Innovation @ Wipro Limited - Case study

Innovation is a critical factor for success in outsourcing industry. Vendors have to constantly innovate and offer services to clients that help them to increase their profitability. Innovation is must in the highly competitive outsourcing industry where vendors are fighting for clients and clients are looking for vendors that have innovation frameworks in their organizations and have successfully provided innovative services to clients that not only reduce costs and improve process efficiency but also increase profitability for both Wipro and clients. Wipro technologies have created a culture that regarded the quest for innovation as its norm. Some of the Innovation initiatives at Wipro Limited are discussed in this article.

Innovation Clock Since year 2000 Innovation initiatives were developed based on a study of innovation methods in companies like Nike, 3M, and Home Depot that were reputed for their innovative practices. Wipro considered commercial viability of the ideas as critical to good innovation. Top management developed a framework for innovation and the framework provided guidelines right from the idea generation stage to commercialization of that idea. The innovation process at Wipro was represented through the Innovation Clock which consisted of 12 steps. Creation of an innovation framework followed by identifying the themes to be worked on is the first step. Generating ideas from employees and validation of those ideas by the customer is next. Wipro also realized rewards and recognition will motivate employees to come up with innovative ideas and framed a detailed rewards policy.

Wipro Intranet Web enabled the whole innovation process and was the place where employees posted their ideas. Wipro constituted innovation teams, conducted workshops, and issued innovation process guidelines to all its managers and business group heads. Wipro set up an Innovation council with five gate ways in all its business groups. Innovation council consists of CTO and five permanent members whose responsibility is to evaluate idea and its commercial viability. The five gateways are Idea gate (idea generation), Evaluation gate (idea screening), Commitment gate (resource commitment), Development gate (customer order, business plan & projected revenues) and Volume gate (commercialization of idea). For Wipro Innovation Clock Graphic please refer to end of the post.

Wipro conducted an Annual event called TechForum where employees present papers and conduct demos on their ideas. It set up Innovation center in Bangalore that employed around 200 people in 2003 and provided funds and infrastructure to nurture innovative ideas and turn them into products. Wipro also set up Centers of Excellence that are R&D centers for future technological challenges. By 2003

Wipro through these innovation initiatives have developed innovative products like Flow-Brix, workflow solutions for publishing, i-Desk, Collaboration tool for HR management, etc.

Quantum Innovation Program 2006 The project designed and implemented by Erehwon Innovation Consulting Pvt. Ltd was expected to generate new ideas to drive business growth and motivate people within the company. By 2007 Erehwon Innovation has helped design more than 50 projects, of which four have been initiated, including the Mission 10X program that aims to train 10,000 faculty members at engineering colleges countrywide by 2010.

Applied Innovation Framework Applied Innovation is the ability to infuse newer ideas and newer ways of doing things into all parts of the organization, and improve business outcomes, often without major disruptive change. It is a 360degree business approach covering process, delivery, business and technology innovations that help Wipro to work collaboratively with clients for cost take-outs, speed-to-market and new business opportunities. This approach is backed by a 25-year heritage in providing domain-intensive technology solutions. Based on this framework Wipro has internally developed products like eCargo suite (Airline Industry), TINA platform (SOA), etc.

Wipro and EMC alliance unites Wipro's applied innovation framework for developing new solutions and services around EMC's industry-leading information infrastructure technologies to enable more organizations, specifically in targeted growth markets, to optimize their infrastructures, secure and protect their information, and leverage their information to unlock its full potential. Wipro and EMC intend to explore collaboration of industry and application specific solutions in key business areas that solve customer needs related to storage management, information management, content management, and information security.

Innovation Centre on SecondLife.com Wipro was the first Indian Company in 2007 to set up an Offshore Development Center (ODC) model campus with facilities like client engagement centre, learning centre, 3 floor ODC setup with cubicles, security desk at the campus entrance gate, etc in Secondlife.com. In 2008 Wipro launched a SOA solutions lab which gives customers an opportunity to explore the impact of SOA in transforming their organizations. In 2009 Wipro launched its 'Innovation Centre' for Testing Services on SecondLife.com, the popular virtual world. The Innovation center will be a replica of the actual lab that is situated at

Wipro campus in Electronic City, Bangalore and will provide a one stop virtual view of IP powered solutions offered by Wipro that includes consultancy, test lifecycle accelerators, pre-certification and certification in the areas of Wi-Fi and mobile handsets, test design solutions in banking, securities and Point of Sale, performance engineering and telecom testing.

Innovation Evangelism Pavan Soni defines an Innovation Evangelist in an organizational context as one who generates awareness of the need to innovate; builds a belief amongst people that anyone can innovate; and provides sufficient facilitation to enable innovation. At Wipro Technologies, Innovation Evangelism happens through a series of vehicles that include: Wipros Innovation Camp, Innovation Bazaar, Story Book on Innovation, Systematic Creativity Workshops, and Inflection Point newsletter, etc. Each of these started as experiments and then through learning got institutionalized. Key learning are: enrollment of the stakeholders; creating a semi-structure knowledge sharing environment; enabling a market of ideas, talent and capital; having a constant and consistent communication; transparency in operations; and taking a more scientific approach towards creativity; among others. One of the areas of further investigation is on measuring the direct and indirect returns of investment for each of these vehicles.

Global Innovation Tournament Wipro Technologies and Knowledge@Wharton together started conducting this tournament in 2010 which selects the most innovative managerial "tools" that companies can use to improve their business by increasing revenues, reducing expenditures and improving customer experience. The goal of an innovation tournament is to pit competing opportunities against one another. The judges consistently filter out the weakest ones until only those with the highest profit potential remain. Karl Ulrich says the panel judged the innovations on four dimensions: Novelty, Feasibility, Track record and Overall potential.

The Innovation Tournament is the brainchild of two Penn business school professors, Christian Terwiesch and Karl Ulrich who authored the book entitled Innovation Tournaments:Creating and Selecting Exceptional Opportunities. The books premise is companies should view and structure the innovation process as a collection of opportunities. After the success of first tournament in 2010 Wipro is conducting the tournament again 2011.

Wipro Innovation Success

Wipro believes businesses are facing challenges and opportunities which are very different to what they were a decade ago or even a year ago and the world is looking up to innovation in the triangle of technology, sociology and the environment to help them deal with these changes. Wipro believes it can leverage on its institutionalized innovation culture to push the boundaries for delivering solutions that provide enhanced value and direct impact for their customers. Innovations like India's most powerful supercomputer, a cost-effective Base Terminal Station designed for GSM networks in underserved markets, a mobile switching router for emerging markets, connected home concept and Wipro Energy Manager that uses M2M communication are some of the products of the Wipro innovation culture. Wipro as part of ODC concept legacy has also developed application-based innovations like Flex and Cigma delivery models which are service-based as opposed to resource-based. Source: Wipro website

Wipro Innovation Clock

Discussion points: 1. Is the Innovation strategy adopted by Wipro since 2000 is successful?

2. Wipro has created a culture of Innovation in the organization. Did this culture generate revenues for Wipro? 3. What is the clients view of Wipro Innovation culture and how did it work for them?

4. Will Wipro strategy of collaborating with other IT Vendors like Hardware vendors and Research Organizations help it in innovation?

Innovation @ Tata Consultancy Services Limited (TCS) Case study

TCS understand that innovation is the lifeline of business and it is a very complex process. IT is always regarded as the companys innovation champion and IT managers want to help their businesses succeed through innovation. Businesses identify innovation critical for business growth and performance and there is still some apprehension about the return on investment on the innovation front. TCS believes innovation can be broadly defined as an idea that makes a material difference to an organizations current capabilities or creates a future capability. TCS believes that innovation must come from all parts of its organization and it has to be part of the organization DNA and cant only be restricted to R&D departments in the organizations. TCS also believes that other stakeholders like clients, academic institutions, peers, other technology firms etc play a critical role in the innovation process and they have to be actively involved. TCS Innovation initiatives are discussed in this article.

Clayton Christensen Innovation Framework According to Harvard Business School professor and author Clayton Christensen who also serves on the board of directors of TCS, innovation can then be divided into three discrete subsets: derivative innovation, platform innovation, and breakthrough innovation. These segments require different environments and support systems to emerge and create maximum business value. TCS apply Professor Christensens segmentation (please see figure below) as follows: Derivative or sustaining innovation that continually provides improvements on current services and solutions, Transformational improvement or platform innovation that facilitates a swift move to visible adjacencies in terms of emerging technologies as well as markets and Disruptive or breakthrough innovation that enables customers to access potentially game-changing or/and new market business models. Derivative or sustaining innovations are handled and funded by the business unit in which the idea originated and Platform-level innovations that might extend an existing offering are directed to one of the companys 19 global innovation labs. Disruptive ideas often originate in the labs, but if one emerged from a business unit it would be directed to a lab or funded through an incubator fund run by the CTOs office.

Innovation Lifecycle- Adopted from Prof Clayton Christensen. Source: TCS white paper Innovation Networks: Casting a Wider Net for IT

TCS Innovation Labs The Tata Research Development and Design Centre (TRDDC) was established in 1981 as a division TCS and is the largest R&D facility among the network of Innovation Labs at TCS. TRDDC has three R&D labs: Process Engineering, Software Engineering and Systems Research and had built a collaborative and open innovation environment for engaging with industry partners and clients in various domains, academia, strategic technology partners, startups, standards organizations, etc. Since the year 2000, TCS has set up Innovation Labs that create value for clients and foster an innovation network in the organization for the successful development and commercialization of new ideas, technologies and best practices.

TCS has 19 Innovation Labs based in three countries including TRDDCs three R&D labs. TCS Innovation labs have 800 associates in R&D and provide an environment for complex IT research in leading-edge technologies as well as in various domains. TCS labs work on areas like Life sciences, Open source technologies, enterprise architecture, wireless technologies, performance engineering, etc. TCS Innovation labs are customer aligned and metrics driven and scientists and researchers continually publish/present research papers and publications. Some of the products created by TCS Innovation labs are mKrishi, DBProdem, Jensor, Wanem, Scrutinet, SmartTest Manager, etc.

TCS Co-Innovation Network (COIN)

TCS set up COIN in 2004, based on the book -The Future of Competition: Co-Creating Unique Value with Customers, co-authored by the late management guru C.K. Prahalad and Prof. Venkat Ramaswamy that talked about co-creation as a strategy for companies to satisfy customers and sustain profitable growth. Co-Innovation network consists is led by TCS Innovation Labs and includes academic institutions like Stanford, MIT, IITs,etc, start-ups like Cicero and WorkLight, venture funds like Helios, Sequoia, Amadeus, etc, strategic alliance partners like Intel, SAP, HP, Cisco, etc, multilateral organizations and key clients. COIN brings to the businesses innovative solutions; customized to the clients needs, disruptive technologies, risk mitigation which is spreading the risk among multiple partners and simplification of technologies. The company now has 24 active TCS co-innovation partners and is generating revenue through 75 solutions developed jointly with various partners in the last five years.

Other Initiatives TCS Leadership has set up systems for encouraging innovative thinking and processing of ideas and created multiple channels, and managers are trained how to direct an employees idea. Innovation is also part of the employees formal annual review process and employees who provided innovative ideas are thoroughly rewarded. IdeaMax, a Digg-like social network that lets any employee submit, comment, and vote on ideas is the platform provided to the employees for innovation. Innovations are a critical component of the formal training programs for the employees and managers and are encouraged to think creatively. Innovation events like Innovation Days help key customers and TCS researchers to collaborate on research toward specific solutions and Innovations Forums held annually in the UK and USA serve as confluences of thought leaders and researchers.

TCS Innovation success Frugal Innovation TCS innovation initiatives have started generating significant amount of revenues but it is still looking for a disruptive offering that will be major part of revenues. TCS has been able to instill an innovative environment within the organization and has developed successful innovative offerings. The company has already invested significant resources in the innovation initiatives and is looking for future growth and performance through them.

Recently the company is also talking about frugal innovation in to capture more business in the emerging markets. Frugal Innovation is derived from Frugal Engineering or Gandhian Engineering is the science of breaking up complex engineering processes/products into basic components and then rebuilding the product in the most economical manner possible. Frugal engineering results in simpler and easier to handle processes and cheaper products with necessary features. Tata Nano the cheapest car in the world today, is held up as an example of successful frugal engineering. The term 'frugal engineering' was first used by Carlos Ghosn, the joint chief of Renault and Nissan. (Source: Wikipedia)

Discussion Points:

Will the overall Innovation strategy of TCS drive business growth? Will frugal innovation work for TCS? What should TCS do for increasing its revenues through innovation?

Innovation @ Infosys Limited - Case study

Innovation is a vital component for business strategy and in order to stay ahead, companies should increase the speed of innovation, be focused on the customer experience, understand their behavior, and co-create with customers and partners. Infosys believed in this and Innovation at Infosys is built on the intellectual capital of employees and the processes to rigorously train employees for innovation. Infosys took that idea (from GE) and created the worlds largest employee training facility. Infosys believes innovations is important for future growth and differentiate from the competition. Products, platforms and new engagement models are part of innovation strategy in Infosys. Innovation is not a new focus for Infosys as it had been focusing on innovation since 1999 when it set up SETLabs (Software Engineering and Technology Labs). Infosys invites some of its top producers under the age of 30 each year to its senior management council meetings. The young employees are invited to share their ideas with senior managers.

Innovation Strategy 2011 Infosys 3.0 As part of its strategic initiative Infosys 3.0, Infosys is expecting to achieve 1/3rd of the revenues from Innovation which currently accounts for 7.3% of revenue. In order to achieve this innovation target revenue Infosys is taking an inorganic route to strengthen its product portfolio along with its in house R&D. Infosys is planning to appoint a business innovation head for each of its four verticals (Financial services & Insurance, Manufacturing, Energy, Utilities, communication and services and Retail, CPG, Logistics and Life sciences) to identify product opportunities within the sectors and build business plans. The Business Innovation group is focusing on non linear revenues which are attempts to de-link the revenue growth from people growth. The four innovation heads would have a dual reporting structure: they would be accountable to their respective vertical heads as well as Business Head of Innovations. Once Innovation heads identify ideas respective verticals will fund the development of the products. It will be a federated structure. A central innovation group will help engineer a product while product management and sales can be decentralized.

Co-Creation since 2005 Co-creation is the practice of developing systems, products, or services based upon innovative ideas from stakeholder experiences, that enhance strategic capital, increase returns, and expand market opportunities. The concept is based on the book published in 2004 The Future of Competition: CoCreating Unique Value with Customers" by Prof Venkat Ramaswamy and management guru the late C K Prahalad. Customer experience is central to enterprise value creation, innovation, strategy and

executive leadership and such changes in society and businesses necessitated co-creation, the authors argued. The types of co-creation can be viewed in terms of two basic dimensions: Who are the stakeholders and what is the engagement area of co-creation? The stakeholders include customers, employees, partners, suppliers, investors, regulators, volunteers, citizens, and others. Co-creation opens up any management process and includes innovation management, which includes process innovation, product innovation, and business innovation.

Infosys' SETLabs incubated the Innovation Lab in collaboration with Prof. Venkat Ramaswamy in 2005 as part of its research and innovation capability. Since then Infosys had been working with its partners and clients in several forms of Innovation Co-creation such as joint research, joint innovation centers, joint Intellectual Property (IP) licensing, joint product development and early adaptor programs. The Infosys Innovation Lab has built several capabilities to enable the practice of Innovation Co-creation by enterprises, which include processes, platforms, engagement models, networks, etc. Also critical are the tools that foster dialogic, transparent, accessible, and reflexive interactions are essential to co-creation. Successful co-Creation cases highlighted on Infosys website are

1. Infosys and BT have collaborated involving researchers conducting joint R&D and prototyping. It has led to the creation of new IP that Infosys and BT jointly take to the market. 2. Nomura Securities derived 150 times application performance improvement. The performance of the interest rate risk analysis application was amplified by more than 15,000 per cent using the Infosys HiPC solution IP. 3. Infosys has co-created with ACDI/VOCA a solution to connect Indian farmers to the global retail supply. It also provided to the organized retail sector access to a reliable small-holder production base and decreased market-to-farm losses, which were estimated at 30-40 per cent on certain products. Infosys SETLabs since 1999 SETLabs are internally divided as Strategic Business Units called Centers of Excellence (CoEs). SETLabs has developed several process frameworks, methodologies, service platforms, etc. Initial COEs are The Convergence CoE that pursues multiple R&D projects in pervasive computing, Grid Computing CoEs vision is to create an adaptive services grid through service-oriented architectural constructs and platform, Service oriented Architecture CoE pursues multiple projects on a variety of practical topics related to SOA, The Data Warehouse and Business Intelligence CoE distills information from projects executed, identifies technology trends and provides thought leadership, J2EE CoE helps enterprises realize benefits of leveraging J2EE technology and Microsoft Technology Center aids in adoption of Microsoft technologies within Infosys and by its customers. Added lately is Cloud Computing CoE to enable Infosys' enterprise customers achieve operational excellence by leveraging cloud computing platforms.

The 600-member technology and domain-focused team has developed products like ELIXIR: Middleware for Wireless Sensor Networks, NIMBUS: Context- Aware Pervasive Computing, MANTRA: A software maintenance platform and MConnect: A middleware to create mobile applications faster. The firm had developed Flypp, a mobile applications platform and iEngage, which is powering social media marketing and employee engagement for five global 500 companies, ShoppingTrip360 service transforms in-store shopping by enabling collaboration between shoppers, retailers and CPG companies in real-time, etc. SETLabs enables Infosys to work with standards bodies on future technologies, share best practices and maintain peer relationships with academic bodies, industry forums, conferences, and journals.

Infosys Innovation Success Innovation initiatives in Infosys not only created products and services but also gained reputation for the company as one of the most innovative company. Infosys constantly figured in the Innovative companies lists compiled by various sources. Recently in August, company has been ranked #15 in Forbes List of The Worlds Most Innovative Companies. The list was based on innovation premium, a metric of stock market valuation by investors in anticipation of sustainable innovation. It is defined as the proportion of a companys market value that cannot be accounted for from cash flows of its current products in its current markets.

The company's new management under K V Kamath and S D Shibulal is planning to set up a separate company focused on IT products, platforms and intellectual property-driven solutions. Employees at Infosys who are already involved on the innovation side, which includes products and platforms, would move to this new firm. The other option is to make an acquisition of an existing company that is involved in areas where Infosys is looking to innovate. Infosys has been emphasizing business innovation as a strategy and through innovation it is planning to drive business transformation of its clients.

Discussion Points:

1. Will the overall Innovation strategy of Infosys drive business growth? 2. Will the strategy to set up separate company for IT products, platforms and intellectual property-driven solutions work? What are the risks involved? 3. What will be the impact of business innovation on the company and outsourcing industry as a whole? 4. What are the challenges for management for fostering innovation in the organization? People, Process, Infrastructure, and Financial related challenges.