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The 4 Factors That Make A Country Ideal For Innovation

The countries most primed for innovation have a mix of factors–including diversity and resource scarcity–that force innovators to come up with the most compelling solutions.

The 4 Factors That Make A Country Ideal For Innovation
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With 1.2 billion people, India is teeming with ideas–and places to try out new innovations in energy, water, banking, and health care. “India is an amazing microcosm,” says Navi Radjou, an innovation and leadership strategist and a Fellow at Judge Business School, University of Cambridge. Radjou and two colleagues have written a book called Jugaad Innovation about the concept of jugaad, a Hindi word meaning an improvised solution born from ingenuity and cleverness.

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There are four ingredients that make India a special spot to innovate, and any good innovator mixes aspects from the four components to create something new, says Radjou.

First, there is a severe scarcity of natural resources, and social resources like access to health care. Out of the country’s 1.2 billion inhabitants, 600 million don’t have access to a bank account, and more than 500 million people lack regular electricity.

Then there’s diversity. India boasts 22 languages spoken, with hundreds of different dialects and cultural norms in each part. Why is that important? “A solution that works in one part of India may not work in another part,” says Radjou, explaining that even things like roads are different in different parts of the country. That forces innovators to create flexible, tailored solutions–one size most definitely cannot fit all.

Third, liberty is an essential component of an innovation society. Radjou calls India a grassroots democracy, where people don’t expect government to do everything for them, so ideas are free to bubble up from the bottom in a fluid way. In one of the book’s examples, a young man experiences the constant bumpy roads in his hometown. Instead of trying to get the road fixed, he retrofits his bicycle with a makeshift device that converts the shocks it receives into acceleration energy—allowing his bicycle to run faster on bumpy roads.

The final ingredient to the innovation cocktail is connectivity. Each month, mobile phone companies add 10 million new subscribers to their networks. In total, there are 800 million Indians with cell phones–roughly the same amount that lack health care. “Connectivity will allow India–and countries like it–to leapfrog the West by using mobile telephony to deliver services,” says Radjou.

India does have some advantages in developing new ideas. A science and tech-oriented education system and a rich history of mathematicians make it different than another innovator like Brazil. And the well-established IT industry certainly doesn’t hurt.

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With those ingredients, India has cooked up some delightful innovation. As an example of the kind of entrepreneurship that India can offer, Radjou points to Selco a company that provides solar energy to underserved communities. Selco distributes solar lanterns to people in remote villages through a network of micro-entrepreneurs.

“They have pricing models where poor people may not need electricity all the time; they may only want it between 6 p.m. and 10 p.m.,” explains Radjou. Grassroots distributors will drop off lanterns, then pick them up at night in a pay-as-you-go-model. Already, the lanterns are helping students study after dark, midwives deliver babies, and flower growers pick buds in the cool hours before the sun rises. So far, the company has reached 125,000 homes.

Radjou says that western industry could learn from emerging markets. Back in the time of Ben Franklin or the Wright Brothers, innovation in America was fluid, flexible, and frugal. “But somehow we have become a bit too uptight to the innovation process,” since that time, he says. “When you go to emerging markets, people are more unstructured.” He’d like to see a return to fluidity, with innovation being more grassroots and dynamic. Looking to India could be a good start.

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