Frugal innovation: A review and research agenda

Production Challenges in Least Developed Countries

“…For a successful set up of new production locations in developing countries, it is crucial to offer appropriate products regarding costs, function and quality [80][81][82][83][84][85] Hereby, a reduction of complexity should be attained e.g., through reducing the number of components [86], standardization [8,16,29,64,72,87] and reduction of resources (such as financial invest, material, production time) [38,49,51]. As unappropriated products are seen as inefficient [79], local population should be involved in product development [38,79] including local product testing [79,80].…”

“…To support the local society corporates should strive for income equality and combat human rights violations, inequality and poverty [50,79]. Transferring the required know-how for production processes is the major task when setting up new locations [20,49,76]. Hereby, the teachability of the process, the capability of technological and market-based learning are crucial as well as a training and transfer suited for the recipient.…”

“…Furthermore, import taxes, tariff and non-tariff trade barriers, local content requirements and financial restrictions challenge corporates [5][6][7]11,67].Additional politics in developing countries demand social commitment of corporates (e.g. create jobs, increase GDP and combat poverty) [6,38,42,78,79].By contrast some countries are characterized by the lack of political support [48], corruption, abuse and theft [36,[47][48][49]54,56] as well as political instability and high inflation rates [67].…”

“…Gross Domestic Product MNC Multi National Corporation R&D Research and Development Appendix A Local corporate management 1 [27] Local competency 11 [28][29][30][31][32][33][34][35][36][37]77] Local partnerships 2 [38,39] Set up duration 1 [40] Distance to main plant 3 [29,31,41] Complexity of decentralization 1 [42] Communication between subsidies and parents 1 [43] Local labor standards 1 [44] Aftersales processes 1 [45] Investment Investment climate 8 [29,36,42,[45][46][47][48]66] FDI and longterm effects 2 [13,49] Local financing 3 [47,50,108] Appropriate profits 3 [31,51,77] Strategy Local competitors 8 [6,11,32,44,45,[52][53][54] Time of ...…”

“…The investments of multinational companies in locations in least developed countries are highly 161 dependent on political and market stability and size [29,36,[45][46][47][48]. In contrast, foreign direct investment 162 is crucial for entrepreneurs in developing countries to achieve long-term effects [13,49]. At the same 163 time, there are restrictions on local financing opportunities that hinder enterprises [47,50].…”