Frugal Innovations: Global Case Studies

  • Krishna Udayakumar
  • Health policy and systems ,
  • Health economics ,
  • Health care access
  • United States
  • Commonwealth Fund

Start Date:

  • January 2015

As health systems in high-income countries struggle to balance affordability, quality, and access to care, particularly for their most vulnerable populations, health innovations arising in low- and middle-income countries (LMICs) represent a source of ideas for new models of care and technologies to help address these challenges. Studying frugal health innovations globally through a systematic approach provides an opportunity to learn from the work of entrepreneurs employing novel methods and models of care in low- and middle-income countries and provides an avenue to identify promising new solutions for the US and elsewhere. Funding from the Commonwealth Fund will support IPIHD to identify, prioritize, and further analyze three models from its global network of health innovations that have the potential to address critical challenges facing the US healthcare system. Selected models would likely target high-need, high-cost patients and conditions as well as low-income patients and other vulnerable populations lacking affordable access to high quality care. Over the course of this 10-month project, IPIHD will work with the Commonwealth Fund to select three promising models and will develop in-depth case studies detailing various aspects of the operational processes, revenue structures, and patient populations supported by these models, as well as considerations related to how they might be adapted to the US context. These case studies will provide the Commonwealth Fund with greater understanding of the potential of these frugal innovations to be replicated in the US and will serve as a foundation for designing and implementing a US-based frugal innovation pilot.

Last updated on February 18, 2022

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  • Defining frugal innovation: a critical review
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  • Chandni N Hindocha 1 ,
  • Grazia Antonacci 1 ,
  • James Barlow 2 ,
  • Matthew Harris 1
  • 1 Department of Primary Care and Public Health , Imperial College London , London , UK
  • 2 Business School , Imperial College London , London , UK
  • Correspondence to Dr Matthew Harris, Department of Primary Care and Public Health, Imperial College London, London W6 8RP, UK; m.harris{at}

Frugal innovation (FI), which has gained traction in various sectors, is loosely defined as developing quality solutions in a resource-constrained environment that are affordable to low-income consumers. However, with its popularity, multiple and diverse definitions have emerged that often lack a theoretical foundation. This has led to a convoluted conceptualisation that hinders research and adoption in practice. Despite this plethora of perspectives and definitions, scholars do agree that there is a need for a unified definition. This critical review across the management, entrepreneurship, business and organisation studies literatures explores the multiple definitions of FI that have appeared in the last two decades and seeks to examine the commonalities and differences. One definition is supported by a theoretical underpinning, and main themes include affordability, adaptability, resource scarcity, accessibility and sustainability, however, there remains significant ambiguity around what constitutes an FI. Defining FI as a concept should not deter from focusing on its core aim and identifying an FI may be best achieved by comparing it to an incumbent alternative, rather than against an ill-defined concept. There is merit in developing a common understanding of FI to support strategies for its successful acceptance and diffusion globally.

  • delivery of health care
  • global health
  • healthcare economics and organisations
  • health services research

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Summary box

What is already known.

Frugal innovation (FI) is ill defined and is synonymous with numerous innovation types such as jugaad, bricolage, disruptive, cost and grass roots innovation.

The premise of FI is essentially to develop quality and affordable solutions in resource-constrained environments for low-income consumers.

Since its introduction and with its growing popularity, a plethora of definitions and descriptions have been developed often supported by conceptual and case studies thus lacking a theoretical underpinning.

What are the new findings?

Various definitions share many overlapping characteristics such as affordability, functionality, resource-scarcity, accessibility and sustainability.

Conceptualising FI should not deter from focusing on its core aim. Identifying an FI may be best achieved by comparing it to an incumbent alternative, rather than against an ill-defined concept.

A common understanding of FI will add significant value to research and practice.


Since its introduction in The Economist (2010), frugal innovation (FI) has gained traction in various sectors such as healthcare, manufacturing, food, automotive, energy and academia across the world. 1–4 But with its popularity, multiple definitions have also developed, depicted mostly through case studies and lacking in a grounded conceptual basis or a theoretical foundation. 3 5–8 FI is not a new strategy but is a flexible approach to thinking about repurposing and sustainable resourcing. 9 Coupled with reduced government spending, reducing incomes and limited budgets, it has recently also caught the attention of developed markets. 10 11 Protagonists view it as an entrepreneurial mindset, having the ability to develop innovative solutions using limited resources for underserved consumers typically in low-income to middle-income countries (LMICs). In this perspective, FI can create new markets and contribute towards a more sustainable and inclusive world by supporting a more circular economy. In contrast, others may view FI as a cheaper and ineffective solution to a temporary problem as aspirations for ‘bigger and better’ are ever-growing. 12 In this review, we explore FI definitions across the business, management, entrepreneurship and organisation behaviour literatures, we compare and contrast the many perspectives of FI, provide a synthesis of its core features and make suggestions for policy and practice.

Defining FI

The increasing interest in FI has led to a wide array of criteria 11 13–15 and conceptualisations. 4 12 16 17 It is often defined by its similarities and differences with other types of innovation, 18–20 through case study research in different markets 10 21 and its relationship with sustainability and other core principles such as cost and adaptability, 4 22 23 (see table 1 ). There is consensus about the lack of transparency and clarity in defining FI and what constitutes an FI. 24 At present, there is no standard definition of FI which may be in part due to the various terminologies such as jugaad, 25 reverse innovation, 26 Ghandian, 15 shanzhai, 27 bricolage, 27 disruptive, 28 resource-constrained innovation, 29 good-enough, 30 grass root innovation, 18 31 cost innovation, 20 32 that are frequently used interchangeably due to its similar premise despite its different backgrounds. 8 31 33 34 Several core characteristics typify the approach to defining FI, including, ‘bottom-of-the-pyramid (BOP) innovation’, ‘good-enough innovation’, ‘doing more with less’, ‘resource scarcity’ and ‘sustainable innovation.’

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Definitions of frugal innovation

BOP innovation

Innovative solutions to support more than four billion people who live on less than $2 a day 35

According to Pisoni et al , 36 the term ‘FI’ was conceived in emerging markets to meet the needs of low-income consumers by producing innovations that maintained quality and added value but that were produced at low expenditure. 11 25 37 However, this can be analogous to disruptive innovation 38 and the principle of ‘disrupting the pyramid’ in emerging markets while also focusing on those with a low-income or cost-conscious consumers in developed markets. It is also an extension of jugaad innovation, 8 as a business model of innovation to create low-cost solutions to everyday problems. Gupta 39 argued that ‘ frugal innovation is a new management philosophy, which integrates specific needs of the bottom of the pyramid markets as a starting point and works backward to develop appropriate solutions which may be significantly different from existing solutions designed to address needs of up market segments’ . Brem and Wolfram 18 shared the same understanding defining FI as having, ‘ …low to medium sophistication, medium sustainability, and medium emerging market orientation’ . 40 This definition again coincides with Christensen’s 41 work on disruptive innovation but also Pisoni et al 36 and Prahalad’s 37 work on introducing creative low-cost innovations to improve the social lifestyle of those at the BOP in developing markets. Gupta 39 refers to a new philosophy that involves addressing the needs of those with low purchasing power as the starting point to develop solutions that may be different to mainstream alternatives designed to address the needs of typical market segments. 42 Gupta 39 further added that FI was a response to contextual concerns created with resource constraints to focus on neglected demographic consumers. It is important to note that those at the BOP are not just confined to low-income countries (LICs) but also to markets in higher-income countries (HICs), as people who earn a lower-income than the national average exists in every country, ‘ frugal innovations can target customers in any segment of the economic pyramid who are price-sensitive by choice or looking for ‘simpler’ products that best meet their real needs’ . 42

Good-enough innovation

Imperfect adapted innovations which involve simple and essential functions that are good-enough to meet the needs of underserved consumers and offered at low-cost 43 44

Angot and Plé 45 described FI as ‘good-enough’ solutions that rely on limited and cheaper resources to face resource scarcity’ which overlaps with many other definitions, such as ‘FI is ‘good-enough,’ affordable products that suffice the needs of resource-constrained consumers’ 16 ‘FI refers to products and services that are developed under resource constraints’ 46 and ‘FI stems from resource scarcity: using limited resources to meet the needs of LICs’. 47 Zeschky et al 48 defined FI as ‘responding to severe resource constraints with products having extreme cost advantages compared with existing solutions’ and ‘good-enough, affordable products that meet the needs of resource-constrained consumers ’ with both definitions focusing on the aspects of cost, basic functionality targeting resource-constrained consumers.

Doing more with less

Creating significantly more value while minimising the use of resources 49

Radjou and Prabhu 49 defined FI as ‘doing with more less ’ and Ratten 3 defined FI as ‘the affordable use of products and services that have been innovated under conditions of resource scarcity ’ , both referring to FI as a process of innovating in an easy to use and cost-efficient way. Although, this definition lacks any contingent aspects, it sets its focal point on the inclusion of a psychological strategy or changing behaviours by seeing resource constraints not as a disadvantage but more as an opportunity. 49 This mindset denotes a creative hemisphere where an innovator strives to deliver high quality at lower costs in comparison to more mainstream solutions. The authors also described FI as an opportunity to innovate cost effectively and sustainably under resource scarcity. The narrative of this definition aligns to that provided by The Economist 1 as it denotes FI as a strategy to rethink the architecture of the production process and use materials sparingly with a conscious effort to limit negative impacts towards the environment (sustainability) ‘FI is not just about redesigning products; it involves rethinking entire production processes and business models ’ . 1

Resource scarcity

FI occurs when there is a lack of sufficient or adequate equipment, qualified personnel, finance, institutional support or infrastructure during the development of innovative solutions 50 51

Though FI is typically cited as an innovation developed in LMICs, it applies to both emerging and developed economies as they seek to target those at the BOP. 31 Furthermore, the idea of resource scarcity is not necessarily limited to consumers at the BOP, as depicted in the definition by Gupta. 39 FI needs to be further explored outside the domain of affordability due to its ability to adapt to any contextual concerns, for example, in a global crisis such as the COVID-19 pandemic, ‘FIs are products and services that focus on crucial needs, spare resource use or eliminate non-essential features in the design process’. 52 The urgency provoked an imminent need to be efficient, innovative and scalable, which initiated an increase in the development and adoption of FIs as the developed world lacked time and resources to follow the traditional process of trials and testing. 53–55 The quick responses to COVID-19 from LICs such as India and Africa are progressing far better in comparison to HICs such as USA and in Europe. 56 Subsequently, these innovations provoke a competitive market, promoting an increase in sustainability despite significant constraints. 57

Sustainable innovation

The development of innovative solutions that contributes towards sustainable development and provides economic, ecological and social benefits 58 59

A significant amount of the literature on FI connects to issues of sustainability, although the explorations of such connections may differ. 60 Many scholars argue that FI can contribute towards a more sustainable world 13 and sustainable development, 61 although other have contested that FI does not create a sustainable impact, 23 does not necessarily involve sustainability 19 and are not initially eco-friendly. 47 Bhatti et al 6 and Prahalad and Mashelkar 15 suggested that FI involved redefining business models, reconfiguring value chains, redesigning products to target those with low purchasing power, creating a new market, using a scalable and sustainable approach. Weyrauch and Herstatt 19 suggested that sustainability was not necessary for FI and defined it as consisting of ‘ … three attributes: substantial cost reduction, concentration on core functionalities and optimised performance level’.

Overall, FI can be referred to a polysemy term, the existence of numerous meanings for a single term, and these are summarised in table 1 .

Identifying FI

The ever-increasing ways to conceptualise FI poses a significant challenge in how to actually identify one. 19 62 Some of the key characteristics typically used to describe FI and distinguish innovation types are functional and market aspects such as technical novelty, market novelty, functionality and resource scarcity 19 (see table 2 ). According to Weyrauch and Herstatt, 19 universal, multidisciplinary criteria are needed to define FI, irrespective of the context of study, due to its wide international application even in developed markets. 62

Key characteristics extracted from the definitions of FI*

Bhatti et al 53 conducted a mixed-method exploratory descriptive study to search for and evaluate less well-known FIs from LMICs that possess similar potential as the oft-repeated examples such as Narayana’s US$1500 cardiac surgery, general electric’s US$800 portable ECG machine, Aravind’s US$30 cataract surgery, non-electric Mitticool fridge and the world’s most affordable car by Tata Motors. 53 Many of these potential FIs were published by ‘innovation curator’ organisations, which identify and collate innovations providing accessible information to all who are seeking new policies, products or practice. 53 However, oftentimes there is no explicit statement of the criteria used, if at all, to identify such innovations as frugal.

Some scholars have proposed a criteria to identify FIs such as Kumar and Puranam’s 14 six principles: (1) robustness, (2) portability, (3) defeaturing, (4) leapfrog technology, (5) mega-scale production and (6) service ecosystem. The FI Hub at Santa Clara University defined 10 core competencies of FI typically used to provide economically efficient, appropriate, adaptable, affordable and accessible products and services to solve needs when facing severe resource scarcity with particular attention to the emerging markets and are used to assess potential adoption. 13 The 10 competences include: (1) ruggedisation (use of robust materials to withstand harsh physical environments), (2) lightweight (ease of transportation, portability), (3) mobile enabled solutions (unlimited connectivity sources), (4) human centric design (user-friendly for all), (5) simplification (essential and basic features and functionalities only), (6) new distribution models (‘unconventional channels and access’), (7) adaptation (leveraging existing alternatives), (8) use of local resources (designed and manufactured locally), (9) green technologies (‘powered by renewable sources’) and (10) affordability (‘based on high volume at low expenditure, attainable to those with low purchasing power’). 6 13 Although these competencies can serve as a rich basis for conceptualising FI, it is still unclear whether an FI must adhere to all competencies or a minimum number to be considered as an FI.

Based on literature review and interviews with managers and researchers, Weyrauch and Herstatt 19 proposed criteria for a universal definition that would distinguish FI from other types of innovation. They found that much of the discourse about FI mostly occurs within three main categories: (1) substantial cost reduction, (2) concentration on core functionalities and (3) optimised performance level and they proposed that an innovation must meet all three criteria simultaneously to be considered as an FI. 19 So, while each criteria on its own could also be used to describe another type of innovation, for example, cost innovation aims to produce products and services that are significantly low cost, only FI would be characterised by all three criteria at the same time. 19 These principles in actual products and services are also significantly dependent on the user environment and context, that is, the core functionalities—though the criteria applies to all markets, this criteria will differ depending on the context. 19

First criterion: ‘substantial cost reduction’

The premise of the first criteria of the framework, ‘substantial cost reduction’, is having products and services that are significantly lower in cost for consumers compared with more conventional mainstream products and services. 19 The amount or degree of the ‘significant low cost’ is not specified but they propose that the cost reduction must be a minimum of one third of the comparable product or service, or if no alternative exists, the estimated costs, for example, importation of current solutions.

Second criterion: ‘core functionalities’

The second criterion of the framework, ‘core functionalities’ relates directly to the user requirements of the FI, that is, simplicity, ease of use, essential functions and high consumer benefits. 19 According to Wooldridge 27 ‘numerous unnecessary bells and whistles to their products…makes the products more attractive to wealthier consumers, but the bells and whistles don’t really deliver any essential value’. This criterion is not limited to cost, but extends to saving resources, lowering the impact on the environment and addressing specific consumer behaviours. 13 19 27 47 63–65

Third criterion: ‘optimised performance level’

The third criterion, optimised performance level, is perhaps the most important of the three criteria as it is believed to encapsulate the true meaning of FI. 19 FIs should ‘meet the required performance level that fulfils its purpose and the local conditions’. 19 The term ‘performance’ encompasses a wide array of functionalities and engineering characteristics, for rxample, speed, durability and power and will vary depending on the type of innovation, that is, the components of a frugal car will differ to those of a frugal ultrasound device. 19 Tiwari and Herstatt 63 stated that FIs are ‘fulfilling or even exceeding certain predefined criteria of acceptable quality standards’. 4

Towards an integrated view

More recently, scholars have developed an integrated view of FI that combine technological and market aspects. For example, Hossain 31 defined FI as ‘a product, service or a solution that emerges despite financial, human, technological and other resource constraints, and where the final outcome is less pricey than competitive offerings (if available) and which meets the needs of those customers who otherwise remain unserved’. 24 31 This definition integrates issues of affordability, basic functionality, simplification and serving those with income constraints. They refer to FI as a process of creating simple low-cost products to create value for consumers with low purchasing power, 24 which also seemed to overlap with aspects of Tiwari and Herstatt’s 63 definition of FI, ‘ … characterised by affordability, robustness, user friendliness, scalability and having an attractive value proposition ’ .

Soni and Krishnan 17 conducted a typology review of FI and presented three types of FI: (1) mindset, (2) process and (3) outcome in the form of products or services. At the basic level, the concept can be thought of as ‘way of life’ or lifestyle whereas on an activity level, it was thought of as a process in which the ‘outcome’ reflects the actual good or service. 17 They defined FI as ‘meeting the desired objective with a good-enough, economical means’ and referred to it as an outcome of frugal engineering which was signified as the process. 17 In contrast, Basu et al 13 defined FI as ‘a design innovation process in which the needs and context of citizens in the developing world are put ‘first in order to develop appropriate, adaptable, affordable and accessible services and products for emerging markets’ and thus referred to FI as complex process as opposed to just an outcome.

Bhatti and Ventresca 7 critically reviewed the typology of various definitions of FI and proposed a theory-driven definition through analysing the concepts of ‘frugality’ and ‘innovation’ individually from a historical and current perspective. They argued that the concept of FI was not novel and dates back to World War Two. 7 Bhatti et al 6 interviewed social entrepreneurs and developed a framework that used a range of theories such as resource-based view, competitive advantage and creation of shared value to demonstrate the theoretical aspects of FI. The authors defined FI as ‘ … a means or an ends, to do more with less, for the many’ 6 50 , which is anchored to three core characteristics: (1) affordability, (2) adaptability and (3) accessibility, that apply to goods, processes and business model innovations and is not limited to a certain market. 6

Affordability (‘means and ends’) refers to the process and outcome of an innovation, which may include low expenditure materials, cost-effective delivery, cheaper manufacturing or disposal. 6 Adaptability (‘to do more with less’) refers to the efficiency and versatility of the innovation to the contextual needs, whereby the product can be ‘good-enough’. 6 Accessibility (‘for the many’) refers to the entire population as a target market, including those at all levels of the pyramid, as all could benefit from the innovation and allows for future scaling. 6 53 54 However, before scaling could be considered there are number of challenges impeding the successful adoption of FI and its subsequent translation to other sectors such as policy-making, funding regulations and institutional and contextual barriers (social and cognitive).

Next steps for policy, practice and research

Despite this array of perspectives and definitions, scholars do agree that the characteristics of FIs are different to those of mainstream innovations, for example (1) the geographical context is different, 64 (2) the diffusion pattern is different, 66 (3) business models are different 48 and (4) distribution channels are different. 24 Although there is no universal definition, many share the basic principles of (1) cost or affordability, (2) functionality, (3) accessibility and (4) sustainability 6 13 19 59 FI essentially encompasses the idea that more value can be achieved using less expenditure while using the resources available.

According to Ratten, 3 a clear definition of anything should adhere to three characteristics: (1) ‘measurable design elements (‘evaluation of term or concept’), (2) validity (‘application to setting’ or context) and (3) theoretical foundation’ (‘supported by research’). 3 Bhatti et al 6 provide a definition supported by a theoretical underpinning and consolidates the predominant principles involved in previous definitions.

There are many semantic benefits to a universal definition of FI such as a unified understanding and approach—what is it, how will it work, how can it be applied and what is needed. Although there is growing interest and publications exploring FI, its application and effectiveness, there is still a lack of a comprehensive theoretical understanding of FI. 6 7 50 To fully grasp what FI is, a standardised approach needs to be developed. It could be argued that FI has a political component because it detracts attention from deeper inequities and socioeconomic classification of countries, distribution of resources and geo-political power. FI diverts attention away from questioning why some countries lack the resources to innovate in the same way as other HICs. On the other hand, it could be argued that the exploration and implementation of FI across contexts, though global learning, can overcome some of these geo-political power differentials and support an awakening that higher-income contexts have much to learn from lower-income ones. Ambiguity surrounding the conceptualisation of FI could be attributed to the overtheorisation of the concept resulting in excessive definitions and perspectives. 67–70 It may be that a pragmatic way to identify an FI is not to examine it against ill-defined concepts but to compare it to its next closest alternative. If, compared with the incumbent, the innovation is more affordable, more accessible and more adaptable, then it might be an FI. 71 72

The existence of numerous definitions of FI did not halt its development and implementation, but it did in fact increase interest in, knowledge of and market for FI. However, consolidation of the various definitions of FI has the capacity to add a significant value to practice and research such as building a reporting group explicitly focusing on FIs, assessing the impact of such innovations, create a body of knowledge about FI and agreement around how to standardise reporting of such innovations. 73

Although there is growing interest and efforts to understand, design and develop FIs with the aim of mitigating problems efficiently and effectively, there still remains the challenge of conceptualising and characterising FI due to its significant overlap with other innovation types. But perhaps this is due to the diversity in definition for other concepts which feature in the definition of FI such as sustainability, low income and good-enough. Defining FI as a concept should not deter from focusing on its core aim. Identifying an FI may be best achieved by comparing it to an incumbent alternative, rather than against an ill-defined concept. There is merit in developing a common understanding of FI to support strategies for its successful acceptance and diffusion globally.

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Contributors CNH designed the study, performed the literature review, completed the first draft and revised subsequent drafts for important intellectual content. GA proposed the study, read the first draft and revised subsequent drafts for important intellectual content. JB proposed the study, read the first draft and revised subsequent drafts for important intellectual content. MH proposed the study, read the first draft and revised subsequent drafts for important intellectual content. All authors read and approved the final manuscript.

Funding MH is supported in part by the NW London NIHR Applied Research Collaboration. Imperial College London is grateful for support from the NW London NIHR Applied Research Collaboration and the Imperial NIHR Biomedical Research Centre.

Disclaimer The views expressed in this publication are those of the authors and not necessarily those of the NIHR or the Department of Health and Social Care.

Competing interests None declared.

Patient and public involvement Patients and/or the public were not involved in the design, or conduct, or reporting, or dissemination plans of this research.

Provenance and peer review Not commissioned; externally peer reviewed.

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Frugal innovation and sustainability outcomes: findings from a systematic literature review

European Journal of Innovation Management

ISSN : 1460-1060

Article publication date: 16 September 2022

Issue publication date: 19 December 2022

Advance the state-of-the-art on how frugal innovation links to sustainability outcomes and based on content analysis of empirical publications in the field of frugal innovation, analyzing when and how FI is connected with social, environmental and economic outcomes.


Quantitative content analysis on empirical papers published on frugal innovation, using data visualization techniques to disclose relationships among the constructs adopted. Materials were collected following a step-wise methodology. In total, 130 articles were identified, read in depth and coded according to five main categories: context; development; implementation, adoption, diffusion; characteristics; and impacts.

The potential of frugal innovation to drive sustainability outcomes is influenced by the type of actors developing the innovation, regarding their organizational form (large firms, small firms, non-firm actors), their geographical origin (foreign or local) or motivations (mostly profit-motivated or socially-oriented). Collaboration plays a key role along the various stages of the frugal innovation cycle and is thus relevant for its potential to drive sustainability outcomes. The results reaffirm the need for greater attention to where and when sustainability-enhancing outcomes of frugal innovation are more likely to occur.


This study provides a qualitative study based on content analysis of empirical studies to explore the associations between frugal innovations and improved economic, environmental and social sustainability outcomes. The key novelty of this study lies in the systematic coding of each paper regarding the features of the innovation, the innovators, and the outcomes achieved. This allows taking stock of the evidence emerging in such a scattered literature, quantifying the extent to which insights take place in the empirical literature, looking for correlations, and highlight research gaps to understand to what extent frugal innovation can contribute to sustainable development.

  • Frugal innovation
  • Sustainability
  • Literature review
  • Base of the pyramid
  • Environmental otucome
  • Social outcome

De Marchi, V. , Pineda-Escobar, M.A. , Howell, R. , Verheij, M. and Knorringa, P. (2022), "Frugal innovation and sustainability outcomes: findings from a systematic literature review", European Journal of Innovation Management , Vol. 25 No. 6, pp. 984-1007.

Emerald Publishing Limited

Copyright © 2022, Valentina De Marchi, Maria A. Pineda-Escobar, Rachel Howell, Michelle Verheij and Peter Knorringa

Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at


Can innovation drive sustainable development? While innovation tends to be conceived as a positive concept, there is clear evidence that innovations might also have (unintended) consequences that may lead to potentially harmful impacts on society and the environment ( Biggi and Giuliani, 2021 ; Coad et al. , 2021 ). Innovations tend to both create new opportunities for growth and development, as well as disrupt existing practices and can lead, at least initially, to new or deeper inequalities. For example, a recent special issue by Coad et al. (2021) addresses ‘the dark side of innovation’, discussing different types of harm from innovation, like public health risks, and environmental degradation. Taking impacts on the environment as an example, there is clear evidence that while innovations reducing material use per unit of outputs or minimizing emissions on air are becoming more frequent, yet they still represent a minority of innovations. The most recent data on innovation activities at the European level reports that only 38% of innovative firms have introduced at least one innovation that effectively reduced their impacts on the environment [1] . Furthermore, positive and negative impacts on the environment might co-exist. The case of solar panels described by Hansen et al. (2021) is a clear case in point: while the possibility to rely on renewable energies is a clear advantage, the end-of-life disposal of solar panels is a great source of concern, especially in the context of developing countries ( Cross and Murray, 2018 ; Xu et al. , 2018 ). Given this growing importance of sustainability for innovation, the study of sustainable innovation has emerged as a hot field of research, trying to understand how innovation activities and sustainability can be reconciled ( Cillo et al. , 2019 ).

Frugal innovation (FI) is one of the categories of innovations that have been considered as inherently contributing to achieving sustainable development. Frugal, grass-root or bottom of the pyramid innovation is an increasingly relevant and debated topic for scholars, practitioners and policy makers ( Agarwal et al. , 2017 ; Hossain, 2016 ). They are “cheap, tough, easy to use and developed with minimal amounts of raw materials” ( Economist, 2009 ; Rao, 2013 ) that are targeting the Bottom of the pyramid (BoP) markets, developing products or services fit for resource-constrained environments. Given that frugal innovations are seen as lower cost, less resource intensive solutions targeted at resource-constraint settings, the negative side-effects of innovation are expected to be less or counterbalanced ( Albert, 2019 ), due to their focus on core functionalities, user-oriented design, lower resource intensity, and overall cost minimization. The positive dynamics might be even larger than for conventional innovations, as frugal innovations are also often expected to create new market opportunities in previously ‘underserved’ markets. However, a review on 60 frugal innovations ( Rosca et al. , 2017 ) stated that frugal innovations ‘do not have an inherent sustainability impact’ and very little is known as yet about the actual sustainability outcomes of frugal innovations ( Hossain, 2017 ; Knorringa et al. , 2016 ; Levänen and Lindeman, 2016 ; Rosca et al. , 2017 ). What are the key features of FI that are connected with higher sustainability outcomes? Which factors, related to the innovation or the context in which it has been developed are connected with higher social, environmental, or economic results? When and under what circumstances sustainability outcomes are more likely to arise as a consequence of the implementation of frugal innovations? This is a major research gap, making it difficult for policy makers to identify in advance which kind of frugal innovations they may wish to support. Therefore, improving our understanding of when specific types of frugal innovations are more likely to lead to particular sustainability outcomes would offer a major step forward.

Against this background, the paper advances the state-of-the-art providing a deep analysis of how FI links to sustainability outcomes presenting findings from a quantitative content analysis based on the in-depth reading of empirical case studies published in the academic literature, which allows evaluating associations among the key variables at stake. Several FI literature reviews exist; however, they have mostly performed a bibliometric analysis of the literature ( Agarwal et al. , 2017 ; Hossain, 2017 ) or adopted a non-systematic selection of papers and a narrative analysis of the evidence emerging ( Cunha et al. , 2014 ; Hossain, 2016 ; Pisoni et al. , 2018 ). On the contrary, our analysis is based on a systematic review of the literature which quantifies the extent to which frugal innovations actually lead to improved economic, environmental and social sustainability outcomes. Our co-occurrency analysis allows identifying which features of the FI are more likely to be connected to higher economic, social or environmental performances, considering for the type of actor developing the FI, the network of relationship activated to develop it, and the context in which the FI has been activated. Providing such an in-depth analysis, we offer a launching pad for more evidence-based follow up studies that analyze under which circumstances frugal innovations are more likely to contribute to sustainable development, and discuss avenues for future research.

The paper is organized as follows. First, the state of the art on frugal innovation and sustainable development is reviewed, taking a contingency approach that leads to two research propositions. Next, an explanation of the research design and methodology is given. After this, our findings are presented distinguishing the key features of frugal innovators, the role of collaborations, and the factors that drive sustainability outcomes. The final section offers a discussion of main findings, concluding remarks, and an indication of future research lines.

State of the art

Frugal innovation and sustainable development.

Frugal innovation represents a young and dynamic field of research with increased interest among scholars, practitioners and policy makers. The origin of the FI concept in academic literature is not clearly identified ( Hossain, 2018a ). Some argue that it derives out of the frugal engineering concept ( Rao, 2013 ), while others affirm it has originated from India ( Chataway et al. , 2014 ), or has its antecedents in bricolage ( Baker and Nelson, 2005 ), and yet others have traced back its origins to Schumacher's idea of appropriate technology ( Schumacher, 1973 ), or in the philosophical and religious roots of the idea of frugality ( Albert, 2019 ). The first wave of studies on FI consisted of conceptual papers exploring how to define FI, illustrative cases studies, and studies that used illustrative cases to develop more grounded definitions. Initial definitions focused on the characteristics of the outcome of the innovation process: i.e. products characterized as combining low cost with high functionality and robustness ( Tiwari and Herstatt, 2012 ). Later definitions added a focus on how the innovation process takes place under resource-constraints and that products, services and systems need to be affordable for poor(er) consumers ( Zeschky et al. , 2014 , Radjou and Prabhu, 2015 ). The present state of the art has embraced a further broadening that looks at FI as an approach ( Prabhu and Jain, 2015 ) or a mindset ( Soni and Krishnan, 2014 ) and not merely as a specific type of innovation outcome or process ( Pisoni et al. , 2018 ). FI can be largely viewed as a novel innovation approach that aims to (re) design products, services, systems, and business models, providing reduced complexity, essential functionality and affordable solutions for underserved poor and new middle-class users ( Basu et al. , 2013 ; Rao, 2013 ; Rosca et al. , 2017 ). Given these features, FI has been generally perceived as a notion associated with the BoP context of emerging and developing countries ( Pisoni et al. , 2018 ; Weyrauch and Herstatt, 2016 ), where large groups of underserved communities have to face severe scarcity and resource constraint. However, the more recent FI literature includes authors that are also looking into the concept from the viewpoint of developed countries ( Brem, 2017 ; Hossain et al. , 2016 ), as pressures of resource scarcity and the need for a more frugal lifestyle are also increasingly present in these advanced economies. Works in this domain are mainly exploring the issue of reverse innovation, understood as innovations that emerge in a developing market context and are then taken into developed economies ( Zeschky et al. , 2014 ); or are looking into the particularities of serving BoP populations in the developed economies ( Angot and Plé, 2015 ).

As a concept, FI overlaps with and is frequently used interchangeably with various other terms ( Hossain, 2017 ; Pansera and Sarkar, 2016 ). In fact, several studies, such as the works by Brem and Wolfram (2014) , Zeschky et al. (2014) or Rosca et al. (2017) , have explored and outlined the overlays among the various innovation concepts that have a relation with resource constraint and scarcity. Overlapping terms include disruptive innovation ( Hart and Christensen, 2002 ), Jugaad innovation ( Radjou et al. , 2012 ), pro-poor innovation ( Berdegué, 2005 ), BoP innovation ( Prahalad, 2012 ), resource-constrained innovation ( Ray and Ray, 2010 ), below-the-radar innovation ( Kaplinsky, 2011a ), and inclusive innovation ( Chataway et al. , 2014 ). As argued by Hossain (2018a) , most of the characteristics of the overlapping concepts are indeed found in FI, having a common ground around the development of no-frills, low-cost but good products, services, systems, and business models for low-income population ( Hossain, 2017 ).

A large part of the extant literature has focused on the search for the ‘best’ and most comprehensive definition of such a heterogeneous group of products, services, new processes or business models. A subgroup of these works has turned attention to the existence of a frugality – sustainability link yet paying very little attention to measuring the actual social, economic and environmental outcomes of such innovations. As documented by Albert (2019) , the understanding of sustainability frequently used by FI scholars is based on three key references: the definition of sustainable development given by the World Commission on Environment and Development (1987) , the triple bottom line approach proposed by Elkington (1997) , and the UN Sustainable Development Goals, SDG, United Nations (2015) . In this context, we could distinguish between a more descriptive/empirical stream in the literature (e.g. Rosca et al. , 2017 ; Albert, 2019 ; Shibin et al. , 2018 ) and a more normative approach to FI ( Le Bas, 2016 ; Basu et al. , 2013 ; Brem and Ivens, 2013 ). The normative approach takes enhanced sustainability outcomes as a causal consequence of how frugal innovations are defined, while for the descriptive approach it is an empirical question under which conditions frugal innovations are more likely to contribute to specific sustainability concerns. Sustainability has been considered as inherent to FI due to its accessibility, simplicity and affordability features, hence being proposed as a solution for responding to the sustainability challenges of lower income communities ( Levänen et al. , 2016 ). Authors such as Basu et al. (2013) have argued that FI may steadily drive progress in achieving sustainable solutions and, if scaled, can “contribute to a more sustainable world by aiding the efforts to end global poverty, world hunger, and social injustice, and to protecting the capacity of the planet to support our own and other species.” (p 66). Particularly in the environmental dimension, it is claimed that frugal innovations may contribute to the adequate management of natural non-renewable resources by promoting energy and material savings which, tied up to reduced technological complexity, may enable green properties such as recycling or reparability ( Le Bas, 2016 ). Similarly, Hassani et al. (2019) argue that environmental sustainability is an implicit FI criterion that is unintentionally considered throughout the design process, and thus indicate that the products of FI can also qualify as sustainable, as compared to other innovations. Brem and Wolfram (2014) , categorize FI as having environmental effort as an important attribute, but consider it has little or no social sustainability. This contradicts with the general trend found in FI literature, which tends to see a more direct link with the social dimension of sustainability. However, the normative cases often ascribe environmental and social outcomes without actually measuring them ( Albert, 2019 ). At this stage in the debate, all statements on outcomes and impacts are based on self-reporting by interviewed respondents. We aim to push the debate forward by explicitly distinguishing between economic, social and environmental outcomes and by considering the contingency that might support achieving such results.

Our in-depth analysis of the literature finds cases pointing to the emergence of positive and negative socio environmental outcomes of frugal innovations. Studying four renewable energy cases in rural Kenya, Karjalainen and Heinonen (2018) note positive environmental outcomes in aspects like energy efficiency and reduction of emissions. However, they also point out mixed social outcomes after the innovation adoption due to aspects like creating local employment, not reaching the poorest of the poor, and clashing with the lifestyle of nomadic groups. Similarly, Levänen et al. (2016) analyze four frugal innovations from energy and water sectors, finding positive environmental results in terms of energy production and water purification, while noting a larger spectrum of results in terms of social sustainability, depending on the type of actors involved and the business models used for the adoption and implementation of the innovation. In contrast, the case study evidence presented by Dressler and Bucher (2018) suggests that the most distinctive contribution to sustainability is in the social dimension, noting that such a contribution is not always of the same kind, as social impacts have an important context specificity. Other works refer negative health and environmental effects of end products like sachets and cooking stoves, due to inadequate ventilation to reduce smoke, increased consumption, or greater waste generation ( Hossain, 2018b ; Singh et al. , 2012 ). These dissimilar findings further problematize the issue, and confirm the need exposed by Hyvärinen et al. (2016) , who urge for deeper studies of the entire cycle of FI processes, and to better understand under which circumstances positive sustainability outcomes are more likely to occur.

A contingency approach to the understanding of FI potential for sustainable development

While there is not a quantitative evidence of what are the features of the FI process which are more likely to be associated to higher sustainability performances, there is a consensus in the literature that some features of the FI process are likely to play a role, in particular the type of innovators and their motivations. In their review of the FI literature that explicitly addressed sustainable development, Rosca et al. (2018) suggest that important differences emerge in terms of outcomes, depending on the type of actors that have been developing the innovation – i.e. multinational enterprises (MNC) or small and medium sized firms (SMEs). This argument goes in line with previous work stressing the existing differences in the contributions towards sustainability depending on company size, recognizing that large and small firms often have a distinct role to play ( Hockerts and Wüstenhagen, 2010 ; Hörisch et al. , 2015 ). Zooming in on actors is important as they may have distinct motivations, logics and ways of acting to develop frugal innovations, which may influence the input, processes and outputs of innovation and may impact upon how these innovations are likely to contribute to for example sustainability. The few case study evidence that currently exists (e.g. Levänen et al. , 2016 ) suggests that sustainability outcomes can be different in case different actors are engaged in developing the FI.

Although extant literature is limited in its understanding of the type of actors engaged in FI, various types of frugal innovators might be identified, including firm and non-firm actors ( Hossain, 2018a ; Knorringa and Bhaduri, 2018 ; Pisoni et al. , 2018 ). Firm actors can be distinguished by their size. First, frugal innovations produced by large multinational corporations MNC's seeking to capture the rapidly growing global market segment of ‘relatively poor and new middle class’ consumers at locations all over the world. The firms that drive these FI processes have often a for-profit motivation, which can be combined with various levels of awareness and action in terms of their social and environmental responsibilities. For these firms, frugal innovations are a means of enhancing competitiveness and developing new business models for longer-term company growth. Common examples of frugal innovations by MNC that are repeatedly cited in current literature include General Electric's Mac 400 hand-held electrocardiogram – first popularized by The Economist (2010) - and GE's portable ultrasound device; Tata's water filter Swach, and Tata's Nano car; Nokia's low-end mobile handsets; or Siemens Computed Tomography Scanner ( Brem, 2017 ; Leliveld and Knorringa, 2018 ; Rao, 2013 ; Zeschky et al. , 2011 ). Second, small firms, startups and social enterprises with varied levels of engagement with major societal and environmental challenges. These enterprises develop innovations that are considered frugal, with simple no frills-designs, effective use of technology, and adequate functionality, all with and affordable price. SavvyLoo waterless toilet system, 5 Star Stoves biomass-based stoves franchise model, Moladi affordable housing solutions, and Selco solar energy system are examples in this category ( Dressler and Bucher, 2018 ; Levänen and Lindeman, 2016 ). Finally, non-firm actors can include NGOs, local associations or communities . Frugal innovations developed and implemented by NGOs and other non-profit organizations tend to have a more philanthropic and donor-based approach as opposed to social enterprises that exhibit a hybrid model of operation using market forces to enable their social goals. FIs developed by communities or individuals to solve their own bottlenecks are often labeled as bottom-up frugal innovations, grassroots innovations, informal sector innovations ( Bhaduri and Talat, 2020 ), or what Chataway et al. (2014) refer to as innovation from below. Non-firm frugal innovations are usually developed without a commercial or scaling objective in mind. Cases found in current literature that illustrate this third group include Arunachalam Muruganantham's low-cost machine to make sanitary pads, Zeta's Mitticool refrigerator, or no-frills simple machines to automatize walnut and cotton deshelling created by farmers in rural India ( Pansera and Sarkar, 2016 ; Sarkar, 2018 ).

The potential of FI to drive sustainable development outcomes depends on the type of actors that co-develop and implement the FI.

The potential of FI to drive sustainable development outcomes depends on the collaborations enacted to support its development and implementation.


In order to get a better understanding under what circumstances FI enables positive social, economic and environmental outcomes, we perform a quantitative content analysis on the empirical papers published on FI. Particularly, starting by a systematic scanning of all empirical papers on FI, we have performed an in-depth analysis of the evidence reported, comparing all cases across the same dimensions to identify common paths. Most of the literature on FI took a case study approach, or a survey one. While those methods allow a more fine-grained analysis, they do not allow generalization, which is instead one of the key advantages of basing the analysis on a large number of cases via content analysis. Furthermore, with respect to narrative review, content analysis can provide more accurate estimates and have a stronger ability to validate the emerging findings ( Hunter and Schmidt, 2004 ; Stanley et al. , 2008 ). Indeed, content analysis can ‘combine the qualitative approach retaining rich meaning with powerful quantitative analyses’ ( Seuring and Gold, 2012 ). In this way, content analysis serves the same goal of meta-analysis. Content analysis can be used to compare qualitative features across studies, by coding qualitative evidence into numerical values, as we did in this study. To identify relevant papers, we adopted a systematic literature review approach ( Denyer and Tranfield, 2009 ; Khan et al. , 2003 ), which allows for the analysis to be consistent, replicable and credible, given it adopts standardized methodologies and guidelines in the searching, filtering, reviewing, critiquing, interpreting, summarizing and reporting of findings from multiples publications. Furthermore, following the suggestions by Ertug et al. (2018) we are using data visualization techniques to disclose the relationships among the constructs adopted, aiming at adopting an informative way to report the rich data collected.

Several literature reviews have been performed so far on FI ( Agarwal et al. , 2017 ; Hossain, 2016 , 2017 ; Pisoni et al. , 2018 ), also specifically addressing the link with sustainable development goals ( Albert, 2019 ; Rosca et al. , 2018 ). The key novelty of this study lies in the systematic coding of each paper regarding the features of the innovation, the innovators, and the outcomes achieved, that allows to take stock of the evidence emerging in such a wide and scattered literature, quantify to what extent the insights they are referring to are taking place in the empirical literature and to look for correlations. Indeed, our in-depth reading and scoring of key variables on the existing empirical cases also allows us to study co-occurrences or coherence between key variables in our database.

Search method and selection procedure

A step-wise methodology has been adopted to collect materials, following the PRISMA method ( Liberati et al. , 2009 ). Such a selection allows for being both selective, by including only high-quality contributions, and broad, by considering sources focused on different fields and based in different geographical contexts.

Our literature comprises English-written peer-reviewed articles, published until 2018 in Scopus. In order to identify the papers that are relevant regarding the scope of this analysis, a comprehensive list of keywords has been adopted, developed based on the existing literature reviews. Papers considered in the identification phases include in the title, abstract or key terms at least one among the following keywords: “Indigenous Innovation”, “Frugal Innovation”, “Frugal Engineering”, “Grassroot Innovation”, “Inclusive Innovation”, “Reverse Innovation”, “Low Cost Innovation”, “Innovation for Inclusive”, “Pro Poor Innovation”, “Catalytic Innovation”, “Resource Constrained Innovation”, “Trickle-Up Innovation.” Additionally, the following keywords have been searched for, in combination with the keyword innovation: “base of the pyramid” and “Jugaad”. In total, 726 articles have been identified, who responded to these features. Subsequently, additional steps were needed to ensure that the identified papers were appropriate to the purpose of this article (screening). Two researchers in the team read all the abstracts in order to exclude papers that clearly did not report on two eligibility criteria: i) being focused on frugal innovation ii) being an empirical paper (accordingly, we excluded literature reviews or theoretical papers). Accordingly, 407 papers were excluded from the analysis. Following, the 297 contributions that passed the screening stage were read in full-length; to make sure they were indeed fit for the analysis, based on the two eligibility criteria reported above. In case the full text was not available, articles were excluded from the analysis. This stage drove the exclusion of 167 articles, so that the final universe considered is composed by 130 articles. Figure 1 summarizes the process of paper identification and selection.

Material evaluation

The 130 articles identified were read in depth and coded to enable to perform associations among the variables considered in the content-analysis. Five main categories have been considered: i) FI context; ii) FI development; iii) FI implementation, adoption, diffusion; iv) FI characteristics; v) FI impacts. The full list of variables and the way they have been captured is reported in Table 1 . A theoretically based categorization scheme with predefined categories, each defined clearly, was created based on intensive discussions within the research team. In order to ensure reliability and replicability of the coding, researchers in the team read the same paper – in case of differences in the coding a discussion was taken with the entire team to ensure finding a common view on the issue, to be applied also in other papers. While not fully avoiding subjectivity – this effort was aimed at ensuring an ‘alignment of interpretation’ ( Seuring and Gold, 2012 ), so to ensure consistency in the generation of our data set [2] .

Unit of analysis of the data collected are the single cases described in the paper; given often papers addressed more than one cases we finally have data on FI 250 cases (described in 130 articles) [3] . In such an analysis, we collected data both on FI development and diffusion, acknowledging that innovation is a process consisting in different steps, each entailing different specificities, in line with Pisoni et al. (2018) and Zanello et al. (2016) .

Key features of frugal innovators and the role of collaborations

As reported in the first research proposition, we expect that the features of the FI developers influence the possibility for the innovation to produce sustainable development outcomes. Based on features of the developers identified in the literature (and presented in previous paragraphs), in our analysis we have recorded both the type of actors and its location, as reported in Table 2 . More in particular, we have considered both firms (distinguishing between small firms and large ones); and non–firms (including both NGOs, local associations or communities) or a combination of the two. Furthermore, we considered if the actors (being a firm or not) are based in the same country where the FI is further adopted (‘local’) or foreign, or a combination of the two (‘Mixed’).

In general, most of the innovations are developed by firms (in 34.3% of the cases being large firms, in 25.9% being small ones); non-firm actors (including NGOs, industry associations, research centers) have been the leading actors developing the innovation in 34.7% of the cases. In very few instances, firms and non-firm actors co-developed the FI (4.2%). As for where those actors are located, with respect to where the innovation is developed, in the majority of the cases (66.1%) they are indeed locals – having a deep understanding of the local needs, they are developing products or services that are tackling them. Interestingly, in 12.9% of the cases analyzed local and foreign actors are developing innovation together, coupling complementary resources and expertise. The prevalence of local actors is high particularly when it comes to non-firm actors, being 80.7% of the total cases, as emerges from Figure 2 [4] , which allows a deeper understanding of this analysis, by visually connecting developer types and their geography. The vast majority of small firms (91.9%) are local, and so is when it comes to non-firms actors (80.7%), whereas the situation is more mixed when it comes to large firms. Large firms represent indeed the 57.1% of the overall cases in which FI has being developed by a foreign entity; the 93.3% of the mixed cases (this is the case of subsidiaries of global multinationals).

Table 2 also allows disentangling for the major motivations to the development of the FI. 37.9% of the innovations analyzed are profit-motivated, i.e. driven by the interest to target an untapped market and profit from selling a targeted product or service; a similar share (40.6%) is instead socially-motivated, i.e. mostly driven by the need to alleviate poverty or improve well-being. Interestingly, an important share of innovation (21.5%) was developed to address both goals, hybridizing the social and the economic sphere, in line with the view of Battilana and Dorado (2010) , Battilana and Lee (2014) . A difference exists among the actors considered, in terms of what motivates their activities: as depicted in Figure 2 the majority of non-firm actors develop FI in order to asses social problems (77.1% of the cases for which information on the motivation was reported). Indeed the majority of socially motivated FI that are purely developed by non-firm actors. The contrary holds true for firms, especially foreign ones, which are rather profit oriented (57.3% vs the 45.2% of smaller firms).

Another key factor that we are zooming on, in order to better understand the potential of FI for sustainable development, is the type of collaborations that were activated by innovators in order to develop the new product, process or service. Considering the high diversity in our sample, including different types of innovations and spanning very different industries and markets, we have been measuring if the innovators have been developed with any other relevant actor: other firms, universities, NGOs or other. Given that those different actors are entailing quite a diverse knowledge base and expertise, however, we have also measured if the collaboration activated could be defined as cross-partner, i.e. if it is engaging, for example, a firm and a NGO, or a NGO and a university. We performed this analysis distinguishing between different stages of the innovation process, i.e. development and adoption. For an improved understanding of the various ways in which FI and sustainable development are related, we need to give careful consideration to the entire innovation cycle, because even if sustainable practices can be identified during the development or adoption stage of FI, it does not directly imply that its implementation will lead to improved sustainability outcomes, as also noted by Halme et al. (2020) . In the research and development stage, when developing the innovations, frugal innovators might need complementary resources on the local market and its peculiar needs or on how to technically develop it. Once the innovation has been developed, however, and especially when it has been developed in a different country than the one in which it will be adopted, innovators might need to access complementary resources and capabilities to have it accepted or distributed in the local context.

Such an expectation is supported by our analysis, as reported in Table 3 . Indeed, having relevant collaboration with other partners – being other firms, institutions or with local communities – is particularly relevant for the development of FI (it was reported in 83.6% of the cases) and to a lower, yet still quite significant level for FI adoption (78.1%). Interestingly, when it comes to the adoption stage, however, such collaborations are more likely to involve different partners; cross-partner collaborations are occurring in 89.3% of the cases, vs the 50.5% of the cases for FI development.

The sustainability outcomes of FI

As noted earlier in the state of the art section, the more normative stream in the literature ( Le Bas, 2016 ; Basu et al. , 2013 ; Brem and Ivens, 2013 ) takes for granted that FI has important sustainability outcomes, as a causal consequence of how frugal innovations are defined. However, more recent descriptive/empirical literature is rather challenging this view ( Albert, 2019 ; Rosca et al. , 2018 ). Table 4 reports on the number of cases that explicitly focus on outcomes, considering for different aspects: i) which type of outcome is reported – among economic, social and environmental; ii) how many, of these three aspects, are considered – distinguishing among cases for which just economic outcomes are reported vs. cases in which just non-economic outcomes are reported vs both. Of the 68% of papers, which explicitly mentioned outcomes of FI, the majority bespoke of economic outcomes (75.3%) such as a significant cost reduction in the access to products or services from a customer perspective ( Bhattacharyya et al. , 2017 ) or the profitability, growth and scalability of business ( Angeli and Jaiswal, 2016 ; Annala et al. , 2018 ; Gebauer et al. , 2017 ). 68.2% reported social outcomes, such as improved health conditions ( Angeli and Jaiswal, 2016 ; Firoz et al. , 2017 ) or local engagement, increased local empowerment and trust ( Goyal et al. , 2017 ; Heuër, 2017 ). Less explored is the relationship between FI and the reduction of environmental problems (32.4%) in line with the results by Albert (2019) . The majority of outcomes reported in the studies were positive, but negative reports are also found, such as discussing the negative environmental/social effects of using materials such as bamboo, mud and un-burnt bricks for low-income housing, which include lack of basic sanitation facilities, inadequate ventilation and higher vulnerability to natural hazards ( Singh et al. , 2012 ). One fourth of the cases report only on economic outcomes related to FI introduction (i.e. increased turnover, export, …) and a similar percentage reports just on non-economic aspects, i.e. on social, environmental or both. By far the largest group (50%), reports on a combination of the two (e.g. economic and social; or economic and environmental, or all three). This combined reporting can be seen in cases like the experience of a yoghurt production in Argentina that uses biotechnologies for inclusive development, as documented by Bortza and Thomas (2017) . The authors report the case as a highly functional innovation process that engaged and empowered the local community, increased local producer's income, and resolved a societal problem by tackling child malnutrition led diseases. The work on Husk Power Systems by Gupta (2013) also exemplifies the reporting on all three aspects. Authors mention profitability, new market entrance and growth, cleaner energy and reduced CO2 emissions as compared to the existing market alternative and increased rural employment and local income. Landrum (2011) discusses negative unintended consequences or outcomes of BoP strategies on all three dimensions, which include deteriorated economic conditions, rise in e-waste under existing hazardous recycling conditions, and loss of social capital.

Which FI factors connect with sustainability outcomes?

One of the key benefits of the quantitative approach to content-analysis, which we have adopted to analyze the empirical FI cases, lies in the possibility to not only count the instances but also to verify to what extent they are related. To this purpose, as illustrated in Figure 3 , we are proposing a bivariate analysis, to see to what extent cases on which two or three sustainability related outcomes are reported vs. cases on which just one outcome is reported [5] , which is used to test our propositions 1 and 2. In Table 5 , we report the statistics analyzed, classifying the cases according to the type of outcomes reported. A chi-square test is then performed, to assess the significance of the difference emerging. Accordingly, elements for which a statistically significant difference is reported testify of a correlation between each considered variable (type and origin of development, major motivations, presence of collaborations and cross-partner collaborations in development and adoption) and the introduction of a FI having a multi-dimensional outcome in terms of sustainable development, i.e. not driving just economic outcomes but also social and/or environmental outcomes, or vice versa.

The emerging analysis suggests that indeed considering the type of actors developing the FI is very important to understand the type of outcome we might expect that innovation to deliver, supporting proposition 1. In particular, Table 5 suggest that FI for which are reported only economic, only non-economic or both type of outcomes differs in a statistically significant manner in terms of the type of FI developers, their location with respect to the local market and their motivations. In fact, results clearly suggest that when the key developer are large firms, FI are reported to drives only economic results (50%) or eventually both economic and social or environmental ones (46.2%). The contrary holds in case of non-firm developers. Interestingly, small firms represent a mid-ground result, in which in the majority of cases it is reported on both economic and non-economic results (51.2% of cases) but there are also quite a good number of cases in which there is not mention to non-economic ones (29.3%).

The analysis of the geographical origin of developers reveals that a mixed outcome is the dominant outcome for both local (52.9%) and foreign (50%) actors, with a secondary prevalence of only economic outcomes for foreign developers (30.8%) and only non-economic outcomes for local developers (29.4%) Intriguingly, when local and foreign actors develop innovations together, economic outcomes are dominating (68.4%), with the absence of only non-economic outcomes. As a result, only 31.6% of FI of mixed origin have some non-economic outcome. Considering the motivations of developers shows that, if most of the cases attain their main purpose, in more than half of the cases there are positive side effects both for profit-motivated developers having some non-economic outcomes (56%) and for social-oriented ones having some economic outcome (55.5%).

Results support the expectations on the importance of collaborations, yet with interesting differences across collaborations for development vs. implementation. The three types of outcomes considered differ significantly in terms of likelihood to have been developed in collaboration with external partners, with the two outcomes including non-economic results being the most similar; however, they do not when it comes to collaboration for adoption or diffusion. Having relevant collaboration with external actors during the development stage seems to be particularly relevant in order to introduce FI having some non-economic outcome: 94.9% of FI with only non-economic outcome and 94.2% of those with mixed outcomes were developed through some major collaboration (vs the 68.8% of the case reporting just on economic outcome). The same is true for cross-partner collaborations: 78.9% of FI with only non-economic outcomes were produced through cross-partner collaborations vs the 21.9% of those with economic outcome. These results might be interpreted in light of the evidence spanning from the innovation literature on environmental innovation. Being more complex, such innovations require a diverse set of competences to be developed, so that the collaboration with external partners (firms, universities, knowledge intensive business services) is more likely to take place than for the development of other innovations ( Cainelli et al. , 2015 ; De Marchi, 2012 ). This is however not the case when we study collaboration for the adoption/diffusion stage. Collaboration with other partners (i.e. with local community leaders or NGOs) is quite diffused, especially when it comes to cross-partner collaboration, yet no significant differences emerge if we compare the cases with only economic, only non-economic or mixed results.

Discussion and conclusions

Although FI has sometimes been considered to inherently contribute to sustainable development, our point of departure has been that this needs to be empirically investigated, to better understand when and under what conditions positive contributions to sustainability outcomes are more likely to arise following the implementation of FI. This is a major research gap in current literature so improving our understanding of when specific types of FIs are more likely to lead to particular sustainability outcomes would offer a major step forward. We have advanced the state-of-the-art providing a deep analysis of how FI links to sustainability outcomes presenting findings from a content analysis of empirical cases in the academic literature, which allowed to identify associations among key features of the FIs, the actors developing them, and the sustainability outcomes related to the introduction of FIs.

First, our analysis confirms that social and environmental outcomes should not be taken for granted in FI, confirming the insights by Rosca et al. (2017) . While we have found very few instances in our literature review in which negative outcomes have been reported, it is true that in a good number of cases either economic or non-economic outcomes where the only ones reported. More of interest to this analysis, however, was under what conditions we might expect sustainable improvements, both economic and non-economic, to take place thanks to the development or adoption of FI.

Our findings indicate that the potential of FI to drive sustainable development outcomes is influenced by the type of actors developing the FI, defined in terms of their organizational form, their geographical origin or motivations. The majority of non-firm actors, both local or foreign, appear to have solving a social problem as their chief motivation for developing the FI; firms, particularly foreign ones, are rather primarily profit motivated, driven by an interest in an untapped market. While these findings do not come as a complete surprise and are in line with what has repeatedly been noted in management and development studies literature (e.g. Karnani, 2007 ; Nakata and Weidner, 2012 ), it is interesting that about one fifth of all frugal innovations show a hybrid motivation, being developed for addressing both social and economic goals. Moreover, our analysis also shows that securing only economic outcomes is more likely to occur with frugal innovations developed by foreign actors, while the likelihood of finding only non-economic outcomes is greater with local developers.

Another interesting finding emerging from our analysis regards the relevance for the innovation to be embedded in the local context. In the majority of the cases the frugal innovations have been developed by local actors – having unique knowledge of the local circumstances and needs. Overall, the prevalence of local actors is more marked within non-firm actors, whereas firms tend to be more balanced in their local and foreign representation. Furthermore, our study suggests that a connection exists between whether the developer is local or foreign, and its main motivation to introduce a FI. Profit-motivated frugal innovations are more likely to have been jointly developed by local and foreign actors, as opposed to socially oriented, which tend to be conducted by local developers.

Our results also show that collaboration plays a key role along the various stages of the FI cycle, from its development to adoption or diffusion, and would thus be relevant for its potential to drive sustainable development outcomes. Our analysis confirms that the majority of frugal innovations are not developed and implemented by one (type of) actor in isolation, in line with the literature suggesting the importance of an ‘open innovation’ and collaborative approach to the development of innovations having a social or environmental outcome ( Austin and Seitanidi, 2012 ; Cainelli et al. , 2015 ; Ghisetti et al. , 2015 ). Quite the contrary, intensive collaboration between different kinds of actors in the innovation cycle appears to be a key characteristic of FI. We find that collaboration with other actors is significant, and particularly relevant at the development stage, but it is not significantly more likely to drive sustainable development (i.e. to achieve both economic and social or environmental results) when it regards the adoption stage. Although the prevalence of collaboration and polycentric innovation in FI has been referred before ( Leliveld and Knorringa, 2018 ) it is still an issue that has not received the attention it deserves. Particularly, the role of cross-actor collaboration should be taken into consideration for understanding how and under which circumstances FI may contribute to sustainable development. Our findings suggest that a great majority of frugal innovations that report having economic and non-economic outcomes were developed with some form of collaboration taking place. Similarly, frugal innovations producing both economic and non-economic outcomes have most likely experienced a form of cross-partner collaboration during their adoption, with one actor identifiable as key driver and others supporting the process of adoption in multiple ways. More empirical evidence is needed, however, to critically study how the complementarities in resources/capabilities of these various types of actors might influence the sustainability of frugal innovations, taking stock of the potential conflicts arising, and assessing the role played by each actor in these collaborations and the costs and benefits of each, in line with the evidence emerging from studies focusing, for example, on environmental innovations ( Melander, 2018 ; Niesten and Jolink, 2020 ; Watson et al. , 2018 ).

All in all, we contribute to the FI literature by reaffirming the need for greater empirical attention to where and when sustainability-enhancing outcomes of FI are more likely to occur. Our results show that nearly one third of cases in current FI literature do not provide an explicit reference to the outcomes of the innovation, let alone make an attempt to actually measure these outcomes. It is also important to note that those that do report, are often based on self-reporting by research participants and tend to describe economic and/or social outcomes, with lesser consideration of environmental aspects. A more careful empirical and evidence-based approach to the measurement of the sustainability outcomes of FI will be beneficial for a better understanding of the societal relevance of FI. Finally, to strengthen the credibility of FI and arrive at more nuanced and evidence-based claims on its sustainability outcomes, it will be crucial to move beyond self-reporting and to add independent third-party evaluations, especially on the outcomes on poorer households. A useful next step would be to build upon the Monitoring and Evaluation protocol by the Donor Committee for Enterprise Development (DCED), which measures systemic change in private sector development programmes. The DCED standard uses three criteria: sustainability of the intervention or innovation, its scalability, and its resilience ( Kessler, 2021 ). On top of that, Posthumus et al. (2020) add a so-called ‘helicopter lens’ to assess responses or changes in the broader system as a consequence of the implementation of innovations. Moreover, Vellema et al. (2022) offer additional tools to qualitatively explore, through action research, the terms of inclusion of actors in their respective value chains, and the terms of access for consumers of the innovation that looks at factors like affordability, availability and appropriateness, making this a highly relevant framework for changes that result from frugal innovations.

By implementing a content analysis approach, we contribute to the FI literature by systematically coding each paper regarding the features of the innovation, the innovators, and the outcomes achieved. By adopting a more objective way of taking stock of current FI literature, we offered a first attempt to quantify the extent to which frugal innovations actually lead to improved economic, environmental and social sustainability outcomes. We also contribute to the FI literature by reaffirming the need for greater attention to where and when sustainability-enhancing outcomes of FI are more likely to occur. We hope our analysis will push the debate forward and motivate a next generation of FI research to provide evidence-based findings on its sustainability outcomes that can assist managerial teams and policy makers in determining which types of FI to support, depending on what outcomes they would like to see. We identify three main areas for follow up studies to understand under which circumstances FI is more likely to contribute to sustainable development, considering all its dimensions. First, a clear exploration of the distinctions (in motives and innovation processes) existing between types of frugal innovators, and the corresponding effect that said differences can have in terms of economic, social and environmental outcomes of their innovations. Second, given the importance that collaborations have for FI, research is needed to better understand the various patterns of (cross-actor) collaborations and polycentric innovation. In particular, a focus on agency is necessary to explore if and how local firm and non-firm actors are actually benefiting from their participation in these networks of collaboration. Also further empirical research can integrate the analysis of collaboration along the various stages of the FI cycle vis-vis sustainability outcomes, to better understand how and under which circumstances FI may contribute to sustainable development. Third, as extant knowledge about FI outcomes is scarce, evidence-based research is needed with a stronger focus on objective measurements of the outcomes of FI.

frugal innovation case study

Paper selection process according to the PRISMA method

frugal innovation case study

Investigating motivations considering for the geography and type of developers

frugal innovation case study

Investigating the outcome considering for the type of developers and their motivations

Variables analyzed in the content analysis

Collaboration in the development and adoption or diffusion of FI

Outcomes of frugal innovations

Multivariate analysis, comparing distribution of firms across type of outcome

Note(s) : *** Significant at the 1% level. * Significant at the 10% level. Percentages calculated on the valid observations

Own elaboration, based on Community Innovation Survey (CIS) data referring to the period 2014–2016. CIS is a comprehensive survey on the innovative activities of EU firms, which is widely adopted in Innovation studies. Information on green innovation have been collected for 14 European countries (Bulgaria, the Czech Republic, Germany, Estonia, Greece, Spain, Croatia, Cyprus, Latvia, Lithuania, Portugal, Romania, Slovakia, and Norway), for a total of almost 40,000 firms representative of the underlying universe. For more information see, for example ( Cainelli et al ., 2015 ; Ghisetti et al ., 2015 ),

Part of the subjectivity in the analysis is related with the coding of the variables where intensity is involved (e.g. in terms of collaboration for development or implementation, or on the features of innovations). In those cases, expertise of the scholar has been essential to code such elements, based on the descriptions provided in the text.

Please note that we do not have all the information for all cases; for each analysis we are indeed reporting the number of valid cases used for calculation.

Figures are visually summarizing the relationship between the three variables considered. Contingencies analysis have also been performed, considering for all the couples of variables but are not reported. Statistical significance has been calculate using the Chi2 test.

Please note that for this analysis we have focused just on the analysis of the cases in which all the outcomes reported are positive – excluding the small number of cases in which mixed results were reported. For reasons of numerosity of observations, we could not report this analysis disentangling among all the possible cases (e.g. only environmental, only social, …).

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The authors gratefully acknowledge funding from Leiden-Delft-Erasmus Universities for the International Centre for Frugal Innovation to finance this study and to Erasmus University Rotterdam for making it open access.

Corresponding author

About the authors.

Valentina De Marchi, PhD, is an Associate Professor in Business Management, University of Padova, Department of Economics and Management ‘Marco Fanno’, Italy. Her research focuses on environmental innovation and sustainability, Industrial districts and Global Value Chains. Her research has been published in journals such as Research Policy, Journal of Cleaner Production, Business Strategy & the Environment . She is president of the GRONEN community and part of the organizing team of Network O (Global Value Chains) at the SASE conference.

Maria A. Pineda-Escobar, is a Professor at the Faculty of Business, Management and Sustainability, Politecnico Grancolombiano University, Colombia, and PhD researcher with the International Institute of Social Studies (ISS) of Erasmus University Rotterdam. Her research focuses on frugal innovation and sustainability, inclusive businesses, social entrepreneurship, and business sustainability in emerging markets. She has been visiting scholar with universities in Czech Republic, Canada, Germany and South Africa and is a Fulbright research visiting scholar awardee (Frugal Innovation Hub, Santa Clara University). A pracademic, building bridges between academia and practice, she is senior consultant with CECODES, the Colombian chapter of the WBCSD.

Rachel Howell works for Pharmaccess Foundation managing the development of digital platforms assisting healthcare facilities in improving quality of healthcare in sub-Saharan Africa. She holds a doctorate from Delft University of Technology, as part of the Leiden Delft Erasmus Centre for Frugal Innovations in Africa. Her PhD research focused on exploring the tension between value capture and value creation in frugal innovations with cases in water and energy. She has conducted quantitative research on off grid electrification and frugal innovation primarily in East Africa. Rachel's research interests are in impact evaluation, innovation management, development economics, and behavioral economics.

Michelle Verheij is a policy advisor at Erasmus University Rotterdam (EUR). She completed her master's in Public International Law at Leiden University in 2019, focusing on compliance matters within the current international climate change regime (the Paris Agreement in particular). After her studies she worked as a Communication and Project Officer at the Leiden-Delft-Erasmus Centre for Frugal Innovation in Africa (CFIA), before taking on her current role as policy advisor at the EUR central level.

Peter Knorringa is a Professor of Private Sector & Development at the International Institute of Social Studies (ISS) of Erasmus University Rotterdam. His research focuses on how entrepreneurs and firms in developing countries impact upon attempts to achieve more sustainable forms of development. He has worked on small and medium sized firms, entrepreneurship, local economic development, industrial clusters, role of trust and networking, global value chains, private governance and sustainability standards, and more recently on frugal innovations. He is one of the co-founders and the present Academic Director of the Leiden-Delft-Erasmus Centre on Frugal Innovation in Africa, based in the Netherlands.

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Frugal Innovation and Its Implementation pp 191–215 Cite as

Small Industrial Companies and Frugal Innovation: A Case Study in the State of Alagoas/Brazil

  • Francisco José Peixoto Rosário 3 &
  • Araken Alves de Lima 4  
  • First Online: 12 May 2021

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Part of the Contributions to Management Science book series (MANAGEMENT SC.)

The goal of this research is to show how the frugal innovation concept is perceived and run on product and process strategies in small industrial companies in the state of Alagoas, in the Northeastern Brazilian Region, the state with the least favored social indicators in the country. Frugal innovation shows itself as a new approach to technological solutions focused on solving local problems in emerging markets. Frugal innovation can be considered as a summarized concept encompassing other concepts related to low costs innovations in resource-scarce environments, according to Bhatti and Ventresca (2013), Brem and Wolfram (2014), and Hossain (2018). For this exploratory and cross-sectional research, data was collected in September 2018 through questionnaire application to 25 small industrial entrepreneurs from a selected universe of 80 entrepreneurs in the state of Alagoas. The data was made available for this research by the Federation of Industries of Alagoas (FIEA). Descriptive statistics and multidimensional scaling were used to capture the characteristics and perception of these entrepreneurs about: (a) target market; (b) product strategy; (c) the perception of the entrepreneur concerning their product. The main findings show that the companies surveyed do not perceive the low-income customer in the specific market in which they operate, considering that about 2/3 of the surveyed companies expressed that they supply the upper and middle classes market and that they do not have to be engaged in solving emerging problems of the lower-class market. From the perception map, a methodology called Enterprise Positioning Matrix was developed that shows qualified business standards and practices from the quadrants of the perception map. The matrix shows four general characteristics developed by the companies: technological software; technological differentiation; technological hardware; local adaptation. The contribution of this research to the knowledge field of frugal innovation is to enlighten why not all companies in the context of scarcity develop solutions oriented to the local market conditions. So, the contribution that comes up with this research can facilitate to emerge new methodologies and business-oriented solutions to develop and manage frugal innovation capabilities.

  • Emerging markets
  • Entrepreneur
  • Frugal innovation
  • Local market
  • Multidimensional scaling
  • Small industrial companies

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Attachment 1

Iteration history for the two-dimensional solutions (in squared distances)

Young’s S-stress formula 1 is used.

Iterations stopped because

S-stress improvement is less than .001000

Stress and squared correlation (RSQ) in distances

RSQ values are the proportion of variance of the scaled data (disparities) in the partition (row, matrix, or entire data) which is accounted for by their corresponding distances.

Stress values are Kruskal’s stress formula 1.

Stress = .19538 RSQ = .85002

Attachment 2

The questionnaire below was based on debates and discussions with Professor Christine Wimschneider of the Faculty of Business, Economics, and Law at the University of Erlangen-Nuremberg (FAU), in Germany, in one of her visits to Brazil in May 2018. At the time, a working group was defined that spin off the research present in this chapter.

The researchers who wrote this chapter are linked to the Graduate Program in Intellectual Property and Technology Transfer for Innovation (PROFNIT), in addition to being also linked to the Federal University of Alagoas (UFAL) and the National Institute of Industrial Property (INPI). To build the questionnaire, in addition to these institutions, researchers linked to the Santa Catarina Industry Federation (FIESC) and the Federal University of Santa Catarina (UFSC) participated in the effort to prepare the questionnaire.

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Rosário, F.J.P., de Lima, A.A. (2021). Small Industrial Companies and Frugal Innovation: A Case Study in the State of Alagoas/Brazil. In: Agarwal, N., Brem, A. (eds) Frugal Innovation and Its Implementation. Contributions to Management Science. Springer, Cham.

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Frugal innovation, where innovation changes more for less.

German, 15 and a student in Senior 1 at Groupe Scolaire Rususa, pauses to wash his hands using a tippy-tap before heading to the refectory for lunch.

“We can do things differently, and we can do different things… Innovation is not only the most sophisticated technologies, sometimes it’s the simplest of things.” United Nations Secretary-General, António Guterres

Preventing disease and promoting hand-washing through simple devices made with low-cost salvaged materials. Saving preterm lives through skin-to skin contact and cloth wrapping in places where incubators are rare.

These are just two examples of frugal innovation: developments that change the lives of children for the better without demanding the latest in cutting-edge technologies. Instead, frugal innovation is born out of necessity and a lack of resources, built by local people with the materials they have available.

The places in which UNICEF works demands frugal innovation, turning constraints into advantages and making the simplest of innovations into invaluable inventions and developments for the people who need them most.

What are frugal innovations?

Turning constraints into advantages

Helping frugal innovations flourish

How UNICEF contributes to frugal innovation

Frugal innovation: What we have learned

Six key insights on frugal innovation

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Frugal Innovation: Six Principles, a Case Study

Out this week is a new book from Navi Radjou and Jaideep Prabhu,  “Frugal Innovation: How to Do More with Less.”  It focuses on how companies can develop high-quality products on limited budgets to appeal not just to consumers in emerging markets, but to Western consumers who are increasingly cost-conscious and environmentally aware. The two co-authors also run the site Frugal Innovation Hub .

frugal innovation case study

They shared with InnoLead their six principles of frugal innovation, and an example from the book about how Kingfisher plc , the largest home improvement retailer in Europe, is working to move the needle on Principle #3, creating sustainable solutions.

The Six Principles of Frugal Innovation

1. Engage and iterate.  Rather than using insular research and development departments that rely on educated guesses about customer needs, E&I starts with customers, observing their behavior in their natural environment, and then considers how products can be made as relevant as possible, going back and forth between the customer and the lab to refine designs.

2. Flex your assets.  New tools (such as robotics and 3D printers) and new approaches (such as social manufacturing and continuous production) can help operations and supply chain managers “flex” their production, logistics, and service assets to satisfy demanding customers better and more cheaply.

3. Create sustainable solutions.  R&D and manufacturing managers can develop self-sustaining solutions that help both businesses and the environment, such as “cradle-to-cradle” (where components and materials are repeatedly recycled.)

4. Shape customer behaviour.  Companies can influence consumers into behaving differently (for example, driving less or more safely) and feeling richer while consuming less.

5. Co-create value with prosumers.  Consumers – especially the tech-savvy Millennial generation (those born between 1982 and 2004) – are evolving from passive individual users into communities of empowered “prosumers,” who collectively design, create and share the products and services they want. As a result, R&D and marketing leaders are working with do-it-yourself (DIY) and crowdsourcing pioneers, such as TechShop and Quirky, to bolster and harness the collective ingenuity and skills of consumer communities.

6. Make innovative friends.  You can develop frugal products, services and business models more efficiently by collaborating with diverse external partners (such as suppliers, universities, venture capitalists, and start-ups) than by working alone.

How Kingfisher Is Measuring Its Progress on Sustainability Goals

In 2012, UK-headquartered home-improvement retailer Kingfisher announced its goal to become “net positive” – that is, return more resources to the earth than it extracts and consumes – in response to forecasts of resource scarcity, social inequality, and climate change. (The company’s annual wood consumption is equivalent to a forest the size of Switzerland.) Its Net Positive plan has four priority areas – timber, energy, innovation and communities – and three related areas – employees, suppliers and the environment – for improvement. Kingfisher uses 50 KPIs, called the Foundations, to measure daily progress set against a 2012 baseline. Each KPI has a 2020 target and most must reach a 2015 milestone. Kingfisher tracks and reports progress every six months. According to Jamie Lawrence, senior sustainability adviser and in-house counsel to Kingfisher Group’s Net Positive strategy:

The company is transparent about both its achievements and its setbacks. Its 2013/14 Net Positive Report, for instance, revealed that while 87% of the timber used in its products is responsibly sourced (against a target of 100% in 2020), it currently sells only 170 products with closed-loop (most eco-friendly) credentials against an ambitious target of 1,000 products by 2020. Richard Gillies, the company’s sustainability director, admits that although Kingfisher is already generating £500 million ($790 million) in sales from its closed-loop products, the company is “still only scratching the surface of the commercial benefits that Net Positive can bring.” As former CEO Ian Cheshire, who led the company until late 2014, notes: “What we’ve learnt is that business ‘unusual’ isn’t easy.”

Kingfisher will tie its Net Positive KPIs to the earnings of its top 250 managers by 2016/17, and to all relevant employees by 2020.

Kingfisher’s Net Positive strategy provides other valuable lessons in how to disrupt an old business model. Its goal is to sell 1,000 products with closed-loop credentials by 2020. Closed-loop products are made mostly from recycled or renewable materials and consume only renewable energy during their manufacture and use. When they break or get old, materials and parts from these products can be collected to make new products.

But the company’s existing supply chains cannot cope with the aggressive closed-loop objectives. So it is building an entirely new supply chain and new supplier partnerships. Kingfisher’s Jamie Lawrence says:

To make this happen, Kingfisher is working with a coalition of the willing. For instance, it decided to use recycled plastics and pallet wood, which is usually thrown away after several shipments, to make worktops in kitchens. When its existing supplier of pallet wood did not want to comply with the new plan – since that would mean less pallet wood to sell – Kingfisher simply switched suppliers.

Eventually, Kingfisher wants its entire 40,000 product portfolio to reach closed-loop status. Kingfisher’s closed-loop calculator is used across the company to assess how existing and new products meet ten criteria. These include the product’s materials, whether it can be rented or repaired, and if it can be easily disassembled into components or materials for reuse or recycling. Kingfisher intends to share this tool with its suppliers.

The company is also piloting numerous product-sharing initiatives. One, titled Project Box, allows customers to rent rather than buy the DIY tools they need for home-improvement projects. Tools such as power drills are typically used for less than 30 minutes over their entire lifetime, making them particularly suited to a rental model. As James Walker, former head of innovation at Kingfisher, explains: Instead of spending £300 on buying the wrong tools that they may use only once anyway, customers can rent the right tools for less.

Focus groups suggest that women like the concept more than men. Women typically complain that their husbands never have the right tools and end up doing a terrible job, or returning to the store to buy more tools; and men respond positively, because they do not have to work it all out themselves. So everyone is happy and less stressed, and there are fewer fights, Walker says.

Constantly communicating the need to change now or lose badly tomorrow is crucial in getting employees to commit to change. But this is not enough. Intrinsic motivation factors such as “I am doing the right thing” or “I am helping save the planet” alone cannot sustain organization-wide mindset and behavior change. Extrinsic motivation factors such as rewards and incentives are also needed to ensure that employees remain fully engaged with the change process. Leaders must therefore set up organization-wide incentive systems based on KPIs to reinforce new behavior.

As Kingfisher’s Jamie Lawrence puts it:

To achieve this objective, Kingfisher aims to make Net Positive targets a part of employees’ bonuses. Doing so will require a change in the company’s current compensation programs. Buying teams, for example, are not yet measured on their commitment to Net Positive objectives. Nevertheless, Kingfisher does have a few sustainability teams backed by Véronique Laury, its committed CEO. And Net Positive is a key part of the company’s business plans. As Lawrence says:

(Adapted with permission from  “Frugal Innovation: How to Do More with Less.” )

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Frugal Innovation Process-A Case Study

Profile image of Praveen Adari

In this study we take a starting point from the frugal innovation principles of Radjou & Prabhu (2014) together with our empirical findings to develop a conceptual model in order to improve our understanding about the process of frugal innovation in SMEs. This paper has both theoretical and practical contribution. In addition to this model, as a theoretical contribution on improving our understanding about the process of frugal innovation in SMEs, the practical contribution of the study is that the model can be used by SMEs managers or product and services developers to initiate and organize the frugal innovation process in their companies.

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Mokter Hossain

This study aims at mapping the frugal innovation phenomenon. The study reveals that scholars affiliated with Indian institutes and originated from India have played a key role in this research discipline. Country wise, the highest number of frugal innovation cases is from India. The articles on frugal innovation have published in a wide range of disciplines and journals. Scholars, practitioners, and policy-makers have understood frugal innovation concept in various ways. Studies are predominantly in sectors, such as healthcare, electric and electronics, transport, finance, ICT, and energy. On the contrary, despite high importance, agriculture and education sectors have received limited attention.

frugal innovation case study

This study aims to review the frugal innovation literature in order to understand the main sources, theories, and overlapping concepts, as well as the input, success factors, impeding factors, and output of frugal innovations (FIs). A systematic research approach was applied in this study to synthesize the frugal innovation literature. Using a standard research review protocol, 101 relevant articles were extracted from 11 publication databases. We found that even though frugal innovation literature is in an embryonic stage there are over a dozen of definitions of it. This study analyses various definition of frugal innovation. The FI concept overlaps with a large number of other concepts, thus hindering the pace of FI research. Combining many overlapping concepts into one-frugal innovation-would help to develop frugal innovation as a well-established discipline. The theoretical development of frugal innovation discipline is still in an early stage. Hence, theory-driven studies are necessary. FIs are emerging from numerous sources as such exploring it from various levels and units of analysis are important. FI requires a significant change in a firm's approach to innovation. It plays an important role in sustainability. Based on the analysis of the extant frugal innovation literature, this study points out research agenda.

Gerrit Anton de Waal

Recognising the greater variety and sophistication of product innovation strategies to target existing and previously untapped markets, the author presents an extended version of the Ansoff product-market expansion grid that highlights the different approaches for developed world and emerging markets. The proposed model consists of seven distinct categories of growth options and depicts alternative strategic possibilities within each category, where appropriate. Categories that are new to the matrix include resource-constrained innovation, necessity innovation and reverse innovation. Necessity innovation is a new concept and a special case of user-innovation, defined as innovation by resource-constrained consumers in emerging markets to serve their own unmet needs. Utilising recent industry examples from a variety of media, the author demonstrates the traits of each strategic approach to grow revenue streams through product-market innovation.

People at the grassroots level have been developing a growing number of frugal innovations (FIs). Many of them do not have formal education and access to science and technologies. FIs are playing important roles for inclusive development. Open innovation (OI) has been studied in the context of large firms, small and medium-sized firms, or high-tech industries. However, OI has not been explored in the context of FIs. In this chapter, I explore the role of open innovation in three frugal innovation cases that emerged in rural India. I also explore the role of these cases for inclusive development. The chapter enhances our knowledge about OI and expands the scope of OI to new application areas. I find that small firms that develop frugal innovations at the grassroots level need more support in the development stage than in the commercialization stage. They need extensive engagement in open innovation activities, such as networking, collaboration with different partners, and scouting. FIs play a significant role for inclusive development.

Andriele Amorim , Helano Pinheiro , Matos Laércio , Laodicéia Weersma

A relação entre inovação frugal e sustentabilidade tem sido apresentada nos estudos acadêmicos (Brem & Ivens, 2013). Nesta perspectiva, este estudo trata-se de uma revisão bibliográfica de artigos provenientes do Portal da Capes no período de 2007 a 2017 por meio das palavras chaves “frugal innovation” e “sustainability” com o objetivo de responder se os estudos contemplam a perspectiva do Triple Bottom Line (TBL). Foram analisados 20 artigos onde foi concluído que em geral os estudos contemplam as dimensões ambiental, social e econômica da sustentabilidade, existindo estudos que fazem uma relação multidimensional, apontando que a integração dessas dimensões tem potencial de contribuir com a sustentabilidade global, principalmente através do empreendedorismo na Base da Pirâmide, porém a literatura carece de estudos que aprofundem a temática no campo da gestão.

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Cover sheet for Dissertation Student Number (as it appears on your student ID card): _______________1557247_____________ Candidate Number (supplied by Examinations Office):

Anne Hyvärinen , Marko Keskinen , Olli Varis

Water is perhaps the most intertwined, and basic, resource on our planet. Nevertheless, billions face water-related challenges, varying from lack of water and sanitation services to hindrances on livelihoods and socioeconomic activities. The Sustainable Development Goals (SDGs) recognize the broad role that water has for development, and also call for the private sector to participate in solving these numerous development challenges. This study looks into the potential of frugal innovations as a means for the private sector to engage in water-related development challenges. Our findings, based on a case study and literature review, indicate that frugal innovations have potential in this front due to their focus on affordable, no-frills solutions. However, we also recognize pitfalls related to frugal innovations in the water sector. Although the innovations would, in principle, be sustainable, deficiencies related to scale and institutional structures may emerge. These deficiencies are linked to the importance of water in a variety of processes, both natural and manmade, as well as to the complexity of global production-consumption value chains. Increasing the innovations' sustainability impact requires broader acknowledgement of the underlying value chains and their diverse links with water. A holistic view on water can mitigate water-related business risks while increasing wellbeing on an individual level.

Management and Organization Review

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Although a substantial literature on the management of technological innovation exists, several scholars argue that much of this research has been rooted in Western contexts, where key assumptions are very different from those in emerging economies. Building on this viewpoint, we investigate the current state of knowledge on technological innovation in two of the largest and fastest growing emerging economies: China and India. We undertook a bibliometric analysis of author keywords and combined different quantitative approaches – frequency analysis, cluster analysis, and co-word analysis – to review 162 articles on technological innovation published about China and India for the period 1991–2015. From the analyses, the trends in technological innovation research in the two countries and the dominant themes of discussion were identified. These themes were further classified into eight sub-themes. Our key findings indicate a near absence of research on the management of technological innovation based on India, limited volume of research on indigenous aspects of innovation, and a lack of theory-building based on these countries’ contexts. Several suggestions for future research are offered based on the gaps identified.


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Proceedings of the 13th International Conference of the Society for Global Business & Economic Development . Università delle Marche, Ancona(IT) 16-18/07/2014. SGBED - Society for Global Business & Economic Development. pp.1029-1040. ISBN: 9788890779572.

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