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.

September - 2007 - issue > Cover Feature

New approaches in going after emerging markets

Sharad Sharma
Saturday, June 28, 2008
Sharad Sharma
Can you ignore the ’emerging markets’ anymore? No. Not, if you have anything to do with Internet users. After all, it’s impossible to disregard the blistering Internet and mobile growth rates in these markets. Nor can you ignore the ‘emerging markets’ if you sell any kind of software solutions to SMBs. Certainly not at a time when the SaaS model is making a huge latent market accessible. In fact, there are very few product categories where you can afford to sit out and brood.

Many CEOs are in a dilemma. They know that faithful replicas of traditional products, their go-to-market strategies, and even the existing business models won’t work well in ‘emerging ’arkets.’ Yet, bringing the required changes in this sphere when the mainstream markets are growing well isn’t easy. The way out is in creating a ‘new’ hub inside the company that’s focused only on ‘emerging markets.’

Ironically, our connected world has made markets more diverse. Now no single hub, no matter how good, can develop products or businesses for the whole world. The new mantra is about in-market incubation of products and businesses. So, the old company architecture of a single-hub-with-multiple-spokes is giving way to a model based on a network-of-hubs. Only those MNCs that embrace this network-of-hubs paradigm can survive credible local competitors in every emerging market.

The R&D captives in India (and China) hold the key to successful company architecture transformation of the MNCs. So far these R&D captives have been extensions of the global hub. Many have built up world-class product development capabilities and significant scale. So they can provide the seeds for the new hub for the ‘emerging markets.’ Teams that move over from the R&D captives will quickly learn how to do product and business incubation for their local markets.

India is turning out to be a safe bet for building an ‘emerging market’ hub. Apart from R&D captives, it also offers a vibrant venture ecosystem that can supplement in-house incubation.

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