A new working paper by our CFI colleagues Malte Krohn and Cornelius Herstatt looks at “The question of a frugal mindset in western MNCs – exploring an emerging phenomenon with a systematic literature review” (Working Paper no. 103, TIM/TUHH)
TIM-TUHH Working Paper (representational image)
Frugal innovation in the context of developed ecomomies has witnessed increasing interest in recent years. For Western multinational companies (MNCs) emerging markets represent promising opportunities for growth as well as the threat of new local competitors. Furthermore, economic developments drive the demand for frugal products within Western countries. Succesfully mastering this challenge means that Western MNCs have to challenge prevailing paradigms within their organizations. Literature suggests that these companies have to develop a frugal mindset to succeed in frugal innovation. However, to the best of our knowledge no publication addresses the phenomenon on an empirical basis or provides enough detail for further empirical investigation. To address this gap, we conducted a systematic literature review of 80 publications in the frugal innovation field.
In Deutschland ist ein Trend hin zu mehr Frugalität und folglich zu frugalen Innovationen erkennbar. Dieser Trend wird maßgeblich getrieben von der zunehmenden Bedeutung von Wachstumsmärkten in Schwellenländern, der Einkommensentwicklung in der hiesigen Gesellschaft sowie dem sich wandelnden Werteverständnis – besonders dem hohen Umweltbewusstsein und der Wahl moderater Lebensstile durch viele (insbesondere junge) Leute. Auch die demographische Entwicklung („alternde Gesellschaft“) scheint die Nachfrage nach benutzerfreundlichen, weniger komplexen und zugleich erschwinglichen Lösungen zu steigern. Die vorliegende Studie von Katharina Kalogerakis, Rajnish Tiwari und Luise Fischer setzt sich mit den politischen Handlungsimplikationen dieses Phänomens für das deutsche Forschungs- und Innovationssystem auseinander.
Authored by: Rajnish Tiwari a, Luise Fischer b and Katharina Kalogerakis a
a Center for Frugal Innovation, Institute for Technology and Innovation Management, Hamburg University of Technology (TUHH), Hamburg, Germany
b Fraunhofer Center for International Management and Knowledge Economy (MOEZ), Leipzig, Germany
The topic of frugal innovation is increasingly gaining relevance in social as well as scholarly discourse. Frugal innovations have been perceived by many to be a phenomenon generally confined to emerging economies where there are large groups of unserved consumers with unmet needs. But there is increasing evidence that this phenomenon is getting relevant also in the industrialized nations potentially affecting the long-term competitiveness of domestic firms not only overseas but also at home.
Aditi Ramdorai and Cornelius Herstatt have published a new book titled “Frugal Innovation in Healthcare: How Targeting Low-Income Markets Leads to Disruptive Innovation” (Springer Verlag, ISBN 978-3-319-16335-2). The book is scheduled to arrive in bookshops on May 14, 2015. It has been published in the “India Studies in Business and Economics” series of Springer and is already the second title by CFI team in this series. The first publication was “Aiming Big with Small Cars: Emergence of a Lead Market in India” by Rajnish Tiwari and Cornelius Herstatt, published in 2014.
About “Frugal Innovation in Healthcare” (publisher’s description)