D V R Seshadri

Innovation through Intrapreneurship: The Road Less Travelled

The relentless pressures of competition stemming from globalization, technological changes, etc., today are increasingly buffeting organizations. One of the pathways for companies to weather these storms is through unleashing the entrepreneurial spirit latent in its employees enabling these employees to carve out new paths, initiate new ventures, defy the status quo in their organizations, and break fresh ground. There is an increasing body of knowledge relating to unleashing entrepreneurial energies in large organizations referred to as corporate entrepreneurship or intrapreneurship. Intrapreneurship is a major driver for organizational renewal or reinvention. This article seeks to understand the intrapreneurial mindset as opposed to the employee mindset. It is inextricably connected with leadership since it involves mobilizing teams of people towards a cause much greater than the individuals involved, often in the face of significant resistance from status quo preserving forces within and outside the organization. Intrapreneurship at any level (individual, group or organization) fundamentally involves taking ownership, i.e., operating with an entrepreneurial mindset. In the corporate context, since the person leading the reinvention is not an autonomous entrepreneur, he/she is more appropriately referred to as an intrapreneur. It is very unlikely that reinvention at any level can occur without this basic transformation of perspective from employee to psychological owner or intrapreneur. Intrapreneuring is not a path that is chosen by the vast majority of people in any profession since this path involves a lot more of the person than would be the case for a person operating with an ‘employee mindset.’ However, the reason it is important is that it is challenging, fulfilling, personally and professionally rewarding, and is urgently required by corporations—both big and small—the world over to thrive meaningfully in todays uncertain times. While the context in which this manifestation of entrepreneurial behaviour is enacted may vary (government, public sector, private sector, NGO, etc.), the fundamental fibre of the person who chooses this path is essentially similar. This article presents three interesting case studies from Tata Steel, a company that has sought to create an entrepreneurial climate in the organization over the last several years. Two of these relate to crashing project time and cost lines to create international records in the face of international technical collaborators affirming that this would not be possible in India. The third intrapreneurial episode relates to turning around a run-down manufacturing facility in the company to produce spectacular results. In the process, the authors have: drawn generic lessons from each of these case studies presented the results of interviews with 30 practising managers on the facilitators and inhibitors for creating an intrapreneurial climate in large organizations highlighted the perspectives of a few senior managers from the Indian IT industry on this very important source of innovation in large organizations tied together the three intrapreneurial episodes presented in this paper by attempting to understand the commonalities among the intrapreneurs. This article would be beneficial to Indian companies seeking to create an entrepreneurial climate and to professionals in these companies to motivate them to look at their work lives differently and to enable them to redefine their roles in their organizations.

Toward a Grounded Theory of Effective Business Incubation

Business incubators are found all over the world. Yet, to date, no viable integrative theory of effective business incubation exists. This essay outlines a grounded theory of incubation, driven by case studies, empirical results, and field work, based on three main principles that generalize across countries and cultures. They are: The paradox of market emulation: Successful incubators both emulate market conditions and shield their ‘infants’ from them. Managing this paradox is fraught with difficulty, not the least because it is often not explicitly recognized. Resolving the key make-or-break constraint: In every country, there are many constraints that hinder ultimate business success of incubator projects, but there is one key constraint that always ‘resonates’, i.e., that dominates the attention and concern of project managers. In India, this constraint is funding. In Israel, where the VC industry is mature and liquid, funding is not a major constraint (though as always and everywhere, raising money is a major challenge), but experienced managerial capacity is the resonating factor. Hence, a theory of incubation should include principles that guide identification of the key ‘resonating’ constraint and provide direction toward reducing or eliminating it. Alignment with local and national cultures: Culture is a shared, learned, symbolic system of values, beliefs, and attitudes that shapes and influences perception and behaviour. Culture is how values drive behaviour. In national studies of incubation, it is strongly evident how powerfully national culture acts as a mediating variable between, for instance, incubator operations and processes and the national and global business environment. Hence, a theory of incubation should include answers to the following question: How can incubator processes align well with elements of national and local culture, in order to: reinforce those aspects of the culture that act positively to help incubator projects attain success mitigate or eliminate those aspects of culture that act negatively, and lead to failure? It is hoped that this work will stimulate other scholars to seek even more important general principles, leading to a powerful general theory of business incubation.

Bridging the Chasm between Management Education, Research, and Practice: Moving Towards the 'Grounded Theory' Approach

This paper addresses the issue of best-practice research methodology in management. It is argued that management research should follow what is known as ‘grounded theory’, or what Harvard Business School Professor, Robert Kaplan, termed as “innovation action research.” Today, management research is found following an inappropriate model, the hypotheticoscientific method designed for laboratory research in the natural sciences. This is unsuitable for management and not aligned with case-based pedagogy, action learning or reality-based executive programmes. The result is a painful disconnect between management research and management teaching. There is an increasing divergence and separation between educators and researchers, when in fact these endeavours should be integrated and converging. While educators use case studies intensively, researchers reject N=1 qualitative methods and instead employ N ≥ 25. It is indeed strange that sometimes the educator and the researcher are the same person. This strange methodological schizophrenia needs a remedy. For management, world is the laboratory. It therefore requires a worldly. research methodology. Management educators seek to use reality-based tools; yet, they often do research that is abstract and diffused. Some of the leading management tools taught by management educators originated, in fact, in best-practice innovations in organizations. Why not adopt this as general best-practice? And why, then, does management research pay lip service to the natural sciences, when its most powerful theories and tools emerged from clinical, not laboratory, settings? This paper offers an alternative, a new way forward, based on the familiar concept of grounded theory. Through examples and case studies, it shows how this approach might be applied and how teaching and research can become tightly integrated. It concludes with some poignant thoughts on the way forward, including finding robust ways to partner between management researchers, educators, and practitioners (who are participants of executive education programmes in most business schools). For instance: There would be a need for extensive collaboration between these three constituents. Management education and research must include extensive team work, rather than the common phenomenon of each educator doing his ‘solo’ act in management education programmes and moving on. There should be relevant and well-thoughtout themes that facilitate high quality dialogue between the three constituents (educators, researchers, and practitioners), where there is intense learning on the part of all of them. Significant mindset changes on the part of companies sponsoring their managers for management education programmes would be necessary. It is hoped that this paper would generate a lot of dialogue resulting in positive changes that would bridge the existing chasm between management education, research, and practice.

Understanding the Process of Transitioning to Customer Value Management

Customer Value Management (CVM) has emerged as an important vehicle for customer retention in business markets. Supplier firms under increasing pressure from relentless competitive forces are seeking to retain and grow the share of business from profitable existing customers as a means of finding a way out of downward spiralling price pressures. While a lot has been written in academics about the importance of CVM, several gaps remain on understanding how a large company actually undertakes this journey. Crafting competitive value chains and focusing on streams of competition are also emerging as important agenda for supplier firms since, increasingly, the end customer is no longer willing to pay for inefficiencies in the value chains. In this context, the challenge for a supplier firm in business markets is no longer restricted to getting its own operations in order, but, additionally, it must ensure that multiple interfaces that exist across the entire value chain all the way until the end customer are streamlined so that the value chain is free of value drains and every meaningful opportunity to create value is exploited. In this paper, the authors present the experiences of the India-based Tata Steel in implementing CVM across 25 select customers. This has enabled it to successfully come out of the commodity trap that it found itself some four years ago. The paper begins with an overview of existing research in the area of CVM covering the important aspects of customer loyalty, customer relationships, trust as an antecedent for relationships, value as a cornerstone of business markets, and importance of the supplier firm focusing on the efficacy of the value chain of which it is a part. While one part of the challenge for a supplier firm is to find avenues to create and deliver unique value to its customer firms, an equally formidable challenge is to obtain equitable return for value delivered. This is where value sharing through integrative negotiations between the supplier and customer firms becomes central. The authors conclude that current understanding on value creation and value sharing is at a preliminary stage. This is the gap that the paper seeks to address based on the actual experience of the company in implementing CVM. This paper presents a framework for mapping the various ideas generated in the CVM implementation process and attempts to build a value sharing methodology based on the CVM journey of the company. It concludes with several challenges that the company has to grapple with for continued progress on its CVM journey. One of the important challenges is addressing value drains and discovering new value creation avenues along all the interfaces between the various firms constituting the value chain all the way until the end customer. The key learnings can be summarized as follows: Success of CVM has to start from the top management of both supplier and customer firms. The focal responsibility cannot be delegated. Firms planning to embark on the CVM journey must adapt the CVM process to their own specific situations while general lessons can be drawn from Tata Steel�s CVM implementation experience. Meaningful roles must be found for all key managers in both supplier and customer firms for success of CVM implementation. It is necessary to take stretch targets for the process to be attractive and worth the while for both the firms. At the same time, it is essential to manage the expectations of both firms: CVM is not a panacea or a magic bullet to solve all the problems of both the firms. The overall philosophy of both firms must be to seek to expand the ‘value pie,’ thus coming up with integrative decisions based on aligned data where both the firms ‘read off the same page’ of data.

Reinventing a Giant Corporation: The Case of Tata Steel

The case on Tata Steel captures the success story of Tata Steel very effectivelyas to how a giant corporation, led by a world-class management team, reinvents itself and sets out on a growth path when faced with dramatic challenges from the environment. This analysis is aimed at summarizing some of the issues and the challenges Tata Steel is likely to face in the years ahead. An attempt has also been made to arrive at some broad strategies and initiatives that the company can implement. Since this analysis is based only on information provided in the case study and additional data available in the public domain – including the Tata Steel website itself—it is very likely that many of the recommended strategies have already received the attention of the company management.

Bucking the Trend: A Look at Zyme Solutions' Non-linear Business Model for IT Services from India

The case describes XGen Technologies (name disguised), an India-based IT Enabled Services (ITES) company having to grapple with the issues of linear growth. The companys headcount had touched a whopping 40,000 and managing such a large setup was becoming a severe challenge, putting immense pressure on Partha Sen, the CEO, to adopt an innovative business model to sustain historical growth rates of revenue and profitability. This situation was similar to what most Indian ITES companies faced: they had been clocking impressive growth, yet there were concerns about the future. The case then describes some of the strategies that software companies have been adopting in order to achieve greater non-linearity in their business. In particular, the case concentrates on Zyme Solutions, Inc., a fully outsourced hosted data service provider to the high-tech vertical market, which has built as a non-linear business from the ground up, without the legacy of the linear business models to contend with. Students are put in the place of Partha Sen, having to decide on an approach that established companies like XGen could adopt to transit to a non-linear model.

Corporation and its Shareholders: What Should B-Schools Teach?

Presents a colloquium on the role of business schools in teaching students about the kind of objectives the top managers should pursue. Principles behind the corporation and its shareholders; Purpose of business school instruction; Need for business schools to articulate their position and reflect the same in their curriculum, culture and incentive and punishment systems.

Infosys Technologies LTD.: Growing Share of a Customer's Business

This case has multiple dimensions of analysis to it. While there is certainly an immediate short-term issue of winning the Ariba® e-procurement project of the existing client, Prairie Four Square (PFS), and gaining an increased share of the customer’s business that the Infosys team is trying to address, there is also an overall long-term strategic issue that needs to be addressed as well – that of the pricing mechanism based on value that needs to be deployed for long-term sustainability and growth of the relationship. This case offers an insight into the various dimensions of moving up the value chain and increasing the economic value of a customer relationship, identifying the differentiation strategy, communicating the positioning effectively, and the impact of local competition in the global scenario. The case also effectively illustrates the general growth path followed by most Indian software services companies, the issues they face in this progression, the changing scenarios in the global competitive arena, and the relentless pressure to lower costs in a diminishing labour cost arbitrage advantage scenario.

Innovation and intrapreneurship through re-invention for sustainable competitive advantage: the case of Tata steel

This paper describes the lessons learnt by Tata steel, one of Indias largest and most respected companies, to foster innovation and corporate entrepreneurship, as part of its efforts to reinvent the company. The company has been able to leverage the creativity of its workforce and transform its employees into effective co-creators of the reinvented company. The results have been spectacular. The company has emerged as one of the top steel manufacturers in the world. The paper presents a roadmap the company adopted to create a pervasive innovation culture. It presents the lessons learnt and the future challenges. The paper is based on the actual experience in leading change in the company, and the insights that the company has gained from managing over a hundred teams that have been innovating in different sub-systems in the organisation. Cumulatively, over 5000 people have been involved in the various innovations undertaken by the company during the last about fifteen years. The methodology used is case study research (Eisenchardt, KM, 1989). Company-specific proprietary information has been deliberately kept out of the scope of this paper while presenting the results.