I like to think for a bit on what we have discussed before I write my post. This week I am glad I did as during work this week our library director has us watch the keynote address from the Association of American Medical Colleges (AAMC). It was given by Walter Isaacson who has written biographies on Steve Jobs, Albert Einstein, and Ben Franklin. His talk centered around innovation which was timely since we have been discussing this. Unfortunately you need an account to view the entire talk, but there were a few things I picked out to share. Isaacson discusses what makes these three people he wrote about unique. He says it was not that they were smart because smart people are a dime a dozen, it was that they were innovators. They were also good at getting people to do things they thought were impossible. He argues that while the founding fathers of the U.S. were extraordinary it took someone like Franklin to be the catalyst for combining their ideas and create a climate for compromise. More than one person said that Steve Jobs got them to do things by staring at them unblinkingly and saying to them "don't be afraid you can do it." When they would say no they cannot, he would repeat it again and again, until they did it. Also there is a short clip of part of his talk that can be seen here.
So this set a good foundation for me to think about frugal innovation. Being smart is not the only component in fact it does not have to be a component at all. It is the will and the drive coupled with creativity to make something new out of something that already exists. A quick search yields numerous articles on the subject and one thing is immediately clear; India is the leader in frugal innovation and engineering. The concept of Jugaad, using what you have to make what you need, is behind this. This is not a new concept to me. Where I grew up we called this "hillbilly ingenuity." I expect you can find frugal innovation anywhere in the world where there is a lack of resources be it financial or material. The difference is in India there has been an explosion of this type of innovation leading to products that changes the lives of millions, not just the person who rigged something for their own needs. As Vijay Govindarajan, a professor at Tuck School of Business stated, "Indian companies must innovate for domestic consumers... Instead of value for money, our mantra has to be value for many or frugal innovation..."
In the article India Leads Frugal Innovation: Why this matters to you, made me realize something else. Frugal innovation applies not just to tangible products, but also to services. This idea of using what you have to create something new can and should be applied to services. That is why the Narayana Hrudayalaya Group, the heart hospital chain in India has been so successful, through using "the philosophies of mass production and lean manufacturing." Also frugal innovation and engineering does not mean that the product or service is automatically inferior. According to this philosophy of Jugaad things are made cheaper and also better. Along with this is the technology aspect. Just because something is cheap does not mean it must be low tech. The General Electric MAC 400 Electrocardiograph discussed in our readings and in this article is a good example of low cost meets cutting edge technology.
Of course with all the praise and practicality of frugal innovation it makes me wonder what is the downside? Most everything I have seen has been positive, but there does appear to be limits. While frugal engineering does not mean that quality has to be sacrificed there are limits. For example in The Limits of Frugality the Tato Nano which has been touted as one of the successes of frugal innovation has not been very successful in the market. Some automakers say that it is impossible to reach such a low price without lowering the quality. There are some things that customers are not going to do without. Also it might be morally and socially responsible to use frugal innovation techniques, but it is not necessarily profitable. This means that most companies cannot solely focus on the bottom of the pyramid, but must mix these ventures with profitable ones. Still if this is the only downside then there is very little reason that companies the world over should not explore frugal innovation and adopt it where feasible.
Sources:
"India Lead Frugal Innovation: Why this matters to you," Social Enterprise Buzz, 6 N 12
"Innovation comes home to go global," The Times of India, 6 Apr 2012.
"Jugadd: Lessons in Frugal Innovation," InnovationManagement.se, 27 Feb 12
"The Limits of Frugality," The Economist, 22 Oct 2011
So this set a good foundation for me to think about frugal innovation. Being smart is not the only component in fact it does not have to be a component at all. It is the will and the drive coupled with creativity to make something new out of something that already exists. A quick search yields numerous articles on the subject and one thing is immediately clear; India is the leader in frugal innovation and engineering. The concept of Jugaad, using what you have to make what you need, is behind this. This is not a new concept to me. Where I grew up we called this "hillbilly ingenuity." I expect you can find frugal innovation anywhere in the world where there is a lack of resources be it financial or material. The difference is in India there has been an explosion of this type of innovation leading to products that changes the lives of millions, not just the person who rigged something for their own needs. As Vijay Govindarajan, a professor at Tuck School of Business stated, "Indian companies must innovate for domestic consumers... Instead of value for money, our mantra has to be value for many or frugal innovation..."
In the article India Leads Frugal Innovation: Why this matters to you, made me realize something else. Frugal innovation applies not just to tangible products, but also to services. This idea of using what you have to create something new can and should be applied to services. That is why the Narayana Hrudayalaya Group, the heart hospital chain in India has been so successful, through using "the philosophies of mass production and lean manufacturing." Also frugal innovation and engineering does not mean that the product or service is automatically inferior. According to this philosophy of Jugaad things are made cheaper and also better. Along with this is the technology aspect. Just because something is cheap does not mean it must be low tech. The General Electric MAC 400 Electrocardiograph discussed in our readings and in this article is a good example of low cost meets cutting edge technology.
Of course with all the praise and practicality of frugal innovation it makes me wonder what is the downside? Most everything I have seen has been positive, but there does appear to be limits. While frugal engineering does not mean that quality has to be sacrificed there are limits. For example in The Limits of Frugality the Tato Nano which has been touted as one of the successes of frugal innovation has not been very successful in the market. Some automakers say that it is impossible to reach such a low price without lowering the quality. There are some things that customers are not going to do without. Also it might be morally and socially responsible to use frugal innovation techniques, but it is not necessarily profitable. This means that most companies cannot solely focus on the bottom of the pyramid, but must mix these ventures with profitable ones. Still if this is the only downside then there is very little reason that companies the world over should not explore frugal innovation and adopt it where feasible.
Sources:
"India Lead Frugal Innovation: Why this matters to you," Social Enterprise Buzz, 6 N 12
"Innovation comes home to go global," The Times of India, 6 Apr 2012.
"Jugadd: Lessons in Frugal Innovation," InnovationManagement.se, 27 Feb 12
"The Limits of Frugality," The Economist, 22 Oct 2011
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