Defining frugal innovation: a critical review

Abstract

Frugal innovation (FI), which has gained traction in various sectors, is loosely defined as developing quality solutions in a resource-constrained environment that are affordable to low-income consumers. However, with its popularity, multiple and diverse definitions have emerged that often lack a theoretical foundation. This has led to a convoluted conceptualisation that hinders research and adoption in practice. Despite this plethora of perspectives and definitions, scholars do agree that there is a need for a unified definition. This critical review across the management, entrepreneurship, business and organisation studies literatures explores the multiple definitions of FI that have appeared in the last two decades and seeks to examine the commonalities and differences. One definition is supported by a theoretical underpinning, and main themes include affordability, adaptability, resource scarcity, accessibility and sustainability, however, there remains significant ambiguity around what constitutes an FI. Defining FI as a concept should not deter from focusing on its core aim and identifying an FI may be best achieved by comparing it to an incumbent alternative, rather than against an ill-defined concept. There is merit in developing a common understanding of FI to support strategies for its successful acceptance and diffusion globally.

Technological Transformation and the Role of Frugal Innovations in Entrepreneurship Development in India

“…However, this can be compared to disruptive innovation and the idea of breaking the pyramid in emerging markets while targeting low-income or price-sensitive consumers in developed countries. It is also a business strategy that is an extension of Jugaad innovation to create cost-effective solutions to common problems (Hindocha et al, 2021). There are so many terms coined to define it, including 'disruptive innovation', 'pro-poor innovation' and 'grassroots innovation'.…”

The Scarcity–Prosociality Link: Ambiguous, Yet Thought-provoking

“…Whether this has added to psychological well-being remains to be seen, but it is a possibility. Scarcity also nurtures frugal innovativeness and the Indian notion of ‘ jugaad ’ (Hindocha et al, 2021). Both ideas, namely frugal innovation and jugaad (especially the latter concept and practice, because of its pejorative connotations), have been criticised.…”

“…Although scarcity is usually described as something to be remedied or avoided, it may also have some positive consequences or concomitants. For example, scarcity encourages behaviour such as frugality and thrift (Ratchford et al, 2021), and attitudes such as innovativeness (Hindocha et al, 2021).…”