The word refers, literally, to a makeshift truck which my colleague Anand Giridharadas once memorably described as being “tossed together, saladlike, in the sheds of northern India, beyond regulators' view.†Jugaad has also entered the lexicon as a concept known in management-speak as “frugal innovation.†For some in India, jugaad represents the best of India â€" the ability of an enterprising people to make do with less. For others, it represents shoddy products and shady practices for which the country has long been known, and a fatalistic acceptance of that reality.
Jugaad has recently gained more attention in the West, thanks to the efforts of people like Navi Radjou, an enthusiastic member of the pro-jugaad camp. A Palo Alto-based “innovation and leadership strategist†who was born in Pondicherry, Mr. Radjou is co-author of “Jugaad Innovation,†along with Jaideep Prabhu, a professor at Cambridge, and Simone Ahuja, founder of Blood Orange Media. The book, which was released in April, describes what Western companies can learn from jugaad and similar concepts common in many developing countries. The Indian edition is already into its second imprint.
A French national, Mr. Radjou has worked with companies such as Best Buy in the United States and he cites Carlos Ghosn, the chairman and chief executive of Nissan and Renault, as an admirer of the jugaad way. (In fact, Mr. Ghosn offers lavish praise of the book on the jacket sleeve.) Mr. Radjou is also a fan of MacGyver, the TV secret agent famous for fashioning implausibly high-tech gadgets with random objects and duct tape. “It was so jugaad,†he says admiringly. Mr. Radjou sat down to discuss his book during the World Economic Forum meeting in Tianjin, China, in September.
Tell me about the book.
The book is a celebration of the ingenuity of entrepreneurs in emerging markets like India and China who, despite having very limited resources, are able to tap into their sheer ingenuity to come up with very simple but effective solutions to address major issues, whether it's in health care or education or any other sector you can think about.
Unlike the Western world, which invests billions of dollars in R&D, entrepreneurs in emerging markets use jugaad, which is a Hindi word which can be loosely translated as “the art of improvising frugal solutions.†We looked at countries like India, China, Brazil and Africa, and in our book, “Jugaad Innovation,†we profile dozens of such entrepreneurs who have come up with very frugal solutions for dealing with major issues in their local communities.
How is this relevant to the West?
“Jugaad Innovation†is very relevant in today's context because in the West we are beginning to see two important changes happening. A lot of countries are facing extreme resource scarcity. But, also, there's more complexity because of demographic shifts, technology shifts and many other variables. In an environment that is becoming more complex and resource-scarce, you need to have a different approach to innovating. It can't be just investing billions of dollars in R&D; it has to be something that is more frugal. More flexible. But also more inclusive as well. And this approach of jugaad is all about that. It's a way of innovating faster, better and cheaper.
Can you give me an example?
In India, an entrepreneur has come up with a company called Embrace. Embrace has developed a portable infant warmer, which is essentially a baby incubator. When you have premature babies, people tend to put them in a fixed incubator. And that incubator deve loped in the West costs up to $20,000. But this particular product costs only $200. Not only is it affordable, it delivers more value to the end user because it's a portable infant warmer â€" the mother can literally put the baby into this infant warmer and then hold it against her, which is very important for building that emotional bond.
Companies like Renault-Nissan have begun to embrace this kind of mindset. Carlos Ghosn is a big fan of jugaad. What he's doing is encouraging his R&D teams to come up with low-cost cars.
One of the criticisms of jugaad is that larger issues don't get solved because it's all about finding ways around problems.
Jugaad in an emerging market context is often interpreted as somehow gaming the system. But actually what's happening is that in emerging markets, what you have is a lack of a system. It's not about gaming the system, but it's just that the system itself is nonexistent, whether it's in health care or any other indust ries. The system is not fully developed. So jugaad solutions fill a major vacuum that has not been filled either by the government or by corporations.
What inspired you to write this book?
In 2008, when the U.S. recession started we recognized that the only way the U.S. could come out of recession was through innovation. We also knew that the old innovation model wouldn't be the right solution because it's very expensive, it's very inflexible. And it's not open enough. The three weaknesses we found in the U.S. innovation system is that it's expensive, it's elitist â€" only a few scientists innovate â€" and thirdly, it's inflexible because it takes eons to come up with new products and services.
So we asked ourselves whether there was an alternative model to innovating, a new approach to innovation which would have three opposite attributes. It would be frugal, it would be flexible, and thirdly it would be open and inclusive. And that's when we went around t he world and we discovered these new approaches to innovation which we call, for lack of a better term, jugaad.
How much of your book is focused on India?
About 60 percent of the examples in the book come from India; 40 percent come from other emerging markets.
We looked at India and saw that there were four variables in India that made it an ideal country for this kind of frugal and flexible approach to innovation. The first variable is complexity; the second one is liberty â€" Indian democracy; the third one is scarcity and the fourth one is interconnectivity.
Can you explain that?
Diversity means that whatever works in one part of India might not work in another part of India. So it puts a lot of pressure on innovators to customize solutions. Liberty means that you have the freedom to innovate in a bottom-up fashion. Then you have scarcity of every kind â€" infrastructure, capital resources, water. And then you have interconnectivity, which i s more like a boom â€" the explosion of cellphones and everything.
Can you give me an example?
A lot of innovation in emerging markets like India is in things like mobile banking: 800 million people in India don't have access to a bank. You have 900 million people who have a cellphone. So if you are a jugaad thinker, you say the glass is half full, not half empty. And that's why you see all these mobile banking solutions popping up in places like India because the jugaad guys are able to convert this adversity into opportunity.
So what sort of jugaad examples are we seeing in the West?
Sal Khan, who is head of the Khan Academy in California. The online video course he holds on YouTube â€" for me that's a great example of jugaad. He's really doing more for less; he's using a cheap platform like YouTube to create content, which is free and available for everybody, so you actually see individuals taking charge of driving this moment of jugaad in the U.S. , and corporations are just waking up to this.
Companies like Procter and Gamble, G.E., 3M and Google are beginning to adopt this approach as well, because it ultimately allows you to innovate faster, better and cheaper. And there's no C.E.O. who won't like to do that. Especially in today's world.
Can you give an example of jugaad in the India of your childhood?
Where I grew up, we never threw away anything. Everything got recycled. If a plastic bucket was slightly broken, we'd try to fix it. There was a whole jugaad industry which helped us reuse everything we had. It wasn't a consumption-driven economy when I grew up. All our toys were makeshift ones that we made with pieces of wood that you'd find somewhere in the street. So we used a lot of ingenuity, which was very abundant, to deal with the resources, which were more scarce.
Is this changing in India today as people become more consumption orientated?
There's a tendency now in India to loo k for things that are more structured, more systematized, and I'm a bit concerned with that because, while it's true from a consumer's standpoint that you want things that are much more predictable and better quality, there's a misconception that jugaad necessarily means poor quality. Not all jugaad innovations have to be cheap and low quality.
Everyone says we need to produce more Ph.D.'s. We need the Ph.D.'s, but we need to also be comfortable with the MacGyver stuff.
