Adopt Frugal Innovation Practices to Jump Ahead of the Competition

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Jossey-Bass releases new book Jugaad Innovation called "most comprehensive book yet to appear on the subject" by The Economist.

Jugaad \jü-'gÄd\:
Hindi word meaning an innovative fix; an improvised solution born from ingenuity and cleverness; resourceful. Also known as zizhu chuangxin in China, gambiarra in Brazil, D-I-Y in the USA, jua kali in Africa, and système D in France.

According to research conducted by Booz & Company, Western firms spent an astounding $550 billion dollars on R&D in 2010. What did they get in return? Not much. The three industries that spent the most on R&D (computing/electronics, healthcare and automotive) struggled to generate a steady stream of groundbreaking innovations, making it clear that money cannot buy innovation. Today’s business must look to places like India, China and Africa for a new, bottom up approach to frugal and flexible innovation. In other words, they must look to a JUGAAD approach to innovation.

In Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth (Jossey-Bass; 978-1-118-24974-1; e-book available; April 2012), authors Navi Radjou, Jaideep Prabhu and Simone Ahuja articulate how jugaad (a Hindi word meaning an improvised solution born from ingenuity and cleverness) is leading dramatic growth in emerging markets—and how Western companies can adopt jugaad to succeed in a hypercompetitive world. Delving into the mindset of jugaad innovators, the authors discuss the six underlying principles of jugaad innovation:

1.    Seek opportunity in adversity
2.    Do more with less
3.    Think and act flexibly
4.    Keep it simple
5.    Include the margin
6.    Follow your heart

To illustrate these principles in action, the authors take examples from emerging markets, such as the invention of the MittiCool—a low-cost fridge invented by an Indian villager that is made entirely of clay and consumes no electricity—and Embrace, a company that creates portable infant warmers that cost less than 1% of a traditional hospital incubator.

But more important, the authors also describe how forward thinking Western firms like 3M, Apple, Best Buy, Facebook, GE, Google, IBM, PepsiCo, Renault-Nissan are already applying jugaad principles to innovate faster, cheaper and better.

From Procter & Gamble’s reinvention of its core business model to profitably serve economically marginalized American consumers to Renault-Nissan’s focus on designing cars that cost less but deliver more value, the Western firms profiled in the book illustrate how businesses can win by practicing jugaad innovation.

Corporate leaders have traditionally managed innovation like an orchestra conductor—with a hierarchical and structured approach. Jugaad Innovation shows how to innovate like a jazz band—with improvisation, creativity, and agility. Both approaches are necessary to succeed in today’s complex global economy.

A groundbreaking book, Jugaad Innovation shows leaders everywhere why the time is right for jugaad to emerge as a powerful business tool in the West—and how to bring the jugaad mindset and practices to their organization.

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Meredith Stanton
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