Jugaad Innovation: Lessons from the Developing World for Business Worldwide

Jaideep Prabhu, Simone Ahuja, Navi Radjou, Rama Bijapurkar and James Crabtree

MUMBAI, June 4, 2012 — Economic innovation led by Western nations has given them unprecedented economic advantages in today’s globalized market. However, "Jugaad innovation," emerging from developing countries, is slowly gaining traction and its importance is only now being understood across both the developed and developing world.

In the discussion Jugaad Innovation: Frugal and Flexible Approaches for the 21st Century, Asia Society India Centre brought together panelists Navi Radjou, Faculty Member of the World Economic Forum; Jaideep Prabhu, Director of the Centre for India & Global Business at the University of Cambridge; Simone Ahuja, Founder and Principal of Blood Orange Media; and Rama Bijapurkar, Market Strategy and Consumer Expert. The discussion was moderated by James Crabtree, Head of the Financial Times Bureau, Mumbai.

Radjou explained that innovation in large Western organizations happens in a "top-down" way, and that it is carried out in a "structured process" — remaining expensive, rigid, elitist and stifling creative voices within a company. R&D processes in the West are also very expensive, making management more averse to disruption. Radjou also claimed that companies practicing Jugaad should be able to "scale out," thereby accounting for diversity in the tastes and requirements of consumers. Companies should also realize that Jugaad must happen before scaling.

Ahuja explained how all companies, regardless of size and geographic location, tried to innovate by asking "what if" questions. She noted, however, that companies in developed countries asked "incremental what if" questions (how can my refrigerator and phone talk to each other?), while companies in developing countries asked the "fundamental what if" question (how can my refrigerator work without electricity?). She argued that companies in developing countries utilized Jugaad more often than their counterparts in developed countries. These innovative questions are often born out of improvised solutions utilizing extreme ingenuity.

Prabhu summarized the six principles of practicing Jugaad: "to seek opportunities in adversity," "find ways to do more with less," "think and act flexibly," "keep the solutions simple," "include marginal customers and employees in the process," and "be passionate about what you do." He suggested that large Western organizations face a dilemma within their corporate structures, and that Jugaad innovation should persist with structured innovation.

While Prabhu advised large Indian firms to approach more structured innovation techniques, he urged them to not leave Jugaad ideology behind. Jugaad, he argued, is what gives them a competitive edge, and combining Jugaad with structured innovation could lead to spectacular innovation. Prabhu also acknowledged that Jugaad faces an image problem, but that it can be overcome when there are more examples of successful Jugaad implementation.

Bijapurkar raised some fundamental questions about this topic as well when she asked "What stops big organizations from doing Jugaad?" She pointed out that there is a creative element to Jugaad, which makes one wonder whether it is a cultural or individual phenomenon to innovation. Bijapurkar indicated limitations brought about by language and context; sometimes "doing Jugaad" could even have negative connotations to members of the business community, and when Jugaad mentality is brought about by the lack of resources for students, it is not an environment that can be celebrated.

This programme was presented in partnership with BSE, Random House India, World Trade Centre Mumbai and All India Association of Industries.