Reverse Innovation: Create Far From Home, Win Everywhere

"Reverse Innovation", by Prof.Vijay Govindarajan and Mr.Chris Trimble of the Amos Tuck School of Business Administration at Dartmouth College, U.S.A., is another master piece after, "The other side of innovation". Like previous book, this is also a delightful mix of excellent academic research and precious practical world sagaciousness. The book primarily originated from the Harvard Business Review's October, 2009, article, "How GE is disrupting itself", and also covers the many insights and ideas that authors had pen down on HBR's blog platform on the same topic. The most influencing among them were the posts on $300 house project that has generated a great deal of debate in academic circles and international press. It is important to mention here that the reverse innovation idea presented in the article considered by Harvard Business Review among the most influencing management ideas of the millennium [...]This book inform the readers that to be successful in emerging markets multinational companies need a shift in their thinking and an escape from all previous knowledge. Emerging markets customer cannot be approached and served the same way as of the developed markets. The main reason for this is the huge income gap between both markets. Contrary to developed markets, the main customers in emerging markets are the people who either belong to the bottom of the pyramid, lower middle class or upper middle class. To capture these markets companies should innovate their products in a way that best serve the local need and also competitive when it comes to price. The knowledge gained through such innovation can be used to introduce the neoteric products in the developed markets. If the companies wants to enjoy the fruit of growth opportunities in emerging markets and also want to sustain their own progress, this book present the strategy for it.The book has two sections. The first part covers the theoretical concepts and second consists of case studies. In my humble view, this is the second section of the book that sets it apart from all other books on emerging markets. The deep seated challenges that arise from lose institutional infrastructure have been vividly detailed with the note that the luck only favors the courageous and brave.In short, this is a worth reading book for all those who are associated with business profession specially a must read for C-class executives, entrepreneurs, corporate managers and academic researchers. Emerging markets offer a wealth of areas for the research, this book points out this glorious fact. Apart from all this is a beautiful addition to one's personal business book library.Imtiaz AHMADFBE- UAE University, UAE.

Caution: this is NOT a book on innovation of capital equipment for emerging markets, nor is it dealing with "product innovation" as the topic is usually treated.Starting reading the book, I first had a hard time to understand its "dominant logic" of connecting social aspects of people living in emerging countries and industrial innovation. Then I found out, that the authors have introduced from the beginning (2009), coining the term: "reverse innovation", the link between the argument "smaller per capita incomes" in emerging markets with "innovations" for them. This way, the living conditions of the majority of people in emerging countries become the benchmark for successful innovation and consequently social criteria like "poor and rich", "one person with 10 dollars vs. 10 people with one dollar", "megatrends with microconsumers", "downhill vs. uphill" which fill the book's pages are understandable. The focus of the book shifts automatically towards innovations for "poor" consumers and consumer goods - not capital equipment.But "re-engineered innovation" for capital equipment to be sold in emerging markets is also on its way and faces quite similar challenges as consumer goods. In both cases the main driver is the gap between market price levels in developed and developing countries, however, the customer types differ: companies and their staff behave not quite similar to street-level consumers - therefore, social aspects as such are no longer the dominating factor ( trying to avoid the use of social categories, however it is obvious, that peoples' income correlates with market prices for goods and vice versa).The book presents several detailed (interesting and helpful) business stories of the way " reverse innovation" for consumer goods is handled - and this is the most valuable part of the book: practical examples with a lot of hints, how to overcome the dominant logic of western headquarter people and how to bridge the cultural gaps between developed and developing countries. Industrial re-engineering innovation projects for capital equipment resemble much.The historical sequence multinational businesses have undergone is quite similar: growth by supplying home markets until they are nearly saturated, going abroad for further growth into similar economies and then, with emerging markets expanding world market volume and strengthened buying power trying to gain market share there as well. We call this "globalization" and due to price-level gaps between developed and developing countries and ever growing competition, companies had to reduce their product cost and adapted them according local needs: "glocalization" was born. Product costs were minimized producing locally and reducing product features and functions, however, the remaining costs often prevented complete market success in emerging countries.People familiar with product management know that product costs are defined by engineering and design and production costs are only a consequence of it. So if production efforts are minimized but product costs still prevent market success - the dominant cost part, defined by design must be changed by re-engineering efforts.Every efficient product engineering project must combine two key ingredients for success for consumer- as well as for capital goods: 1.profound understanding of customer's needs and 2. Technological expertise and latest know how for a thrilling solution fulfilling those wishes and needs. And this has paramount importance for emerging markets innovations.The later (technological expertise) is usually incumbents market leader's core competency. As a consequence, their real challenge is, to have people onboard with in-depth knowledge of the needs of target-group customers - which live in completely different cultures - and to manage that merger. Preferably, experts with headquarter-know-how and local team members form an innovation project team for a defined target-group of customers. To make that teamwork happen merging the two ingredients, that's the whole story of "reverse innovation" and re-engineered innovations for capital goods!The authors deliver 8 business stories of different companies which managed "reverse innovation" successfully. The GE-story from 2009 serves as the backbone of the book and is the most colorful: it demonstrates what works in practice and what doesn't. Some key points are very clear: "Innovation is sometimes a matter of simply talking to the right employees - those who understand local needs"; "Breakthrough customer insights not breakthrough technology matter most in unloading new markets"; "Move people, power, and money to where the growth is"; "Strike the right balance between local autonomy and global authority"; "Carefully managed partnerships of local teams and global expertise" are only a few.Analyzing the business stories in detail, you see sometimes confusing mixes of social and methodological argumentation happen (e.g. in the Hartman-story) and some pure re-engineering examples focusing on one country only (mostly India). So the red thread of the book's main idea is not always very consequent. In the end, a few doubts still remain:1. "Reverse innovation" by the author's definition takes place in a certain (emerging) country based on typical local needs (which are the root-causes for innovation). Can the innovative solution also become successful in other markets? If local needs dominate - won't localization start again and again - country by country? The book's claim: "some fundamental needs are widespread among emerging markets, so that relatively straightforward customizations will suffice for other countries" simply repeats the argument that drove glocalization - what is different this time?2. Even if some (more than 50%) of the solutions given in the examples for "reverse innovation" could also be sold lateron outside the country, where "reverse innovation" initially took place, does this percentage stand for "winning everywhere"? Why should "reverse innovation" solutions "win everywhere", when glocalization failed?3. Many similarities in projects for consumer goods innovation (i.e. "reverse innovation") and capital goods re-engineering innovation exist today. The authors' vision of innovated solutions flowing back into "headquarter's markets" seems to be fragile and to a certain extent questionable even for consumer goods (see 2.). For capital equipment innovations: won't the percentage be much lower?4. The cannibalization topic is well recognized and the counter-arguments given repeat well-known rational statements - however, to convince headquarter people with their emotions and fears: it needs more!

This book is crucial for understanding the economic possibilities beyond the developed world. The eight case studies are brief, engaging and is very instructive on the strategies of capitalizing in developing countries growing consumption. Recommended read for anyone that wants a better understanding of future economic trends of the global economy.

Still I not received this order, ordered in 9th January 2018, but still I not received the book, I too paid the amount, please send as soon as possible

El libro ha tardado mas de dos semanas en llegar. Distribución lenta tal vez porque lo quiero e inglés. Así que todavía no lo he podido valorar.

Este livro introduz o conceito de inovação reversa, ou seja, inovação criada especificamente para mercados emergentes e depois utilizada de volta na matriz da empresa, realimentada.Ele foi escrito baseado em experiências dos autores como consultores na General Electric, mas traz um grande números de casos de estudo para ilustrar a idéia.Recomendo a leitura a todos aqueles que trabalham em mercados emergentes ou em multinacionais.

the book shows great insights into what is happening currently in the world of innovation and global shift of power. Great case studies, as a working book, one understands immediately what does it mean for the own organisation. I think it is a MUST for every business owner and manager to be ready for the future, not only in emerging markets but in the west as well