Competitiveness is a weird concept. It forces you to constantly destabilise yourself, keep on the move, and remain a moving target. Else you are a sitting duck. As the saying goes, ‘kill your product yourself, before others do’. That is the ‘paradox of innovation’ at work. The tension between existing ‘stable’ and created ‘unstable’ environments must be managed for successful and continuous innovation.

The government’s dilemma and flip-flops in Parliament over the 17b clause in the Nuclear Liability Bill on suppliers’ compensatory liability is a glaring example of the asymmetry of bargaining power that results when few suppliers have the vital technology that a country badly needs. The clear message is that firms (and nations) cannot ignore the realpolitik of hi-technology innovation (HTI) in a networked world.

The real test of an HTI is a firm’s export competitiveness. A hi-technology innovation should lead to greater exports and reduced customer negotiation power. This is an area where we have failed collectively. For the past 60 years, we have not been able to produce any ‘global’ product or service that enhances our image as a technology or kn­owledge-based economy. In several emerging and sunrise industries such as biotech, nuclear, renewable energy, aeronautics, consumer electronics and pharmaceuticals, our firms have not yet started on the innovation curve (barring exceptions). Where are our own hi-technology small and medium enterprises that form the backbone of German export competitiveness? So­uth Korea and Taiwan are leading-edge countries in consumer electronics, while China has moved rapidly ah­ead in renewable energy, automobiles, and electronics hardware and software.

A good indicator of our global T&NI competitiveness is the number of patents filed and rejected within the country. We are far behind on this parameter compared with developed nations and even some other Asian countries. Digging deeper, we have no figures for the number of patents granted for the money (dollars) invested in R&D, which indices the efficiency of our investments. The other useful statistic could be the return on investment on technology (ROIT). This important statistic can help develop a better commercial understanding of various projects of national importance including the Arjuna MBT, light combat aircraft and thorium-based thermo-nuclear reactors, among others.

The main reasons for our collective inability to develop new hi-tech innovations can be summarised as:

n Too much differentiation between process and product innovations. In real commercial world these do not matter.

n Low priority to engineering skills compared to managerial ones (in terms of monetary rewards and societal prestige) — leading to de-emphasis on systems-based pr­oblem-sol­ving skills.

n India abounds in local-level jugaads. These are functionally useful problem-solutions but usually physically dangerous and environmentally disastrous, and never patentable. n Poor or absent knowledge management in companies. The knowledge is much individual-based and once the person retires or leaves the firm is stranded. An off-shoot of this mindset is the paucity of information in research journals and textbooks about innovations by Indian companies. Even today, we depend on the western world-produced literature and case st­udies for our curriculum.

n Poor or absent safeguarding structures and systems for the innovators. Often the research-minds are burdened with administrative duties, or worse, evaluated on normal bureaucratic parameters even in centres of excellence.

Poor overall results in hi-technology innovations are surprising and troubling at the same time. Pick up any issue of a major science or research-based journal, and one can find many Indians writing and contributing major pieces. In a recent issue of Nature, I could count at least nine Indians (single largest community) who were providing state-of-the-art research commentary on subjects as diverse as physics, astronomy, chemistry, biology and pharma-genetics. It also showed that our much-maligned universities are af­ter-all not so bad for producing top talent.

For cost reasons, traditional leaders from developed world have invested in manufacturing capabilities in China and India. This shifting of technology and capability-building sho­uld ideally lead to all-across reverse engineering skills. Ho­wever without an ability to ‘augment’ the ‘reverse’ part, nothing worthwhile can em­erge. The augmentation pa­rt unfortunately is missing from corporate strategy.

The first two steps for developing this capability for the firm are:

n Understand how distinctive technological competencies are used to develop competitive advantage.

n Determine which distinctive technological competencies are needed for this purpose.

The single criterion should be the patentability of the technology-product and its exp­loitation in global markets. The innovation-ecology will emerge from the identified collective aspirations. However, time is of vital essence in hi-technology innovations. Competitive markets ensure that no firm can have unlimited time or monopoly of talent.