Presentation in InnoFrugal 2016 conference at Heureka, Vantaa, Finland 25-26.4.2016
Sustainable
innovation
Sustainable innovation
means that innovation should balance the long term influences of the innovation
process, and the actual innovative output with the needs of and impacts on
people, societies, the economy and the environment. The motivation for sustainable
innovation is in combining competitiveness, the well-being of people and
sustainable solutions.
Properties of
sustainable innovation:
- Inclusivity
- Systemic approach
- Wicked problems
- Impact orientation
One defining attribute
of sustainable innovation is inclusivity: open innovation, user-driving
innovation; innovation for all. Systemic approach is related to
changes in socio-technical systems and often they are described by jumps or
transitions; need of societal innovations. Sustainable innovation
provides the foundation for future business; it is not just part of ethical
responsibility. Sustainable innovation is oriented towards solving wicked
problems.
Sustainable innovation
follows the 4i-Model of innovation:
Idea
-> Invention -> Implementation -> Impact.
In the impact stage
the effect of innovation and the actual ways of use are actualized and
assessed.
Frugal
Engineering/Innovation
”Frugal
innovation or frugal engineering is the process of reducing the complexity and
cost of a good and its production.” Frugal innovation tries to achieve more
with fewer resources. Examples; Tata Nano car, 100 € computer.
Frugal
innovation is societally tuned: no affordable solution is working well if
operating models, communities, institutions and habits of people are not
adjusted to adopt solutions. Therefor frugal innovation presupposes systemic
approach.
Frugal is not cheap in
the sense of bad quality. It is the optimization of quality/cost ratio to
achieve affordable solutions. The secret of frugal innovation is modularity
and collaboration: solutions must be divide into separate modules which are
easy to combine to perform a certain task. The modularization allows to
distribute the task to different firms and organizations leading to
collaboration.
How to
improve capabilities of Finnish enterprises to produce frugal innovation?
- Better knowledge about frugal engineering and Bottom of Pyramid markets
- Better access and connections to emerging markets (India, Indonesia, Brazil etc.)
- Partnership with local agencies and enterprises in emerging markets (marketing, distribution channels)
- Real collaboration in innovation and production combining Finnish competencies in engineering and ICT with production capacities and low costs of emerging markets
- Building vivid global special business ecosystems between Finland and emerging markets like India
First of all,
Finnish enterprises have to adopt a new mind-set to understand that
- You can do profit even when prices are low if you could scale your products to "billion customers markets"
- Normal engineering thinking is not enough, you have to know how customers behave and use your products
PS. By the way, the
Innofrugal 2016 conference was more that just collecting experts to meet each
other: Conference opened a new prospect for Finnish companies and public agencies
to enlarge activities into emerging markets. Few years ago no one in
Finland knew what frugal innovation is. I became familiar with
the concept in 2010, when I visited Singapore and when professor Ruben
Biswas visited at University of Jyväskylä.
Hautamäki A. (2010).
Sustainable Innovation. A New Age of Innovation and Finland’s Innovation Policy.
Sitra Reports 87. Helsinki.
Hautamäki A. &
Oksanen K. (2016): Sustainable Innovation: Solving Wicked Problems Through
Innovation. Mention A-L. and Torkkeli M. (Eds.), Open Innovation, A
Multifaceted Perspective, In two parts, Part I. Singapore: World
Scientific, 87-110.
Radjou,
Navi, Jaideep C. Prabhu, Ahuja, Simone. "Jugaad Innovation: Think Frugal, Be Flexible, Generate
Breakthrough Growth." San Francisco, CA: Jossey-Bass - Random
House India, 2012.
