Is Innovation at a Crossroads?
Tuesday, May 19, 2009
Over the last few years the traditional thinking about innovation has been turned on its head. We used to assume that innovation was driven by access to the most advanced tools and resources. But the emphasis has shifted more recently to the role that scarcity plays in driving innovation. This change has inspired a newfound belief that innovation will emerge from the bottom up, out of developing markets, as opposed to being exported by rich nations like the U.S. and Japan.
BusinessWeek recently published an article profiling a number of major corporations that are increasingly looking to developing markets for innovation. The article profiled both cutting-edge consumer technology companies like Nokia, as well as industrial stalwarts like GE. These companies realize that we have a huge amount to learn from solutions that are emerging on the periphery. I recently attended a talk, titled Street Hacks, by Jan Chipchasewith Eric Von Hippel’s group at MIT Sloan, in which he showcased a number of interesting innovations that his team has uncovered in urban slums throughout the developing world. He included one particularly fascinating example of markets where you can buy a dual sim card in which someone has removed the chips from two existing carrier sims and soldered them onto a single sim. This allows mobile phone users to switch back and forth between carriers on the fly, depending on rates and how much they have in each account. We are years away from enjoying an innovation like that in the U.S.