Tatas take the innovation route to rake in moolah

Research is often considered a cost unit for organisations. Not so in the Tata Group, where $2.9 billion is spent each year on R&D.

Now, with a Group Technology and Innovation Office (GTIO) created by Cyrus Mistry, Tata Sons is bringing together various group companies to create products and services that can each generate $100 million a year in profit.

The GTIO was created two years ago when Mistry roped in Dr Gopichand Katragadda from GE to turn Tata Group companies into innovation-focused firms.

Katragadda, who has been credited for the transformation of GE’s John F Welch technology centre into an intellectual property hub, is going beyond IT to achieve this.

He has been given a team of just about 20 people to achieve this while he ropes in another 30 from the group companies to work on specific projects.

“We will make programmes which have the potential to impact 100 million people and have the potential of producing $100 million of profit a year,” Katragadda told BusinessLine in an interview.

The GTIO has already implemented solutions in four focus areas — energy, food & wellness, digital consumer products and services, and digital factory and fleets.

In the energy space, the company is working on innovative technologies to lower the costs of graphene material and fuel cells systems. In the food and wellness space, it has built a drone for delivery of crop protection products. In digital consumer products and services, a smart or wearable watch has been built to improve safety conditions for factory workers.

“These individual programs are just a starting point of a very large area that we would like to excel in. So when we talk about wearables for factory floor workers, it starts with crane operators then it goes into the entire factory floor and then to truck drivers, hospital workers and various professions where safety is a concern. But then it goes beyond into the commercial world as well,” said Katragadda, who started his career with a company that created sensors for the US Navy.

Each one of the four programmes — the wearables; drones for pesticide spraying; factory and fleet programme; and energy project around graphene and fuel cells — has a team of about 10 people. An additional 10 people in the GTIO work on the administrative roles such as university collaboration.

In contrast, Katragadda had 5,000 engineers reporting to him at GE where R&D function was centralised.

“This is hence a very different and nimble approach to driving technologies,” he said.

There are various ways in which Katragadda plans to use these projects after they are ready for commercialisation.

“How we will monetise? It can be one of many ways. It can go through an existing company as a product or a set of products. It can go through Tata Industries, which is a business incubator. Just like we incubate technologies in the group technology office, Tata Industries incubates businesses. It could go independently as an entirely new business from Tata Sons as well. These are the three different modes to monetise,” he said.

The drone-based service for pesticide spraying project would most likely be integrated with Tata group’s agricultural products company Rallis India, he observed. Similarly, for the project on low-cost graphene, the natural avenue would be Tata Steel. “Those two we are set with internal Tata companies, for the others we still have to figure out,” Katragadda said.

He is working with about 10-12 Tata Group companies for whom technology is a key differentiator. He is also holding workshops with their CEOs to pick one or two areas of disruptive innovation where the company can focus on for the next three years.

“We run a programme called Innovation Edge for CEOs and the direct staff and the idea is that at the end of the workshop, we will identify a select few disruptive areas of focus and innovations and then track them for three years until they are delivered,” Katragadda said.

He is similarly working on collaborating with various universities across the globe to work on innovative projects.

“It will help individual companies to grow. Also, the companies will get to know each other better because in each of these collaborations there will be multiple Tata Group companies participating along with Tata Sons. That’s also a new model where Tata Sons is an anchor with a purpose of encouraging other group companies to participate,” he said.

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