Rethinking Innovation
Too often, we equate innovation with hi-fi research and technological breakthroughs. But many of the most important innovations consist of incremental improvements i.e. ‘Jugaad’ to products and processes aimed at the middle or the bottom of the income pyramid. What a better example than the Tata’s 100,000 rupee Nano!
The Developing World has already started leapfrogging ahead of the Western World. India’s Bharat Forge in forging, China’s BYD in batteries and Brazil’s Embraer in jet aircraft, are as good as anybody in the world. On the other hand, companies like Yahoo! and eBay retreated from China, and Google too has recently backed out from there. As if this were not enough, Black & Decker - America’s biggest toolmaker has almost left India and China, the world’s two biggest construction sites!
So what’s the secret? To echo Churchill’s phrase, the Developing World sees opportunities in every difficulty rather than difficulties in every opportunity. The Economist argues that because so many consumers are poor in the emerging economies, companies have to go for volume. But because piracy is so commonplace, they also have to keep upgrading their products. Thus, driven by a mixture of ambition and fear—ambition to bestride the world stage and fear of even cheaper competitors, they have to rethink everything from products to distribution systems….Interesting!
Last 5 posts by ankurgupta
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Tags: emerging economies, innovation