Companies that fund research and development during a downturn will stand to reap the benefits – Microsoft
Funding research and innovation has not been high on the priority list of Indian IT companies, but the global economic downturn could actually change this. "Companies that fund research and development during a downturn will stand to reap the benefits," says Microsoft Research
How do you see R&D environment in IT sector shaping up?
There are three aspects to funding innovation at the research level. Funding of basic research, which is for the long term, is done by the government and a few private companies and tends to have a direct impact. The second aspect comes from companies that are innovative and looking at making their products better. The third facet usually involves funding new companies or start-ups. In the second category, it has been proved that companies, which fund R&D during downturn stand to reap the benefits.
What's your view on Indian IT industry?
Investment in start-ups and new companies is quite vigorous, though funding for R&D and innovation is not quite happening. My only concern is that not enough companies are innovating. If our business model is based on cost arbitrage, we are getting more expensive and most of the companies do realise that. We are behind the curve of opportunity and there is not enough urgency. However, I feel it is a transition issue.
What are the challenges for IT companies?
The primary challenge is their ability to understand the mid-term value proposition. Getting people is less of a challenge due to a competitive education system. But we will have to create strong academic and industry linkages.
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