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Packaging must drive product innovation

31 October 2017

​​Prof Dheeraj Sharma, director, Indian Institute of Management, Rohtak in his keynote address at the International Summit for Packaging Industry redefines the role of packaging as an aid to product innovation

dhiraj Prof Dheeraj Sharma, director, Indian Institute of Management, Rohtak

We are witnessing a reduced pace of growth globally, and my view as a management professor is, one of the major contributing factors is that we are not innovating.

There are three types of innovations: continuous, discontinuous and disruptive innovation. What was the last disruptive innovation that one has experienced in telecommunication, automobile, IT and FMCG? Finding an answer to this question is a bit difficult because there have not been many disruptive innovations in the last three decades. We are probably reaping the rewards of the innovation which had commercialised 20-25 years ago. In the absence of disruptive innovations, we are experiencing a reduced pace of growth.

So what is it that packaging can offer.

Let’s take an example of a pharma company in Goa, which has to transport its product in Northern India. Consider this product to be sensitive such that it needs to be maintained at a particular temperature, say about 2-8 degree Celsius. How does it do that? The answer is very simple. The transportation has to be in a cold chain using refrigerated trucks.

Now, in India, it is extremely difficult for the multinational companies in the logistics industry to operate with a full fleet model. That means they operate with an asset-light model. So, they will hire assets from the market and small-time players will transport these sensitive drugs from Goa to the Northern India. Now, the driver, in an Indian context, will most probably be an underpaid, little-educated person, who is not sensitive to the efficacy and the purity of the medicine in consideration.

While he brings the truck to New Delhi, he might have taken 10 stops, shutting the engine at every stop. So, how is the cold chain going to be maintained? And even if the cold chain is maintained with IT intervention, how do you maintain the cold chain further on – from the wholesaler to the retailer. And how many retailers in India have air-conditioned retailing for the pharma products. How many retailers actually have refrigerators which remain switched on 24 hours.

So, pharmaceutical companies are innovating to handle this scenario. They have data loggers that go along with its shipments to monitor the cold chain. These are continuous innovations. Discontinuous innovations also happen. The pharma companies are now getting into delivery solutions. The packaging itself indicates to the consumers about the efficacy of the medicine. The next step for the pharma companies is to come up with better solutions like for unique challenges like if all the retail stores have refrigeration facilities, can one guarantee a continuous supply of electricity. A dry vaccine can be a solution, which pharma companies are working on.

There are unique challenges in India and therefore research in Indian context becomes extremely important. Packaging industry needs to look at an end-to-end solution rather than working in silos. That’s because the context is unique, the consumption pattern is unique.

Five areas which the packaging industry should focus on commercialisation of product innovation are:

1.    How can it contribute in demonstrating the advantage of any innovation coming in the market?

2.    How can it simplify the use of a product?

3.    How can it boost assimilation of the product in the daily life of consumers?

4.    How can it aid in observability of an innovation?

5.    How can it aid in the trial ability of an innovation?      

The role of packaging, which has already moved from product preservation to product communication, now, I believe, has to be about product innovation.

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