Dear Students,
Today’s Lecture covered Open Innovation in Emerging Economies “Overcoming External Constraints and Expanding the Value”. We defined the importance and mechanics of Disruptive Innovation and Reverse Innovation. Please answer four questions:
- What are your key takeaways from today lecture?
- What insights did you gain?
- How do they apply to your new business model?
- Please state how it may or may not apply to your new model?
My key takeaway from today’s lecture is that disruptive innovation enables value creation for many. During the different case analyses for cars, medical equipment, prosthetic legs, and more, it becomes evident that the “impossible” can often be accomplished through innovation in different areas of the business model.
Another insight I gained was the definition of disruptive innovation, and how the HBS professor Clayton Christensen showed Intel CEO Andy Grove how to think, instead of what to think. Disruptive innovation is about transforming products to become more accessible and affordable – “democratizing” ideas/technologies by going after new customers.
It’s interesting to consider how we can similarly “go after new customers” within Coke’s existing business model. By developing a business model inside of a business model (what our team is calling the Coke Internal Innovation Forum), we can make the technological innovation process more accessible via co-creation with key influencers within the organization. Rather than telling business units what to think, Coke can show them how to think about the tech innovation process.
The main takeaway today is that it is difficult to reach the many without employing disruptive innovation strategies. Clayton Christensen, the father of disruptive innovation, defines this type of innovation as a “process by which a product or service transforms an existing market by introducing simplicity, convenience, accessibility, and affordability”. Disruptive businesses do not necessarily make products any better but instead transform the product’s reach by focusing on the people not the profits. Once the people are satisfied, the profits will organically flow into the business.
The major insight I gained today is the asset utilization factor of disruptive businesses. Professor Darwin shared with us multiple examples of disruptive products from cars, phones, baby incubators, to even a $28 prosthetic leg. However, the example that really stood out to me was the two-wheeler business model in China. This model used dynamic capabilities by orchestrating specialists to all contribute to the product, resulting in an asset light model. This efficient use of assets is powerful. The western countries still have yet to learn from emerging countries how to efficiently utilize their assets. It is particularly interesting that some of the simple medical machines made for India were brought back to America. This is called reverse innovation – when the rich want what the poor has.
After today, Professor Darwin inspired me to look at all the assets I underutilize in my life and think of ways to use them. As for applying disruptive strategies to the United Health Optum model, I think my team can integrate ways to keep our assets light. Right now we are exploring a charitable rewards application that can link into existing platforms. This would add a new aspect to social networking and show the digital space something they have never experienced before — giving money to the many, after getting healthy of course!
The key takeway from this class for was the thinking that “We don´t want create value for money but value for many “. I really like the graphic of having a quality product with low price because that it is the difficult challenge .Smart people is needed to achieve it.
The major insight that I gained was the application of open innovation to social and non-profit goals .Because it is through innovation how we can improve the world .Achieving this aims implies cooperation, collaboration and passion between companies and people.
For me this class was so inspiring for our projet .Because the examples we saw were so impressive and were exactly what we want to achieve .We want that every Indian village has a basic health care equipment and emphasize in the main death cause in India ,heart diseases.However, we need to research deeply in the situation of the clinics in the rural areas in India to get an optimal result.
What I believe it can apply in our new model is the reverse innovation.This means to take back the product we want to sell in India to the US.We have to find a place in the American market for our product.
My key takeaway from today’s lecture was that Disruptive Innovation is redefines a product or service to be more accessible to the majority of a population versus the slim percentage that would be the wealthy. Disruptive innovation has produced many products that has helped the poor live a more habitable lifestyle.
Disruptive Innovation is the reason why India can transport more efficiently and affordably. An engineer designed a car that will solely be run off of air. It can drive up to 43 mph and at a distance over 200 miles. And the cost to fill the tank is less than $2. This provided the people of India a safe and new way of transporting with much ease. The insight I gained from this is how significant disruptive innovation is to opening up new doors for the world especially third world countries.
In our business model we are creating a platform for patients to interact with each other as well as the doctors. Although there are other platforms similar to ours, we are disrupting them by creating a platform that is solely objective and not solely about profits. This not only allows our platform more affordable than the competitors, but also allows patients to truly interact without being taken advantage of.
Dear Jacqueline, Alexandra, Bea and Liz,
You all contributed good insights and demonstrated that you are tracking with me. Thanks for getting the ball rolling on this blog. I look forward to reading more from your other classmates.
I really found this class inspiring.
For me the big take away was to see how products designed for the ‘poor’ are not only having a success in their own market but also in new markets. In our developed countries we end up producing products or services that are actually too sophisticated, too expensive, and too complicated for many customers in their market. We are now understanding that having the most ‘complete’ product might not be the solution. We need products that are available for the most majority and that can be used in the majority of cases.
An innovation that is disruptive allows a whole new population of consumers at the bottom of a market access to a product or service that was historically only accessible to consumers with a lot of money or a lot of skill.
This lecture made me think that we need to make sure that we create a service/ product at GE that is going to be accepted by both Indians and Americans. Something that could be dangerous would be that out product will be considered as in the example shown in the class about the two wheel transformed in a car that was unsuccessful because it was considered a ‘car for the poor’. We need to keep in mind that our proposition will have to be welcomed and accepted by both market and don’t gain a bad reputation.
My key takeaway for Thursday’s lecture is that disruptive innovation is about making products/services accessible to more people – create value for many. It surprises me that how great innovation is when we start with the idea to make the product / service more accessible for people who don’t have skills and money. The examples such as mini fridge, medical device, and cataract surgery in India all show how disruptive innovation make product/service more cost-effective and cater to the needs to customers and therefore create greater value with less cost. And those innovations actually change people’s life and contribute to the development of underdeveloped community. For our business model, we want to create value for everyone in the healthcare system. I think after learning about what disruptive innovation is, we should think more from the perspective of people who have less money and skills and make our platform more accessible to those people, provide the information they need in a user-friendly and low-cost way, and help improve their well-being in an unprecedented way.
My key takeaway from this lecture today is that in order for a company to gain more customers it is some times better to build for a specific customer base. What that specifically entails would be start from scratch and understand what the customer really wants and to build it for them. One example that showed this type of disruptive innovation was through the example of the ChotuKool. The creators of ChotuKool understand the problem that people in India had and built the fridge accordingly to what they needed. Other examples that were shown in class such as the were also very inspiring such as the MAC 1200 that GE Healthcare created that is now universally used for health on the go. This type of innovation definitely reminded me of one of my side projects at my internship in which the company urged us to go out and talk to our target audience to really identify their pain points and innovate to solve for their pain points.
In terms of my group’s business model, I’m not sure if this type of innovation may directly apply to our business model but whole focus will be to focus on our customer’s need and making a convenient, simple and easily accessible solution.
This particular lecture was not only educational, but it was also inspirational. The key takeaway for me was that although innovation may be beneficial to some, disruptive innovation is beneficial to all. Moving forward, we should be seeking to create disruptive innovation because regardless of cultural differences, at the end of the day, we are all battling the similar struggles.
A particular example that struck my curiosity was the integration of a rather expensive medical instrument into underdeveloped areas that did not have constant access to electricity. It is amazing to see how a high value tool that was constructed at a high price could be reimagined to a tool that fit a low price point all the while maintaining its high value. Reverse innovation proved that this simplified version offered nearly identical value to its expensive counterpart. This means that the tool, after undergoing disruptive innovation, was brought back to the U.S. and utilized for car accidents (essentially emergency incidences when the tool needed to be carried on the go and there were no available electrical outlets). Now, for only a fraction of the price, many lives can be saved. Although it is beneficial to use state-of-the-art technology to create innovation, sometimes it is important to take a few steps back (e.g. using AA batteries) to create the most innovative products.
My key takeaway from Thursday’s lecture was the importance of innovation for social good. Entrepreneurs and innovators in this day and age seem to be more focused on how to solve problems that are only applicable to the relatively wealthy. By emphasizing disruptive innovation, however, we can help a larger number of people while still turning a profit.
I gained insights into the innovation process. When Professor Darwin mentioned that the group of MIT students working for P&G had great success in their test runs but very little in India (where the product was actually launched), he showcased how imperative it is that these innovators actually visit and understand their target market. There needs to be a real connection.
In terms of Team Coke’s business model, I think this lecture helped us look at the “bigger picture”. Although we have an internal-facing issue, the framework for our business model can be applied across many different situations. Perhaps it could even be applied to increase something like bureaucratic efficiency in developing nations.
I too was left class very inspired.
Professor Darwin stated “Instead of telling a man what to think, you teach him how to think.” This was a beautiful reminder of the importance of empowering someone to stand on their own two feet.
One of the key take aways was Modular Innovation, where you bid out specific pieces of the product to a community. I think this is a great business idea. I also am concerned that it may have people working for even less money or putting forth efforts in which they don’t get paid. Wanting to learn more I did a google search and found articles that was more or less defining the term. I would be interested in knowing more how it impacts the people involved.
Modular Innovation can be applied to a business model and can cut the bottom line. The other distinctive piece from lecture was how to get both high value and low price. There were some remarkable ways in which this was demonstrated in class. I loved the blok phone and all the medical innovation was very moving. One of the take aways here is that in order to create such brilliant products that you have to color outside the lines. Also it is important to immerse yourself within a culture to understand their needs, otherwise the business model can fail.
All of these aspects will be incorporated in our thought process as we develop our product for United.
There is a lot of focus on developing new products for the rich/1st world when there in fact is very much money to make, and people to help, in developing economies. This was one of the takeaways that led us in on the importance of reverse- and disruptive innovation. Both of these concepts are very important for Wipro’s challenge. Wipro has a reputation and competitive advantage of being frugal and cost-effective. That is why it would be perfect for them to innovate reversely by offering frugal solutions to cities in developing countries, then transfer these to Europe and North America. The solutions also has to be disruptive since the goal is to improve the life in the city for millions of people, and that isn’t done by just offering private parking spots or similar solutions to the rich!
This was one of my favorite lectures so far.
My key takeaway was that a company needs to make value for many, not for money. The goal of all the companies mentioned in this lecture was to find an innovative solution for those who cannot afford expensive technologies.
One insight I gained was the importance of a high asset turnover and the utilization of existing assets. This applies to our new business model because we want Fujitsu to create a new branch in order to enter the higher education market. Originally our plan involved the purchasing of new assets, new resources and making new partners. However after our phone call with their senior executive we realized that the smarter solution would be to utilize Fujitsu’s existing assets and leverage them in a way that would allow them to enter this new market without a large investment and startup costs.
In addition this idea of a high value but low price innovation is something we’re trying to create with our idea of a centralized platform for student resources. We want our service to be free for universities and accessible for all students and faculty but maintain its high value.
This was by far my favorite class of the entire semester. While it wasn’t a takeaway, the coolest thing I took away from this class was how disruptive innovation can actually be. In particular, two specific “inventions” stood out – the $28 foot and the Tata car that runs only on air. Both of these are changing the way people in India can live and function, and are at an extremely affordable price point.
Being Indian, I know that the need for both of these products in India is beyond necessary. They have the potential to significantly improve people’s lives, and is done on a small budget. Another cool innovation that I noticed that Indians have “created” is the new Mars shuttle that uses the Earth, Sun and Mars’ gravity in order to actually propel the rocket. It’s incredible how they managed to figure this solution, and how cost-saving this measure truly is.
My key take away from Thursday’s lecture was that disruptive innovation does not necessarily mean breakthrough innovation. Disruptive innovation TRANSFORMS a product that was historically very expensive, complicated, and exclusive to an affordable and accessible product for all. I gained new insights about the importance of learned of its wonderful success through the Phonebloks startup (which got bought by Google in 2013) and through the utilization differential example of the hospital that is opening a 2000 bed hospital in the Cayman Islands.
For GE, our current plan is to create a B2B model where GE supplies rural Indian clinics with telehealth equipment; however, our model will only be successful if the equipment is constantly being used and servicing hundreds and thousands of people. Thursday’s inspirational lecture reminded me that our business model must make healthcare services not only affordable for the people but also affordable for the clinics to offer. With this objective in mind, it is imperative that our business model implement incentives to drive consumers to visit these clinics so that these health professionals can use GE’s machines.
Thursdays lecture was comprised of multiple videos in class. From Phonebloks to the prosthetic leg, many of these videos were very inspiring and struck a personal cord with me. In regards to phonebloks, the sustainable and simplistic model it advocated aligned very closely with my goals to build a sustainable and resource efficient future. And seeing a man run and jump with the help of an affordable prosthetic leg was very touching as well.
The videos really got me thinking about frugal innovation (known as Jugaad in Hindi). Vijay Govindarajan’s book on Reverse Innovation highlights the power of creating more with less in countries that are less developed. His key phrase preaches to western business ideals in that one must “create far from home, to win everywhere.”
Mr. Vijay even mentions GE’s portable ECG machine that measures heart rate, runs on batteries, weighs 6.6 lbs, and serves as the perfect solution for rural telemedicine that was invented in India and can be applied everywhere else in the world today.
We will definitely incorporate these principles in our GE project which involves frugal jugaad and reverse innovation.
The lecture on Thursday was very interesting to me. The concept of reverse innovation is very interesting to me and I believe that it is very applicable to our business model on Internet of Things and Smart Cities for Wipro. This is because it is crucial to be able to be more cost efficient when building a smart city in a developing country like India, compared to building a city in the US or Europe, and I believe we can bring the reverse innovation that we develop in India and reapply to great success here in the US. The cities in the US, though having better standards of living, are very wasteful in its resources. I believe that the we can bring the innovations developed for Smart Cities in India and bring it back to the US, allowing the cities to maintain the same quality of life yet drastically reducing cost.
One additional comment I wanted to make in class but I don’t think Professor Darwin saw my hand: I really believe in the quote “Necessity is the mother of all invention.” I really think that limits and constraints are crucial factors in making people go beyond the box and be innovative. I speculate that the US, due to its abundance in resources and material, will struggle to innovate when the impact of depletion of resources is felt, as their current products all depend on a lot more resources and is less efficient than the ones currently developed in countries like India or China. Unless we can also apply the same constraints when trying to innovate (or using the reverse innovation methodology and introduce cost-effective products back to the country), the US may not be able to maintain its advantage for long.
My most takeaways from Thursday’s lecture was to have different ideas of creating a product with high value but low price. The existing models for lower price and lower quality or for higher price and higher quality don’t quite apply with developing economies, since the driving force for quality isn’t only depended on pricing now. I am also fascinated by the idea of a globalized economy where a problem in India could have global participation. However, as we were told, it’s impossible to have remote R&D without actually visiting the site and experience the customer’s problems. After the class, I am thinking about creating a pricing strategy with lower price but maintains the quality, even though for our challenge it is still in America. In order to let everyone uses it, but to keep an extra quality for whoever willing to pay more, we could use the “Freemium” revenue model.
About last class, it was really interesting to learn the difference of creating many value and creating value for many. To learn how important can it be to create value for social purpose. Another takeaway was to learn that disruptive innovation doesn’t require the development of a new product, but it can also be done by improving an existing one or making it accessible.
For our own project we are developing a new product who will disrupt any comparable products, because it will better and for free.
The idea of reserve innovation really intrigued me. I was doing some research about this and historically nearly all innovations have been adopted first in rich countries. Reserve Innovation is the opposite idea – a reverse innovation is any innovation likely to be adopted first in the developing world FIRST. Having grown up in India, I think that reverse innovation will become more and more common, and that it presents a significant challenge for large organizations headquartered in the rich world.