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The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

Durable Differentiators for IT R&D

Vijay Anand
Friday, September 1, 2006
Vijay Anand
The popular press is currently touting a pending slowdown among Indian providers as they become victims of their own success, but the truth is that Indian firms will continue to grow and not just because they are a lower-cost option. These players will continue their growth path because they have caused a fundamental and structural change in the service provider/client relationship. Offshore providers have taught clients to expect transparency, efficiency and accountability in service delivery,” writes Stephanie Moore, an analyst at Forrester Research Inc.

This is a clear example of how Indian firms need to move up the value chain and create fundamental differentiators rather than focus exclusively on lower costs. The cost arbitrage gives us a window to build other durable differentiators for long-term success.

In this article I ponder the scenario for R&D in India. Today, there are significant investments in high tech R&D pouring into India. Note the recent pronouncements by leaders at Cisco, SAP, Microsoft and others talking about substantial R&D investments in their captive centers and vendors. Lower costs and a large labor pool have been two reasons cited for the significant expansion of product R&D in India. It is imperative that the R&D industry takes a similar approach to what the IT Services industry has done and build durable differentiators. Success in product R&D is based on three key elements:
1 Innovation

2 Time to market
3 Anticipating market trends

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