The Hindu : Business : Innovation must drive manufacturing

Online edition of India's National Newspaper
Thursday, Dec 15, 2005

Business

Business

Innovation must drive manufacturing

Staff Correspondent

Need to back right ideas with resources

MUMBAI: Indian companies should focus their efforts on innovations that are relevant to their industry and put their resources in the innovation process. Indian companies seem to be hedging their bets and spreading themselves across all dimensions, often too thinly and this does not yield the right results, according to a report by the Boston Consulting Group (BCG) for the Confederation of Indian Industry (CII).

The report, Manufacturing Innovation, was released on Tuesday at the Manufacturing Summit 2005 — `Innovation for sustainable advantage,' a two-day event organised by the Confederation of Indian Industry.

The report summarises the key findings of a joint BCG-CII survey conducted in November. The survey analyses how Indian business leaders think about innovation and how their companies manage the innovation process. The findings of this survey have been compared with BCG's 2005 Global Survey on Innovation in which 940 executives representing 68 countries and all major industries participated.

BCG has defined innovation as "the process of transforming new ideas to create value for internal and external customers by breaking an existing compromise.'' The report suggests that companies should strengthen their portfolio management to evaluate ideas and select the right ones, to be able to put the right resources against key areas and to ensure appropriate decision-making on the overall risk, return and timing of innovation being pursued. Companies should introduce metrics to make informed decisions on innovation, measure the effectiveness of the process and take appropriate corrective actions.

Arun Maira, Chairman, BCG India, said, "now is the time to focus managers on innovation. Indian companies are likely to be more successful at innovation than western companies.''

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