Connectivity and access to information

A large number of small Indian IT firms working with very large global companies. These are not the traditional companies that think about IT/ITES phenomenon; but companies which specialize in unique skills. That seems very intriguing.

Simultaneously four driving forces were coming together for the first time in human history. Take connectivity and access to information: 3-3.5 billion people are getting connected through cell phones or PCs. The second is digitization and the ability to move information seamlessly across multiple devices and the dramatic reduction in the cost of computing and communication. This is for not only the cost of PCs and cell phones, but also the cost of storage.

The third piece is convergence of industry and technology boundaries. Today cell phone is a telephone, a computer, a camera, a watch and may be radio and TV, and finally the emergence of social networks. These four drivers together enable the emergence of a new competitive dynamic. However, 90% of the thinking on innovation is still very much a firm centric product centric view. Imagine the contribution if 2 billion people start becoming innovators rather than just passive consumers of innovation that comes from one genius or one firm.

The world is moving at breakneck speed. A step forward can be taken and in that new world of competition of active involvement of consumers there is a new different way to innovate. There may be a different way to leverage the resources of others rather than assume that all the resources have to be inside the company. Once starting with that new perspective or a managerial lens, a manager can see change in innovation patterns all across. Take iGoogle which lets create your own page. IT serves 100 million customers but cost is zero for the user. For advertisers it’s quite unique and personalized. It is unique because you co-create. You build your own page. Google even when they service 100 million consumers, each one is unique. Then you look at Apple, iTunes, a Coffee Day, or Starbucks.

At ICICI Bank first there was a lot of debate on whether they can be a retail bank. Now they are not only a retail bank, they are continuously evolving very rapidly. They created a culture of highly decentralized any ideas that they have for new products and services. They get a chance to do it if it works. They can roll out the concept and scale it rapidly. If it doesn’t they kill it. So, there’s a decentralized innovation process but a very simple one based on a strategic intent: Global and rural simultaneously. It means they want to serve large clients, global clients but also want the ability to serve the poorest of the poor with self help group community banks and rural microfinance. The only organizing principle between those two is very resilient business processes that can be continuously changed at allow cost, commitment to information and communication technologies and the social infrastructure where experiment and desire to win the broad goal of being simultaneously global and rural. It also demands a deep understanding of how technology can be used reduce cost and improve service.

There are many right or wrong ways, because each company has a different starting point. A Bridgestone or a Goodyear has a different starting point from a Nike. So, different paths to transformation can be taken. But all of them have two things in common they have a point of view of where they want to go. And the point of view is about uniquely developing personalized consumer experience based on co-created solutions. Second, no company today has the capabilities to service just one consumer at a time because of the complexity involved in building and sustaining the ecosystem. There is a need to build a unique supply chain that allows a manager to selectivity access resources depending on the demands of the consumer. Supply chain can also become important not for cost reasons but for competitive reasons.