
Besides, RIL has also beaten out global giants like Boeing, Goldman Sachs, 3M, Wal-Mart, Target and fast growing social networking website Face book.
Business Week has ranked a total of 50 firms on its website, including the top 25 innovative companies of the world.
These firms also include another company run by a person of Indian origin—telecom giant Vodafone. Last year, the British company entered India through a multi billion dollar majority stake buyout of Hutch Essar.
Ranking it at 47th position, Business Week said, spotting the potential for growth in emerging markets, the British mobile phone giant partnered with Kenya’s cell phone operator safaricom to offer mobile payment services.
Aimed at customers without bank accounts the new service is being rolled out across Vodafone networks in Britain Tanzania and India, It noted about Vodafone.
The magazine said that as the US recession debate shifts from “what if” to “how long” slashing companies research and development budgets just got a lot more tempting.
But there can be an upside to the downturn. Low cost methods to create new products are easier than ever as emerging markets provide both cheap labor and booming pockets for growth, it said.
In an accompanying list of 20 most innovative companies by region, the magazine said that the Tatas and RIL have seen ranked at fourth and eighth positions in Asia.
Besides, the Tatas have been ranked at eighth and 13th ranks in Europe and North America, whereas RIL does not figure in the Europe and North American lists.