Modes and routines of frugal innovation: an examination on the basis of the auto components industry

Start Page
46
End Page
72
Citation
Handbook of Research on Techno-Entrepreneurship, Third Edition, p46–72 (2019)
Publisher DOI
10.4337/9781786439079.00011
Publisher
Edward Elgar Publishing
Frugal innovations, that is, affordable products and services with appropriately good quality, are becoming increasingly important for securing long-term competitiveness in both the developing world and in industrial nations. Nevertheless, methods of developing and actually implementing frugal inventions remain under-researched. This study investigates the modes and routines employed by techno-entrepreneurs from industrial nations when innovating frugally. The study is based on the patent data of seven auto component sector firms from Germany with a documented history of contributing cost-effective solutions to frugal vehicles. With the help of a keyword analysis we identify the role of frugality in (patented) technical inventions. Select case studies of frugal inventions show that cost effectiveness and environmental sustainability can often be achieved through simplification of the design and the production process, as well as by eliminating avoidable complexity, for example through standardization. The study shows that frugal inventions in the investigated firms are often driven by individual inventors, while the potential of open global innovation networks is under-utilized. Furthermore, the study shows that frugality can (only) be achieved by a holistic approach that encompasses the entire value chain, including logistics and waste management. The results are potentially beneficial for techno-entrepreneurs across industry sectors and product domains.