The Tickle-up Innovation

Yesterday, I read an article about importance of investments in R&D to manufacture and sell low-cost products or technology in developing markets like India, China and Africa. It emphatically also pointed out troubles to promote such products because of their low customer reach, and lesser brand recognition due to a stiff competition from other well-established consumer products companies. One thing, which caught my eye, was the term “tickle-up innovation“. A total mystery for my knowledge, I decided to Google. Here are my findings and I will try to relate it to you in some or other forms.

First, what is Tickle-up Innovation? (also known as Reverse Innovation) is a practice, which is used first, in developing countries and then sold elsewhere in the world. Traditionally, innovation originates from a developed country, which further moves to a developing markets, if successful. But here life-cycle is reverse, hence the name “Reverse Innovation”. The contrasting point involved is that the products/technology/services, which are a part of it, are created locally in the developing markets.

But what edge does this gives to a local manufacturer?

1) Cut down huge shipment costs.
2) Easy availability of hundreds of low-pay skilled workers.
3) Customer feedback can be obtained and processed much faster and more efficiently.
4) Setup and opportunity costs are considerably lower.
5) Humongous market size to test/pilot any product/technology.
6) Superior customer acquisition model as product developers would mostly be from the country of origin.

Okay. Now comes the part: what all problems it can eradicate by providing a plausible solution. Following is sector-wise analysis:

a ) Food:

High price and Saddled working hours: Life style in developing countries is rougher in comparison with developed countries, thus people tend to miss a daily dose of healthy food or right amount of nutrition (both in rural and urban areas). Costly food further adds misery. Therefore, there is a dire need of a new category of food supplement.

b) Health:

Non-availability of state-of-the-art medical facilities: Paying monthly medical bills isn’t easy. Instruments with high cost and steep power consumption system makes a patient life’s more miserable. Steep power consumption means more electricity requirement, and countries like India, having acute shortage of electricity, ask for efficient and cost-cutting alternatives. To counter such problems many companies are recommending battery based medical devices as a solution.    

c) Technology:

The Power of Web: Everyone demands it but only few can afford. With mobile internet market size to grow to 300 Million by 2015 in India (and considerably at a higher or same rate in other developing countries) there are only two ways to cash-in the upcoming customers. Either by decreasing prices of smartphone devices or by innovating applications for non-smartphone segment to allow users to access web. The later could be a more cost-effective and plausible solution at this moment. Due to this reason alone, most of the tech companies are investing and betting on cloud computing today.

d) Travel and Transportation:

Easy on pocket, anytime, anywhere: The “mantra” for travel nowadays. Everyone loves to own car but affordability is the biggest issue stopping them from fulfilling their dreams. Projects like Tata Nano aims to fill that bridge, though, is far from a huge success and yet to be tested worldwide, provides ample opportunities for other Auto-manufactures to take a leap in this segment. Also there is a huge requirement for a new day-to-day transportation model, to keep pace with the growing demand and population.

What NEXT?……If it is successful in developing countries, then it can be upgraded for sales in developed world. But that raise questions about whether or not they be able to compete in the top-tier markets (as I pointed out early). This particular concept is called “provenance paradox“. Though, many experts suggest to go for a long-haul then looking for short-term profits and flaunt your country of origin, if you want build your brand for the future, the real deal is yet to be proven.

innovation

“Roadmap of business innovation for the world” –  Mukesh Ambani

“Essential for global business leaders” – NR Narayana Murthy

“Reverse Innovation explains how innovations are originating from developing countries” – Ratan Tata

Online Education

This HOT topic for college undergraduates is getting trendy also among young school students. The new online education cum fashion [atleast for some time, I would say] can be considered a revolutionary breakthrough for education sector. But the question is: Will it be as promising as it sound? I guess, no-one has the answer except future. But we, for sure, can discuss its pros to justify all the hype and cons to see if there are any holes to fill.

First, lets talk on PROS:

   1) May put some breaks on sky-high tuition costs of our leading world-class education centers.

   2) World’s top institutions’ [Harvard/ Stanford/ Berkeley, etc] course material/ video lectures would now be in everyone’s reach.

   3) Students don’t have to invest 4 years [which I consider too much, even if it is for high quality education] of their life in/on one institution and may focus more on hands-on industry learning. Hence, they will be more productive and sharper.

   4) College faculty and administration have to come up with better course structure to enhance their reputation and to attract students.

   5) Parents’ debt may decrease sharply thus helping them to invest in other important issues.

   6) “Educational” savings could be invested into other requirements to ensure a good quality life, which would also boost consumer market.

   7) It, for sure [in my view], will cause complete downfall of coaching cum business centers.

Now look at some CONS:

   1) Market entry in education sector may become explicitly tough, which in return may lead to monopoly by few institutions.

   2) Learnings about human relations/cultures will be very limited.

   3) Some health related issues can also arise as students will spend most of their time in front of a desktop, tablet, laptop, etc.

   4) May hit people who want to(are) seek(ing) teaching as a career.

   5) Parents will play two roles: a parent and a teacher. And this clearly suggest that they have to bear more pressure.

My Final Take: Education could never be a fun without classrooms.school kids

Often, it’s not about becoming a new person, but becoming the person you were meant to be, and already are, but don’t know how to be.
― Heath L. Buckmaster

P.S: This particular blog is inspired by HBR article on future education