Frugal Innovation: Transforming constraints into opportunities Premium

To read the article in full, become Privileged Subscriber or log in

What is Jugaad? “The delicate art of improvising ingenious solutions,” explains Navi Radjou, Jaideep Prabhu, and Simone Ahuja. What is this approach to innovation, created in the remote Indian countryside? Why is it changing the lives of millions of consumers worldwide? How can it help Western companies to develop their creativity?

 

 

In environments facing tighter and tighter resource constraints, whether in India or in the Silicon Valley after the recession, Jugaad makes it possible to boost ingenuity, accelerate market introduction, and meet client needs more effectively. Good reason to look at what is being practiced in emerging countries!

Three advantages of Jugaad innovation:
• Faster: Rather than long R&D processes, frugal innovators use a quick prototyping approach by collaborating early on with future users.
• Cheaper: The frugal innovator uses existing infrastructure and/or recombines proven solutions.
• Better: Frugal innovations, more affordable and with significant added value, meet the immediate needs of consumers and earn their loyalty over the long term.

How can you switch to the frugal mode?
• See the glass as half full: Jugaad innovation is above all a mindset: you have to want to overcome everyday problems by finding revolutionary solutions. In other words, tackle adversity with enthusiasm.
• Stay flexible: in uncertain environments, Jugaad innovators continually improvise and experiment in order to resolve seemingly unresolvable problems.
• Go farther for your business and society: By responding to the needs of people traditionally excluded from consumption, Jugaad innovation reconciles economic and social values.

Business leader testimony
To succeed in emerging markets, in 2005 Siemens launched a new product strategy, known as SMART, based on frugal innovation principles. The idea: basic products of solid design, perfectly adapted to the needs of local consumers. The strategy was a success, with SMART’s product portfolio accounting for €100 million in revenue for Siemens in 2010 in India alone, with hopes of exceeding €1 billion by 2020.

Read our dossier
Frugal Innovation: Turn limits into opportunities

Business Digest no. May 2012.
Based on Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth by Navi Radjou, Jaideep Prabhu and Simone Ahuja (Jossey-Bass, May 2012), and the interview with Armin Bruck, CEO Siemens India, April 2012.