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IBM drives innovation in automobile sector in India

Published on Tue, Sep 12, 2006 at 14:24 | Source : Moneycontrol.com

Updated at Tue, Sep 12, 2006 at 17:52

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The Indian automotive industry is no different. The increase in competition, globalization, technology and demanding customers will require more and more innovation in business. The imperatives of the business will force the sector to apply business models that will differentiate themselves from others", says Ramesh Srinivas, Partner, Industrial Unit, GBS, IBM. "The good news is that the Indian automotive sector is on track".

The study found four key aspects to business model flexibility. Namely:

Responsiveness: anticipating and responding to customer needs as well as market and industry changes;
Differentiation: translating customer needs into innovative products and services that the customer will desire and competitors imitate;
Efficiency: common, lean processes and operations for producing products and services at a cost that generates profits and supports growth; and
Impact: determining the magnitude of desired change in products, services and operations.

Business model flexibility needs to be developed under strong discipline and leadership. IBM Global Business Services identified a set of guiding principles to use when a company makes a change to create a more flexible and successful automotive company:

1. Componentize your company so it works as an aggregation of smaller, more nimble businesses. Componentization allows you to evaluate your company in the context of its ecosystem to better understand its strengths and weaknesses.

2. Specialize your company by focusing on its core strengths, and depend on partners to fill in gaps and exploit opportunity areas.

3. Simplify by looking for opportunities to make business easier and straightforward.

4. Standardize the interactions of people, processes and technology in your business. Standardization and rules create an environment where decisions can be made at the point of interaction (not up the chain of command) and become the 'glue of collaboration'.

5. Sense shifts within the industry and beyond that require responses or present opportunity. The availability of new technologies, for example, can accelerate the sensing and predicting of potential product quality issues before they become warranty problems and potentially allow manufacturers and suppliers to save millions of dollars in warranty costs.(*1)

Ramesh Srinivas says, "IBM in India and globally through its R&D has brought to this industry some path breaking innovations. The IBM's Parametric Analysis Centre to help companies with early detection and prediction, is one such innovation."

K.S. Raghunandan adds, "The automobile sector in India will see exponential growth. With major global players entering the Indian market and Indian players expanding, we envisage Innovation playing a major role in the market in the times to come. Having done exemplary work in India and globally, this is an exciting time for us at IBM's Industrial Unit."