Tata Group's Innovation Competition

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At the end of the day, though, the judges chose two others projects to move forward. Both originated in Tata Consultancy Services: One was a customer-centered business model that improved customer results and brand loyalty at the same time. The other helped a retail client make Web-based content more available to offline users.

The Prize: Respect—and Profits

The two now move on to face 22 teams from regional preliminaries in Europe and Asia. The winners get no cash. Three will walk away with Tata's Promising Innovation awards, while two will win Dare to Try awards—an honor the company bestows on those who took on ambitious projects and failed. Two years ago, for instance, a Tata company tried to develop a plastic door for the Nano minicar. "We want people to be bold and to not be afraid to fail," says Sinha.

The real prize is the respect and recognition of Tata's leadership, says Prasad Satyavolu, practice director for manufacturing in North America for Tata Consultancy and one of the North American winners.

But the biggest winner may be the $85 billion Tata conglomerate. Consider Tata Refractories, a 51-year-old company based in Belpahar, India, whose clients include Tata Steel, Steel Authority of India, and numerous other metal, glass, and petrochemical plants. In 2007, the company won an Innovista award for a groundbreaking material to line containers holding molten steel, which lasts six times longer than conventional brick linings.

"The more projects there are, the more people are inspired to participate and are encouraging their peers to do so, and that healthy competition drives innovation," says Sinha.

"It is pervasive across the Tata companies," says Satyavolu, who spent a decade at Tata Motors before joining Tata Consultancy, with a stint at engine-maker Cummins (CMI) in between. "There is a lot of encouragement from management to try new ideas, create new business models, and ask 'How can we do things better?' "

Jessie Scanlon is the senior writer for Innovation & Design at BusinessWeek, where she covers the intersection of design and business.

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