BackStart-ups 2.0 will innovate for Smart Enterprises
The new generation of Smart Enterprises no longer looks at start-ups as competition, but as an innovation lab
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A Smart Enterprise is the composite of a few defining parameters, of which propensity to innovate and disrupt through data are arguably right up there. On the other hand, we have start-ups that are nimble and aggressive and by their legacy have come to embody the spirit of innovation.
Start-ups 2.0 marks the emergence of the new-era start-up world in India, one which has a more defined and amicable personality and is aligning itself with the industry, academia and government.
Typically a large organization is bedevilled by bureaucracy and structural issues, an almost inevitable offshoot of scale. To address this challenge, Smart Enterprises have started treating start-ups as their innovation labs, which need a different and more flexible culture compared to a big corporate house that has a defined policy and structure to meet the goals of several stakeholders. This era of Start-ups 2.0 has filled lot of gaps from its earlier version, where funding, mentoring, government policies, industry collaboration and the role of academia were still nascent yet to be defined.
Start-ups innovate because they can. They have to. In an open economy where entry barriers are almost non-existent, the challenges faced from incumbents can be daunting, thus compounding the need to break away to create a USP (unique selling proposition), and beating the “me-too" trap. Shorn of structural impediments and riding on tight venture capital money, for start-ups, the response time has to be very quick.
Notably, some very large entities have started functioning like start-ups to stay in the game and nullify the threat posed by nimble-footed competitors. In such an environment, employees are encouraged to think differently, and are given adequate leeway to work on their ideas.
While this happens, a bigger wave of collaboration between industry and start-ups for innovation is forming. The new generation of Smart Enterprises no longer looks at these start-ups as competition, but as an innovation lab, where industry can collaborate with start-ups in their relevant space and help them co-innovate for mutual benefit. The industry is helping them scale up by providing access to new customers, geographies and technologies.
The dust seems to be settling and things have started falling in place. Start-ups 2.0 will have a more systematic approach and a defined life cycle to grow into a successful venture. The various stakeholders are getting more confident and clear about their approach and the value creation when they engage with the start-ups. This will help more engagements in the start-up space with a more predictable value creation.
The government sees start-ups solve various problems in countries such as India, where many giant multinational companies do not find the bottom of the pyramid to be a strategic or mature market for them.
India is full of such examples. For instance, a technology start-up from Bengaluru is helping farmers increase crop yield by 15%. This irrigation technology start-up helps in sensing soil temperature and moisture levels, and regulates water flow. The flow of water is auto-controlled based on the size of the farm and the specific requirement of the particular breed of the crop.
Such technology-based start-ups can help the three-fifths of India’s 1.2 billion population dependent on agriculture and the monsoon for their living, by providing affordable solutions to farmers such as smarter irrigation methods, precise weather forecasting, pest elimination and improved yields.
Associations like Nasscom have been working relentlessly on creating a sustainable ecosystem for start-ups. A big start-up programme named 10K is being run to achieve the set goals. Nasscom has partnered the government to get India transition to the digital age, enhance the skills of the employable population, mobilize corporate entities to participate in such initiatives and play an advisory role to transform vision into reality. Nasscom strongly supports the prime minister’s inspiring call: “Start up India, Stand up India".
This era of Start-ups 2.0 will also see numerous collaborations between Smart Enterprises and start-ups. The start-ups will get direct benefit of being incubated, accelerated, mentored, funded and nurtured by large organizations, along with access to markets and prospective customers in equal measure.
On the other hand, the Smart Enterprises will be able to leverage start-ups to co-innovate and get faster in terms of IP (intellectual property) creation and time to market.
The author is chairman of software body Nasscom and founder, chairman and MD of IT services company Cyient Ltd.
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