1 fostering innovation: transition from chimps, to hyena and lion type innovative enterprise manoj...
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Fostering Innovation: Transition from Chimps, to Hyena and Lion
Type Innovative Enterprise
Manoj JoshiProfessor- Strategy, Entrepreneurship & Innovation
Amity Business School, Amity University, Lucknow Campus
BE(Mech), MIE(Mech), PGDFM, MBA, MIMA, Ph.D (Innovation)
Chartered Engineer [India]
[email protected], [email protected]
Phone: +91-522-2330934, Handy: +91-9415017498
1. Asia Editor: International Journal of Entrepreneurship & Innovation, IP Publishing
2. Editorial Board: Business Strategy & Environment, Interscience Willey
3. Editorial Board: Entrepreneurship Theory & practice, Family Business Review, Asia Pacific Journal of Management
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The Background
Small and Medium sized enterprises (SME’s) have created a special space within all national economies.
Their very nature of autonomy and high level of professionalism has aided them to be very innovative.
Their founder managers, few equipped with professional experience(s) and few exposed to family owned (professional) business have shaped a niche in themselves.
The objective of this study was to explore the innovative enterprise and its characteristics along with the nature of innovation.
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The Background
It is termed as strategic innovation because such innovations have everlasting impact on the survival of the enterprise engaged in true level of competitive entrepreneurship.
These strategic innovations may emanate in the field of new technology, like Information Technology.
They can emerge from the discovery of new and more convenient location, like in retailing.
They can come in the form of new raw materials or discovery of new sources of raw material, like fibre optics, or alloys, or new oil and gas finds.
They can be in the form of product or services like new credit cards or mobile phones.
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The Background
They can come from new forms of organisations like strategic alliances, flat organisations, the ambidextrous organisations that can manage contradictions like short-term versus long-term, control and autonomy.
They can come in marketing practices like customer management relations and in boundary relationship management.
In fact the scope and possibilities or innovations is infinite and difficult to concise and build boundaries.
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The Background
The identified Innovative enterprises have been classified as Chimp type (Start-ups <5 years), Hyena type (>= 5 and <15 years) and Lion type (>=15 years) innovative enterprise (metaphor used for these animal representative of the description used).
Such characteristics an innovative enterprise would possess during its cycle, competing for existence (survival) and business (hunting), similar to a Chimp, Hyena and a Lion for its survival.
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Background
Majority seeded - age group from 35 to 40 years. They possessed multidimensional skills ranging from being highly professional back ground i.e. Technical, MBA, PhD, and Medicine etc to graduates or University degree. Some had even lesser educational qualification.
The enterprises belonged to Industries like Advertising, Chemicals, Automotive, Computer/electronics, Consumer Goods, Finance/ Insurance/real Estate, Hospitality/Recreation, Media/entertainment, Pharmaceutical, Retail, Telecommunication and Travel.
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Findings
Innovative firms: developing absolutely new product/service for new customer(s), developing absolutely new product/service for existing customer(s), making changes that enhanced existing products /services and reducing cost of the product and services offered by modifications.
Emphasis: deeper customer understanding, providing a strong project team support, appreciating time Management, understanding the topography of business and most importantly nurturing the culture to promote innovation.
Important factors (innovation process): Passion to fulfil dream, environment, entrepreneurial orientation, opportunity recognition, competitive challenge, entrepreneurial leadership.
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Findings
Most of the innovative practices and their outcomes have been evident in the engineering (manufacturing), health services and in financial services.
Factors: Higher autonomy, passion to excel, openness to thinking. Flexible structures. High risk taking ability, steered by passion
Thus it brings to a point an important conclusion that autonomy provides impetus towards the innovative practices, irrespective of the industry and the innovation type.
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Findings
However, in the case of the enterprise being more than 15 years, the enterprise has been innovative or was forced to be innovative to sustain by the competitive environment, in the past 10 years.
There was a mix of industries that they belonged to, from engineering to health services and in financial services etc. Customer satisfaction looked to be a common platform for these innovative enterprises.
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Findings Quiet a few of the founder managers possessed lesser
education but were in pursuance of their noble idea.
Most entrepreneurs saw an opportunity well beyond its reality on the emerging markets.
Precision tools company (PTC) is one such enterprise that saw a large market for castings and forgings in the international market.
Similarly RTAP discovered a strong need for the same instruments in the Power generating enterprises.
Metal Seam, better known as “drum suppliers”, also got to know the opportunity for requirements for Drums by a paint company.
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Findings
The success of the organisation has been attributed to accepting challenges and utilise its own core competency in resolving issues.
Intrinsic motivation
Opportunity orientation and recognition
as supplements to growth in all terrain.
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Lessons and Learning: Chimp type enterprise
Chimps usually move around full of energy and maintain an upright position. They tend to live within the communities or to a referred group.
The actual size of the community is difficult to ascertain as it varies. A tendency to travel along with mother is prominent.
They do have the capability to reason and plan an action for future with a propensity to move in groups or clusters.
They are noisy and very curious, intelligent and of social nature.
They can grip on an opportunity and pick it up fast. They are very quick in terms of climbing and building
new fronts. Their social interaction rate is high.
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Lessons and Learning: Chimp type enterprise IACO began its operations and strength of 15 people who made
selling air-conditioning an instinctive ability and today is over 350.
Shree Renuka Sugars manufactures sugar, energy, ethanol and bio fertilizers in an integrated plant. Its merchant export division is the second largest sugar exporter out of India
Edelweiss Capital place on building long-term relationships with the clients. The focus is on long-term relationships and round the clock involvement
Thus these Chimps are constantly engaged in high energy moves with all kinds of experiments coming their way, only to educate and make them successful learners for their onward mission.
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Lessons and Learning: Hyena type enterprise
It is one of the most common carnivores of mid size. Their reputation to be shrewd, bold, dangerous and attacking cannot be ignored.
They can normally be responded in grassy areas, woodlands, desert, forest and even mountain terrain.
That means it is an all terrain hunting animal. Their defence is strong around their den. They possess a strong
smell power, which enables them to retrace their footsteps. They are known to be very social and communicate with each other
by special calls. Their intentions to any outside person are strongly reflected by
their attitude. Hyena is known to generate excitement in short notice and be opportunist.
The tendency is to pick up easy and attractive food. The powerful jaws that they have enable them to hold their target easily.
Their night vision is strong and can hunt upon a wide variety of animals.
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Lessons and Learning: Hyena type enterprise
Once the stability to establish the business is in mid stages, a strong desire to hunt shrewdly becomes an imperative for their existence.
It is here that their very nature of being attacking and expanding for newer business, expansion, acquisition etc initiates.
Since their presence in the related business activity is recognised, these enterprises become all terrain movers.
They then tend to move in newer segments in search of business growth by any means.
They cleverly use their social community in usurping business opportunity and orient towards it.
Their strong smell power gives them an edge to ascertain the environment earlier than their competitors.
However they are famous to pick up easy targets in the process of building their business empire.
Their movement cannot be followed easily as they can move around in undercover and even in darkness that means when environment is flaccid.
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Lessons and Learning: Hyena type enterprise
Rural Innovation Networks (RIN) works on a number of innovations that are varied in nature. As an incubator, RIN impacts all aspects of the process cycle it plans - innovation, rural enterprise, rural users and the wealth creation, by forging ties with venture capital (VC) firms.
KPIT Cummins, their unique business model focuses on relationship. While conducting their business, they ensure absolute configuration in terms of geography, language, investments, processes, and most importantly, people. Risk management is one such important factor in their business
R. K. Marble Private Limited for quality without compromise. It believes in the long-term business relations and works hand to hand with the customers ensuring that it gets the best value of money.
Similarly, Vision Tek has been able to develop and customise their products innovatively to suit the all terrain requirements. They strike and run in for new business opportunist before the competition sets in.
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Lessons and Learning: Lion type enterprise
The lion is the member of the cat family and known popularly to be a very clever and matured hunter.
Being muscular has the strength to sustain hunting for longer duration. Powerfully built, the natural structure gives an all terrain access for hunting purpose but with cleverness.
They have an undisputed strength ready to defeat the enemy in a short interval.
The sense of smell is highly developed that aids it to undertake the mission in a planned manner.
This also gives them a directional sense. The maturity level is competitively higher than other animals and can think logistically prior making a new move.
One very interesting characteristics they have is that they do steal a lot, however has a focussed thinking.
This is prominently distinguishes them with the other animals, hence termed as the king of the jungle.
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Lessons and Learning: Lion type enterprise It is here the maturity of the enterprise They can hunt around in boldness, once they have established
their identity in the respective market.
They can even bargain their position and bully the market suiting their purpose.
The experience of being in the market for a pretty long time provides an access to smooth understanding of the environment, competition, products, processes etc and with the help of matured innovative practices steer themselves for growth.
In the process their bargain power because of physical dimension enables them to steal.
These enterprises off late develop a focussed thinking and this becomes the distinguishing factor of the enterprise from others, in making to a successful corporate.
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Lessons and Learning: Lion type enterprise Butterfly group were the first enterprise in India, to introduce Stainless steel Pressure
Cookers and Vacuum Flasks, and acquire the ISO 9002 certification, in the LPG and Mixer divisions. Today, Butterfly manufactures a comprehensive range of home appliances, kitchen products and cookware as they have matured their presence in the Indian market. As of now their products are being exported to the United Kingdom, Canada, Australia, Japan, Middle East and the East Asian Countries, among others.
Similarly the Petron Group has seen steady growth over two and a half decades. The Group comprise of five operating divisions employing more than 5,000 people. The company provides services in Mechanical, Erection, Piping, Electrical, Instrumentation, Painting, and Refractory & Insulation work for Refineries, Chemicals, Petrochemicals, Cement, Fertilizers, Metallurgical, Power plants and other Industrial Plants. Petron has now expanded its wings outside India working in Bahrain, Jordan, Iraq, Kuwait, South Yemen, U.A.E & Sri Lanka.
On the other side, Surya Roshini has grown to become the largest manufacturer of electrical products in India with presence in more than 45 countries. It has been mature enough to expand in the markets by virtue of backward integration. The undisputed strength it possesses hurls away the small time competitors in the respective areas of operation.
Patel Roadways Ltd (PRL) began as a one-truck activity in the 50’s soon grew into one of the largest logistics companies in Asia, boasting a multinational clientele, and brand equity incomparable in the Indian logistics industry. The enterprise has been built on the trust on its strong base of customers and associates. The Patel’s have forged strongly ahead with growth-oriented diversification that has found them in couriers, air-freight, finance, foreign exchange and the fast growing money remittance business.
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Summary Innovators or enterprises engaged in innovation keep recognising
the increasing horizon for opportunities.
Growth and continuous innovation mediate as the key drivers for the new ventures.
They rigorously engage in evaluating/deciphering new ways to solve emerging problems like convincing investors & customers, aligning suppliers and attracting the employees.
They learn both from both negative and positive outcomes of their entrepreneurial actions.
Role of chance and luck cannot be ignored, as both engage in bringing happy outcomes sometimes and many a times surprising failures.
It has been said that "luck favours the prepared", while “the odds are more in favour than against”.
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Summary
Thus, to become an Innovator, be it any type of enterprise (Chimp, Hyena or Lion) the enterprise needs to initiate the following:
If the benefits outstrip the costs for being an entrepreneur, the time is to plunge the opportunity, seize and act upon. The rewards and costs could be psychological and financial.
Search for market gaps, as this may be imperatives to develop upon the market opportunities.
Study and test on restricted customers, hence, gauge the size of the market and make corrections while forecasting.
Configure as to how to meet the customer expectations, evaluate what and how would you deliver better.
Keep the strategy flexible and formulate investments after examining continuous feedback.
Keep working on the growth plan. Never sit upon an Innovation for a long, it has chances of being either replicated
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Summary
The presence of innovation dependent on the environmental conditions, i.e. the local, regional, national and international.
It consists of the knowledge resources available with associations, academia, labour pool, professionals, infrastructure, other related industries, suppliers and customers, local laws and entrepreneurial culture.
The regional and national environment comprises of the favourable policy and institutional framework that fits the evolving enterprise.
In India the major curse resisting innovation & entrepreneurship has been the corrupt and inefficient bureaucracy, complicated labour, taxation and company laws and restrictive infra structural facilities.
It is the creative capabilities of people and innovative outputs that drive an economy and therefore we must acknowledge for creating a culture to be constantly innovative.