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Frugal Innovation Forum:
     Setting the Context

            Jaideep Prabhu



BRAC Center for Management Development
          March 30, 2013
Three Frugal Innovation Challenges

 More innovation or more scaling up?



 Is scaling up always a good thing?



 Is being frugal always a good thing?
More innovation or more scaling up?
What is Innovation?



The successful application of
new ideas



                                Joseph Schumpeter
                                    (1883-1950)
Innovation is More than Invention


 “Solutions to many of the world’s most difficult
 social problems don’t need to be invented, they
 need only to be found, funded, and scaled.”

                  Judith Rodin, in Steve Davis’
                  Social Innovation: A Matter of Scale
What is Frugal Innovation?

 Dramatically minimizes costs by reducing
 the use of resources in
 development, production and delivery, or
 leveraging resources in new ways



 Dramatically reduces prices for customers


         “Our Frugal Future: Lessons from India’s Innovation System,” Kirsten Bound and Ian Thornton,
         NESTA Report: July 2012
Thinking Outside the (Ice) Box
                                 WHAT IF your fridge
                             can operate without electricity?
Source: http://gizmodo.com




                                                        Source: http://www.mitticool.in/
The Proposition Is Simple



Cash In Cash Out
Person 2 Person Transfer
Airtime Top-Up
Merchant Payment
Bill Payment
ATM Withdrawals
Social Payments

International Transfer




                            Page 8
Dr Mohan’s Mobile Diabetes Clinic




  Source: http://www.drvmohan.com/   Source: http://www.worlddiabetesfoundation.org/composite-2731.htm
BRAC HRLS Property Rights Initiative
Why the World Needs Frugal Innovation
Why the World Needs Frugal Innovation
Is scaling up always a good thing?
Harish Hande and SELCO
Microfinance in Andhra Pradesh

Rapid scaling: the McDonald’s model



A bubble



A crash that set the whole industry back
Is being frugal always a good thing?
Three Phases of Innovation

Get the idea



Develop the solution



Implement/scale it
Design for America and Swipe Sense

To solve problems in health
care, education, and energy in the US




Hospital acquired infections: 2 million people

100,000 deaths each year

$2-4 billion dollars in costs to the healthcare
industry
Penny-Wise and Pound Foolish?

Dan Pallotta in Uncharitable: How Restraints on
Nonprofits Undermine Their Potential


The nonprofit sector denies itself critical tools that
the for-profit sector uses without restraint


Donated dollars for nothing but program costs
Not True of BRAC Though!
Invested in human, physical and organisational
  infrastructure



Selecting and training, monitoring, research and
 evaluation, and learning



Huge salesforce and distribution infrastructure
Being Frugal is a Mindset

Market back rather than technology push



The need and the context determine the solution



Which in turn determines when to be frugal
Tata and the Nano




         Source:http://www.examiner.com/road-driver-in-national/world-s-cheapest-car-the-tata-nano
Conclusions

Implementation is more important than invention



Scaling up is hard and sometimes counterproductive



Many ways to be frugal but only some are appropriate
Thank you!

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BRAC frugal innovation forum - setting the context

  • 1. Frugal Innovation Forum: Setting the Context Jaideep Prabhu BRAC Center for Management Development March 30, 2013
  • 2. Three Frugal Innovation Challenges More innovation or more scaling up? Is scaling up always a good thing? Is being frugal always a good thing?
  • 3. More innovation or more scaling up?
  • 4. What is Innovation? The successful application of new ideas Joseph Schumpeter (1883-1950)
  • 5. Innovation is More than Invention “Solutions to many of the world’s most difficult social problems don’t need to be invented, they need only to be found, funded, and scaled.” Judith Rodin, in Steve Davis’ Social Innovation: A Matter of Scale
  • 6. What is Frugal Innovation? Dramatically minimizes costs by reducing the use of resources in development, production and delivery, or leveraging resources in new ways Dramatically reduces prices for customers “Our Frugal Future: Lessons from India’s Innovation System,” Kirsten Bound and Ian Thornton, NESTA Report: July 2012
  • 7. Thinking Outside the (Ice) Box WHAT IF your fridge can operate without electricity? Source: http://gizmodo.com Source: http://www.mitticool.in/
  • 8. The Proposition Is Simple Cash In Cash Out Person 2 Person Transfer Airtime Top-Up Merchant Payment Bill Payment ATM Withdrawals Social Payments International Transfer Page 8
  • 9. Dr Mohan’s Mobile Diabetes Clinic Source: http://www.drvmohan.com/ Source: http://www.worlddiabetesfoundation.org/composite-2731.htm
  • 10. BRAC HRLS Property Rights Initiative
  • 11. Why the World Needs Frugal Innovation
  • 12. Why the World Needs Frugal Innovation
  • 13. Is scaling up always a good thing?
  • 15. Microfinance in Andhra Pradesh Rapid scaling: the McDonald’s model A bubble A crash that set the whole industry back
  • 16. Is being frugal always a good thing?
  • 17. Three Phases of Innovation Get the idea Develop the solution Implement/scale it
  • 18. Design for America and Swipe Sense To solve problems in health care, education, and energy in the US Hospital acquired infections: 2 million people 100,000 deaths each year $2-4 billion dollars in costs to the healthcare industry
  • 19. Penny-Wise and Pound Foolish? Dan Pallotta in Uncharitable: How Restraints on Nonprofits Undermine Their Potential The nonprofit sector denies itself critical tools that the for-profit sector uses without restraint Donated dollars for nothing but program costs
  • 20. Not True of BRAC Though! Invested in human, physical and organisational infrastructure Selecting and training, monitoring, research and evaluation, and learning Huge salesforce and distribution infrastructure
  • 21. Being Frugal is a Mindset Market back rather than technology push The need and the context determine the solution Which in turn determines when to be frugal
  • 22. Tata and the Nano Source:http://www.examiner.com/road-driver-in-national/world-s-cheapest-car-the-tata-nano
  • 23. Conclusions Implementation is more important than invention Scaling up is hard and sometimes counterproductive Many ways to be frugal but only some are appropriate

Hinweis der Redaktion

  1. COMPANIES COME UP WITH INNOVATIONS by ASKING THEMSELVES: “WHAT IF” – in developed nations, we ask incremental “what-if” – whereas in developing nations big WHAT IF questions are being asked like “what if we can make a fridge without electricity”(they don’t take electricity for granted as in advanced economies)What if a fridge doesn’t consume electricity: that’s a question somebody with a PhD at NASA or Whirlpool asked himself/herself, but somebody in India who didn’t finish high-school asked himself? He didn’t ask it as a theoretical question, he even came up with a solution….It’s a wise fridge because in India more than 600 million people lack access to electricity
  2. Why should patients come see doctors: not another way around
  3. Neusoft has developed several low-cost but high-tech solutions such as affordable MRI machines and telemedicine solutions for rural hospitals. More impressively, Neusoft has developed a cutting-edge wristwatch for chronic disease patients to use as a mobile health monitor. On a regular basis, the watch collects bio indicators from sensors attached to the patient’s body, analyzes the data and sends a warning when safe limits are exceeded (e.g., “Your glucose level is too low”). It can also help the patient make lifestyle changes. For instance, if your pulse is too low, it recommend that you go for a speed-walk and check your pulse at the end of the walk to see if the rate has improved.