New Delhi, November 30, 2020 – As organizations across the world and India continue to deal with disruptions resulting from the pandemic, 77% of businesses in India consider that innovation is now a ‘must’ for them to respond quickly to market challenges and opportunities, and ensure business resilience, says a recent Microsoft and IDC report.
The India findings of the study ‘Culture of Innovation: Foundation for business resilience and economic recovery in Asia Pacific’ highlighted that a large majority of business decision makers agree that innovation is a necessity to staying resilient in a crisis. The findings were released by Rajiv Sodhi, Chief Operating Officer, Microsoft India and Vasant Rao, Managing Director – India and South Asia, IDC, in the presence of Mukesh Sharma, Chief Technology Officer, Paisabazaar.com and Gaurav Aggarwal, Director and Head of Unsecured Loans, Paisabazaar.com.
The study found that in a short span of six months, organizations in India have increased their ability to innovate by 4% by maturing their Culture of Innovation. The study also showed that close to 78% of India organizations are speeding up digitalization in a variety of ways to adapt to the new reality. This included launching digital products and introducing digital payments to embracing ecommerce and automation. As a result, Indian companies are aiming at increasing their revenue from digital products and services to 50% in the next 3 years from 36% at present. According to the survey, 64% of respondents acknowledged that innovation has become easier in the post-COVID-19 era. Prior to the pandemic, only 32.5% of Indian business found innovation in their products and services easy.
The study introduced the culture of innovation framework, which spans the dimensions of people, process, data, and technology, to assess organizations’ approach to innovation. It surveyed 439 business decision makers and 438 workers in India within a 6-month period, before and since COVID-19. The India study was part of a broader survey among 3,312 business decision makers and 3,495 workers across 15 markets in Asia Pacific region. Through the research, organizations’ maturity was mapped and as a result, organizations were grouped in four stages – traditionalist (stage 1), novice (stage 2), adaptor (stage 3) and leaders (stage 4). Leaders comprise of organizations that are the most mature in building a culture of innovation.
“Innovation is no longer an option, but a necessity. We have seen how the recent crisis has spurred the need for transformation; for organizations to adapt and innovate in order to emerge stronger,” said Rajiv Sodhi, COO, Microsoft India. “We commissioned this research to gain better understanding of the relationship between having a culture of innovation and an organization’s growth. But now, more than achieving growth, we see that having a mature culture of innovation translates to resilience, and strength to withstand economic crises to recover,” he added.
Adds Vasant Rao, Managing Director, India and South Asia, IDC: “We see amongst leaders a constant appetite for growth and evolution. During COVID-19, 31% of firms in India said they think their business model will lose competitiveness in five years’ time. This desire and urgency for continuous improvement through agility and adaptation to change will determine the success of businesses in this new normal,” said.
Focus on technology and skilling|
When asked about their priorities for the next 12 months ahead, organizations in India (45%) indicated that they will focus on Technology as most essential for business resilience and recovery. According to the report, some best practices will include developing a culture that promotes investing in disruptive technologies and leveraging data to differentiate and enhance products and services.
The other area of focus is People. In the coming year, 18.5% businesses in India plan to focus on embracing risks and driving innovation through ongoing learning, and the right talent and skills. Supported by technological transformation, organization also need to focus on encouraging new and breakthrough ideas among its employees as well as hiring a diverse workforce.
Showcasing a new technology feature that deploys Microsoft Azure and Azure AI to enable extensive digital solutions for loans & credit cards, Mukesh Sharma, Chief Technology Officer, Paisabazaar.com, said, “Most large lenders and Fintechs were unprepared due to the lack of digital processes and infrastructure. We all had to wake up to a new reality and adapt to it. Everybody was impacted and our focus was to ensure that consumers could have access to the loans they needed, through completely paper less and presence less processes. We recognised the potential of AI and Cognitive Services to make end-to-end digital loan disbursals a reality with our Digital Stack. As the market leader with partnerships with most large banks and new-age lenders - and a culture of innovation since inception - we are well placed to accelerate this critical shift towards the much-needed digitization of the entire ecosystem.”
Paisabazaar.com, India’s largest digital marketplace for lending products, is driving technology innovation in their offerings. Paisabazaar Stack uses Microsoft Azure AI capabilities to make loan disbursals and credit card issuance completely digital. Under the Digitization Stack, the fintech has built completely digital solutions for KYC verification, income and employment validation, repayment set-up and consent on loan agreement. With this, a large section of customers will now be able to access credit much quicker from the comfort of their homes through a presence-less and contactless process as each erstwhile physical step in the lending process has now been built digitally.
Microsoft is utilizing its platforms and services to enable a culture of innovation among Indian enterprises - across retail, IT/ITeS, and healthcare, among other sectors. This is helping organizations adapt, innovate and reimagine their business in the COVID-19 era.
The Culture of Innovation refers to an organization’s ongoing ability to respond quickly to challenges and successfully perform in four dimensions - People, Processes, Data and Technology capabilities. According to the Culture of Innovation framework by IDC, organizations fall into four stages of COI – Traditionalist (Stage 1), Novice (Stage 2), Adopter (Stage 3) and Leader (Stage 4).
A culture of innovation is critical to driving innovation and business resilience in the new normal
77% of Indian organizations have found innovation to be critical or important to their performance and resilience. Moreover, the pandemic has accelerated the evolution towards innovation, with companies in India maturing by 4% in their journeys over the last six months.
Innovation has become easier
Indian organizations were compelled to innovate in order to build resilience in the new normal. However, this development also resulted in innovation becoming easier for organizations in the country. According to the survey, 64% of respondents acknowledged that innovation has become easier in the post-COVID-19 era. Prior to the pandemic, only 32.5% of Indian businesses found innovation in their products and services easy.
Moving forward, organizations in India say that they will prioritize increasing customer centricity, while leaders in Asia Pacific plan to focus on investing in technology infrastructure that is robust and allows scalability and flexibility.
Culture of Innovation driving digital adoption
Organizations in India are focusing on increasing the percentage share of their revenue derived from digital products and services or digital business models. 78% of the respondents have stated that they are speedily embracing digital capabilities. According to the study, businesses in India are aiming to increase their revenue from digital products and services from one third (36%) at present, to half (50%) in the next 3 years
Beyond digital products, services and processes; leaders understand the urgency of redesigning their overall business models. Indeed, organizations are already increasingly focussing on customer centricity as they work to ensure business resilience and faster recovery.
Technology and People are key in India
When asked about their priorities for the next 12 months ahead, organizations in India indicated that they will focus on technology (45%) as the most essential areas for business resilience and recovery. 18.5% businesses plan to focus on embracing risks and driving innovation through ongoing learning, and the right talent and skills. Supported by technological transformation, organization also need to focus on encouraging new and breakthrough ideas among its employees as well as hiring a diverse workforce.
Culture of Innovation – a success formula for resilience and faster economic recovery
Using the Culture of Innovation framework, the study revealed the best practices that organizations can adopt to progress across people, technology, data and process.