Innovation - but at what cost?

 

Innovation is the exploitation of creative potential to generate ideas that can be commercialized through entrepreneurial spirit and verve. In the last few years, technology has had a supreme influence on innovation management. But have you ever wondered about the other side of this development?

In most cases, it appears as though entrepreneurial innovations have been spurred more by the lure of green bucks and generation of business profits at any cost – ethical norms and governance principles be damned. Ironically, most start-ups claim to have attracted investments from abroad despite the fact that their losses have consistently subsumed their operational efficiencies. It is akin to a situation where the municipality makes great efforts to clean the roads only to have people dump their garbage again and again. A vicious cycle indeed!

Thus the start-ups will make losses but continue to attract investments which will make them more complacent so that they can afford to make more losses. On close observation, we realize that all the euphoria about entrepreneurship (particularly in India) is often misplaced.

1. Most start-ups start with a bang but find it difficult to sustain their operations. Over-ambition and the insatiable craze to achieve too much too soon are proving to be new-age entrepreneurs ‘Achilles’ heel.

2. The damage that some of them have caused to the environment is indescribable. E-commerce companies have exacerbated the problems of solid waste management through mounds and mounds of packaging that are nonchalantly disposed of in the waste bin. Delivery boys further add to the traffic congestion on roads where the traffic is choc-a-block.

3. Almost all the start-ups in the service sector have positioned their services on “Customer Convenience” so much so that this has become a holy grail. You sit at home and order food. Watch television and order tea. No need to go on a shopping spree. You can shop from the convenience of your home. In the process, convenience has become a comfortable excuse for promoting laziness.

4. Some foodservice providers have gone to the extent of exhorting customers to stop cooking food at home. Why pray? So that they can keep making profits and boost their sales revenues. Yet, profits seem elusive!

5. Today the way some services are being delivered it is clear that their only goal is to exploit people’s vulnerabilities and dependencies and make profits. Surge pricing, peak hour pricing, early morning premium price, late-night charges, convenience fee – all these have become modern-day jargons simply to exploit the customers availing a cab aggregator service. To add insult to injury, the ride-sourcing aggregators have often been accused of exposing their customers to unsafe rides and driver aggression. Incensed at having to pay huge commissions, the drivers vent their frustration and anger on unsuspecting customers.

6. A media report talks about how an entrepreneurial firm invented a cardboard thermos flask to serve tea to customers at their homes. Apparently, this cardboard flask (priced at Rs 30) is for one-time use. The first thought that crosses your mind is – but what about the negative impact on the environment? So, motivate people to order tea at home, increase their dependence on the service provider, increase the carbon footprint and also promote a social evil like laziness as “customer convenience”.

7. Travel aggregators are also grabbing the attention of the media for all the wrong reasons. Employees have recounted the nightmare of working in these firms. Hotels have pointed accusing fingers at some of the aggregators who haven’t paid the dues to their vendors for months. Aggregators have reverted with counter-accusations and allegations against the hotels. Leakages in ethical norms and governance deficits seem to be plaguing these aggregators who struggle to wriggle out of this mess.

Time to ponder… Are innovation and entrepreneurship all about exploiting vulnerabilities of others to make a fast buck? Is it necessary to achieve entrepreneurial glory by diluting ethical standards and sustaining business operations on weak governance norms? Is innovation only about generating business profits by causing damage to the environment and causing erosion of societal values? What do you think?