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From the editors

Lessons from Tata’s


Corporate Innovation
Strategy
Sunil Mithas, University of Maryland
Ravi Arora, Tata Sons

M
anaging ­innovation i­nnovation as part of its transfor- how to improve innovation capabil-
in enterprise has mation agenda—which also in- ity, and creates a group-wide com-
always been a com- cluded initiatives such as the Tata munity of “innovation evangelists.”
plex task, but it’s business excellence model (TBEM, It initially focused on building
become even more so as orga- derived from the Malcolm Bald- capabilities for innovation through
nizations become more globally rige Criteria developed at the US workshops, learning missions (also
distributed and new digital tech- ­National Institute of Standards and called InnoMission), and dissemi-
nologies proliferate. Some studies Technology) and globalization7—to nation of concepts and examples.
of IT companies have used agile transform itself from a US$5.8 bil- It aimed to build working knowl-
approaches in software develop- lion Indian firm in 1992 to a $103 edge by carrying out some quick
ment and the IT-enabled global billion global corporation in 2014, and low-cost experiments in Tata
innovation ecosystem,1–4 whereas with more than 65 percent of rev- companies, and to create the drive
others focus on IT’s effects on enues coming from outside India. for innovation using various tools
innovation.5,6 However, it’s hard and processes, including improving
to find examples of non-IT firms Tata’s Corporate leadership communications, inte-
that have crafted a practical cor- Innovation Strategy grating innovation into the TBEM
porate strategy to manage inno- Although Tata Group has a long assessment, and implementing the
vations in a variety of contexts history of innovations across its InnoMeter and InnoVista pro-
globally across industries, and companies over the past 100 years grams (outlined later).
how they have embraced IT to or so, few systematic attempts were Major TGIF activities in foster-
drive innovation. made to actively and systematical- ing innovation fall into four broad
Here, we present Tata Group’s ly manage innovation at the cor- areas: create capacity for inno-
corporate innovation strategy. We porate level. In 2007, Tata Group vation, measure innovation, fa-
analyze how it provides high-level set up the Tata Group Innovation cilitate innovation, and recognize
direction and support while allow- Forum (TGIF) to plan and roll out and reward innovation.
ing significant room for creativity group-level initiatives to help Tata
and autonomy to individual com- companies innovate. In a way, Creating Capacity
panies and business units spread TGIF became responsible for the for Innovation
worldwide in multiple industry corporate innovation ecosystem TGIF uses three learning mecha-
sectors to devise their competitive at Tata Group. TGIF comprises nisms to build capability for in-
or functional innovation strategies. CEOs/CXOs and “innovation novations: innovation workshops,
Tata Group, sometimes called the leads” from Tata companies, and learning missions, and dissemina-
“GE of India,” is one of India’s most meets quarterly to review progress tion of innovation-related litera-
prominent business groups; it’s the on existing programs and decide ture and case studies. First, TGIF
largest private-sector employer on actions to fill the gaps in the organizes workshops with leading
in both India and the UK, and it innovation ecosystem. innovation experts to introduce
owns brands such as Jaguar, Land TGIF encourages Tata com- the concepts of and tools for inno-
Rover, Taj, Titan, and ­ Tetley. We panies to create an innovative vation. Second, TGIF ­organizes
discuss how Tata Group m ­ anaged environment, advises them on
­ i nnovation missions—visits to
­

2 IT Pro March/April 2015 Published by the IEEE Computer Society 1520-9202/15/$31.00 © 2015 IEEE
some leading firms outside India to
understand their innovation pro-
cesses. These visits included US
companies such as 3M, Microsoft,
Intel, HP, and Raytheon; Japanese
companies such as Ito En, Fuji,
Olympus, Nissan, Toshiba, and 17 Bet
Hitachi; and a visit to Israel with companies
Post
a focus on agriculture, chemicals, 643 54,970+
and water management. Finally, challenges enrolled 46,390+ 470,000+ 344+ ideas
dissemination efforts—facilitated users ideas impressions 2,345+ ideas implemented
selected
by the Tata Management Training
Centre (TMTC) through research
and training—focus on innovation 12,972
culture and tools in executive pro- participated
grams, and on publications that
trace the history of innovations in
TQMS
Tata Group and review best prac-
tices from elsewhere.
Figure 1. Tata InnoVerse participation. This figure illustrates facilitating
Measuring Innovation the innovation value chain from idea generation to idea selection and
Tata Group uses a questionnaire implementation.
called InnoMeter to measure the
“as-is” state of innovation. Broadly, Tata InnoVerse is an in-house Recognizing and Rewarding
it covers three areas: the innova- social networking platform with Innovation
tion process, innovation culture, Facebook-like features as well In 2006, Tata Group initiated the
and the strategic focus on innova- as features similar to prediction process of celebrating innovations
tion. It asks respondents to indi- markets to augment the innova- in Tata Group through a program
cate their assessment of strategic tion life cycle that starts from idea called Tata InnoVista. The goal
clarity, resource availability, the generation. Figure 1 shows the was to recognize innovators and
extent of empowerment, expecta- InnoVerse funnel, features, and encourage innovations in com-
tions, and processes for tracking performance. Some companies panies, share the levers compa-
and rewarding innovation efforts. have used this platform to pose nies use to identify and execute
It also has some perceptual mea- vexing problems coming from innovation projects, and create a
sures for the success of innova- CEOs as part of a “Challenges culture of risk taking. Tata Inno­
tion efforts, such as how quickly Worth Solving” (CWS) program. Vista currently has four award
innovations could be rolled out In 2015, 17 Tata companies were categories: Promising Innova-
or the extent to which they lead using this system with promis- tions (successfully implemented
the industry. The outcome of the ing results in engaging employees innovations that have provided
InnoMeter generates creative ten- in creative problem solving and benefits); Dare to Try (serious and
sion and lets the company identify idea evaluation. InnoVerse had audacious attempts to innovate
areas it must address to make its more than 54,000 enrolled users that couldn’t be completed suc-
innovation funnel and processes who generated more than 46,000 cessfully, to encourage the culture
more robust. Tata Group has con- ideas and 470,000 impressions of risk taking); The Leading-Edge
ducted InnoMeter assessments in either organically or through
­ Proven Technologies (for new
more than two dozen companies more than 640 challenges; the technologies that have yet to be
or business units so far, providing platform helped to select more commercialized); and Design
opportunities for reflection and for than 2,340 ideas. More than 40 Honor to highlight the impor-
improving the innovation climate. percent of these ideas came from tance of design in all products and
employees of other Tata compa- services. This popular program
Facilitating Innovation nies. The group is working toward has been adopted by companies
Tata Group uses IT to fuel its enhancing this platform to track such as TCS, Jaguar Land Rover,
innovation efforts and improve and develop selected ideas for TACO, Tata projects, Tata Con-
idea generation and selection. ­subsequent commercialization. sulting Engineers, and CMC,

computer.org/ITPro 3
From the editors

ADROIT Framework to Assess the Value ­illion annually, according to


b
Mukund Rajan, brand custodian
of Innovations and chief ethics officer at Tata
Sons. Although the methodology
T he ADROIT framework aligns closely with what can be called the
­fundamental equation for economic value:
for calculating economic value
is in a nascent stage, roughly 20
(EV) = volume (A) × margin (differentiate, reduce costs) percent of the benefits relate to
+ optimize risk + innovate/improve industry structure revenue gains, whereas 80 per-
+ transform cent relate to cost reduction
innovations.
A Add volume or growth
Among noneconomic parame-
D Differentiate or increase willingness to pay (WTP) ters, the group has achieved some
Reduce costs (operating costs, post-merger integration costs, capital success in creating a culture of
R
costs, and so on) risk taking with its Dare to Try
O Optimize risk (systematic, idiosyncratic, downside): reduce volatility of category: it received only 12 en-
cash flows and reduce competitive risk tries from six companies in this
I Innovate by generating knowledge and other resources and category in 2007, but participa-
capabilities, and improve industry attractiveness tion increased to more than 240
entries by 2015. Another impor-
T Transform industry, products, services, or business models
tant benefit is the development
of a commonly understood lan-
guage; moreover, every employee
knows how and when to contrib-
ute to their company’s or group’s
3,000
DTT PI TLE-PT DH
innovation efforts. Innovation is
no longer seen as a job only for
2,500
R&D, and employees across all
functional areas participate in in-
2,000 novation projects, as we found in
our analysis of InnoVista team
1,500 entries in 2015. In addition, in-
novation programs have made the
1,000 group more cohesive by bringing
together employees across mul-
500 tiple levels from different organi-
zations serving as another welding
0
mechanism. Some within the
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 group argue that innovation’s true
value should be judged not only by
Figure 2. Trends in Tata InnoVista participation. DTT: Dare to Try, PI: how much visibility it has but also
Promising Innovations, TLE-PT: The Leading Edge-Proven Technologies, by the fraction of the world’s pop-
DH: Design Honor. ulation it touches and the differ-
ence it makes in the quality of life
for people at the base of the pyra-
which have started conducting Engineers for core process in- mid. Many of the innovations in
internal InnoVista-like programs. novations, and Tata Power Delhi Tata Group (such as Tata Swach
Figure 2 shows trends in In- Distribution for support process and Ace) had perhaps lower vis-
noVista participation. The 2014 innovations. ibility or hype but a significantly
Promising Innovations awards large potential impact in terms
went to Jaguar Land Rover for new Impact of the Strategy of their footprint (the popula-
product innovations, Tata Con- In terms of economic value, the tion they were intended to touch,
sultancy Services and Tata Steel estimated potential benefit of as with i-Shakti or Power of 49).
for new service innovations, Tata 43 finalist InnoVista entries In contrast, some other innova-
Steel Europe and Tata ­Consulting in 2014 is approximately US$1 tions (such as Apple’s ­ products)

4 IT Pro March/April 2015


had higher perceived impact, even by using agile approaches to as- Steel, Tata Power, Tata ­Chemicals,
though they touched mostly top- sist with discovery, development, and Indian Hotels also design
of-the-pyramid consumers in diffusion, and the impact of IT- and pursue product, process, and
most markets. embodied and IT-enabled inno- service innovations that leverage
The group has made progress vations. Although much has been group innovation programs. Tata
in the last few years to improve its learned about how to drive inno- Group’s innovation approach can
culture of innovation. By remov- vation programs, we must further be a useful starting point for many
ing the stigma associated with research the types of manage- organizations worldwide to craft
failure and bringing salience to rial and IT interventions that can their innovation programs. 
innovation efforts to bring simi- help achieve desirable innovation
lar attention as that given to eco- outcomes (for example, amount, Acknowledgments
nomic measures, it’s now moving speed, quality, inimitability, busi- We adapted this article from Sunil Mithas’s book,
toward addressing the “process” ness model changes, and industry Dancing Elephants and Leaping Jaguars:
part of innovation through better leadership).10 Likewise, under- How to Excel, Innovate, and Transform
tracking and measurement. Some standing how to benefit from open Your Organization the Tata Way, focusing
of these refinements could address innovations and supplier and more sharply on its innovation programs.
both effectiveness and efficiency customer involvement with ap-
considerations by approaching propriate use of IT applications References
the discussion of innovation per- can help craft ­effective innovation 1. C.L. Colby et al., “What Drives Suc-
formance using six pathways to programs for transformations and cessful Product Development and
value, captured with the ADROIT economic success.11 Innovation in the Software Devel-
framework: adding volume and opment Process? The Product De-
growth, differentiating, reducing velopment Success Index (PDSI),”

T
costs, optimizing risks, improving ata Group’s corporate in- Proc. Frontiers in Service Conf., 2015;
industry structure (also innovat- novation program is a man- https://www-950.ibm.com/events/
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els and processes for continued overall transformation efforts, 2. P. Huang, A. Tafti, and S. Mithas,
relevance.8,9 This framework has which include business excellence “Knowledge Contribution in On-
been applied in other contexts— and globalization.3,7 The use of IT line Network of Practice: The Role
for instance, to understand the to sustain corporate innovation of IT Infrastructure, Foreign Direct
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er transformation initiatives. The terprise’s digital, innovation, and 32nd Int’l Conf. Information Systems,
ADROIT sidebar breaks down the global strategies should be viewed 2012; http://aisel.aisnet.org/icis2012/
framework in greater detail. as part of its broader portfolio of proceedings/DigitalNetworks/1/.
interdependent strategic choices 3. T. Kude et al., “Disciplined Au-
Embracing IT to transform itself and to meet tonomy and Innovation Outcomes:
to Drive Innovation the product, process, and business The Role of Team Efficacy and Task
Tata Group uses IT for innovation model innovation needs of its cus- Volatility,” working paper, Univ. of
in the following ways: learning (by tomers across the globe.7,12–15 The Mannheim, 2014.
disseminating other companies’ group-level innovation programs 4. A. King and K.R. Lakhani, “Using
innovation approaches), measur- are best viewed as a complement Open Innovation to Identify the Best
ing (deploying the InnoMeter­ to firm-level or within-firm func- Ideas,” MIT Sloan Management Rev.,
tool), facilitation (through Tata tional innovation strategies. For vol. 55, no. 1, 2013, pp. 41–48.
InnoVerse to build a commu- example, Titan’s “innovation ba- 5. N. Ramasubbu, J. Woodard, and S.
nity of innovation evangelists zaar” and Interweave programs Mithas, “Orchestrating Service In-
and facilitate the discovery and create collaboration across its novation Using Design Moves: The
development of new ideas), and business units; Jaguar Land Rover Dynamics of Fit between Service and
recognition (through InnoVista uses Tata InnoVerse to develop Enterprise IT Architectures,” Proc.
competitions that are managed ideas and prototypes; and TCS 34th Int’l Conf. Information Systems,
using an IT platform). The group uses an internal social platform 2014; http://aisel.aisnet.org/icis2014/
realizes the critical role IT profes- called KNOME to manage knowl- proceedings/ServiceScience/1/.
sionals play in creating flexible and edge and innovation within TCS. 6. T. Ravichandran, S. Han, and S.
robust IT systems, i­ncreasingly Other companies such as Tata Mithas, “How Information T ­ echnology

computer.org/ITPro 5
From the editors

Influences Innovation Output of a tability, and Industry Leadership in tion Strategy?” IEEE IT Professional,
Firm: Theory and Evidence,” IFIP Innovation,” working paper, Univ. vol. 15, no. 6, 2013, pp. 2–6.
Working Group 8.2 Organizations and of Maryland, 2015. 15. S. Nambisan and M. Sawhney,
Society in Information Systems (OASIS) 11. T. Saldanha, S. Mithas, and M. The Global Brain: Your Roadmap for
Workshop, 2011. Krishnan, “How Does Customer Innovating Faster and Smarter in a
­
7. S. Mithas, Dancing Elephants and Involvement Influence Innovation? Networked World, Wharton School
Leaping Jaguars: How to Excel, Innovate, The Moderating Role of Customer ­Publishing, 2008.
and Transform Your Organization the Relationship Management Systems
Tata Way, Finerplanet, 2014. and Business Analytics,” Workshop on Sunil Mithas is a professor at the Robert
8. S. Mithas, Digital Intelligence: What Information Systems Economics (WISE), H. Smith School of Business at the Uni-
Every Smart Manager Must Have for 2014. versity of Maryland. His research focuses
Success in an Information Age, Finer- 12. R.G. Fichman, B.L. Dos Santos, and on strategies for managing innovation
planet, 2013. Z.E. Zheng, “Digital Innovation as and excellence for corporate transforma-
9. R. Sharma, S. Mithas, and A. a Fundamental and Powerful Con- tion, and provides insights on the role of
Kankanhalli, “Transforming De- cept in the Information ­ Systems technology and other intangibles. Mithas
cision-Making Processes: A Re- Curriculum,” MIS Quarterly, vol. 38, is the author of Digital Intelligence:
search Agenda for Understanding no. 2, 2014, pp. 329–353. What Every Smart Manager Must
the Impact of Business Analytics 13. S.R. Gordon and M. Tarafdar, “The Have for Success in an Information
on Organizations,” European J. Infor- IT Audit that Boosts Innovation,” Age (2013) and Dancing Elephants
mation Systems, vol. 23, no. 4, 2014, Sloan Management Rev., Summer and Leaping Jaguars: How to Excel,
pp. 433–441. 2010, pp. 39–47. Innovate, and Transform Your Or-
10. D. Lee et al., “How Managerial In- 14. S.C. Srivastava, S. Mithas, and B. ganization the Tata Way (2014, both
terventions Influence Pace, Inimi- Jha, “What Is Your Global Innova- from Finerplanet). He’s a member of IT
Professional’s editorial board. Contact him
at [email protected].

ADVERTISER SALES INFORMATION Ravi Arora is the vice president for


innovation, benchmarking, knowl-
edge management, and business ex-
Advertising Personnel Southwest, California: cellence at TQMS, a division of Tata
Marian Anderson Mike Hughes
Sr. Advertising Coordinator Email: [email protected] Sons, currently based in Pune, India.
Email: [email protected] Phone: +1 805 529 6790 He’s ­responsible for driving the innova-
Phone: +1 714 816 2139 tion programs for Tata Group. Arora is
Fax: +1 714 821 4010 Southeast: writing a book for incumbent companies,
Heather Buonadies Making Innovation Happen—How
Sandy Brown Email: [email protected]
Sr. Business Development Mgr. the Board and Management Can
Phone: +1 973 585 7070
Email: [email protected] Fax: +1 973 585 7071 Pull Innovations by Inducing Fore-
Phone: +1 714 816 2144 sights (IAH, 2015). Contact him at
Fax: +1 714 821 4010 Advertising Sales [email protected].
Representative
Advertising Sales Representatives (Classified Line)
(display) Heather Buonadies
Central, Northwest, Far East: Email: [email protected]
Eric Kincaid Phone: +1 973 304 4123
Email: [email protected] Fax: +1 973 585 7071
Phone: +1 214 673 3742
Fax: +1 888 886 8599 Advertising Sales
Representative (Jobs Board)
Northeast, Midwest, Europe, Heather Buonadies
Middle East: Email: [email protected]
Ann & David Schissler Phone: +1 973 304 4123
Email: [email protected], Fax: +1 973 585 7071
[email protected]
Phone: +1 508 394 4026
Fax: +1 508 394 1707 Selected CS articles and
columns are available for free at
http://ComputingNow.computer.org.

6 IT Pro March/April 2015

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