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 Avnish Sabharwal - Managing Director, Accenture Ventures And Open Innovation 

Date of Publish - Tuesday, 6th March 2018

"Accenture Ventures partners with and invests in growth-stage companies that create innovative enterprise technologies using an open innovation approach"

Avnish, tell us more about open innovation at Accenture

Accenture Open Innovation is part of the global Accenture Ventures practice which is a key pillar of the Accenture global innovation architecture. Accenture Ventures partners with and invests in growth-stage companies that create innovative enterprise technologies using an open innovation approach.

"Accenture Ventures partners with and invests in growth-stage companies"

We work with top-tier accelerators, venture capital firms, universities and corporate R&D labs, to build and bring to market innovative solutions that meet our clients' strategic business objectives. Think of Accenture Open Innovation as a bridge- maker in the global innovation ecosystem. We have 3 major focus areas for our Open Innovation Services in India:

India Domestic Market : We are engaged with industry majors to drive their Digital & Innovation agenda. To this effect, we help our clients identify their innovation hotspots, implement rapid PoCs with our startup partners and drive large scale rollout.

We also help our clients in their innovation journey by co- innovating with them. A recent example of this is Bengaluru International Airport Limited, where we are jointly setting up BIAL’s Innovation center.

Global Delivery Centers : We are engaging with startups in our delivery centers, both in the Technology and Operations Delivery centers. We have several startups working out of the recently inaugurated Innovation Center in Bangalore. These startups are working with us on offering development, client PoCs and creating MVPs.

What are the focus areas relevant for Accenture when you choose to work with startups?

This kind of startup engagement opens up a whole range of opportunities for startups to partner with Accenture to solve some of the most complex problems faced by our global clients across NA, EU and APAC.

"Our focus is on startups in AI, Robotics Process Automation, Interactive, Cyber security, IoT, Blockchain, AR/VR/MR and New-IT"

Accenture Corporate Functions: Accenture in India runs a large and complex business serving our domestic and global clients. With our 140K employees and multiple facilities across 7 cities in India, we need to constantly innovate to improve the competitiveness of our operations and deliver superior experience for our employees. We are collaborating with our partners in the startup community to help us innovate in these areas.

The last 5 years have been transformational for Accenture. Our global revenue from the new (which comprises of digital, cloud and security) is now about 50% of our total revenue, as per Q3FY17. We achieved this by “Rotating to the New” and focusing on new Digital services which are relevant to our evolving client needs.
A good part of the “New” has come from our M&A investments in the Digital space and from engaging with startups. To stay ahead of the curve, we focus on areas that drive our client’s Digital & Innovation agenda.

So, while Social, Mobility, Analytics, Cloud & Interactive technologies continue to be a part of our focus areas, we are now focusing more on startups in the areas of AI, Robotics Process Automation, Interactive, Cyber security, IoT, Blockchain, AR/VR/MR and New-IT.

We typically focus on growth stage startups that have market validated products. We give startups access to our G2000 clients and become their “growth partner”. When it comes to leveraging startups for our own corporate functions we are more experimental since it helps in pushing our own innovation boundaries.

For EBITDA improvement, we look for startups which can help in augmenting digital tech to improve human efficiencies, reducing waste, maximizing asset utilization etc.

"We give startups access to our G2000 clients and become their 'growth partner'"

When we work with clients on their Digital and Innovation agenda, we make sure that we stay focused on delivering business outcomes. We do this by focusing on revenue enhancement and EBITDA margin expansion than by “doing” digital for the sake of it. For revenue enhancement opportunities, we look for startups in the space of Customer Experience, Digital Platforms etc.

Some of these are fast evolving areas and so it is important that we partner with committed startups who can work hand-in-hand with us to deliver business outcomes for our clients.

Your recent trip to Israel and its deep rooted technology culture is fascinating, what are the top 5 lessons/ insights you'd share with Indian founders?

2017 has been historic for India and Israel—marking the 25th anniversary of diplomatic ties between the two nations. Over the last 25 years, both nations have stepped up their cooperation largely in sectors such as agriculture, cyber-security and defence. The two democracies are seeing a new high in relations with Prime Minister Narendra Modi's maiden visit to Israel earlier this year.

I have been fortunate to visit Israel twice over the past 3 months and soak in the start-up nation chutzpah. The verdict of my experiences - life changing! During my visits, I spent considerable time meeting serial entrepreneurs, startup founders, innovation centres, Army establishments, University heads, accelerators, Government bodies and investors.

The in-depth conversations I've had with them have given me a better insight into the Israeli startup engine and the lessons the Indian startup ecosystem could emulate if we want to become a name to reckon with in DeepTech and produce world class tech products and platforms in the future.

Here are Top 5 lessons from the current to the aspiring start-up nation:

  1. Embrace Risks, accept failures: The one big lesson India needs to learn from Israel is to rise from the ashes and not get bogged down by failures. One major thing that differentiates the Indian and Israeli innovation systems is the way the Israelis accept failure, and how failed entrepreneurs are not stigmatized. Yoav Tzruya, Partner at JVP Cyber Labs at Beer Sheva in Israel, said, "One of the basic cultural differences that exist in Israel as a start up nation is how we look at failure. In Israel we do not penalize failures. We look at the entrepreneurs, who created their companies that failed, as people who have gained from their experiences. We have been asked by many countries around the world to replicate it, the successful model of innovation, and always culture was an obstacle. People that founded start ups and failed were looked down upon. It is critical actually to embrace failure, learn from it rather than look down upon it." Israel nurtures the start-up environment.
    Incubators are set up by the Israeli government and Israel Innovation Authority, which used to give USD 600,000 risk free loan to promising starts ups.
    If companies fail they don't need to pay back the loan but if they succeed they pay back a 3% annual royalty. This encourages Israeli start-ups to solve some of the toughest problems that the world is facing – in areas where private investors may be reluctant to put their money as the probability of failure is very high.
  2. Government and policy makers are catalysts for Innovation: Israel’s government has supported entrepreneurs with focused incentives and smart regulation. The government finances 18 incubators where start-ups receive up to 85 percent financing. While the success rate of public- incubator supported companies has been less than amazing, the incubators have given some of Israel’s most brilliant entrepreneurs their start. Think of these incubators as a breeding ground for future entrepreneurs. Foreign investors also benefit from incentives such as tax breaks and grants for setting up R&D centers, incubators and innovation labs. These and other programs for entrepreneurs and investors will soon be administered by an integrated technology authority that combines previously separate programs at the Economics Ministry and the Chief Scientist’s office. There will now be a single authority responsible for all innovation policy and support – a far cry from the complex maze of government programs and offices trying to help entrepreneurs in most other countries. But perhaps the most important lesson from the Israeli experience is that the government mostly manages to get out of the way of entrepreneurs and lets them run with their ideas.
  3. Make premier education institutes the hub for Innovation: Israel’s reinvention as a high-tech powerhouse doesn’t just create opportunities for companies and entrepreneurs, it also offers valuable lessons for policymakers around the world including India hoping to boost their own country’s start-up and innovation culture. Lacking natural resources, Israel has consistently prioritized education and research. Israel has the highest per capita of Noble prize winners.

    The nation spends 4.1 percent of GDP on civilian R&D – more than double the European Union average of 1.9 percent. This investment produces a steady flow of technology and specialists in life sciences, IT and many other sectors.

    Today, tiny Israel is home to seven research universities, two of which rank among the world’s top 50 for science. Naturally, a globally competitive research and academic sector that rewards bright ideas is a key building block for start-up success. In my recent visit I was fortunate enough to meet UniSpectral, a leading deep- tech start-up in the Computer vision and spectral analysis space. 

    This start-up was conceived and developed over 7 long years at the Tel Aviv University and now counts Samsung and Bosch as its strategic investors. Commercialization of university assets is a key lesson for India to learn from Israel. Dr. Som Dutta, NASSCOM Product Council’s Co-Chair, said, “The powerful collaboration between Israel's academia, government and armed forces working towards fostering innovation is what makes them a class apart.
    The armed forces, Israel's largest recruitment body, becomes their finishing school in a sense that this is where the cream of the crop is selected, handheld and curated. The academia which plays a crucial role in doing deep scientific research and becomes their incubating lab.

    The academia is ably supported by the government through grants and funds for DeepTech, science and technology.
  4. Role of Israel Armed forces: “If you give us a very tough mission, we will do it immediately. An impossible one may take us a bit longer.”– Quote at the Israeli Air Force flight school. Israel gets a big additional boost from defense- related research, where the country has had to excel to compensate for its challenging security environment. Military research has produced countless civilian spinoffs and provides the country with a constant stream of elite specialists trained in the Israeli Defense Forces’ advanced intelligence and technology units. One prominent example is Gavriel Iddan, a former rocket scientist specializing in missile optics who invented a pill with a built-in camera, using the same technology to revolutionize medical diagnostics. The company he founded, Given Imaging, was sold in 2014 for USD 860 million. More recently, companies such as ICQ, Check Point and Metacafe were founded by former IDF specialists. Because of defense and intelligence research, Israeli companies are global leaders in cybersecurity, imaging, civilian drone technology and many other types of high-tech devices. This seamless way the Israeli government, Army and Academia all work with a common objective to innovate is a key lesson for India. 
  5. Turning Adversity into opportunity: Israel’s lack of natural resources and precarious security environment have forced the nation to compensate with ingenuity. Learning to cope with barren land and lack of fresh water has turned Israeli companies into world leaders in desert agriculture, irrigation systems, water recycling and desalination technology. Their products – from Netafim’s drip irrigation systems to IDE Technologies’ state-of-the-art desalination plants – are now finding customers from India to California. A growing cluster of agro-tech start-ups is now focusing on precision farming, land-based fish and algae farms, as well as natural pest control. The important lesson here is that governments shouldn’t waste their resources on trying to copy others, but build on their own strengths. High-tech clusters aren’t created by planners from scratch, but coalesce around existing industries, universities, and creative urban environments. On the 25th anniversary of the establishment of diplomatic ties between the two nations, NASSCOM and
    Accenture developed a unique report, Collaborative Innovation: The vehicle driving Indo-Israel prosperity. The report sheds light on the opportunities and imperatives that must be met for the two countries to move towards Alliance 2.0—allowing both nations to transcend from the orbit of cooperation to collaboration. A key takeaway of the report is the IINSPIRE (Israel INdia Start-up Platform for Innovative Research and Entrepreneurship) framework, which aims to unleash the combined power of these two nations around the globe by uniting their strengths across three areas: Talent, Technology and Temperament.
Author :
Karunakara M Reddy


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