Everything we do today is obsolete.' You hardly can imagine a better starter for a lecture on Innovation. The quote comes from Sam Pitroda who spoke in Brussels at the Economist’s Innovation Lecture series on the first of March. Sam is one of the fathers of India's IT and telecom revolution, and he currently advises the Prime Minister of India on public information infrastructure and innovations. He has been pioneering programmes that use information technology to lift people out of poverty and foster economic development.
He highlighted that the Indian strategy around innovation has to address the challenges of disparity, demography and development. Therefore, in his view, innovation should focus more on the problems of the people at the “bottom of the pyramid” of society to drive inclusive growth. He noted that all innovation of the past 50 years comes from the US, but the American consumption model is not sustainable in his view, and therefore does not fit for India.
I think those two points are interesting if we want to think about innovation in Europe. An often heard reason for the unsatisfactory innovation output in Europe is that we do not “suffer” scarcity, which is as a driver for innovation, as it could be in India. In my opinion, this argument does not stand in view of the recent innovation record in the US, where the entrepreneurs in Silicon Valley do not really suffer severe material scarcity. But to bring innovative ideas to reality, an appropriate entrepreneurial environment and funding is necessary. Although existing models abroad are probably not simply transposable to Europe, we can nevertheless still learn a lot from the US and emerging innovation powers in Asia.
It is a fact of life that innovation can emerge from any unmet needs, which exist everywhere as do new ideas. Innovation is more about new processes, “doing new things” rather than new “gadgets or gizmos”, as Sam Pitroda pointed out. For example, mobile payments should not just be payments as today done with a mobile phone, but innovation resides in a new ways of doing transactions, i.e. new processes emerge. I think that telecommunications services, both fixed and mobile, are a key platform to let innovation flourish and to meet Sam Pitroda’s goals of development for all levels of the pyramid. It is therefore also very opportune that Telefónica launched this week the WAYRA initiative in Latin America to create a venture capital fund and a net of Silicon Valley style business incubators in the region. This adds to the initiative of the Wholesale Applications Community (WAC), a global alliance for developers that was commercially launched at the Mobile World Congress last month.
What drives innovation if not scarcity, particularly in richer countries? Is there a new model needed in Europe to help drive innovation? What more can we learn from other regions?