Tuesday, September 17, 2013

Enablers of Frugal Innovation: Propositions - Rajnish Tiwari and Cornelius Herstatt - 2012 Working Paper

Open Global Innovation Networks as Enablers of Frugal Innovation: Propositions Based on Evidence from India
Rajnish Tiwari
Cornelius Herstatt
December 2012

Working Paper No. 72

An edited & peer-reviewed version of this paper has been published as “Frugal Innovation: A Global Networks’ Perspective” in: Die Unternehmung, 66(3): 245-274.

Hamburg University of Technology
Schwarzenbergstr. 95, D-21073 Hamburg, Germany


“Low-income markets present a prodigious opportunity for the world’s wealthiest companies – to seek their fortunes and bring prosperity to the aspiring poor.”
(Prahalad and Hart, 2002, 2)


Frugal innovations have a greater chance of commercial success if their value proposition
incorporates the twin objectives of reducing the cost-of-ownership while matching
customer aspirations for quality and image.

Companies can increase the probability of offering an attractive value proposition for successful frugal innovations if they are able to successfully connect their product development process with global innovation networks.

Setting up innovation capabilities in product-specific “lead markets” increases the
probability to identify and access suitable global innovation networks.