It’s easy to think that innovation is about resources – throw enough money, smart minds and clever technology at the problem and the answer will surely follow. But the history of ideas suggests there is another pathway. Sometimes the very absence of resources is what galvanises innovation. Think about these examples:
- Back in 1943 at the height of the war a small team at Lockheed’s Burbank factory were given the apparently impossible task of designing and building a jet aircraft within six months. They’d never built a jet before so there were no designs to work from, the technology was unknown, the only engine was in the UK and wouldn’t be available to them to experiment with until near the end of the project – and the factory was already working flat out on producing bombers for the war effort. Kelly Johnson was the manager appointed to run this project and one of his first tasks was to rent a circus tent because there was no space available for his team to work in! Time was of the essence – the Germans had been working on jets since 1938 and were already flying their Messerschmidt 262 fighters in Europe. Despite all these barriers his ‘skunk works’ team achieved their target with weeks to spare, producing and safely flying the Shooting Star.
- Toyota wasn’t always the great car-maker we know today. Back in the post-war years Japan’s slow and painful recovery was hampered by resource shortages, its physical infrastructure still severely damaged and skilled labour desperately scarce. All of this on an island which had to import most of its key industrial resources. The stuttering local car market was small and fragmented; under such conditions it was impossible to run a car factory in the profligate style associated with mass production. Constraints forced experiments towards a radically different approach emphasising reduced waste at every stage. From these unhappy beginnings (and a long learning process) the idea of ‘lean’ was born, one which went on to become one of the most powerful process innovations of the twentieth century.
- It’s not just in the world of manufacturing – back in the 1970s Dr Govindappa Venkataswamy began his search to try and bring safe low cost eye care to the poor of India. The cataract operation he pioneered was simple enough to perform technically; the innovation challenge he faced was doing so in a resource-constrained context. Lack of skills or facilities and more importantly lack of money – the average cost of cataract treatment was around $300, far beyond the means of poor village folk trying to subsist on incomes of less than $2/day. His Aravind Eye System borrowed ideas from the world of fast food and essentially shifted the model of surgery to one similar to manufacturing – in the process cutting the average cost to $25 and delivering it using largely unskilled labour trained in narrow focused areas. Forty years later and millions of people around the world owe their sight to his innovation; his ideas influenced Devi Shetty and others to pioneer similar approaches to operations as complex as heart by-pass surgery, again massively lowering the costs without compromising on the safety element.
- And think about the world of the arts. Each season the Royal Shakespeare Company faces the challenge of short time scales and the need to find something new in a 400 year old repertoire limited to 37 plays – all of which have already been performed thousands of times before. Despite this they can still push the edges of the audience experience.
Something is going on here which is clearly not about having lots of resources – instead the very shortage of them forces a different mind-set. It triggers a different kind of search, one with a number of important characteristics:
- Ends rather than means drive innovation – the presence of a challenging vision compels innovation, even if the ways of reaching the goal are unclear
- Extensive search – because the normal pathways may be blocked the search for solutions pushes out into new and unfamiliar territory
- Reframing – one powerful exploration tool is to work at a higher level of abstraction, bridging between different worlds to find solutions to similar problems (for example Aravind’s leap between the worlds of healthcare and fast food)
- Creatively combining – improvising solutions from what is available, often in novel configurations. The French word ‘bricolage’ helpfully describes this process which is one of the core elements in the entrepreneur’s mind-set
- Experimental learning – improvising and building on what emerges, learning fast from early prototyping
- Tolerance of imperfection – rather than planning the innovation from the outset the journey is one of stepping-stone jumps, improving as the design takes shape and often building in key elements of the user experience into the process
A 1960s novel (made into a successful movie in 2004), ‘The Flight of the Phoenix’, provides a good example of the way this story unfolds. A plane crashes in the Mongolian Desert and some people survive. They have little food and water, they are miles from anywhere, the radio is (of course) broken and the sun is beating down. It doesn’t take long to set up the drama – they are trapped and unless they come up with a radical solution fast they will all die. Plenty of room for arguments, romance and other dramatic devices – but at its heart the story is about creativity under constraints. One of the survivors has a background in aeronautical engineering, enough of the plane remains intact so that parts could be bolted together to make a crude airframe, one of the engines is undamaged and there are enough drops of fuel left to give them one shot at flying their ‘Phoenix’ out of the desert and to safety. It’s a story of improvisation, inspiration, occasional violent arguments which trigger new insights – and it has a more or less happy ending!
Recent research on creativity lends support to this model. In studies at the University of Amsterdam it appears that obstacles and constraints actually help the creative process. Using different kinds of barriers and constraints the studies found that participants began to search more widely in their problem solving behaviour – as if the limitations trigger an “if obstacle, then start global processing” response.
It’s not enough just to have the search behaviour – we also need perseverance. The Amsterdam studies found the global search effect particularly powerful when used by individuals who were naturally inclined to stay engaged and finish on-going activities. We’ve got plenty of role models in the world of innovation which remind us of this – for example, Thomas Edison trying hundreds of possible solutions before he found a filament for his light bulb, James Dyson struggling through 5 years and 5000 prototypes for his cyclone vacuum cleaner.
‘Creativity loves constraints’ is one of Google’s operating mantras, driving innovation in new directions. A powerful principle – as long as we recognise that it involves a balancing act. Constraints provide pressure, but too much pressure can be dangerous. Urgent projects can become unstoppable – the tragic disaster in 1986 when the Challenger space shuttle exploded shortly after launch is a powerful reminder of this. In many ways it mirrored an earlier aviation disaster; back in 1930 the airship R101 on its maiden voyage crashed into a hillside in France killing all on board. Like the Challenger the R101 project was high profile and driven by a sense of urgency, always in the public eye, being rushed along by high profile leaders pushing for success.
Just as the faulty O-ring seals in the Challenger’s engines were known about but brushed aside by project managers driven by the urgency of the shuttle launch, so the R101 engineers could not get their doubting voices heard. As the novelist Nevil Shute (who worked in the industry) commented in his autobiography ‘Slide rule” ‘…. it was impossible for them to admit mistakes without incurring discredit far exceeding their deserts, for everybody makes mistakes from time to time. Surely no engineers were ever placed in so unhappy a position’
What we’re looking for is the ‘sweet spot’ between having enough constraints to provide the pressure to innovate– and too much which will destroy it. On the other side, too much resource – and we can relax, work in our comfort zone, draw on variations on established themes and try to make them work. Too little and we become paralysed.
What innovation management lessons can we take from this?
- Create the challenge – build a compelling vision, something to engage the energy
- Construct the sense of crisis – bring the constraints to the fore, demand a solution in spite of them
- Coach the team – many famous crisis innovation teams have leaders – like Kelly Johnson – whose role is working as coaches, challengers, guides
- Cultivate the team – diversity helps, drawing on different core knowledge but also on different personalities, perspectives, angles
- Enable co-operation – networking can often fill much of the resource gap. For example, 3M’s famous ‘bootlegging’ model is at heart a social process, depending on the community from which entrepreneurs can beg, borrow and otherwise pull together the resources they need
Say the word ‘frugal’ – and it conjures images of making do, eking out scarce resources, managing on a shoestring. And in the world of innovation there are plenty of examples where this principle has triggered interesting solutions. For example Alfredo Moser’s idea of re-using Coke bottles as domestic lighting in the favelas of Rio has led to its use in around a million homes around the world. And potter Mansukhbhai Prajapati’s Mitticool ceramic refrigerator offers a low cost way of keeping food cold without the need for power.
But frugal is not simply low cost improvised solutions in a resource constrained part of the world. It’s a mind-set with powerful implications for even the most advanced organization. Sometimes crisis conditions and resource scarcity trigger search in new directions, leading to radical and unexpected alternatives.
For example, when Indian eye surgeon Dr Govindappa Venkataswamy retired he wanted to bring safe reliable cataract surgery to the poor in the villages of his home state of Tamil Nadu. The context was not favourable – even by Indian standards the cost of the operation (around $300) put it beyond the reach of millions living close to the poverty line, and there were additional constraints around the availability of skilled staff to carry out the procedure. Undeterred he searched for alternative approaches which could bring the cost down to around $30 – and he found an answer in a surprising place, underneath McDonald’s golden arches. His argument was that the same techniques used for fast food production and service (which relied largely on unskilled labour narrowly trained up in key areas) could apply in eye surgery. His Aravind Clinic was founded in 1976; today it treats upwards of a quarter of a million people every year and has the distinction of having given back sight to over 12 million people around the world who would otherwise have gone blind because they couldn’t afford the operation.
What began as a ‘frugal’ innovation has grown into a global system offering some of the best eye care in the world. It has spawned multiple innovations – in education, preventive care, and in replacing expensive replacement lenses with a much cheaper alternative designed for the Indian context. (Aurolab is now the world’s largest producer, exporting to 87 countries).
This new ‘platform’ model of reliable, low cost but safe healthcare has been taken up by others. Devi Shetty, once heart surgeon to Mother Teresa, has been christened the ‘Henry Ford of heart surgery’ for his application of it to complex operations like by-pass surgery. As with Aravind the massive savings in time and cost are not at the expense of quality; his Narayana Hospitals boast quality rates better than many western hospitals. And like Aravind emphasis is on a systems approach often challenging conventional business models for healthcare; for example 12 million farmers now pay a monthly micro-insurance premium of 12 cents to receive widespread healthcare benefits. Using advanced telemedicine means that problems of skill shortages and expert coverage across a vast sub-continent can be dealt with using sophisticated IT infrastructure.
Others are imitating this approach – for example in China software giant Neusoft are pioneering the use of advanced telemedicine to help deal with the growing crisis in which 0.5 billion people will need health care. Instead of building more hospitals the plan is to develop an advanced IT-supported infrastructure to offer a network of primary care – a ‘virtual hospital’ model at much lower cost and with much wider outreach.
Whilst frugal innovation is associated with emerging market conditions where purchasing power is low there is also potential for such ideas to transfer back to industrialized markets. GE’s simple ECG machine (the MAC 400) was originally developed for use in rural India but has become widely successful in other markets because of its simplicity and low cost. It was developed in 18 months for a 60% lower product cost yet offers most of the key functions needed by healthcare professionals.
Siemens took a similar approach with its Somatom Spirit, designed in China as a low cost computer body scanner (CAT) machine. The target was to be affordable, easy to maintain, usable by low skilled staff; the resulting product costs 10% of full-scale machine, increases throughput of patients by 30%, delivers 60% less radiation. Over half of production is now sold in international markets. In particular Siemens took a ‘SMART’ approach based on key principles – simple (concentrating on the most important and widely used functions rather than going for the full state of the art), maintainable, affordable, reliable, (fast) time to market.
Rajan Tata pioneered a frugal approach in developing the ‘Nano’ – essentially a safe, reliable car for the Indian mass market. The whole project, from component supply chain through to downstream repair and servicing was designed to a target price of $2500. Early experience has been mixed but it has led others to move into the ‘frugal’ space, notably Renault-Nissan. Building on the success of a ‘frugal’ model (the Dacia/Logan platform in Europe) they established a design centre in Chennai to develop products for the local market. The Kwid SUV was launched in 2016 selling at $4000 and has broken sales records with a healthy order book and despite strong competition.
Its easy to dismiss these examples as relevant only to a low income emerging world – but there are several reasons why this would be a mistake. Frugal innovation is relevant because:
- Resources are increasingly scarce and organizations are looking for ways to do more with less. The frugal approach can be applied to intellectual and skilled resources as much as to physical ones – something of relevance in a world where R&D productivity is increasingly an issue. For example the Indian Mangalaayan Mars orbiter spacecraft was successfully launched 2013 at the first attempt. Despite the complexity of such a project this was developed 3 times faster than international rivals and for a tenth of their costs. Its success is attributed to frugal principles – simplifying the payload, re-using proven components and technology, etc.
- Crisis conditions can often force new thinking – something which research on creativity has highlighted. So the improvisational entrepreneurial skills of frugal innovators – nicely captured in the Hindi word ‘jugaad’ – could be an important tool to enable ‘out of the box’ thinking
- Frugal innovations have a habit of migrating from their original context to other locations where they offer better value. Think about low cost airlines – the model there was essentially one which stripped away all but the essential function of safe travel between two points. Originally targeted at travellers unable to afford mainstream offerings the model quickly disrupted the entire industry.
So how might an organization begin to think about frugal innovation? There are some core principles which help make up the mind-set:
- Simplify – not dumbing down but distilling the key necessary functions
- Focus on value – avoid overshoot, avoid waste
- Don’t reinvent the wheel – adopt, adapt, re-use, recombine ideas from elsewhere
- Think horizontally – open up the innovation process, engage more minds on the job
- Platform thinking – build a simple frugal core and then add modules
- Continuous improvement – evolve and learn, best is the enemy of better
 There’s an excellent website and network on the topic here http://frugalinnovationhub.com/en/
 More details at http://www.nesta.org.uk/sites/default/files/our_frugal_future.pdf
Innovation matters – of course! Few people would argue with the need to ensure that our organizations change their offerings (products/services) and the ways we create and deliver them (processes) in order to keep pace with a rapidly changing world. If we don’t the message from history is clear – we won’t survive or grow! This theme is as relevant to public sector or social innovators as it is to the commercial world – it’s an innovation imperative.
The challenge comes not in recognizing the need for change but working out how to respond. Anyone might get lucky once but if we want to keep a steady flow of innovation happening then we need to think about organizing and managing the process. Innovation is all about creating value from ideas – but it won’t just happen, it needs some supporting structures and methods. We need to learn to manage innovation.
The good news is that we’ve got plenty to draw upon. In different ways practising managers, academic researchers and consultants have all been trying to understand how to make innovation happen and we can use that knowledge base to help build innovation management capability. But we need to adapt and configure those general principles to work in particular settings. And we need to recognize that whilst lectures and classrooms have their place, there is still plenty to do in terms of getting the message across to the people who will make innovation happen. In other words we need some innovation in the ways we think about teaching and coaching innovation.
That’s the core challenge at the heart of TACIT, a 3-year EU Knowledge Alliance (2016-2018) project under the Erasmus+ programme. Working together academics and practitioner organizations will explore, prototype and roll out a suite of different and complementary approaches to the challenge and make this experience (and the emerging tools and methods) available to a wider audience. The work centres on eight core approaches: storytelling, peripatetic learning, future-based learning, entrepreneurship laboratory, innovation theatre, innovation games, design making, and project based learning.
 Teaching and Coaching Innovation Innovatively (TACIT). Partners include Aachen-Münchener, ASIIN, BMW, ISPIM, LEGO, Lufthansa, Nokia and NHS Foundation Trust together with University of Exeter (UK); Southern Denmark University, Leipzig Graduate School of Management and RWTH International Academy, Aachen, (Germany).