BusinessWeek recently published an article profiling a number of major corporations that are increasingly looking to developing markets for innovation. The article profiled both cutting-edge consumer technology companies like Nokia, as well as industrial stalwarts like GE. These companies realize that we have a huge amount to learn from solutions that are emerging on the periphery. I recently attended a talk, titled Street Hacks, by Jan Chipchase with Eric Von Hippel’s group at MIT Sloan, in which he showcased a number of interesting innovations that his team has uncovered in urban slums throughout the developing world. He included one particularly fascinating example of markets where you can buy a dual sim card in which someone has removed the chips from two existing carrier sims and soldered them onto a single sim. This allows mobile phone users to switch back and forth between carriers on the fly, depending on rates and how much they have in each account. We are years away from enjoying an innovation like that in the U.S.
GE is leveraging a host of different businesses to learn from this initiative and develop new products and services that target low-cost, resource-constrained operating environments. While the story was featured in their healthymagination launch, it is not just their Health-care group that is learning from this experience, but also GE Energy, Water and Finance — all fields in which GE is a major player. GE is learning that innovation often exists at the crossroads of their different businesses.
At frog, we have made our own commitment of time and resources to learn from developing markets in the area of health care and technology. Our first foray is the 18-month-long collaboration for Project Masiluleke which has been pretty well documented in the press (most recently in this special report in The Economist). We have worked with local partners such as iTeach, MTN and the Praekelt Foundation (as well as Pop!Tech) to find innovative ways to deliver health and improve outcomes in an extremely resourced-constrained environment–KwaZulu Natal province in South Africa.
This partnership has convinced me that we are going to see a similar leapfrog phenomenon in health care as we have seen in telecommunications and mobile finance in emerging markets. Experts agree that earlier diagnosis and treatment are the only effective ways to combat the AIDS epidemic.
So does this experience confirm the new thinking on innovation? Is scarcity the primary driver of innovation in an increasingly resource-constrained world? Adam Gopnik wrote a great piece in last week’s New Yorker challenging this hypothesis, using disposable razors as one of his examples. Drawing an analogy with Darwin and evolution, he contends that at times of scarcity, it is much harder to innovate because all of our energies our devoted to maximizing current practices. We define narrow approaches to problems and have a very hard time deviating from them: “Scarcity encourages people to hold the rites of scarcity sacred… In environments where it takes a lot of effort to make a living, genes have to work hard and each can only do one job: molars crunch, claws kill, larynxes cry; the genome is as segmented and task-defined as the working day was on a Detroit assembly line way back when.”
It is hard not to give this notion some credence when we look at technologies like the treadlepump that have brought tens of thousands of small, one-acre farmers out of poverty over the last two decades (thanks to the amazing work of organizations like IDE, Kickstart and others).
As usual these debates tend to oversimplify a richer and more complex dynamic between scarcity and abundance. If our experience in South Africa is any indication, then it is worth considering what happens when the two conditions meet, as is increasingly the case–when a culture dominated by resources scarcity (like KZN) is confronted with an abundance of different resources (mobile networks and social capital).
After all, “scarcity” is no longer synonymous with poverty. True scarcity exists in very remote, rural regions of the world. But poverty is more often characterized these days by dense urban slums. Areas where there is an abundance of social resources, marketplaces and a growing abundance of information and media as well.
What we are seeing more and more is the collision of scarcity and abundance (which was the topic of last year’s Pop!Tech conference, for those lucky enough to attend). We are increasingly confronted with images of street kids in India saving up the few rupees they can scrounge from scavenging scrap metal to play video games or buy minutes for their mobile phones. As urban slums become the defining human condition, you will see an acceleration of innovation. Density and connectivity are the big game changers that will drive innovation for generations to come. Not scarcity.
Read more of Robert Fabricant’s Design4Impact blog
Robert is a leader of frog’s health-care expert group, a cross-disciplinary global team that works collectively to share best practices and build frog’s health-care capabilities. An expert in design for social innovation, Robert recently led Project Masiluleke, an initiative that harnesses the power of mobile technology to combat the world’s worst HIV and AIDS epidemic in KwaZulu Natal, South Africa.
Robert is an adjunct professor at NYU’s Tisch School of the Arts where he teaches a foundation course in Interaction Design. In 2009, he joined the faculty of the School of Visual Arts in New York and is a faculty member of the Pop!Tech Social Innovation Fellowship Program. A regular speaker at conferences and events, Robert recently gave a keynote speech at the 2009 IxDA Interaction Conference. He is a frequent contributor to a wide variety of publications, including I.D. Magazine, The Wall Street Journal, and Wired.