[This week's post is a continuation from last week's post - insights from the Inclusive Innovation conference held at Rashtrapati Bhavan.]
Funding of innovation is always a challenge, and one that
different countries solve in different ways.
Gilles G. Patry, President & CEO spoke about how the
Canada Foundation for Innovation has invested over a billion dollars in state-of-the-art
facilities at universities across Canada to help them do world-class research. The
Foundation funds upto 40% of the project cost and focuses on partnerships. He
suggested that the model is largely successful. The evidence? - Canada punches above its weight on research
and accounts for 5% of impactful research papers [sorry, I can’t recall exactly
how this was measured or over which period.]
For me, one of the big attractions of the Round Table was
the participation of Nobel Laureate and Grameen Bank founder Mohammed Yunus.
For someone who has brought revolutionary ideas like microfinance to the world,
he was surprisingly skeptical about the availability of finance. According to Yunus, the sector needing the
largest innovations is the finance sector! Professor Yunus drew our attention
to what he considered the biggest achievement of Grameen Bank - in savings and
not in lending! He estimated that the Grameen Bank had contributed to more than
$2B savings so far.
A German participant pointed out that money is available for
impact investment but not enough social enterprises are available to absorb
this investment. But, other participants were skeptical of Impact investing,
citing a conflict between the social mission of the enterprise and the
investor’s desired outcomes
Anil Gupta said the ecosystem should support both managed
innovation and spontaneous innovation. He stressed the need for both a sanctuary
model that has chaos inside and order
outside and an incubator model that has
chaos outside and order inside.
Making Social Innovation Work
Several useful ideas emerged on this theme:
One participant made an interesting observation – most people
today recognize 1000 corporate logos but fewer than 10 plant species. Parag
Anand of the School of Planning & Architecture (SPA) at Delhi came up with
at least one solution to this problem – the SPA organizes tours for student
immersion as user experience is critical to social innovation.
Iyer from the Mumbai-based Indian Foundation for Development
(IFD) spoke about the need for tinkering rooms/workshops in schools as also
innovation exchange programmes. The IFD has started 185 balagurukuls that host
12500 children, and there is a need to expose them to creativity and innovation.
Anil Gupta advocated the Indian concept of samavedana –
making others’ pain your own, or empathetic innovation.
Mohammed Yunus suggested targeting waste. He said that at
least one out of every 6 pairs of shoes bought by customers is not worn. Can’t
these be re-channelised to the poor? Can’t cloth rejected by textile mills also
Some participants wondered how existing innovations could be
spread or diffused better. Reaching the market is often difficult. Anil Gupta
gave an interesting example of four machine tool start-ups in
Ghazaiabad/Faridabad that started a common marketing company so that together they
would have a broad enough catalogue and a large enough volume of products to
justify marketing expenditures.
Grameen Bank uses the joint venture route to solve new
problems and reach users. For example, it has a joint venture with BASF for
treated mosquito nets, and uses the Grameen Bank channel including self-help
groups to reach users. The scientist from LBNL advocated coming up with innovations
that the corporate sector will embrace.
Corporate Sector vs. Social Sector
In fact, the liveliest debates were about the role of the
corporate sector and the social sector. Lines
were clearly drawn with some people like this scientist clearly preferring
market-based solutions and others clearly distrusting the private sector to do
anything beyond enriching itself. The word “trust” figured in many of these
Solomon Darwin of the University of California at Berkeley
pointed out that while open innovation is a 2-way street involving ideas
flowing both outside in and inside out, corporations have tended to focus only
on the former. He pronounced that the world of high margins is over though I
wonder how this can be completely true when Apple is sitting on hundreds of
billions of dollars amassed through huge margins.
One of the most engaged participants in the Round Table was Jin
Hyo Joseph Yun of South Korea. One could almost see his mind working as he
tried to relate what he had seen in the exhibition to the discussion in the
conference room! He tried to build a model on the fly – volunteers are needed to
connect technology to society/market but virtuous big business is needed to make
it commercially successful.
Stuart Hart cited Polanyi to make a point that was in one of
his articles - production has got disembedded from the social world. People
have come to distrust the business process. There is a need to re-embed
economic activity in society, that is to build business models that create
Mukesh Puri, Secretary Higher & Technical Education, Government
of Gujarat believed that successful innovations have to be owned by the people
. The perceived benefits need to be clear. He cited Pravesh Utsav, a
celebration held at the time of girls joining school in Class 1 All political
figures participate. He said that the drop-out rate has declined as a result.
It is ironic that innovation which is inherently an
integrative activity is today impeded by silos. These silos are reinforced by
different philosophies and worldviews. We may have to rely on other forces at
work to lower these walls. Take the new requirement of compulsory CSR activity
by Indian companies – this is forcing companies to work more closely with NGOs
and other social organizations. Hopefully, this will create an environment in
which companies and NGOs recognize each others’ worth, and lead to
collaborative and inclusive innovation in the future.
[This blog has been written based on notes taken by the
author. These have not been re-checked with the speakers. Views expressed are
those of the individuals and do not necessarily represent the institutions they
The practice of inviting outstanding grassroot innovators to
the majestic environs of Rashtrapati Bhavan, the home of India’s head of state,
was started by President APJ Abdul Kalam when he was president. It’s a tribute
to the rootedness of our national leaders and the persistence of Drs. Anil
Gupta and RA Mashelkar that the practice has not only continued but been
reinforced over time. This year, the event evolved into a week-long “Festival
of Innovations” with award ceremonies, workshops and roundtables.
Under the Tent…
The centre of the festival was a huge temporary structure
pitched on the Rashtrapati Bhavan Football Grounds that had exhibits and
demonstrations of all the award-winning innovations. The innovators must have
been encouraged by the large crowds in the hall, even though the main
destination of the crowds was the famed Mughal Gardens, thrown open to the
public at this time every year.
The innovations themselves were not very different from
earlier grassroot innovations that I have seen, at least in terms of the
categories they represented. The most prominent was mechanical devices to do
tasks that would otherwise be done manually. Many of these were focused on farm
operations but some were on health and sanitation. Devices to help people with
disabilities, and improved agricultural varieties were other important
Some of the impressive innovations included a modified
walker that enables climbing stairs, interlocking bricks, and wearing a helmet
as an ignition switch for a motorcycle.
The centre of the hall had banners with quotations on
innovation, largely from Anil Gupta and Mashelkar. Truth be said though, there
weren’t many people reading these banners, and I wonder how many people would
have appreciated the nuances of the quotes even if they had read them!
The innovators themselves were present, and many of them
were peppered with questions by enthusiastic visitors. I imagine this must have
been motivating for them, though by the end of the day they must have been
But, if the purpose of the event was to recognize and
encourage innovators from all corners of our country, and to underline the
democratic idiom of innovation (“Anyone can innovate”), I am sure this event
served its purpose.
…. And Inside the Conference Room
Inside the newly constructed Rashtrapati Bhavan Cultural
Centre with its high ceilings and ornate decorations (including larger than
life size portraits of all India’s presidents till date), innovation experts
from all over the world conferred about the future of inclusive innovation.
What are the problems to solve?
If you read our book 8 Steps to Innovation, you might
remember that we advocated creating a challenge book of the most pressing
problems that are literally crying for innovation. One piece of good news is
that the Lawrence Berkeley National Laboratory (LBNL) Institute for GloballyTransformative Technologies has identified the fifty most important global
problems to solve with technology. These include low-cost desalination to make
drinking water available at a reasonable cost; a DNA-based diagnostic for
accurate detection of tuberculosis; an integrated “clinic-in-a-box” for
maternal and child care; low-cost homes for the urban poor; and a very timely point-of-use
DNA-based rape kit to enable timely collection of evidence against perpetrators
Of course, there are solutions searching for problems as well.
The co-founder of the notion of the fortune at the bottom of the pyramid (BoP),
Stuart Hart drew attention to the wealth of “shelf technologies” in
universities. At Cornell alone he reported that the university found about
4,000 technologies / patents that had not been exploited.
Anshu Gupta, founder of Goonj had a different take on
problems. He argued that there are many “non-issues” that need to be made
issues. Clothing is important, as important as food and shelter. Why can’t
clothing also be a parallel currency? Earlier clothing was only part of
disaster relief and charity. Why can’t cloth be given for work?
Anshu pointed out the importance of clothing by reminding
the audience that more people die due to cold in winter than due to other
Drawing attention to another “non-issue” that needs to
become an issue, he said that 88% of women don’t have access to sanitary
How to solve the problems?
Hart advocated an intermingling of what he called “exponential
technologies” with traditional ones to address the problems of people at the
But, going back to the exhibition for a moment, it’s
interesting to reflect that there were hardly any “modern” technologies like
electronics or computers on display in any of the exhibits. The only such
device in use was the mobile phone, and even this was in very small numbers.
An earnest NRI from a US lab had a different take on this.
While he felt that India should continue to build world class R&D
institutions, he thought that solutions may be available more quickly if the
government were to subsidize private sector R&D or, more radically,
“reverse outsource” critical problems to western research centres. What he was
suggesting here is that the Indian government commission (say) a Pfizer or a
Merck to come up with a new cure for tuberculosis and make it worth their while
by underwriting all the research expenses. But I really wonder whether that’s a
business model they would be interested in; what could work though is for the
government to give a research contract to one or more outstanding academic or
research laboratories abroad.
Brock from the UNICEF Innovation Centre underlined the
importance of design with the user rather than for the user. He emphasized that
design should be for scale, and that an organization liked UNICEF should
embrace open standards (not open source) since a public organization should
embrace public goods.
But, he admitted that there was a need to change their
mindset from seeing the private sector only as suppliers to working with
grassroot innovators as partners.
I spoke about the importance of government procurement, and
policies regarding standards in making social innovation work. Rigid standards
designed with existing technologies and suppliers in mind can keep out
important innovations. Pre-qualification clauses can act as barriers to entry.
The government sometimes encourages imitation without respecting intellectual
property. And tender procedures prevent government from procuring things that
might have been developed specifically for the government. Instead, the
government should play a more positive and proactive role in supporting
How do you make Inclusive Innovation work?
To conclude this piece and share the key takeaways, please
visit this space next week….
[This blog has been written based on notes taken by the
author. These have not been re-checked with the speakers. Views expressed are
those of the individuals and do not necessarily represent the institutions they
When prominent demographer Ashish Bose suggested the name “Bimaru”
for the collective of four north Indian states that were struggling to perform
well on both the economic and social fronts, little did he realize that this
name would stick for several decades to follow. But, it’s now a moniker that at
least one of the four states – Madhya Pradesh – is keen to shed as it projects
itself as a growth state for the future.
At a workshop organized by CII at Bhopal on March 5, Professor
BB Bhattacharya (BBB) [picture below], economist and former VC of JNU, suggested an interesting distinction – you are still a
Bimaru state when, like Bihar, you are seeking special economic packages, and
not like MP when you are confident of creating your own destiny.
As is well known, MP’s economic growth in recent years has
come from agriculture. It is the country’s leading producer of soybean and
pulses and #2 in wheat. The state has won the Krishi Karman award – an award
given by the National Food Security Mission to states excelling in foodgrain
production - the last three years in a row.
I am still not completely clear about how and why the state
has been able to achieve 10+ % growth in agriculture the last three years. While
the government of MP credits the growth to improved irrigation, adoption of
technology and better farming practices, and optimum utilization of rain-fed
areas, media reports refer to a zero-interest loan scheme to farmers,
availability of power, and better irrigation coverage.
But, whatever the reason, the state has realized that it
can’t depend on growth in agriculture alone for the future development of the
state. That’s why it is increasingly looking at industry as the key to future
An Industrial Growth Strategy for MP?
At the workshop, Professor BBB made a few important
observations in his opening remarks. The East Asian growth story was as much a
story of social development as economic development, and the availability of
skilled and educated manpower made the growth story possible. East Asia also
became technologically savvy quickly, and rapidly made the transition from being
a mere recipient of technology to a creator of technology as well. He therefore
underlined the importance of human development and technological capabilities
for industrial growth.
Mr. Prabhakar Kadapa, CEO of Avtec, a CK Birla group company
that makes engines for the automotive industry observed that his company’s products
are becoming more knowledge and technology-intensive. While it has plants in
multiple locations, the technology-intensive work that has a higher element of
value-added happens in Hosur near Bangalore and not in his older plant in
Pithampur near Indore. He estimated that 70% of his future capex would flow
As a participant in the panel, I observed that the East
Asian countries had followed a similar trajectory of industrial growth,
starting with relatively less complex industries and then graduating to more
complex ones. But I wondered aloud whether manufacturing will remain the same
going forward, or whether there will be fundamental changes. Some recent
developments like the growth of 3D printing [see picture below] and the shift of some manufacturing
back to the developed world might point to fundamental changes in the nature
and patterns of global manufacturing.
Mr. Prabhakar felt that in spite of these changes there
would still be plenty of opportunities in low-cost manufacturing. He felt that
manufacturing could make a leap if MP is able to attract one or two big name
automotive companies to make the state their hub.
Prof. BBB emphasized the importance of individual companies
inserting themselves into global value chains and then striving for continuous
improvement to maintain competitiveness. Mr. Sanjay Kirloskar observed that his
company’s single biggest recent investment was in 3D printing, and that the 3D
printer was allowing dies and moulds to be created rapidly thereby cutting down
the overall cycle time of taking new products to the market. He also cautioned
that we should change perspective from low-cost to total cost of ownership, and
I also emphasized the importance of catching the next wave
at the right time. MP pretty much missed out on the IT services wave and
managed to attract companies like Infosys and TCS too late. Given the slowdown
in their businesses, it’s doubtful that their development centres in the state
will ever reach a large size.
The final point I made was on last mile connectivity and
speed. While MP has undoubtedly made significant progress in building highways
connecting the major cities in the state, city and last-mile connectivity
remains an issue. The state has the right intent, but there is a need to match
the intent with speed of execution as fast response is key to competitiveness.
What the State Government is Doing
The Government of MP has taken the mantra of “Ease of doing
business” seriously. At a workshop with industry on March 4, the government
explored 150 different possibilities for simplifying permissions and
procedures. MP CM Shivraj Chouhan personally spent a good part of the day at
this workshop, and reportedly told state bureaucrats not to worry about the few
percent of people who will take undue advantage of the simplified processes.
Instead, he advised them to focus on the benefits that will accrue from
Participants in the workshop were appreciative of the
government’s efforts but underlined the importance of the government’s
industry-friendly approach trickling down to the lowest level of the
government. Such a change in approach is reported to have happened in some
states like Gujarat. Industries Commissioner Kantha Rao said the government
hoped to use technology to overcome any problems at the delivery point.
Mr. Kantha Rao also mentioned that the state is trying to
leverage the central government’s policy initiatives – it’s been one of the
first states to have its own policies for supporting Electronics Systems Design
and Manufacture, and Defence industries. The State also offers one of the best
policies for textile units.
Professor BBB cited the example of China to warn the state
that several advantages that the state enjoys today like availability of land,
water and electricity could very rapidly change into constraints if industrial
development takes off. Echoing this concern, some of the participants suggested
that the state be sensitive to environmental concerns upfront rather than
trying to address them later in a corrective mode. One participant suggested
that the state should focus on clean energy. But, as he was speaking I recalled
President Obama’s travails in trying to support clean energy and wondered
whether Madhya Pradesh is quite ready for such challenges.
While there was broad agreement that the state needs to be
able to attract higher quality talent to support R&D investments, some
participants asked whether MP can hope to attract higher end jobs without making
its cities more attractive. Would techies ever consider an Indore or a Bhopal
on par with a Bangalore or a Hyderabad?
Another line of discussion centered around what the state can
do to promote entrepreneurship. Can it set up incubators to support young
entrepreneurs? Mr. Kantha Rao said, quite rightly in my view, that the
government is not ideally suited to setting up or running incubators, but could
be a catalyst of such initiatives.
Some Concluding Thoughts
India is embarking on a pro-manufacturing policy at a time
when manufacturing itself may be on the verge of major changes. While the speed
of adoption of new manufacturing technologies is difficult to predict, it is
clear that the last generation of technologies itself has made manufacturing
much more technology-intensive and most plants today are run by a small core of
very highly skilled people. Given this,
it’s an open question how much employment manufacturing can create. Govindraj
Ethiraj, Chief Editor of the Ping Network who moderated the discussion told me
that a recent McKinsey report predicts a decline even in knowledge-intensive
jobs thanks to changes in the way work is done.
Having said that, government policy support will create
manufacturing opportunities in some sectors for sure. Defence is one of these,
with the government having indicated its preference for products manufactured
in India, and its willingness to move away from the earlier public sector
centric model of defence production.
But, state-level strategies remain tricky. Should all states
try to woo all types of industries? How can states build additional layers of
advantage that would make companies find them more attractive as investment
destinations? These are some of the big questions to ponder over.
I just got back to Indore after a week in Odisha, Delhi and
Rajasthan. It was a good trip, and set me thinking on multiple fronts.
One of the big debates in India in recent times has been on
what conditions you need to create for investment and development to follow.
This trip raised some new issues in this debate as both Odisha and Rajasthan have
created high quality roads but not exactly been magnets for investment. You can
get from Jodhpur to Jaisalmer, a distance of 285 km, in a little over 4 hours!
And this is not even a four-lane highway! The roads between Bhubaneswar,
Konark, and Puri are quite decent as well. Contrast this with Bangalore and
Mumbai which are, in spite of their creaky infrastructure, getting more crowded
by the day! Apparently, human resource availability and other agglomeration
benefits outweigh infrastructure!
Of course, it could also be argued that the reason the roads
in Odisha and Rajasthan are good is because the states are less economically
developed, and hence have less traffic. There’s definitely an element of truth
in that as far as Rajasthan is concerned, the traffic was really sparse and
consisted of only tourists or army trucks!
One big change that has happened over the last decade is the
emergence of new education hubs. Bhubaneswar is one such with a good mix of
private and government institutions. Jodhpur is one too – it has an IIT, an
AIIMS, a National Law School, to just name a few. But it’s not clear if these
locations are able to build any additional levels of advantage thanks to the
co-location of these institutions. Instead,
they appear to be operating in their own silos. Unfortunately, the
concept of a Meta University promoted by Kapil Sibal to promote collaboration
between institutions in cities never took off.
Spots of Tourist Importance
It’s good to see that there has been a conscious effort to
control traffic near important monuments. Whether it be at the Sun Temple in Konark,
or the Jagannath Temple in Puri, vehicles are stopped some distance away from
the actual location. However, this does mean that covering the “last mile”
becomes difficult or expensive – a cycle rickshaw from the designated parking
place to the Jagannath temple charges Rs. 30, and the distance is just that
little bit longer than one would ideally like to walk in the sun. While I
appreciate locals getting a livelihood thanks to these traffic restrictions,
perhaps these towns should offer an electric shuttle bus service from the parking
However, while traffic is under control, commerce has grown
by leaps and bounds. Whether it be the Pandas of the Jagannath Temple or the
guides and hawkers in front of the Sun Temple, or itinerant vendors selling
everything from soft drinks to beer on the sand dunes, commerce is loud and in
your face. And, the Jaisalmer Fort (see picture below) is a living fort, inhabited by more than
4,000 families, so naturally commerce is all around. The most subtle and
well-organised commerce is at the privately run Mehrangarh Fort in Jodhpur
where the designated route through the Fort takes you through a boutique, a
local crafts fair, and two cafes!
East vs. West
While we seem to have picked up the consumerism of the west
fast, we haven’t been as adept in picking up some of the western virtues. My
visit to Bhubaneswar started with attending the valedictory function of a
professional society. Much to my surprise, the function stretched to cover
double the time planned. They had too many speakers and these speakers were
either not given a clearly indicated duration to speak or the organisers
thought it rude to interrupt and tell someone when they had exceeded their
time. I noticed a similar phenomenon at the otherwise well-run conclave of the
Indore Management Association in February, and at a Rotary jamboree in Indore recently.
Maybe this is a Tier-2 city phenomenon, for I see most events in the metros
sticking to their schedules!
Entrepreneurship alive and well
It was good to see entrepreneurship alive and kicking. I was
particularly impressed by Manvar Resort, approximately halfway on the road from
Jodhpur to Jaisalmer. Just off the highway, it’s a lovely green resort,
well-mantained, and served delicious aloo parathas. The owner is from the
family that is a major landowner in the area, but full marks to him for the
aesthetic ambience and excellent service of the resort.
Varun Arya, an IIT Delhi and IIM Ahmedabad alumnus, set up
the Aravali Institute of Management in Jodhpur over a decade ago. His endeavor
has been to bring the IIMA education philosophy to students of that part of
Rajasthan. Along the way, he has had to weather many storms – with different
agencies of the central and state governments. One result of these ups and
downs has been that he has had to suspend his education programmes for some
time till regulatory issues are addressed.
In the meantime, he has converted what was barren and saline
land on the Jodhpur-Jaipur highway into a mini-oasis. He has built 12 lakes on
this land, and all of them still have plenty of water from the last monsoon.
Thanks to the lakes, the campus is cooler by a few degrees.
Varun has done several interesting things. All construction
on campus is by local labour. He has got special equipment fabricated so that
he has to rely minimally on transporting things from Jodhpur. They grow only
trees that help other vegetation grow, and have stopped growing some plants
that are common in the area but in reality “poisonous” for other vegetation.
The boundary walls allow water to flow in during the monsoon to replenish the
lakes, and also allow excess water to flow out. The classrooms are minimalist
but functional. It’s quite a place!
The last place I expected to see empty beer bottles strewn
around was on the sand dunes of Jaisalmer. The Swachha Bharat campaign has its
work cut out – all the way from the beaches to the deserts!