Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth

Citation

Bhatti, Y. (2013), "Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth", South Asian Journal of Global Business Research, Vol. 2 No. 2, pp. 279-282. https://doi.org/10.1108/SAJGBR-03-2013-0014

Academics and consultants Radjou, Prabhu, and Ahuja gain inspiration from South Asia, particularly India, and cogently describe what the rest of the world can learn from the mindset, art, or culture of jugaad innovation. Jugaad is a Hindi word defined as “an innovative fix; an improvised solution born from ingenuity and cleverness” (p. 4). But the authors caution that jugaad is “neither a process nor a tool nor a scientific method that can be deployed in a top down way. It is closer to a fluid art and culture” (p. 196). The book's message rests on the premise that emerging market firms are practising jugaad as a response to unique contexts there marked by resource constraints and are in the process able to outwit western competition both at home and in developed international markets.

The book chapters are structured around each of the six principles of jugaad innovation: seek opportunity in adversity, do more with less, think and act flexibly, keep it simple, include the margin, and follow your heart. The cases and stories cited constitute a mix of grassroots, entrepreneurs, social entrepreneurs, and local and international firms. The authors draw inspiration primarily from but not limited to India. They use 20 or so dispersed cases representing Argentina, Brazil, China, Costa Rica, India, Kenya, Mexico, and the Philippines to support each of the six jugaad principles. The richness of cases is inspiring, but the lack of illustrations that summarize key ideas, cases, or lessons makes the ability to track cases and transpose lessons from one unique group to the other difficult. Also the lack of questions for reflection and implementation exercises means the book isn’t particularly suitable for training purposes or for classroom instruction.

The jugaad book's audience is more practitioner than academic and so understandably fails to explicitly position itself within the theory behind international business or the literature on innovation. But the book serves well to raise awareness of fresh ideas on innovation in and for emerging markets paving the way for both practical and scholarly investigation. The narration of cases throughout the text is expository and capturing. Managers will likely find the creative story telling insightful and valuable. Researchers however may view this style of writing as too practical and unscholarly.

Jugaad Innovation argues convincingly that the developed world should return to its roots embodied in the likes of Benjamin Franklin. The adoption of frugal and flexible innovation is now a global imperative given competition from emerging markets. Such firms are using jugaad to grow locally and beyond to compete with western business. The book warns western businesses about this threat and encourages the adoption of the same jugaad innovation to succeed globally. For this purpose perhaps, the book shifts in each chapter from first citing a few emerging market cases and then describing how several western firms are already doing it.

The authors show how firms in emerging markets are innovating in ways that depart from the contemporary western logic of structured, high cost, and high‐margin R&D, and rich customer focus. And compelling reasons to rethink this structured approach and complement it with a flexible and frugal approach are presented. Popular Indian cases cited include Mitticool, Tata Nano, GE's compact ultrasound and ECG machines and social enterprises Aravind and Narayan Haruldaya cardiac hospital. Popular western cases cited to support adoption of jugaad include Google, Facebook, 3M, Apple, Best Buy, GE, IBM, Nokia, Procter and Gamble, and PepsiCo. Perhaps in an effort to make the book appealing to a mainstream business audience, the book fails to acknowledge several cases as either self‐proclaimed or recognized social entrepreneurs, and the discussion of social entrepreneurship is a miss in the book.

At times the claims and evidence do not adequately support each other. For instance, in arguing for reframing the half empty glass as half full, as the first and most important strategy of jugaad innovators, the book presents the case example of O.P. Bhatt, former chairman of the State Bank of India. The book argues that Bhatt “used a jugaad approach to ignite the genius within SBI. First, he drew on his superior communication skills to rekindle his employees’ feelings of pride about SBI […] Then, through an in‐house training program called Parivarthan (Sanskrit for ‘transformation’), he instilled a new sense of commitment into SBI staff across all levels and departments” (p. 34). Shortly thereafter the book argues that not only did jugaad innovators such as O.P. Bhatt think differently in response to adversity, but they “also acted quickly to adapt their models and strategies to the challenges in their environments” (p. 35). With the little information provided about the SBI case, there is insufficient data to back these claims on reframing and acting quickly. Besides, such use of superior communication skills to rekindle employee spirit is not unique to leaders in emerging markets. And use of transformative training programs in organizations to improve worker empowerment and creativity are also not unique to emerging market firms. What specifically was different about the way perhaps these two activities were done that makes them uniquely “jugaad” is not exposed by the book.

Jugaad is presented as a “resilient mindset that is prevalent in emerging markets like Brazil and China” (pp. 47‐48). And the book warns western firms of this prevalence of jugaad innovation by local EM firms. It rests on the supposition that emerging market firm strategies are the “right way” and are in an enviable situation. This presupposition could be better fortified by explaining the research methodology used to gather and analyze emerging market cases. And if the emerging market firms are so important and threatening, what might be lessons for them? While the book portrays the ideas presented would be useful for EM firms, the lessons are spelled out mainly for developed country MNCs, and there are few, if any, for EM firms.

Also there is little differentiation between examples of jugaad by local firms or by western MNCs. western firms such as Google, Facebook, 3M, Danone, Apple, Best Buy, GE, IBM, Nokia, Procter & Gamble, and PepsiCo are equated with EM firms such as Selco, Tata, Airtel, Los Grobos, Hapinoy, and Optima to be actively involved in practicing jugaad innovation. Several western examples in Chapter 2 of “Seeking opportunity in adversity” are cited as “taking a cue from jugaad innovators” (p. 44). This reliance on western examples as exemplary cases of jugaad makes one wonder whether the practice of jugaad among EM firms is even needed to come to the recommendations and conclusions outlined. Additionally, the book claims India as a leading context for jugaad, but given that jugaad examples cited stem from other emerging markets as well as western firms, it does not convincingly defend the adoption of the word jugaad globally.

Further confusion stems from jugaad stories of Salesforce.com's Benioff and Apple's Steve Jobs. While intriguing, these could be entrepreneurial cases regardless of context. Benioff is classified as a jugaad entrepreneur for his flexible strategies to create a new market in the face of adversity and Jobs is described as a jugaad innovator based on his knack of principle six, “follow your heart”. However, on other principles such as radically doing more with less, it seems less probable that Jobs was a jugaad innovator or that Benioff like any other entrepreneur would not be frugal and flexible. So what makes Benioff a jugaad entrepreneur and Jobs a jugaad innovator inspired by jugaad principles as opposed to any other entrepreneur seeking to create a new market? The frequent shifting focus between “jugaad innovators” and “jugaad entrepreneurs” without differentiating or defining the two makes the further generalization of “jugaad” unconvincing and makes the book somewhat hard to follow.

Overall, Jugaad Innovation boldly challenges prevailing notions of innovation and strategy in international business and proposes a full‐circle return to global roots in frugal and flexible means and ends. Jugaad's roots in India stem from the need to get things done despite lack of abundant resources. Abundant resources have been enjoyed by western societies until recently, who too according to the authors will have to deal with more adversity. The book helps to dispel the myth that abundant resources for both innovators and beneficiaries result in disruptive innovation and breakthrough growth. It certainly paves the way for further scholarly research and practical experimentation to understand, legitimize, and diffuse the practice of jugaad.