Developing frugal product innovation capabilities in the healthcare industry : The role of emerging markets
Type
conference paper
Date Issued
2011-06-28
Author(s)
Abstract
In the last few years, emerging countries have become hot spots for the development of frugal innovations - products that are stripped down to their bare essentials offering the resource-constrained customer basic functionalities at affordable costs. The rising acceptance of frugal innovations in emerging as well as developed markets have forced Western MNCs, whose established business models and structures are typically optimized for high technology products, to engage in frugal innovations. Based on the insights from three in depth case studies from the healthcare industry, we show how Western MNCs develop frugal product innovation capabilities. We find that frugal product innovation capabilities are effectively built in the resourceconstrained environments of emerging markets. Furthermore, we find that local R&D staff is needed to sense latent local market requirements. The ability to translate these requirements into frugal products depends on the access of the technological knowledge base and the technological training of the local R&D staff.
Language
English
Keywords
reverse innovation
emerging countries
Western MNCs
global R&D
new product development
HSG Classification
contribution to scientific community
Refereed
No
Book title
Sustainability and Innovation
Event Title
R&D Management Conference (RADMA) 2011
Event Location
Norrköping
Event Date
28.-30.06.2011
Subject(s)
Division(s)
Eprints ID
166764