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Growth Champions: The Battle for Sustained Innovation Leadership by

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CHAPTER 13

Tata and Bharti

Leapfrogging from India

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Today a good proportion of the world's disruptive innovation is coming from emerging markets and much of it is changing the balance of power across a variety of sectors. Many companies are focused on exploiting the opportunities in high-growth markets and applying what has become termed as ‘frugal,’ ‘reverse,’ or ‘cost’ innovation – redesigning products and processes to eliminate up to 80% of costs and so provide for the masses at the bottom of the pyramid – but that also work very well for those at the top. The majority of the action is taking place in India where Tata Motors is selling the Nano ‘people's car’ for INR 150,000 ($3000); Bharat Biotech retails a single dose of its hepatitis B vaccine for 20 cents; and Bharti Airtel provides one of the cheapest wireless telephone services in the world.

In 2006, emerging markets’ challengers on the global stage were a novelty. Lenovo had recently purchased the PC business of IBM and China NOOC had made an unsolicited and ultimately unsuccessful bid for Unocal. Just five years later it's all changed. Global challengers from emerging markets are the norm, and many are taking a different route to growth than the established players. The new challengers are leap-froggers, moving quickly to build leading-edge international operations. Significantly, alongside strong organic growth, they ...

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