In April 2010, an article in The Economist described frugal innovation as “products that are stripped down to their bare essentials taking the needs of poor consumers as the starting point”. What this article did was to give a name to and conceptually articulate practices and approaches that have been in evidence for many years.
For instance, efficiency, economy and elegance were attributed to the scholarly discourse of Prof David Billington, who was a proponent of structural art at Princeton University, by his colleague Prof Michael Littman, who said that “efficiency means minimal materials, economy means minimal cost and elegance means maximum expression”. This would indeed be an apt description of frugality in a technical context. However, over the years, the scope of frugal innovation has expanded, covering products, business models and services.
Of the many definitions of “frugal innovation”, the one given by Soni and Krishnan (2014) perhaps describes it comprehensively: “a resource scarce solution (ie, product, service, process, or business model) that is designed and implemented despite financial, technological, material or other resource constraints, whereby the final outcome is significantly cheaper than competitive offerings (if available) and is good enough to meet the basic needs of customers who would otherwise remain un(der) served”.
The Covid-19 pandemic prompted the adoption of new approaches for frugal innovations optimising the use of human capital and other resources.
From managing the pandemic through lockdowns and enforcement of work-from-home (WFH) modalities, adopting digital technologies for daily needs to big data analysis and decision-making and controlling one of the most serious pandemics in living memory through rapid development of diagnostics, to drugs, vaccines and medical support system also reiterated the need for collaborative and open innovation scenarios.
Most frugal innovations originate while solving local and specific problems, using available skills and resources. The roles of science, technology experience, trial and error are extremely important, and innovators either adopt one or a combination of these approaches. A seemingly simple innovation, which is built around a known technology or an existing practice, can sometimes change or expand the whole range of its application.
For example, though many scientists contributed towards the development of integrated circuits (ICs), a set of interconnected electronic components that are integrated on a tiny chip of a semiconducting material, Jack St Clair Kilby, an electrical engineer from Texas Instruments, is credited with the development of the first hybrid IC in 1958 and its commercialisation, which revolutionised the world of electronics.
From audio, radio and optical devices to communication technology, medical instruments, implants, aircraft and spaceships, ICs are recognised as one of the most significant technological developments of the twenty-first century. By bringing down the size, cost and energy consumption drastically and the manifold increase in the efficiency and precision of electronic devices, such innovations resulted in greater reach of technologies for commercial and non-commercial purposes.
In most cases, drastic cost reduction is achieved by using locally available resources, including trained human power, alternative processes, or by cutting down the frills and accessories that would not affect core functionality and efficiency.
China has shown the power of home-grown technologies. As predicted by venture capitalist Rebecca Fannin, China has established its tech supremacy in almost every sector with the power of frugal innovations, be it Tencent’s WeChat messaging services, Haier home appliances or the Alibaba merchandising platform.
At the beginning of this decade, the primary purpose of all frugal innovations was affordable functionality. Innovations aimed at the BOP consumer were made to fulfil the needs and aspirations of a large segment of people having limited resources, Such frugal innovations were promoted on the merits of “how to do more with less”, and were successful too.
However, with all-round technological advancements taking place and rapid transformations happening worldwide, people’s aspirations kept rising. As a result, expectations from frugal innovation are also expanding. Today’s BOP consumers demand “better from less”, for which Radjou and Prabhu recommend six principles that promise a path towards sustainable growth.
Since such innovation is meant to be “for all”, these are broadly termed as “frugal technology”. Depending on the complexity of problems and intricacies of innovations, these represent different levels of innovation and are known by many different names, such as reverse/inverse technology (innovations directed to achieve an end product by working it backwards), grassroots technology (innovations made and meant for the rural community), Gandhian innovations (a version adapted for lesser cost), nano-vation (a small but vital intervention), and of course jugaad (“quick-fixing” a problem using locally available resources and technology).
While any kind of frugal innovation (as mentioned above) is always cheaper than alternative options available in the market, at times these also offer a superior technology at a lower price.
Though the term jugaad has a very Indian connotation of a local and quick-fix frugal, flexible approach to innovation, similar practices prevail in other countries as well, such as gambiarra in Brazil and jua kali in Kenya. Many grassroots innovations can also be seen as jugaad, which are of great value in certain situations and may or may not be replicable elsewhere.
Though the notion of present-day frugal innovation initially originated from grassroots’ innovations, mostly from India, China and other developing economies, it soon encompassed a wide range of innovations, from rural electrification to medical diagnostics, with some based on deep scientific interventions and others redesigning existing technology to make it more affordable. These innovations, which may be called advanced frugal innovations, are low-cost sophisticated products made from minimal resource use.
Therefore, frugality could mean different things in different contexts, but in the context of developing economies and resource use, whether it is drug development, medical management or building a small car, it must follow the principle of inclusivity. It has been appropriately summarised as “make more (performance) from less (resource) for more (people)”, which has now become a global mantra.
A successful frugal innovation can be the result of scientific ingenuity in product development, or more efficient production, system of delivery or marketing strategy, which can transform an existing scientific or technological solution into a frugal innovation, as seen in the cases of Aravind Eye Hospital in Tamil Nadu and Narayana Health in Bengaluru.
Neither the cataract surgeries nor the cardiac procedures provided in these places respectively are new innovations per se, but by adopting a lean business model and several process and service innovations they have brought down the costs massively. India excels in service innovations applied to improve business models, delivery systems and institutional organisation.
All scientific advancements do not necessarily lead to either frugal innovation or technology development.
However, there is no denying that good science leads to good innovation. Scientific inventions and technology developments are the two wheels of the vehicle of progress on which a country rides towards the path of social, economic, political and overall leadership.
Acknowledging that “innovation is that third, and often the hidden, wheel which drives the vehicle of progress towards a sustainable goal”, the United Nations Conference on Trade and Development (UNCTAD) Report, 2017, points out the need to adopt new modalities for development, bringing innovation to the foreground.
Innovative and improved technologies are key enablers of most Sustainable Development Goals (SDGs), whether it is achieving goal number two: “end hunger, achieve food security and improved nutrition and promote sustainable agriculture”, or fulfilling goal number nine: “build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation”. The question, therefore, is not whether to encourage frugal innovation, but what kind of innovation to encourage.
Excerpted with permission from The Art and Science of Frugal Innovation, Malavika Dadlani, Anil Wali, and Kaushik Mukerjee, Penguin Books India.