India’s Emergence as an Innovation Mecca

By: Anuraj Gambhir

A mega-trend in innovation is reverse innovation. Reverse or frugal innovation describes innovations originally developed and/or adopted in the developing world which later become prominent in mature world markets. It is an interesting trend that is introducing a new perspective to innovation. It is based on the idea ‘jugaad’, which describes activity in India to adapt existing solutions using low cost technology.

This phenomenon is increasing in the emerging BRIIC (Brazil, Russia, India, Indonesia & China) countries. We can see great potential for breakthrough innovations based on this approach. Some good examples of reverse innovations are GE’s $1,000 hand-held ECG and $15,000 PC-based ultra-sound machines and Godrej’s $ 85 Chotucool fridge. Tata’s nano car. As a frugal approach driven by good value and based on working from the ground up is core to these innovations.

Prof. Vijay Govindarajan describes reverse innovation based on three strategies: managing the present, selectively abandoning the past, and creating a future with demand from the billions of people in the emerging economies. We need to manage past learning effectively in order to ensure a brighter future. India is producing increasing numbers of solutions that are being exploited across the world.

Sachet packaging for fast moving consumer goods offered good value for money;  and improved telecommunications brought about a revolution and improved affordability such as via micro-recharges for mobile pre-paid.

Move over – here comes rural India…..

70% of India’s population (742 m) live in rural areas and account for over 60% of the growth in mobile telecommunication. Thus in telecoms most of our innovation activity is focused there. Currently, we are working on innovation projects to improve the livelihoods in rural communities, to produce ICT enabled offerings for rural and enterprises and farmers that will increase their productivity by providing instant access to knowledge. Reverse innovation is very important: there is a large BOP (Bottom-of-the-Pyramid) market which is being satisfied by grass-roots ideas. The idea of ‘Connecting the Unconnected’ is being promoted by the GSM Association through various programmes including developments such as Emerging (Ultra Low Cost) Handset Markets.

The Indian government is playing a major role and is providing various tools to more than 600,000 villages in India, including the USOF (Universal Services Obligation Fund). Jagdish Sheth, author of Chindia eRising, has abandoned the 4Ps (Product, Price, Place, Production) of traditional marketing and is promoting the 4As, i.e. Awareness, Accessibility, Affordability and Acceptability, as being essential for rural market development, which is dependent on the Total Cost of Ownership (TCO) of packaged solutions being affordable for all.

Empowering the masses through Innovation in ICT

There are major developments in India in the areas of micro-finance and a more prominent role for women in rural emerging markets. Tens of thousands of SHG (Self Help Group’s) supporting artisans in remote villages are being enabled by access to mobile telecoms. Village producers can market their offerings and receive worthwhile returns.

The largest IT(&T) innovation project currently underway in the world is the construction of the Universal Identity (IUD) ecosystem. This will revolutionize life for many (Aam-Aadmi) in India who will be empowered to achieve better livelihoods and become contributing citizens.

The Desire for ‘Simplexity’

Innovation is about simple and straight forward offerings, whose benefits must be evident, and fast time to market. Simplicity is the key to successful innovation and is now being achieved by inventors in the east as well as the western world. The back end complexity, which should provide a richer and more superior service to the consumer, must be invisible. In the 1990s I coined the term ‘simplexity‘ to describe this attribute; stressing the need for simplicity in the total user and product experience in the context of increasingly complex ecosystems, devices and architectures.

To paraphrase Leo Tolstoy, I would say that there cannot be greatness if there is not simplexity, goodness and truth.

As smartphones become ever smarter, more pervasive and increasingly affordable, this makes the possibility of ultra-low cost smart devices based on open platforms and customizable for segments such as rural enterprise, more realistic. Dedicated applications and services combined with simplicity are becoming core values in the connected, computer enabled world in which the masses are able to get livelihood-enriching benefits from the convergence and integration of telecoms with computing and the new media.

There cannot be greatness if there is not simplexity, goodness and truth.

Ericsson made an investment in a highly innovative Indian Institute of Technology (Madras) spin-off called Novatium Solutions which offers ‘computing for the next billion’ based on the medium of PCaaS (PC-as-a-Service). This represents a paradigm shift and uses a dynamic thick-thin client and a smart combination of grid/cloud and utility computing which transforms the computer into an appliance.

The new-age cloud computing is easily scalable through the use of flexible services that are easily consumed over the Internet through a low-touch, as-needed, pay-per-use business model. Shared and optimal use of scarce resources are fundamental to scaling the offering. A family/shared computer encompasses the 4As. Its evolution has launched a revolution in Internet computing for numerous segments and large sectors of the population. A simple widget approach requiring one click to access dedicated apps makes this a highly compelling innovation that is easy to use and suitable for mass adoption.

Broadband penetration will have a much greater impact in emerging markets, such as India, if there is access to easy to use solutions in the cloud space. Micro- and small and medium firms will benefit the most from these offerings. We see the cloud as a multi-dimensional approach to computing that takes advantage of the scale of the Internet to connect people, to provide information, and to give access to computing, in new ways.

Broadband penetration will have a much greater impact in emerging markets…

The criticality of education and healthcare increases as countries develop, and government and transportation means play important roles in infrastructure development. One of Ericsson’s show case initiatives called Gramjyoti or  ‘light of the village’) has put the company at the forefront in terms of demonstrating meaningful applications of 3G/HSPA (High Speed Packet Access) for the masses, and for rural (generally underserved) populations. Tele-medicine (in partnership with India’s Apollo Hospital), Tele-education, E-governance are providing immense benefits to the communities in 18 villages in Tamil Nadu (Southern India).

The Indian government’s bold announcement of $35 or INR 1500 tablet computers for students will result in major effects (comparable to what the nano car did for the automobile sector). It is a great example of academia and industry collaborating and where the top institutes in the country, such as the Indian Institute of Technology and the Indian Institution of Science, are driving a highly interesting undertaking. The aim is to provide further subsidies and offer even cheaper computing devices. However, the question remains, as Prof. Prem Kalra, Head of IIT-Rajasthan put it: We may have connected millions or rather billions of transistors, but have we truly connected millions of people!

Indian youth is set to rule

The young people of urban India think globally; they are ‘switched on’ to the new technology, and in many cases are ahead of the curve as early adoptors. Technological ‘savviness’ and continuing to be up-to-date with the latest and greatest inventions and idea, accompanied by aspiration and motivation, are changing the face of India. India’s population includes 54% aged under 25 (and 45% under 19); with the youngest population world-wide India can hardly avoid becoming witness to some game changing innovations.

The youth and rural populations of India, in particular, are poised to exploit the new and customized applications and services, which must be made locally relevant, available in local languages, and be seen to improve livelihoods. Multimedia in all its forms will have profound implications; for example, it has been predicted that video will represent some 50% to 70% of broadband data traffic by 2012. The benefits of video conferencing will be a new experience and will provide great value for migrants to the cities and peri-urban areas, in enabling easy communication with their families.

True innovation happens when what you think, what you say and what you do are in harmony.

A recent pilot project called Aamne-Saamne (or in front of each other), launched by a 3G operator in India is producing good results. Video has major emotional benefits for communities in allowing them to see and talk to family members, making them seem less far away. Video is a universal media that can play a vital role in education and can reach out to the illiterate.

The evolving market heralds an exciting future which will bring simple but significant solutions to the masses. Users will need to make careful decisions among the new offerings.  The impact will need to be obvious – improvement to their standard of living and productivity.

I like to end by paraphrasing something that Mahatma Gandhi said: True innovation happens when what you think, what you say and what you do are in harmony.

By Anuraj Gambhir