In the crosshairs of mega trends

In the article, “The Importance of Frugal Engineering”, the authors highlight the relevance of frugal engineering in developing products for lower to middle income niche markets. The emphasis on reducing ‘non-essential’ cost while creating sustainable value for consumers in emerging economies brings to the fore an important question: To an outsider, social innovation presents very lucrative opportunities in these markets but in the face of rural-urban migration, can rapid technological change upend the associated benefits of simplified, tailor made products in emerging economies?

For many developing markets, shortcomings in many sectors such as education, healthcare, energy, ICT among others mean human-centered design thinking is more critical than ever in innovating products for those at the bottom of the pyramid (BoP). The relative non-mature nature of such mass markets coupled with fast paced growth indicates a future rise in technology dependency. The April 2015 McKinsey book excerpt on “The Four Global Forces Breaking all Trends” puts into perspective the rise of new global cities, particularly in the BRICS (Brazil, Russia, India, China, South Africa) and the increasing number of elderly people in urban centres.

A lot of innovative solutions that solve a particular challenge that target the BoP are designed for non-urban settings as exemplified by case of the water treatment plant for a semi-rural community near Hyderabad, India. As younger people move to larger cities for educational purposes or for jobs (whether in the formal white-collared sector or the non-formal services industry), they potentially replace an aging workforce. At the same time, they leave behind in villages and hamlets, older folks who may not have the physical capacity operate innovations in critical areas like mechanized agriculture or bioenergy. Naturally, this creates new cultural shift in the development of design thinking paradigms. In the global social innovation community, how do we strike a balance between frugal engineering in cities that are fast catching up with mature market technologies and the maintenance regimes or sustainability of installed technologies in rural locations? In the pursuit of the public good, social entrepreneurs could draw on lessons from past failures of some well-intentioned development and non-profit projects that did not maximize sustainable value despite employing ‘cross-functional teams’, ‘bottom up innovations’ and chalking a few anecdotal successes.

The disruptive dynamics of the modern globalized economy through uneven trade and geopolitics might mean that novel technologies could end up not having a significant impact even in more mature markets. The complexities the world faces today makes the role of positive deviance in social innovation less significant than before. Frugal engineering may drive innovation up to a point but without stronger institutional arrangements in emerging economies that systemically consolidate policy and regulation, problem-specific design thinking could still be susceptible to the fast changing landscape called globalization. That said, I think human-centered design thinking a good starting point to further understand social innovation and how its impact dramatically improves the needs of a segment of society. In my opinion, it is especially applicable in mobile-based technologies for social ventures in emerging regions where the rate of ICT adoption (through cell phone usage) has outpaced economic growth.

What are your thoughts?