Complementary and continuation Innovation: Case of the Indian software industry

Abstract

Indian software services exports have been growing at a spectacular rate for over more than a decade now. Global resource shortage and labour arbitrage have often been cited as reasons for this growth. In this paper, we go beyond these arguments in explaining this phenomenal growth that is remarkable due to its consistency and resilience in the face of technological and business volatility. In the process, we identify a series of complementary and continuous managerial innovations witnessed in the industry that resulted in creation of superior customer value. The industry exhibited dynamic capability in continuously morphing its business proposition, first by facilitating optimal usage of client resources and subsequently enabling diversification of risks arising out of technology churn and business volatility. Therein, we believe, lies the true explanation for the industry’s ability to convert a limited opportunity window into a sustainable business of global proportions.