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What is Frugal Innovation?

In Navi Radjou’s Ted Talk,“Creative Problem Solving in the Face of Extreme Limits,”  Be-Bound is chosen as one of Radjou’s top three companies that best exemplify the concept. Radjou’s talk was based on his book, Jugaad Innovation (co-authored by Dr. Jaideep Prabhu and Dr. Simone Abuja). The Hindi word Jugaad means “a clever solution born in adversity” and translates into English as “frugal innovation.”

After studying the phenomenon of ingenuity in developing countries, Radjou describes how the concept of frugal innovation has been gaining ground as a business strategy in the north as resources diminish.

The vocabulary used to differentiate between “developed” and “developing” countries often lends to the simplistic notion that “developing” countries have one single task ahead of them: to catch up. However, when it comes to ingenuity, the opposite is the case: developing countries have something to teach the rest of the world, and in fact they are leapfrogging developed countries when it comes to innovative tech solutions.

Just as the Hindi word Jugaad suggests, in emerging markets, frugal innovation is something that has been born out of necessity. Governments and households living with scarcity have had to make more out of less. With limited infrastructure and resources available, frugal innovation becomes inevitable; people develop creative solutions using what is readily available. As the north faces the reality of diminishing resources, it is becoming imperative to consider alternative perspectives and appropriate responses to our circumstances. More are insisting upon making progress in spite of having less at their disposal. There is a perspective shift happening insofar as there is a new expectation that economic and social value should (at  least in part) evolve out of what is already plainly in front of us.

Developing countries are setting a new precedent for western entrepreneurs who are discovering the benefits of “Jugaad.” Having every resource at one’s disposal encourages laziness; people opt for a solution regardless of how wasteful or expensive it is. Realizing that we have limitations forces us to think outside of the box. Radjou, who lives in Sillicon Valley, the world’s high-tech mecca, notes that startups are adopting the idea of frugal innovation to get a competitive advantage in today’s markets.

To better illustrate the concept of what Jugaad means in relation to businesses, Radjou mentions 3 companies he admires that are putting frugal innovation to work. We were pleased that Be-Bound was spotlighted as a prime example.

Be-Bound caught Radjou’s attention because it uses the ubiquitous 2G and SMS networks to bring an Internet connection to the 2/3 of the world that is still unconnected. Long assumed to be for SMS-only, the 2G network covers 95% of the world’s population, and in that sense, was long sitting as an underused an abundant resource lying in wait. With the observation that WiFi, 3G and 4G were only available in particular areas, Be-Bound discovered a way to bring Internet connection to remote areas of the world by using 2G as a transport layer. So, Be-Bound technology is a “frugal innovation” in that it works with the existing infrastructure and therefore costs very little to implement. With Be-Bound, countries do not have to spend heaps of money to build the infrastructure necessary for 3G/4G etc. Be-Bound automatically works wherever a phone signal exists.Through this process, Internet connection is being brought to areas it was previously unavailable.

Book: Jugaad innovation by Navi Radjou, Jaideep Prabhu, and Simone Ahuja
Book: Jugaad innovation by Navi Radjou, Jaideep Prabhu, Simone Ahuja

There is no doubt that technology has the power to improve lives, and there is no reason why developing countries  should be excluded from the advantages that advances in tech can bring. Radjou rightly points out that those who have  drastically lower incomes, have no fewer aspirations than the rest of the world. Frugal innovations are a win-win  because they are cost-effective for both the business, and the consumer. Working with what already exists costs the  business less, and the savings can be handed back to the customer. When directed toward populations with lower  incomes, frugal innovations are bringing people more opportunities in the face of hardship. Customers with less money  to spend, are finally being offered realistic products that are designed for their environment, and their income.  Technology is starting to become more accessible and affordable, and is equalizing the playing field.

We are a big fan of TedTalks and the inspiration that they bring to every field. You can see more of Navid Radjou’s work  on the Jugaad Innovation website: or following the Twitter account @JugaadAtWork.

Other companies mentioned alongside Be-Bound® were Thrive , a tool for farmers, and Compte Nickel  giving banking opportunities to more people.