In its colloquial form, jugaad has come to stand for an ingenious yet very temporary solution. The Hindi word also has global cousins, like DIY in the US, gambiarra in Brazil, zizhu chuangxin in China, and systeme D in France. We are reminded of this at the website for Jugaad Innovation, authored by Navi Radjou, Jaideep Prabhu, and Simone Ahuja, which The Economist has acclaimed as the most comprehensive book on the subject. With the aid of an extended email interaction, we learn from the authors why this concept is gaining global respect far beyond what?s suggested by its colloquial usage.
Radjou, Prabhu and Ahuja define jugaad as a frugal, flexible and inclusive approach to innovation, improvising effective solutions with limited resources. While some jugaads are temporary, these principles can deliver serious long-term solutions that do not compromise on quality, and in fact can be more effective than traditional solutions. The Tata Nano and GE Healthcare?s line of portable ECG machines are two examples from India.
For companies set in their ways and large corporations with complex structures, how easy would it be to adopt jugaad principles? Radjou, Prabhu and Ahuja say such entities are typically committed to a highly structured approach. This has three major pitfalls. It?s expensive (R&D budgets are constantly on the rise), rigid (because of structured plans) and insular (innovation is limited to those people within the firm who are designated as innovators). For large corporations committed to pushing technology for the sake of technology (rather than driven by the pressure to meet a market need at a very low price point), jugaad presents an almost antithetical approach to innovation. While it may be quite difficult to adopt for large corporations, some have successfully managed to do so already. The book considers their examples carefully and details how others might be able to do the same.
After travelling through the country, Radjou, Prabhu and Ahuja are struck by how everyone from grassroots innovators and social entrepreneurs to large Indian firms and MNCs is using jugaad in one way or another. In India, scarcity drives frugality, unpredictability drives flexibility and the increasing connectedness of people (through mobile phones etc) drives inclusivity. And jugaad may be vital for India. Despite last 20 years? growth, many people?s basic needs (education, healthcare, energy, water, financial services, etc) are unmet. Governments and large companies are frequently absent from this space, and thus, people are left with no choice but to improvise frugal solutions for themselves. That is the power of jugaad innovation: it can and will drive growth in India and other similar economies from the bottom-up.
As for the West, given its gloomy economic environment, the concept can have a big influence there as well. Western companies face three big challenges. First, they are facing zero or negative growth in the West where they traditionally marketed their innovations. Second, while there is growth in emerging markets, much of this growth is for relatively low-end products, an area where Western firms do not have experience and where they face competition from emerging market counterparts who do. Finally, Western corporations are now facing the conditions of emerging markets (scarcity, unpredictability and relatively large numbers of low-income consumers) in Western markets as well. These trends are causing Western corporations to look more carefully at revising their old innovation model.
An example Radjou, Prabhu and Ahuja devote much attention to is GE Healthcare. Its traditional approach of developing high-tech medical equipment for Western markets that it might then de-feature and price somewhat lower for emerging markets doesn?t work so well any more. To compete in emerging markets against highly affordable products from domestic Indian and Chinese medical equipment firms, GE has taken to adopting jugaad innovation in emerging markets, closely examining the needs of consumers and integrating these insights from the very beginning of the development cycle. The line of portable and highly affordable ECG machines developed in India and mentioned above is a case in point. These machines have been very successful in India and China and are now being marketed successfully in Western Europe and North America. Siemens and Philips are practicing jugaad innovation as well.
Western universities such as Stanford, MIT, and Cambridge are leading the way in creating the next generation of innovators who will use frugal and flexible principles to innovate. In India, IIT Madras and IISC are helping create the next generation of affordable solutions for rural India. IIM Ahmedabad is working with its alumni network and the Department of Science and Technology to drive jugaad solutions in energy and water. The Stanford-India Biodesign collaboration between AIIMS, IIT Delhi and Stanford University is working to train the next generation of medical technology innovators in India.
Radjou, Prabhu and Ahuja say that jugaad innovation, like any tool, is most useful when it is used at the right time for the right purpose. Sometimes innovating firms or entrepreneurs may need a hammer (that is the structured approach to innovation) and at other times they may need a screwdriver (the jugaad approach). For instance, jugaad innovation may be particularly effective in markets characterised by scarcity and unpredictability, whereas the structured approach may be better for more munificent and predictable markets. Or jugaad may be most effective in the early stages of idea generation, prototype development and testing, whereas the structured approach may lend itself better to scaling.
As for businesses and consumers accepting jugaad as a business concept, Radjou, Prabhu and Ahuja think this is entirely a mindset issue! It is not about specific solutions but rather the mindset that underlies how innovators come up with these solutions. That said, changing mindsets can be very difficult. And hence a great deal of their book is about managers in large corporations where mindsets are very different and about how they can learn from jugaad entrepreneurs.