Monday, April 23, 2007

Highways to Opportunity for Innovation

Highway development, including Golden Quadrilateral, in India is one of the most powerful change agents the country has ever seen. Rethinking geographic allocation of production, storage & manpower deployment can unleash sources of competitive advantage across sectors.

A powerful touch point ripe for innovation is locations of warehouses and locations of last mile value addition facilities.

Highway system has shrunk a distance of 250 kms from 10 hours to 4 hours. This time compression opens up an area of 500 sq kms around consumption hubs such as Bangalore for value addition processing and warehousing.

For example, goods for consumption in Bangalore can now be manufactured in Indore Industrial belt of MP, transported to a value addition processing center cum warehouse within 250 kms radius of Bangalore and packaged/labeled inline with to local needs and culture.

A fresh analysis and ensuing list of lowest cost locations is another area of opportunity for early birds. Well developed highway system gives interior areas of country and not just port cities opportunities to attract capital and generate employment. Capital gets opportunity to avail lower cost labor coupled with excellent transport connectivity to these locations.

Highways have opened up opportunities across sectors. A lot of these fall in the category of billion dollars opportunities. Web2.0 opportunity size in India is a mere change in comparison.

With core sectors flush with opportunities, going virtual is virtually not so exciting.

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