What can companies in the developed world learn from innovators who make irrigation pumps from bicycles or solar ovens from old suitcases?
Quite a bit, as it turns out.
Jugaad is a Hindi colloquialism that refers to constraint-based innovation. While it may also be a way of life in India, where “inventing what you need by using only what you have” is an imperative, it also has been the source of breakthroughs that have improved the lives of millions beyond India in the developing world.
In business, Jugaad (pronounced “joo-gaardh”) suggests an openness to improvisation and outside ideas in a search for the simplest route to solving a complex problem. Jugaad is often mentioned in tandem with “frugal innovation,” which involves the delivery of exceptional customer value to low-income customers.
Increasingly, however, businesses oriented toward mature economies are using principles of Jugaad/frugal innovation to foster a creative tension they feel will lead to game-changing innovations.
Jugaad has been the source of breakthroughs that have improved the lives of millions in the developing world.
Perhaps the most illustrative of these offerings is the “Car Parts Infant Incubator,” which takes advantage of locally available replacement car parts, familiar automobile design, and globe-spanning automotive supply chains to create a life-altering medical device. The baby warmer sells for 5% of the cost of a traditional incubator, and might save as many as 2.4 million infants per year in the developing world.
The creators of these products shared an ambition beyond merely slashing costs and features. They sought to make high-value products that solved fundamental customer needs, while working with local economic realities and constraints.
Frugal innovation and Jugaad principles are especially important in today’s economy, for two reasons.
First, corporations adversely affected by the slow economy lack resources for R&D. They need an alternate approach and Jugaad inspires offerings that are economical for the consumer and the supplier, without having to sacrifice margin.
Second, the practice has long been considered an “antidote” to the complexity of India, a country of perpetually shifting cultures and profound scarcity. Now the same principles can help address issues faced by multinationals whose capacity for breakthroughs has been stifled by rigid internal processes, long R&D cycles, and above all else, multiple layers of complexity.
This alternate approach to innovation is an excellent disruptor of rigid legacy processes because it democratizes innovation, stripping away extraneous features and processes, while opening the door to ideas from unconventional sources. The result is a clean slate, and a chance to re-orient innovation around the customer.
With increased frequency, major corporations are embracing these approaches and self-imposing constraints around innovation. They might restrict R&D funds or artificially compress a window of opportunity — regardless, the goal is to foster creative solutions, quick experimentation and flexible processes that revolve around the end user.
Arriving at this “clean slate” involves the following:
Abundant resources might change how a company goes about its business, but not necessarily its chances of success.
The bottom line is that in a hypercompetitive world, social media and other tech have raised expectations for agility. If companies are to experiment with the principles of Jugaad, business leaders will have to step forward, clearly authorize a break with tradition, rethink processes and explicitly allow for more creative independence from corporate control to achieve commercial success.
How can your organization increase its R&D ROI from adopting such clean slate approaches that challenge the status quo?
Mitali Sharma is an executive in the Innovation and Product Development practice at Accenture, a global management consulting, technology services and outsourcing company.