This week we discussed frugal innovation, and how it has helped developing countries to produce new technologies and goods at costs which people can afford such as cars, cell phones, or as you can see from the Ted Talk below, women’s needs. What surprised me the most was that part of the success of frugal innovation is sub contracting, and even out-sourcing.
As out-sourcing is not considering a good thing in my Western point of view because it takes away jobs from the US and gives them to other countries, I would assume that it would mean even more to developing countries to keep jobs in country. But, one of the main components of frugal innovation is to produce goods at the lowest cost possible, and if it is more cost-effective for parts to be made in other countries and shipped to the country developing the product, then the overall cost to make and therefore to sell which benefits consumers.
The question is what happens when this trend of frugal innovation becomes big business?
While researching frugal innovation, Jugaad came up frequently:
I also found that some large Western corporations are also interested in frugal innovation.
And, according to a BBC radio show, using frugal innovation in the West has large financial implications for the Western corporations.
So, if frugal innovation becomes the next big business in the US, will the consequences be positive or negative. Anytime, resources and costs can be save, that is good right?
The goal of US big business is to make as much money as possible. With frugal innovation, saving resources and costs are added benefits. But, in order to be successful, according to the above study, Western business will have to change their innate way of thinking about business.