Reverse Innovation

Vijay Govindarajan in an HBR article 'How to Build a reverse Innovation', talks about Stanford University's BioDesign program, where students are going to developing economies and figuring out how the reverse innovations can be done from there.

Reverse Innovation is nothing but frugal innovation ,where you have rigid constraints like resources and cost and you have to deliver may be 50% of the functionality of a sophisticated product at say 15-20% of the cost of the higher end solution. Most of these innovations have happened based on the 'Necessity is the mother of Invention' principle. 

Till now this has happened more to serve the markets that will not be able to afford the full blown solutions. In other words, these were the plain vanilla versions of the solutions that are sold to the richer economies. Now with the world economies moving towards a more equanimous environment, the reverse innovations may become standard solutions. 

Service Innovation instances

Paul Sloane in his latest newsletter gives an instance of Service Innovation that benefits both the organizations and the customers, saving both time and resources. He talks about self- check at airports, self help groups for common diseases which in some cases has helped lesser cases reaching the hospitals, of Ikea that lets its customers do the product assembly themselves and outfits like Threadless that depend on crowdsourcing the designs for their products. 

Now these cases sound very interesting and as of now they are almost unique in the way they engage the customer to do a part of work that was traditionally done by them. It is not as simple as it sounds. To let customers do a part of your job, you have to make the job so simple and intuitive that customers can do them without needing any kind of help otherwise you are creating another service monster for yourself. 

Having said that, I think there is a lot of scope in service innovations as that is where most customer complaints lie, so by improving the service or by involving the customers in the service, you are improving the customer experience which would for sure impact the customer loyalty and retention.