Frugal Innovation: Will It Change The Center of Global Innovation Gravity From West to East?

Michael D. Moberly   September 5, 2012

Is frugal innovation being oversold?  If so, can Western companies relax now?  Two relevant questions posed in an aptly titled article ‘Asian Innovation: Frugal Ideas Are Spreading From East to West (The Economist, March 24, 2012).

At this point, anyone who perceives frugal innovation, and, I include intangible assets in this milieu, as merely being another ‘flash-in-the-pan’ business mania are not only mistaken, in my judgment, they’re in for a very rude awakening.  Innovation, frugal or otherwise, is a concept, a philosophy, and a process that has acquired much warranted attention, in the last half decade, spurred in part by several key articles and now books, not the least of which was The Economist’s special report on frugal innovation in April, 2010.

Again, in The Economist’s Schumpeter column (March 24, 2012) titled ‘Asian Innovation: Frugal Ideas Are Spreading From East to West’ it’s noted that numerous firms, as well as universities, are now in somewhat of a ‘scramble mode’ to develop programs in (frugal) innovation. In large part, that’s because the principles and fundamentals of frugal innovation are  finding relevance insofar as meeting the dual (requisite) visions of (a.) do-ability, and (b.) being within reach of prospective innovators!  Translated, frugal innovation represents a principled, yet not overly structured path for developing practical innovations that initially target consumers at the so-called ‘bottom of the pyramid’.  But, with guided strategic planning, such innovations can be further developed and/or enhanced to find consumers in successive brackets of the (global) pyramid.

To be sure, advocates and practitioners of frugal innovation in the East, as The Economist’ article points out, reimagine that Western products, upon removal of unnecessary frills, will lead to such substantial cost savings that frugal ideas will (eventually) come to dominate the innovation process.  I’m confident, as others, we have not arrived at that point.  However, the interest of prospective innovators to pursue alternative – unconventional paths to innovation absent many of the traditional hurdles and/or constraints, particularly those having to do with finding a target market and securing substantial investment are indeed attractive.

“Reverse Innovation” a book written by Vijay Govindarajan and Chris Trimble, and “Jugaad Innovation” by Navi Radjou, Jaideep Prabhu and Simone Ahuja (addressed previously in this blog), are certainly relevant and experienced guides to frugal innovation.  And, as a demonstration that the concept of frugal innovation is not wholly dismissed by the multi-nationals, Mr Govindarajan (Dartmouth’s Tuck Business School) is known to have advised General Electric on frugal innovation and co-authored a very worthy article with its CEO, Jeffrey Immelt.

A special thanks to The Economist magazine and its various articles addressing different facets of frugal innovation.

Comments regarding my blog posts are encouraged and respected.  While visiting my blog I encourage you to browse other topics (posts) which may be relevant to your circumstance.  Either way,  I welcome your inquiry at  314-440-3593 or [email protected]


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