Innovating for the Next 3 Billion: Don't Get Hooked on the High-Tech Fix

08/18/2013 01:04 pm 13:04:00

Click here to read an original op-ed from the TED speaker who inspired this post and watch the TEDTalk below.

I watched Nathan Myhrvold's TEDTalk, "Could this laser zap malaria?" with fascination. Having just got back from India, where we spent much of our time slapping the pesky mosquitoes, I wouldn't have minded packing Mr. Myhrvold's high-tech zapper with me.

I admire Mr. Myhrvold's intentions and his life's work in technology, cuisine and everything in between. I love the inspiring imagery of the TED talk, the charisma of the speaker on a stage littered with the seductive paraphernalia of technology, entertainment and design -- the three pillars of TED. But it is sobering to think of how far removed this paraphernalia of the "Global North" are from the "Global South", where more than half the world's population lives on under $2 a day. The innovations needed there may not all lend themselves to inspiring imagery. They will be low in technology and design - and probably not terribly entertaining.

Those of us in the "North" are excited about serving our brethren in the "South" for many reasons. Some of the Southerners, about a billion will be paying consumers; they are on the move and they want stuff. According to my old firm, McKinsey & Company, by 2025, more than a billion people will be added to the $10 plus a day layer - officially, the middle class. At the opposite end of the spectrum, according to The Economist magazine, another billion could be pulled out of the "extreme poverty" layer of $1.25 a day by 2030. Of course, there are all of those who are in between. We feel inspired by the success of innovations in the North to re-direct this energy towards the needs of the South.

We need to motivate our brightest minds and investors towards the far less elegant - but equally creative -- work of painstakingly grinding out new business models, new forms of miserly thinking and mastering the process of frustration, chaos and iterative experimentation. -- Bhaskar Chakravorti

Unfortunately, I fear that our fixation with the high-tech fix detracts from the real innovations. As Mr. Myrhvold points out, the successful inventions will have to be applicable, affordable and accessible. However, to jump from invention to impact, these ideas must have the capacity to plug into the rather messy context of the South. It is easy to fall in love with the elegance of the high-tech solution that "zaps malaria" and does other instantaneously amazing things. But it gives us a false sense of complacency that "our" clever technologies can prove to be world-saving, just as they helped us buy any song anywhere, upload our musings in 140 character chunks or allowed us to update our friends and business contacts that we have added a new skill to our repertoire. World-saving may not lend itself to such aesthetically pleasing innovations. We need to motivate our brightest minds and investors towards the far less elegant - but equally creative -- work of painstakingly grinding out new business models, new forms of miserly thinking and mastering the process of frustration, chaos and iterative experimentation.

For those of us who have followed creative solutions for the South for decades, the path from invention to impact is littered with cautionary tales; one of my favorites is that of the Play Pump: it was pumped-up but didn't play for long.

The Play Pump, launched in South Africa, was a marvelously simple idea: Children play on a merry-go-round connected to a pump that draws water for the community's use; the water is stored in overhead tanks that carry commercial billboards, some of which displayed public health messages. It solved many problems simultaneously: access to clean water; play areas for children; health education; funding (supported by the billboards' revenues). The Play Pump seduced the likes of Bill Clinton, Steve Case and Jay-Z. It would have made a brilliant TED Talk. Alas, it was overwhelmed by the messy realities of the global south's context: getting spare parts for the merry-go-round/pump system was difficult in rural South Africa, mechanical devices wear out faster in that environment; more critically, children would have had to play all day at the Play Pump in order to pump sufficient water for the community; walking miles for water is a habit hard to give up, if you are not sure that the local high-tech solution will deliver.

Innovators with their eyes on the needs of the Global South should be mindful of three fundamental principles, without which they are unlikely to get too far:

1. Fill-in institutional gaps

2. Extract creativity from constraints

3. Find the formula for scale

Consider each in turn:

The developing world context is characterized by institutional gaps: missing portions of the value chain - in supply, distribution, manufacturing, and infrastructure; missing political and legal systems; unavailability of adequate financing; serious deficiencies in the state of the human condition: health, education, living conditions, rights and skill-building resources. The innovators must make the gap-filling an essential part of their business model. Consider the investments made by the agricultural trading company, Olam, in Gabon in helping the Gabonese government build infrastructure and getting access in return. Coca-Cola, in collaboration with TechnoServe and the Gates Foundation, provided support to farmers in Kenya and Uganda to improve their cultivation practices to ensure fruit supply for Coke's fruit juices business.

The global south is rich in constraints. You have to contend with limited space, inadequate budgets and complements, extreme climate conditions and restrictive socio-cultural norms. Successful innovators in these markets have paid particular attention to "localizing" the products: smaller products, from Haier or Embraer or LG; products that withstand the poor climatic conditions, such as Cadbury's Bytes brand in India with melted chocolate at its core, to withstand the heat and poor refrigeration or the dairy, beverage and food enhancement company, Promasidor's, replacing of the animal fat in the milk in sub-Saharan Africa with vegetable fat to compensate for the lack of a reliable cold chain.

Coming up with a good idea that solves a local problem is hard enough. But the sizes of the needy populations are enormous. Getting a really good idea to scale-up is a different challenge altogether. How do you, predictably, get adoption to diffuse? Give consumers the tools or push it through large institutions, such as local governments? How do you generate sustainable funding sources? Healthcare groups in India, such as Aravind Eye Care for cataract surgery and Narayana Hruduyalaya, for cardiac, eye, trauma and cancer care, are outstanding examples of internally cross-subsidized operations. In addition, there are several strategies for driving operational efficiencies that have proven successful across a wide range of enterprises. An example is "para-skilling", when activities are broken out into small tasks that can be performed by many less skilled, lower cost workers - thereby lowering costs and spreading out the diffusion capability. But this is all detailed, pain-staking work.

Mosquito-zapping lasers are, indeed, inspirational stories. But let us not ignore the prosaic realities of getting from invention to impact. There is something very satisfying about the Zap! It delivers a solution in an instant. Providing for the growing needs of the next 3 billion consumers is about as far one can get from a Zap!

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