IT and the East: How China and India Are Altering the Future of Technology and Innovation

Vicente Safon (University of Valencia, Spain)

Management Decision

ISSN: 0025-1747

Article publication date: 23 May 2008

271

Citation

Safon, V. (2008), "IT and the East: How China and India Are Altering the Future of Technology and Innovation", Management Decision, Vol. 46 No. 5, pp. 813-814. https://doi.org/10.1108/00251740810873789

Publisher

:

Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited


IT and the East joins the growing list of publications such as The Elephant and the Dragon by Robyn Meredith, whose aim is to give an insight on present‐day China and India from the business perspective. The book is written in a typically direct and simple style by two Gartner Consulting analysts who are experts on China and India. The book is principally aimed at chief information officers and other information technology decision‐makers in global enterprises. It has a general appeal for all those interested in worldwide information technology trends and how best to pursue the future of their firms in China and India, although in light of the level of analysis and the data provided, it is possible that the main target audience consists of chief executive officers and corporate development executives of firms interested in that region of the world.

The book is divided into three sections: one dedicated to China, another to India, and the third to the concept of the two countries together (referred to as Chindia). In each of them, Popkin and Iyengar analyze the past (except in the case of Chindia), present and future of these countries, proposing three different scenarios of the situation in 5 years' time, built upon two dimensions (uncertainties) and several events (milestones).

According to these authors, the uncertainties that are essential to predicting the future of China are:

  1. 1.

    the role of the government, which they view as the chief inhibitor of the tremendous potential for innovation in the country; and

  2. 2.

    the level of innovation in science and technology.

Using these two variables, they create a vision of three scenarios for China's ICT industries in five years' time. The first, which they endow with a 70 percent probability of coming true implies a slight reduction in government intervention and an increase in the level of innovation. The second scenario they see as having a 20 percent likelihood of happening and differs from the first scenario in variable (1), which would undergo a sharp step backwards. The third, with a probability of 10 percent, would see an increase in variable (1) and a reduction in variable (2). Each scenario is analyzed form the point of view of the processes it will generate, and above all, the opportunities and potential threats that would arise for firms around the world.

In order to understand the future of the scenarios described for China, the authors state what, in their view, are the main milestones to look out for. The first important event that might indicate the future of ICT in China is knowing what attitude the Chinese Communist Party will take after the Beijing 2008 Summer Olympic Games. Probably, a successful Olympics could accelerate the process of economic and political openness and liberalization, although there is a certain risk of the opposite happening after the Games.

Just as they do for China, Popkin and Iyengar put forward three scenarios for India's ICT industries in response to two critical uncertainties, both of which are extremely dependent on the Indian government:

  1. 1.

    the range of availability and qualifications for India's IT workforce; and

  2. 2.

    the level of India's physical infrastructure.

They see the first scenario as having a 50 percent chance of happening in reality, and it is based on a wide‐reaching improvement in variable (2) and a small increase in the level of variable (1). The second is regarded as having a 30 percent chance of materializing and differs with regard to variable (1), which increases to maximum levels; a scenario that would see India becoming an Information and Communication Technology Superpower. The third scenario, with a 20 percent chance of occurring presents a slight increase in variable (1) and a moderate one in variable (2), creating a scenario based on isolated centres of information technology capabilities.

Finally, the authors make a prediction on the possible evolution of China and India together as a massive economic and geographic entity. As they did for China and India, they identify three scenarios, whose main uncertainties are:

  1. 1.

    the progress of cross‐border ties among various Chinese and Indian organizations and constituent groups; and

  2. 2.

    the country's ability to synchronize policies on major diplomatic and commercial issues.

Starting from the premise that Chindia is now at a moderate level in both variables (1) and (2), the authors propose three scenarios. The first, with a probability of 10 percent is formulated for the case of a high level of relation and a low level of synchronization. The second, with a 30 percent chance of happening contains a situation where relation is low and synchronization is high. The third scenario, with 60 percent probability of becoming a reality is for high levels of both relation and synchronization, which would consolidate the emerging “Chindia Bloc”.

According to these authors, every firm in the world should design a China and India strategy, that looks further than outsourcing or offshore development, and they should analyze each country separately and together (Chindia). As a guideline for these strategies, the authors end the book by proposing eight strategies for making the most of opportunities in China, India, and Chindia for the most likely scenarios. In each strategy they propose a course of action and underline the competencies that will be necessary for successfully reaching the objectives of the strategy.

Overall, the book is useful and interesting. The scenarios it proposes are highly convincing and, unless there is an unexpected economic or political international crisis, they are the only foreseeable and reasonably acceptable situations five years from now. The book helps to formulate a global strategy for China and India, which makes it perhaps more appropriate reading for a chief executive officer than for a chief information officer.

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