India’s well-known penchant for creating quick solutions to pressing problems has been praised as a model for speeding up innovation in developed countries, but could it be undermining the country’s own economic health?
A debate on the topic emerged during the India Summit at Emory University Feb. 18, where a panel of experts discussed the future of technology and innovation for a country seeking to go from “jugaad to juggernaut.”
India is the birthplace of jugaad, a Hindi word that roughly means a “makeshift solution” in a situation where resources are limited.
Also known as frugal innovation, jugaad has led to the creation of countless products and services across India, such as a portable pouch to incubate premature babies, coolers made of clay to be used in villages without electricity or marketing platforms that use missed calls to communicate, said Navi Radjou, author of “Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth”.
But jugaad is also creeping westward as consumers and producers in developed economies have seen their bank accounts depleted and confidence shaken by recent crises.
With 68 million Americans still underbanked, frugality is going more mainstream here, and the sharing economy has taken off in Europe, where fewer young people have aspirations to own a car, Mr. Radjou said.
“There is actually a bottom of the pyramid in the Western economies as well,” he said.
Still, jugaad in the West is less of a “tactical response” to financial setbacks and more of a recognized method for developing products without long, expensive research and development cycles.
In the U.S., solo entrepreneurs aided by the emergence of more affordable 3-D printers have begun to practice such bottom-up innovation. Abroad, multinational corporations harness it to adapt their products to local markets.
Bhaskar Chakravorti, assistant dean at The Fletcher School at Tufts University, cited Cadbury’s, which entered the market with melted chocolate encased in a caramel shell instead of trying to keep traditional chocolate products from melting in India’s heat.
India, he said, is the perfect laboratory for such innovation precisely because of the adversity it faces in nearly every facet of life, he said.
But building your economy on a knack for “making lemonade out of any lemon you’re given”, as Mr. Radjou put it, can actually perpetuate adversity by limiting the ability to scale up products and build underlying institutions that help countries deal with major problems like public health and education, Dr. Chakravorti said.
He pointed to recent news that 20 percent of India’s generic drugs are counterfeit, which is shocking considering that the industry is considered “one of the backbones of the resurgent India.”
“Where does that come from? It comes from a jugaad mentality: good enough,’” he said.
He then referenced the American TV action hero Macgyver, known for his ability to weasel his way out of any situation with whatever resources are on hand, from paper clips to Swiss army knives.
“We celebrate our ability to do the Macguyer stuff, but it is permeating everything we do as a society, and that is dangerous,” Dr. Chakravorti said, adding that India is underinvesting in research and development, and its universities are not competitive globally.
Innovations like hydraulic fracturing, which is revolutionizing the U.S. energy scene, are the result of long-term research that can’t be done on a shoestring, and regulatory uncertainty keeps companies guessing.
Mr. Radjou acknowledged that there is “good, bad and ugly” jugaad, the good coming when the process incorporates global best practices and combines local innovations with scaled solutions. He singled out India’s massive cardiovascular hospitals, which churn out thousands of operations of consistent quality for a fraction of the cost in the United States.
“Even a traditional, top-down centralized system, you can bring in the jugaad element,” he said.
One problem in India is that entrepreneurs are “happy to solve the problem at a local level” but lack the desire or ability to scale up, while Silicon Valley entrepreneurs think about big-picture problems and thus drum up millions in funding before they even have a prototype.
The panelists agreed that jugaad is well suited for the new tech-enabled era of divergence in the global economy, as the world shifts from a mass-production model to one that is increasingly distributed, with small factories making limited runs of tailored products for local customer bases.
Benn Konsynski, an information systems professor at Emory, said jugaad is good for getting at the heart of the entrepreneurial process: creating a solution to a core problem, instead of simply adding capabilities to existing solutions.
More important than the products in the long-term, though, are processes and platforms on which sustainable solutions will be based, he said.
Dr. Chakravorti believes that mobile technology could be that enabler for the broader Indian economy.
“The mobile platform is kind of the great white hope that could be the scaling mechanism that combines this bottom-up ingenuity with the ability to serve large numbers,” he said.
Read more: India: Innovation by Necessity