Creative problem-solving in the face of extreme limits
-
0:01 - 0:05When you grow up in a developing country
like India, as I did, -
0:06 - 0:11you instantly learn to get more value
from limited resources -
0:11 - 0:15and find creative ways to reuse
what you already have. -
0:16 - 0:20Take Mansukh Prajapati,
a potter in India. -
0:20 - 0:26He has created a fridge
made entirely of clay -
0:26 - 0:28that consumes no electricity.
-
0:28 - 0:32He can keep fruits and vegetables
fresh for many days. -
0:32 - 0:37That's a cool invention, literally.
-
0:37 - 0:41In Africa, if you run out of
your cell phone battery, don't panic. -
0:41 - 0:44You will find some
resourceful entrepreneurs -
0:44 - 0:47who can recharge your
cell phone using bicycles. -
0:47 - 0:49And since we are in South America,
-
0:49 - 0:52let's go to Lima in Peru,
-
0:52 - 0:54a region with high humidity
-
0:54 - 0:59that receives only one inch
of rainfall each year. -
0:59 - 1:06An engineering college in Lima
designed a giant advertising billboard -
1:06 - 1:13that absorbs air humidity
and converts it into purified water, -
1:13 - 1:18generating over 90 liters
of water every day. -
1:18 - 1:20The Peruvians are amazing.
-
1:20 - 1:24They can literally create
water out of thin air. -
1:24 - 1:26For the past seven years,
-
1:26 - 1:30I have met and studied
hundreds of entrepreneurs -
1:30 - 1:37in India, China, Africa and South America,
and they keep amazing me. -
1:37 - 1:40Many of them did not go to school.
-
1:40 - 1:44They don't invent stuff in big R&D labs.
-
1:44 - 1:47The street is the lab.
-
1:47 - 1:49Why do they do that?
-
1:49 - 1:53Because they don't have the kind
of basic resources we take for granted, -
1:53 - 1:54like capital and energy,
-
1:54 - 1:57and basic services
like healthcare and education -
1:57 - 2:01are also scarce in those regions.
-
2:01 - 2:07When external resources are scarce,
you have to go within yourself -
2:07 - 2:11to tap the most abundant
resource, human ingenuity, -
2:11 - 2:18and use that ingenuity to find clever ways
to solve problems with limited resources. -
2:18 - 2:22In India, we call it Jugaad.
-
2:22 - 2:24Jugaad is a Hindi word
-
2:24 - 2:30that means an improvised fix,
a clever solution born in adversity. -
2:30 - 2:35Jugaad solutions are not
sophisticated or perfect, -
2:35 - 2:38but they create more value at lower cost.
-
2:38 - 2:42For me, the entrepreneurs
who will create Jugaad solutions -
2:42 - 2:44are like alchemists.
-
2:44 - 2:48They can magically transform
adversity into opportunity, -
2:48 - 2:53and turn something of less value
into something of high value. -
2:53 - 3:00In other words, they mastered the art
of doing more with less, -
3:00 - 3:05which is the essence of frugal innovation.
-
3:05 - 3:11Frugal innovation is the ability
to create more economic and social value -
3:11 - 3:14using fewer resources.
-
3:14 - 3:20Frugal innovation is not about making do;
it's about making things better. -
3:21 - 3:26Now I want to show you how,
across emerging markets, -
3:26 - 3:31entrepreneurs and companies are adopting
frugal innovation on a larger scale -
3:31 - 3:36to cost-effectively deliver healthcare
and energy to billions of people -
3:36 - 3:40who may have little income
but very high aspirations. -
3:41 - 3:43Let's first go to China,
-
3:43 - 3:47where the country's largest
I.T. service provider, Neusoft, -
3:47 - 3:50has developed a telemedicine solution
-
3:50 - 3:55to help doctors in cities
remotely treat old and poor patients -
3:55 - 3:57in Chinese villages.
-
3:57 - 4:01This solution is based on
simple-to-use medical devices -
4:01 - 4:06that less qualified health workers
like nurses can use in rural clinics. -
4:06 - 4:10China desperately needs
these frugal medical solutions -
4:10 - 4:18because by 2050 it will be home
to over half a billion senior citizens. -
4:18 - 4:21Now let's go to Kenya,
-
4:21 - 4:27a country where half the population
uses M-Pesa, a mobile payment solution. -
4:27 - 4:29This is a great solution
for the African continent -
4:29 - 4:33because 80 percent of Africans
don't have a bank account, -
4:33 - 4:38but what is exciting is that M-Pesa
is now becoming the source -
4:38 - 4:43of other disruptive business models
in sectors like energy. -
4:43 - 4:48Take M-KOPA, the home solar solution
that comes literally in a box -
4:48 - 4:53that has a solar rooftop panel,
three LED lights, -
4:53 - 4:57a solar radio, and a cell phone charger.
-
4:57 - 5:03The whole kit, though, costs 200 dollars,
which is too expensive for most Kenyans, -
5:03 - 5:09and this is where mobile telephony
can make the solution more affordable. -
5:09 - 5:15Today, you can buy this kit by making
an initial deposit of just 35 dollars, -
5:15 - 5:20and then pay off the rest by making
a daily micro-payment of 45 cents -
5:20 - 5:23using your mobile phone.
-
5:23 - 5:28Once you've made 365 micro-payments,
the system is unlocked, -
5:28 - 5:34and you own the product and you start
receiving clean, free electricity. -
5:34 - 5:36This is an amazing solution for Kenya,
-
5:36 - 5:40where 70 percent of people
live off the grid. -
5:41 - 5:44This shows that with frugal innovation
-
5:44 - 5:49what matters is that you take what is
most abundant, mobile connectivity, -
5:49 - 5:54to deal with what is scarce,
which is energy. -
5:54 - 5:59With frugal innovation,
the global South is actually catching up -
5:59 - 6:02and in some cases
even leap-frogging the North. -
6:02 - 6:07Instead of building expensive hospitals,
China is using telemedicine -
6:07 - 6:11to cost-effectively treat
millions of patients, -
6:11 - 6:16and Africa, instead of building
banks and electricity grids, -
6:16 - 6:21is going straight to mobile payments
and distributed clean energy. -
6:21 - 6:28Frugal innovation is diametrically opposed
to the way we innovate in the North. -
6:28 - 6:30I live in Silicon Valley,
-
6:30 - 6:33where we keep chasing
the next big technology thing. -
6:33 - 6:38Think of the iPhone 5, 6, then 7, 8.
-
6:38 - 6:42Companies in the West spend
billions of dollars investing in R&D, -
6:42 - 6:46and use tons of natural resources
to create ever more complex products, -
6:46 - 6:50to differentiate their brands
from competition, -
6:50 - 6:54and they charge customers
more money for new features. -
6:54 - 7:00So the conventional business model
in the West is more for more. -
7:01 - 7:07But sadly, this more for more model
is running out of gas, for three reasons: -
7:07 - 7:11First, a big portion
of customers in the West -
7:11 - 7:14because of the diminishing
purchasing power, -
7:14 - 7:17can no longer afford
these expensive products. -
7:17 - 7:22Second, we are running out of
natural water and oil. -
7:22 - 7:26In California, where I live,
water scarcity is becoming a big problem. -
7:26 - 7:28And third, most importantly,
-
7:28 - 7:31because of the growing income disparity
-
7:31 - 7:34between the rich
and the middle class in the West, -
7:34 - 7:37there is a big disconnect
between existing products and services -
7:37 - 7:39and basic needs of customers.
-
7:39 - 7:41Do you know that today,
-
7:41 - 7:46there are over 70 million Americans
today who are underbanked, -
7:46 - 7:49because existing banking services
-
7:49 - 7:54are not designed to address
their basic needs. -
7:54 - 7:58The prolonged economic crisis
in the West is making people think -
7:58 - 8:01that they are about to lose
the high standard of living -
8:01 - 8:04and face deprivation.
-
8:04 - 8:08I believe that the only way we can sustain
growth and prosperity in the West -
8:08 - 8:12is if we learn to do more with less.
-
8:12 - 8:15The good news is,
that's starting to happen. -
8:15 - 8:18Several Western companies
are now adopting frugal innovation -
8:18 - 8:23to create affordable products
for Western consumers. -
8:23 - 8:25Let me give you two examples.
-
8:25 - 8:27When I first saw this building,
-
8:27 - 8:30I told myself it's some
kind of postmodern house. -
8:30 - 8:35Actually, it's a small manufacturing plant
set up by Grameen Danone, -
8:35 - 8:39a joint venture between
Grameen Bank of Muhammad Yunus -
8:39 - 8:41and the food multinational Danone
-
8:41 - 8:44to make high-quality yogurt in Bangladesh.
-
8:44 - 8:48This factory is 10 percent the size
of existing Danone factories -
8:48 - 8:51and cost much less to build.
-
8:51 - 8:54I guess you can call it a low-fat factory.
-
8:54 - 8:59Now this factory, unlike Western factories
that are highly automated, -
8:59 - 9:05relies a lot on manual processes in order
to generate jobs for local communities. -
9:05 - 9:08Danone was so inspired by this model
-
9:08 - 9:12that combines economic efficiency
and social sustainability, -
9:12 - 9:16they are planning to roll it out
in other parts of the world as well. -
9:16 - 9:18Now, when you see this example,
-
9:18 - 9:22you might be thinking, "Well,
frugal innovation is low tech." -
9:22 - 9:24Actually, no.
-
9:24 - 9:27Frugal innovation is also
about making high tech -
9:27 - 9:30more affordable and more
accessible to more people. -
9:30 - 9:32Let me give you an example.
-
9:32 - 9:35In China, the R&D engineers
of Siemens Healthcare -
9:35 - 9:40have designed a C.T. scanner
that is easy enough to be used -
9:40 - 9:44by less qualified health workers,
like nurses and technicians. -
9:44 - 9:48This device can scan
more patients on a daily basis, -
9:48 - 9:50and yet consumes less energy,
-
9:50 - 9:54which is great for hospitals,
but it's also great for patients -
9:54 - 9:58because it reduces the cost
of treatment by 30 percent -
9:58 - 10:02and radiation dosage by up to 60 percent.
-
10:02 - 10:06This solution was initially designed
for the Chinese market, -
10:06 - 10:10but now it's selling like hotcakes
in the U.S. and Europe, -
10:10 - 10:15where hospitals are pressured
to deliver quality care at lower cost. -
10:16 - 10:19But the frugal innovation revolution
-
10:19 - 10:23in the West is actually led
by creative entrepreneurs -
10:23 - 10:25who are coming up with amazing solutions
-
10:25 - 10:28to address basic needs
in the U.S. and Europe. -
10:28 - 10:31Let me quickly give you
three examples of startups -
10:31 - 10:33that personally inspire me.
-
10:33 - 10:37The first one happens to be launched
by my neighbor in Silicon Valley. -
10:37 - 10:39It's called gThrive.
-
10:39 - 10:42They make these wireless sensors
designed like plastic rulers -
10:42 - 10:45that farmers can stick
in different parts of the field -
10:45 - 10:49and start collecting detailed
information like soil conditions. -
10:49 - 10:54This dynamic data allows farmers
to optimize use of water energy -
10:54 - 10:58while improving quality
of the products and the yields, -
10:58 - 11:03which is a great solution for California,
which faces major water shortage. -
11:03 - 11:05It pays for itself within one year.
-
11:05 - 11:09Second example is Be-Bound,
also in Silicon Valley, -
11:09 - 11:12that enables you
to connect to the Internet -
11:12 - 11:17even in no-bandwidth areas
where there's no wi-fi or 3G or 4G. -
11:17 - 11:18How do they do that?
-
11:18 - 11:25They simply use SMS, a basic technology,
but that happens to be the most reliable -
11:25 - 11:27and most widely available
around the world. -
11:27 - 11:30Three billion people today with
cell phones can't access the Internet. -
11:30 - 11:35This solution can connect them
to the Internet in a frugal way. -
11:35 - 11:39And in France, there is
a startup calle Compte Nickel, -
11:39 - 11:41
which is revolutionizing
the banking sector. -
11:41 - 11:45It allows thousands of people
to walk into a Mom and Pop store -
11:45 - 11:49and in just five minutes activate
the service that gives them two products: -
11:49 - 11:54an international bank account number
and an international debit card. -
11:54 - 11:58They charge a flat annual
maintenance fee of just 20 Euros. -
11:58 - 12:01That means you can do
all banking transactions -- -
12:01 - 12:03send and receive money,
pay with your debit card -- -
12:03 - 12:05all with no additional charge.
-
12:05 - 12:09This is what I call low-cost banking
without the bank. -
12:09 - 12:14Amazingly, 75 percent
of the customers using this service -
12:14 - 12:18are the middle-class French
who can't afford high banking fees. -
12:18 - 12:23Now, I talked about frugal innovation,
initially pioneered in the South, -
12:23 - 12:25now being adopted in the North.
-
12:25 - 12:27Ultimately, we would like to see
-
12:27 - 12:30developed countries
and developing countries -
12:30 - 12:33come together and co-create
frugal solutions -
12:33 - 12:35that benefit the entire humanity.
-
12:35 - 12:38The exciting news is
that's starting to happen. -
12:38 - 12:41Let's go to Nairobi to find that out.
-
12:41 - 12:44Nairobi has horrendous traffic jams.
-
12:44 - 12:47When I first saw them,
I thought, "Holy cow." -
12:47 - 12:52Literally, because you have to dodge cows
as well when you drive in Nairobi. -
12:52 - 12:54To ease the situation,
-
12:54 - 13:01the engineers at the IBM lab in Kenya
are piloting a solution called Megaffic, -
13:01 - 13:05which initially was designed
by the Japanese engineers. -
13:05 - 13:10Unlike in the West, Megaffic
doesn't rely on roadside sensors, -
13:10 - 13:13which are very expensive
to install in Nairobi. -
13:13 - 13:16Instead they process images, traffic data,
-
13:16 - 13:22collected from a small number of
low-resolution webcams in Nairobi streets, -
13:22 - 13:26and then they use analytic software
to predict congestion points, -
13:26 - 13:30and they can SMS drivers
alternate routes to take. -
13:30 - 13:34Granted, Megaffic is not
as sexy as self-driving cars, -
13:34 - 13:39but it promises to take Nairobi drivers
from point A to point B -
13:39 - 13:43at least 20 percent faster.
-
13:43 - 13:49And earlier this year, UCLA Health
launched its Global Lab for Innovation, -
13:49 - 13:54which seeks to identify frugal healthcare
solutions anywhere in the world -
13:54 - 13:59that will be at least 20 percent cheaper
than existing solutions in the U.S. -
13:59 - 14:02and yet more effective.
-
14:02 - 14:06It also tries to bring together
innovators from North and South -
14:06 - 14:11to cocreate affordable healthcare
solutions for all of humanity. -
14:12 - 14:16I gave tons of examples of frugal
innovators from around the world, -
14:16 - 14:20but the question is, how do you go about
adopting frugal innovation? -
14:20 - 14:24Well, I gleaned out three principles
from frugal innovators around the world -
14:24 - 14:26that I want to share with you
-
14:26 - 14:28that you can apply
in your own organization -
14:28 - 14:31to do more with less.
-
14:31 - 14:35The first principle is: Keep it simple.
-
14:35 - 14:38Don't create solutions
to impress customers. -
14:38 - 14:41Make them easy enough to use
and widely accessible, -
14:41 - 14:44like the C.T. scanner we saw in China.
-
14:44 - 14:48Second principle:
Do not reinvent the wheel. -
14:48 - 14:52Try to leverage existing resources
and assets that are widely available, -
14:52 - 14:56like using mobile telephony
to offer clean energy -
14:56 - 15:00or Mom and Pop stores
to offer banking services. -
15:00 - 15:04Third principle is:
Think and act horizontally. -
15:04 - 15:08Companies tend to scale up vertically
-
15:08 - 15:11by centralizing operations
in big factories and warehouses, -
15:11 - 15:15but if you want to be agile and deal
with immense customer diversity, -
15:15 - 15:20you need to scale out horizontally
using a distributed supply chain -
15:20 - 15:23with smaller manufacturing
and distribution units, -
15:23 - 15:27like Grameen Bank has shown.
-
15:27 - 15:32The South pioneered frugal innovation
out of sheer necessity. -
15:32 - 15:37The North is now learning to do
more and better with less -
15:37 - 15:40as it faces resource constraints.
-
15:40 - 15:45As an Indian-born French national
who lives in the United States, -
15:45 - 15:52my hope is that we transcend
this artificial North-South divide -
15:52 - 15:54so that we can harness
the collective ingenuity -
15:54 - 15:56of innovators from around the world
-
15:56 - 15:59to cocreate frugal solutions
-
15:59 - 16:03that will improve the quality of life
of everyone in the world, -
16:03 - 16:06while preserving our precious planet.
-
16:06 - 16:08Thank you very much.
-
16:08 - 16:12(Applause)
- Title:
- Creative problem-solving in the face of extreme limits
- Speaker:
- Navi Radjou
- Description:
-
Navi Radjou has spent years studying "jugaad," also known as frugal innovation. Pioneered by entrepreneurs in emerging markets who figured out how to get spectacular value from limited resources, the practice has now caught on globally. Peppering his talk with a wealth of examples of human ingenuity at work, Radjou also shares three principles for how we can all do more with less.
- Video Language:
- English
- Team:
- closed TED
- Project:
- TEDTalks
- Duration:
- 16:25
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At 07:49 the question mark is missing
There's a typo at 11:34: it says "calle" instead of "called".