Execs frustrated by lack of innovation : Can offshoring help?
It was interesting to read Mark Kobayashi-Hillary muse about “Execs frustrated by lack of innovation” His blog talks about
The fourth annual global survey and report on innovation from the strategy consulting firm Boston Consulting Group (BCG) describes how executives are getting more and more frustrated with the returns (or lack of) from innovation efforts. The report also shows those same executives recognising that innovation is now essential for performance and growth. For the third year in a row, Apple has been crowned as the world’s most innovative company. Apple is followed by Google, Toyota, General Electric, Microsoft, and Procter & Gamble.
Now this is a topic one reads about frequently in different contexts, meaning different things to different folks.
In the offshoring context, innovation (or lack of it) is a general musing by journalists about how software service firms (read offshoring firms) are not innovating enough… or fail to be moving up the value chain. While much of this is purely rhetoric, one cannot really make a persuasive argument one way or the other [Example, journalists who bemoan lack of innovation also pick up on stories of how service firms are innovating offshore]. Extending this argument, among the most innovative companies listed in the BCG list, Microsoft has also been trying to expand in the online world both by innovating … and by buying those who are innovating.
Now what gives?
And speaking of innovation Jithesh Sathyan, from Infosys was recently granted a patent by the USPOT for an idea for “Displaying holographic three dimensional images” About his patented idea, Jithesh says "Current developments in 3D are limited to virtual 3D – drawing images on a 3D mesh, increasing the resolution of the screen or having a different image for the left and right eye using stereoscopy. This patent is the first solution to provide an actual 3D experience on a wireless handset without any additional communication bandwidth requirements."
Of course, patenting of ideas like this are just the tip of the iceberg in our innovation ecosystem. I have written about how Infosys’ R&D culture, driven in part by SETLabs and other delivery groups provide ‘innovative’ solutions to our clients over and over. Some of the innovation is driven by our popular global internship program and by our campus connect initiative
Bottomline: innovation is an interesting topic to study, read and blog/write about… but to actually see it at work: to see innovation lead to something actionable, eventually ‘business value’ is another matter altogether…perhaps a topic for another blog?
Comments
I would argue that offshoring deals are incredibly fertile ground for innovation. Chaos theory tells us that chaos is often required to enable higher levels of order to emerge. This formula maps perfectly to offshoring, even of fairly mundane business processes. No matter how precisely a set of business processes or other organizational functions (perhaps functions that already demand innovation on an ongoing basis) can be transitioned to an offshore model, the fact remains that even if much is not 'lost in translation' you still have a new and unique group of highly educated human beings executing the work to be done. As such (and especially if they are coached to be on the lookout) the opportunity is there to spot inefficiencies during and post transition, and to devise innovative ways to meet the same business needs with less effort/people/time/more precision/additional value etc. Even if we are talking about a high volume business process, these tweaks (large or small) are most certainly innovation. Again, the level of disruption that offshoring adds to the equation, even when the goal is complete seamless repetition of the existing business function, is enough to create useful chaos and make apparent some of these opportunities that otherwise might well have remained entrenched in the previous model. (I should add that in keeping with the theme of this blog, I used offshoring as my example, but any outsourcing situation lends itself to this dynamic).
Posted by: Michael | August 15, 2007 01:18 PM
Right on target Michael,
The topic of 'Global Innovation Exchange' where enterprises leverage talent and solutions from across the world has fascinated me for a while. There again as few academics and 'management gurus' study the topic, enterprising organizations are already leveraging global talent to their benefit.
Posted by: Mohan | August 18, 2007 02:31 PM
The CIO piece that prompted Vinnie's post contrasts with my perspective above. One quick thought as to why: it seems to discuss innovation by an outsourcer as something that can occur in a vacuum whereas my vision for the ideal arrangement is whereby the client continues to provide leadership and stays committed to maximizing the benefits in all areas.
http://dealarchitect.typepad.com/deal_architect/2007/10/outsourcers-and.html
PS Would love to see search functionality added to the blog.
Posted by: michael | October 15, 2007 04:23 PM
Innovation inside offshored projects are really dependent on the client-vendor relationship. The more comfortable the client vendor relationship is, the more latitude that the client affords to the vendor, there are better chances of innovation to happen.
Having run an offshoring outfit for the past 7 years, I have experienced and witnessed this first hand. There are clients who really want to give you full latitude to innovate and are forgiving for slight slippage in deadlines or changes in outcome.
On the other hand there are companies that in their own right do not want to innovate. The wanting to innovate bit is quite significant.
It is true that many clients and also vendors do not approach the whole outsourcing paradigm with an inclination to innovate in the first place. If a client has that vision of allowing to innovate in processes and the project deliverable itself, things would be a lot more innovative.
However, innovation needs to be on the agenda of both parties to work in a typical multi party outsourcing arrangement that offshoring many times tends to become.
Regards,
Siddharth
Posted by: Siddharth Sethi | January 11, 2008 05:25 AM