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Should businesses in India innovate, imitate of adapt technology?

Entrepreneurs, investors, government agencies, domestic companies & MNC executives in India need to think beyond “hi-tech” ventures and creation of IP and should focus instead of adapting existing technologies for Indian needs, points out Kaushik Gala in a new essay he published on his website. Kaushik is a Business Development Manager at Pune-based startup incubator Venture Center, so he does spend a lot of time talking to and thinking about all the players of our technology and startup ecosystem mentioned in the first sentence of this paragraph.

Kaushik Gala, Business Development Manager

Kaushik Gala, Business Development Manager at Venture Center occasionally writes essays on issues related to startups and small businesses in India. Click on the photo to see more of his essays, and his website

The whole article is definitely worth reading, and we give here a few excerpts from the article to whet your appetite:

So, will hi-tech entrepreneurs & startups drive economic growth & wealth creation in India? Consider this assertion by economist John Kay:

Advancing technology is the principal determinant of economic growth for the twenty or so rich countries of the world. However most of the world is well inside that technological frontier. For these countries, prospects of economic growth depend little on technology and principally on advances in their economic, political and social infrastructure.

Over the two centuries of rapid economic growth in rich states, the pattern has been for one or two countries to join the group of advanced states every decade or two. In the last fifty years or so these new members of the rich list include Italy, Finland and Ireland within Europe and the first Asian economies (Japan, Hong Kong, Singapore) to operate at this technological frontier.

Later, he points out that there are three kinds of tech startups in India: 1) Technology innovators (who are creating new IP at the cutting edge of science & technology), 2) Technology imitators (who are reverse engineering technology from elsewhere and implementing a copy here), and 3) Technology adapters (who take a foreign technology, and then adapt it to Indian conditions. This usually involves significant changes, and there’s usually a key piece of (non-technology) innovation required to make it successful locally).

He gives this example of technology adaption:

My favorite example is Sarvajal. They sell clean drinking water – but with many twists:

  • They’ve developed a (patent pending!) device called Soochak which combines existing water purification technology with cloud computing.
  • Their innovative ‘distributed’ business model uses pre-payment, franchising, branding, etc. to make it profitable to sell relatively affordable water to remote rural areas.
  • Success for Sarvajal is as much – or more – dependent on understanding the psychology of rural customers and village entrepreneurs (franchisees) as it is on the technology.

Kaushik ends by saying that while all three avatars of technology enterprises are required for wealth creation in India, being an adopter/adapter in India offers far more opportunities to excel.

Read the full article. Highly recommended.

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