Just a few words on what REAL innovation should mean.

Exactly four years ago, Prof. S. Bhaduri gave an interesting inaugural lecture on Frugal innovation by “the small and the marginal”. Please enjoy these few quotes from the first part of the lecture (and then go read it all). We all sorely need real innovation these days.

What is Frugal Innovation, and where is it?

Innovations for the global North do not always satisfy the requirements of the global South.

To meet the needs of the people living at the “bottom of the pyramid”, scholars propose to alter the process and organizational structure of innovative activities. This view shares the spirit of “appropriate technology” and “technological capability”. The appropriate technology discourse aims to reconfigure technological activities in the global South by breaking away from the large-scale technological projects of the North. The technological capability school argues that developing economies must adapt and assimilate (the same) technologies transferred from the global North.

These discussions have essentially focused on the “formal sectors” of the economies in the global South, perhaps due to the belief that innovative activities by agents of the informal economy are the exception rather than the rule.

[Existing] scholarship on frugal innovation calls for absorbing the knowledge available in the informal economy of the vast global South, [without engaging] with the process of innovative activities in the informal economy.

[It is necessary, instead, to] contribute to the agenda on innovation and development in a way that is sensitive to that plurality of knowledge, focusing on the local knowledge of “the small and the marginal” [and on] the behavioural characteristics of agents and economic activities in informal economies.

Frugal innovation is nothing new, and it about “doing more with less”. Prof. Bhaduri points out that, in Adam Smith’s work on the Wealth of Nations the terms “frugal and “frugality” appear more frequently than “invention”, or “inventive”, and that “In an activity much closer to the modern day usage of the term innovation, frugality is observed by Smith in demonstrating the value of “experience” in offering innovative solutions to frequently encountered problems in daily lives”.

In the last decades, instead, little energy has been spent on a meaningful understanding of frugality, which among other things requires an intense engagement with the motivations behind the knowledge-generating activities, underlying mechanisms used to approach uncertainty, of the way this reservoir of knowledge persists or evolves.

One way of achieving frugality is through “polycentric innovation”, which aims at the co-creation of products from the very beginning, rather than treating “the entire bottom of the pyramid” as just “a large reservoir of knowledge, immensely useful to large business establishments”.

Indeed, one problem with the contemporary discourse on frugal innovation is that it attempts to locate it “almost exclusively in large private organizations of research and production”.

[To counter this] the present day frugal innovation discourse makes a few important advances.

First, it visualizes innovations in a great many dimensions, rather than only focusing on technological change. The focus on products, processes, encouraging polycentrism and the development of business models for entering new markets makes it compatible with the Schumpeterian notion of innovation.

Secondly, by explicitly referring to the role of the behavioural characteristics of the jugaad (*) performing individuals at the bottom of the pyramid, it opens scope for bringing a whole range of creative and innovative activities, hitherto ignored, into the mainstream of innovation discourse and provokes one to look into the nature and kind of technological learning from (instead of by) the global South. In its current form, however, the frugal innovation discourse shies away from taking that emphatic step forward by confining its discussion almost exclusively to how frugality can help big business.

My own excerpt of the conclusions of the paper is here. The full paper is here.

(This post was drafted in May 2020, but only put online in August, because… my coronavirus reports, of course)

(*) Jugaad is an Indian word meaning “the creative improvisations of individual economic actors who come up with innovative fixes or simple work-arounds”