Things you wanted to know about Reverse Innovation
Innovation is usually linked with the industrialized world and often developed in these industrialized countries and then used in developing countries. Many of the ways through which the services are provided in the developing countries are by copying the western model e.g. in health sector specialized hospital are developing which provide high cost health services. But what actually is required in the countries like India is low cost health solution for the masses. For these low cost health solution there is huge market in developing countries, as compared to market for specialised hospital which cannot be afforded by the masses.
Reverse Innovation is just the reverse of the above mentioned process. In reverse innovation, innovation is first developed in the developing country. It is developed by taking into account the needs and requirements of these countries. And then these are applied to industrialized and other parts of the world. Thus it is the reverse of the usual innovation process of developing innovation in developed world and then applying to developing world.
Examples of reverse innovation
Reverse Innovation in Education sector
India is passing through demographic dividend stage, thus it may be difficult to build brick and mortar infrastructure for education in the short term. Thus India may utilise the digital world to provide education to the remotest areas in the country. Massive Open Online courses are its excellent example. Similar can be done for providing skills.
Reverse Innovation in Health Sector
Low cost health solution, especially for rural areas is the need of the developing country. Thus innovation should be done here keeping this criterion of low cost in mind. Once developed, this service has huge market in India and other developing countries.
India is a energy deficit economy. Renewable energy provide good alternative to supplement the coal, gas and oil resources. India has market as well as skilled worker to develop this type of innovation. Western companies are fighting to enter India because of its huge market. Indian companies can get an edge over western by analysing the local needs and requirement in the country.
- Microsoft is creating new phone app services for “dumb” phones which allow users with existing, non-Smartphone devices to access Web sites such as Twitter, Facebook. Built for markets in India and South Africa, there is surprising potential for these apps as a low-cost cloud computing platform. India has the largest population with such non-Smartphone.
- Tata Motors is planning to sell an upgraded version of the TATA Nano in western markets; it’s called Tata Europa.
- GE is now selling an ultra-portable electrocardiograph machine in the U.S. at an 80% markdown for similar products. The machine was originally built by GE Healthcare for doctors in India and China.
- Nokia is testing new business models for classified ads in Kenya; it has also created new features in its hand-held phones sold in the US, based on observations of how phones are shared in Ghana.
- Nestle learned that it could sell its low-cost; low-fat dried noodles originally created for rural India and position the same product as a healthy alternative in Australia and New Zealand.
Indian companies with its large English speaking and highly skilled workforce possess great potential for reverse innovation by analysing the needs of Indian market e.g. low cost health and education. Indian companies by utilising this advantage can put high competition to western companies.