Asian innovation: Frugal ideas are spreading from East to West

GE Healthcare’s Mac 400 electrocardiogram machine, seen here being used in rural India,
was developed for markets in that country and China. GE Healthcare made further improvements
 to the breakthrough technology and this year brought the new model, the Mac 800,
 pictured inset, into the U.S, where it is finding new applications, such as at accident sites.

The Economist has an article describing some of the industrial innovation going on in developing nations, which taps emerging markets of the poor while creating employment. Some of the products designed for those markets are being adapted and commercialized in rich countries.

Is frugal innovation being oversold? Can Western companies relax? 

Two new books—“Reverse Innovation” by Vijay Govindarajan and Chris Trimble, and “Jugaad Innovation” by Navi Radjou, Jaideep Prabhu and Simone Ahuja—suggest that the answer to both questions is No.

Here are a couple of links that further develop the idea:

• Reverse innovation: How GE is disrupting itself
• Jugaad: A Breakthrough Growth Strategy

Both trends are important. The BRICI countries have huge populations with increasing incomes, and thus  huge markets that can be developed. Industrial innovation to supply these markets seems necessary and very useful; it will involve both local invention and the adaptation of technologies from abroad.

Good ideas can arise anywhere, and technologies appropriate for the relatively poor in developing countries will sometimes prove appropriate for market niches in developed nations. Companies in the rich world would be foolish to ignore this source of innovation -- of technologies to be transferred from the South and adapted to the North.