Institutional Growth and Industrial Competitiveness: Exploring the Role of Strategic Flexibility Taking the Case of Select Institutes in India

‘Where your talents and the needs of the world cross, there lies your purpose’.

Aristotle, Greek philosopher and scientist.

Abstract

The internationalization of human resources, supply chains and technology management is driving the rise of institutes from Asia. The focus may shift from institutional growth to dynamism for technology-based focal institutes keen to contribute to industrial competitiveness. The role of strategic flexibility to enhance the contribution of institutes to competitiveness is an unexplored area. We study situations and trends in the growth of select leading institutes in India to explore patterns and problems. We attempt to structure the key problem factually to find root causes. While literature review is of limited help to detect any key patterns, interactions and observations indicate that flexibility in the ability to shift proportion of paths in the portfolio of an institute may enhance its vitality and competitiveness. The study contributes to the method of ‘problem structuring’ by proposing ‘actor-based root cause diagram’, and ambiguities to evolve sharper research questions. The study identifies several topics for further research to accelerate catch-up by institutions on quality and vitality.

Appendices

Appendix 1: Working definitions of key concepts

Focal Institute

Focal institutes are institutes with noble mission, deep strength to be a leading contributor to a holistic industrial ecosystem. They are known for their outstanding contributions to at least local clusters, if not a state or a large country. They strive to develop capabilities to achieve balances and progress sustainably on an arduous journey of excellence if not world class (e.g. Altbach and Salmi 2011).

In contexts, where knowledge creation (e.g. Nonaka and Takeuchi 1995) is replacing ownership of capital assets and labour productivity as the source of growth and prosperity, they can be knowledge-creating universities.

Institute Growth

Institute growth may not have been defined very systematically, particularly in public institutes that largely depended on government funds. From criteria such as number of faculty, staff and students, institute may be moving towards growth in budgets, if not revenues. Considering that revenues are rarely able to match relatively very high wastages and rapidly rising costs, following definition can provide long-term pathways:

Multi-dimensional shift in growth from input-focused factors such as students and faculty towards growth in output factors such as no. of ventures graduated or scaling-up, balances (from budget and financial to knowledge and trade). Weighted indices with roadmap of improvements can be evolved.

Institutional Excellence

Institutions can be of many types. In context of this research related to competitiveness (Momaya 2001) and focus on IITB, it can be defined as:

The ability of an institute to undertake research, education and outreach (including industrial collaborations) of increasingly superior quality.

In our context, focal institutes are expected to contribute on multiple dimensions. Their contribution to competitiveness of clusters—at least in the region, if not country—is becoming very important. Excellent institutes are known for very impactful contribution to regions and even country (e.g. MIT, TIT, ETH). The contributions come in many forms such as skills, technology transfer and entrepreneurs, to ventures that become focal firms and evolve dominant designs.

More pragmatic definition can be:

Capability of an institute to innovate in order to achieve growth on multiple factors of assets, processes and performance to reflect on key performance indicators (see examples in Table 1).

Excellent institutes have energy to start contributing positively to at least industries in proximity, if not country, and move to higher levels of maturity on balances—from financial, forex to knowledge and technology.

Other terms that are being used are institutional quality/effectiveness and competitiveness (e.g. AICTE 2004).

Appendix 2: Examples of Select Elements of Problem Structuring

Key objective of the paper is to characterize the phenomenon ‘pre-mature stagnation in contribution of IITs to enhance industrial competitiveness’ through problem structuring (PS). PS involves several interactive activities whose outcomes are summarized into specific elements. Typical PS can have 4–5 key elements such as problem statement, goals blocked and root cause analysis (RCA). While summary of RCA is given as root cause diagram in Fig. 2 in the main paper, other elements are given here as examples.

Problem Statement

Old IITs have contributed enormously in first half century of their journey and attract best of India’s aspiring engineers, technologists and managers. Expectations from the IITs, particularly IITB, are rising rapidly, as Indian firms face the paradoxes such as hyper-competition and formidable international players with superior capabilities on key fronts. The IIT is expected to significantly enhance its contribution to industrial competitiveness of at least region, but there is lot of ambiguities on internal fronts (from strategic intent, values and culture to processes and systems) and external fronts of the opportunities and the problem of less able to contribute to catch-up in competitiveness of focal firms. Structure the problem to find out root causes and ambiguities, particularly role of organization health/vitality and strategic flexibility.

Goals Blocked

Goal orientation in many IITs can be quite loose, decentralized and implicit. What stated here are examples of goals evolved from review of contributions of select leading institutes such as ETH, MIT, SNU, Stanford and Tokyo Institute of Technology.

• Graduating learners, whose contributions to indigenous industry are distinctly more, e.g.

  • Help in rapid breakout in competitiveness (from bottom, if any).

  • Nurture venture and spin-off that create interesting jobs.

• Motto ग्यानम परमम ध्येयम (Gyanam paramam dhyeyam) is very inspiring, but not sure what kind, levels of knowledge exchanges are more relevant with whom, for competitiveness of India and what are trends, e.g.

  • What can be minimum levels of knowledge flow to indigenous industry and trends?

Unwanted Symptoms

• Reducing flexibility due to tight finances (rigid structure with >60 % budget going to salaries {& pensionary benefits?} without link to revenue streams).

• Diverse faculty interests with very low alignment even for balances (not surpluses) or industrial competitiveness.

• Less systematic knowledge about health and vitality of faculty, staff and students.

• Less respectful balances on number of graduates contributing to indigenous firms and organizations.

• Large number of ventures stagnating prematurely on levels of IC.

• Not progressing fast on journey of low-carbon institute despite a leading position in climate change.

• Excessive dependence on ‘Validation from West’ (e.g. for their students and even faculty) and foreign multinationals for alternate paths towards industrial competitiveness (IC), e.g. anchor client in Research Park.

Root Cause Analysis

This analysis is very iterative and went through cycles of analysis, data finding, discussion, improvements to reach at some high-potential root causes. Idea generation techniques help evolve long lists of causes in group sessions that were refined by fact finding and discussion. The causes were clustered around key actors that were prioritized. An example of actor-based root cause analysis is given in Fig. 2.

Ambiguities

This is the last, but perhaps the most creative and challenging part of iterative process of problem structuring. Identifying key dilemma related to root causes is very difficult. Still, an attempt is made here.

• What kind of balances among local/state, country and international contributions an institute of national importance aim at?

  • While technology is more universal, should management schools focus more on local and country level? How can they balance student interest to work in foreign MNEs?

• While ventures path appears to be more relevant (e.g. matching, scalable) for IITB, how flexibility among other paths (e.g. HR of higher quality and values) be aspired and achieved for steady and sustainable progresss?

  • Do leading German, Japanese or Korean universities have much lower entrepreneurial capabilities? If yes, then how are they contributing to high IC?

• Top management of IITs and faculty are identified to be key driver actors to nurture linkages with students, firms and industries. What values they can imbibe and effectively evolve with students? Do shared value concept work in IITs? Has any IIT explicitized it?

  • Can change in top management bring major change in strategic intent, directions and major catch-up in performance?

  • Can explicit emphasis on health/fitness/vitality link with institute vitality?

Appendix 3: Example of Factors to Characterize the Phenomenon

From the generic phenomenon ‘pre-mature stagnation of organizations’, we evolved specific phenomenon ‘pre-mature stagnation of institutes in India’. The institutes here refer specifically to IITs, the institutes of national importance that have potential to achieve great heights themselves on multiple factors from health, human capital output, knowledge output to higher levels of ventures. Capable institutes have high potential to contribute to formation and vitality of clusters with many technology-based focal firms that are emerging MNEs. Here are just examples of few select factors that evolved through interactions with some top leaders.

• Origin

  • Symptoms of phenomenon: shift in values to some short-term goals, declining balances, widening inequity (incl. financial, as some faculty are able to manage large portfolio).

  • Likely period of start: can happen earlier also, but often when first generation (that laid foundations of values, culture, etc) retires.

• Journey

  • Journey can be characterized on many factors, e.g.

    • Quantitative: Nos. of faculty, students, budgets, publications, patents,

    • Quality: Sustained programs, laboratories, breakthrough inventions, ventures,

• Potential Key Reasons

  • Gaps in strategic intent (e.g. mismatches among elements & with environment).

  • Less able to secure industry projects.

  • Low flexibility (to revitalize, even after biggest discontinuity).

  • Gaps in health and fitness to sustain on challenges.

  • Gaps in knowledge, understanding or alignment of key actors.

Above are just indicative examples of factors to characterize the phenomenon. Refinements in such factors and new factors will emerge as we sustain research.