For the last decade companies in emerging markets (EMs) have started to develop products, which are can compete with those produced by firms in advanced countries (ACs). This ability to compete did not come and many overnight and the new companies emerging have followed a way of advancing that led them from producing for a developed company to designing their own product and then finally creating their own brand.
This essay will discuss the implications of the different stages in development of firms in emerging markets and will show on the example of Wipro, that while there is a standard way, but not the only way. The strategy used by Wipro involved skipping the first step of being an original equipment manufacturer (OEM) for others and starting their innovation from the get-go, being an original design manufacturer (ODM), progressing to being an own brand manufacturer (OBM) in the late 1990s early 2000s. After going through these phases, the company is now a recognised, global player and leads the industry in integrated business and business process solutions, as a strong consultancy and production partner.
Further the paper will discuss how the company was influenced by the macro and meso environment in India and Bangalore. On the macro level, it will provide evidence how Wipro has benefitted from the higher spending on education by the Indian government in the last 30 years, how AC companies’ outsourcing activities helped Wipro to catch up quickly and how the improvement of Intellectual Property Rights (IPRs) helps the innovation process of the firm further. Around the meso level influences on Wipro, the discussion will focus on the vacuum left by IBM leaving Bangalore and the clustering of tech companies and institutions that followed, as well as the entrepreneurship ecosystem, which is nurtured by the government’s policies and support.
Table of Contents
1. Introduction
2. The Standard development of emerging market companies
3. Different ways to innovate as an EM company
4. Wipro development and innovation
5. Macro environmental factors supporting the development of Wipro
6. Meso environmental factors affecting Wipro’s development
7. Conclusion
Objectives and Topics
This paper examines how companies in emerging markets, specifically Wipro in India, successfully transition through innovation stages to become global players, despite deviating from standard industry development models. It investigates the specific macro- and meso-level environmental factors that fostered Wipro's growth and innovation capabilities within the Bangalore technology cluster.
- Developmental stages of emerging market firms (OEM, ODM, OBM)
- Catch-up and frugal innovation strategies
- Impact of government education spending on local talent pools
- Significance of Intellectual Property Rights in fostering innovation
- The role of tech clusters and entrepreneurship ecosystems in corporate growth
Excerpt from the Book
Wipro development and innovation
Wipro is a special case in the theory. Looking at its development over time, one cannot classify the tech side of the company as a pure OEM at any point. Moving into Bangalore the company started off with building mini-computers and selling them through a sales network. These mini-computers were produced using a method known as surface mounted (NDTV 2018). This method has been around in ACs for a while, for India however, a computer with this kind of production was completely new. Therefore, it can be argued that the company used the catch-up innovation strategy, imitating developed companies to quickly close the gap between the international competition and itself. Furthermore, this method enabled Wipro to skip the stage of being a pure OEM, becoming a company in the ODM stage straight away, with the production of said mini-computers.
While innovation has been done alone and leveraging in-house know-how, the company then started to innovate in a different way. After establishing its name, launching global R&D and software services, the firm then had the chance to learn and innovate side by-side with some of the large global IT players, such as Acer, Cisco and BT (NDTV 2018). Wipro, starting as a company needing to catch up, now has the respect and the strength, to innovate alongside MNEs who were established far longer than Wipro itself. How Wipro caught up and what influenced the company to become this international player, will be explained in the following, by analysing macro and meso environmental factors, affecting the firm’s innovation process.
Chapter Summary
1. Introduction: This chapter introduces the shift of emerging market companies towards global competitiveness and outlines the paper's focus on the development of Wipro.
2. The Standard development of emerging market companies: This section details the conventional progression of firms from OEM to ODM and eventually OBM, emphasizing the necessity of technological learning.
3. Different ways to innovate as an EM company: This chapter defines and contrasts frugal innovation with catch-up/imitation strategies as core paths for development.
4. Wipro development and innovation: This chapter analyzes Wipro as a unique case study that bypassed pure OEM status by leveraging advanced production methods early on.
5. Macro environmental factors supporting the development of Wipro: This chapter explores how Indian government investment in education, outsourcing trends, and improved IPR laws supported Wipro's growth.
6. Meso environmental factors affecting Wipro’s development: This chapter discusses the impact of the Bangalore tech cluster, the influence of IBM's departure, and the role of local entrepreneurship ecosystems.
7. Conclusion: This chapter synthesizes findings, confirming that while development stages exist, success in emerging markets relies on a combination of internal strategy and favorable environmental surroundings.
Keywords
Wipro, Emerging Markets, OEM, ODM, OBM, Catch-up Innovation, Frugal Innovation, Bangalore, India, Intellectual Property Rights, Tech Cluster, Entrepreneurship, Outsourcing, Macro Environment, Meso Environment
Frequently Asked Questions
What is the primary focus of this paper?
The paper explores the development strategies of companies in emerging markets, using Wipro as a case study to demonstrate how firms can successfully transition from local entities to global IT leaders.
What are the central themes discussed in the work?
The central themes include corporate innovation strategies, the impact of national education policies, the importance of intellectual property rights, and the role of regional tech clusters in fostering business growth.
What is the core research objective?
The objective is to explain how Wipro successfully navigated its development by utilizing specific innovation strategies and benefiting from favorable macro- and meso-environmental factors in India.
Which scientific approach does the author use?
The author uses a qualitative, analytical approach, examining theoretical development stages (Hobday, 2000) and applying them to the specific practical evidence and historical development of the company Wipro.
What is covered in the main body of the work?
The main body covers the theoretical framework of company development, the specific innovation strategies utilized by emerging market firms, and a detailed environmental analysis of Wipro’s growth in Bangalore.
Which keywords best characterize this research?
Key terms include Emerging Markets, Wipro, Catch-up Innovation, Frugal Innovation, Tech Cluster, IPR, and Entrepreneurship Ecosystem.
How did Wipro deviate from the standard OEM path?
Wipro bypassed the pure OEM stage by immediately engaging in the production of mini-computers using surface-mounted technology, effectively moving directly into the ODM stage.
What role did the Bangalore tech cluster play in Wipro's success?
The cluster provided infrastructure, a concentration of IT talent, opportunities for knowledge transfer through collaboration with MNEs, and a supportive entrepreneurship environment initiated by government policy.
- Citar trabajo
- Marcel Strangmueller (Autor), 2018, Developing Knowledge-based International Businesses in Emerging Economies, Múnich, GRIN Verlag, https://www.grin.com/document/476809
