How and why reverse innovation can help to reverse the negative trends and tendencies that can weaken an organization
Those who have read one or more of Vijay Govindarajan and Chris Trimble’s previously published books (notably Ten Rules for Strategic Innovators and, more recently, The Other Side of Innovation) already know that they share a unique talent for recognizing and then explaining previously unrecognized – or under-appreciated — business trends and their implications. In this instance, the fact that the dynamics of global innovation are not only changing, they are shifting from rich countries with incumbent economies to meeting unmet needs in developing countries.
Leaders in companies that aspire to accommodate those needs must develop a mindset that is radically different, one whose core concept is reverse innovation. That is, “any innovation that is adopted first in the developing world.” To develop that mindset, leaders must understand the significant differences between rich-country and poor-country needs. “Reverse innovation does not begin with inventing, but with forgetting. You must let go of what you’ve learned, what you’ve seen, and what has brought you your greatest successes. You must let go of the dominant logic that has served you well in rich countries. If you want to use today’s science and technology to address unmet needs in the developing world, then you must start with humility and curiosity.”
In short, think “far from home” before attempting to do business there.
Govindarajan and Trimble identify and explore five need gaps that can serve as paths to success with reverse innovation in macro markets of micro consumers. Understanding the nature, extent, and perils as well as opportunities of these need gaps will serve as the foundation of the radically different mindset to which I referred earlier. With both uncommon rigor and precision, Govindarajan and Chris Trimble explain
o What the reverse innovation challenge requires
o How to develop the reverse innovation mindset
o How to formulate an appropriate strategy based the five paths
o How to create “clean slate” innovation in emerging markets
o “The Reverse Innovation Playbook” (Nine rules to guide and inform strategy, global organization, and project organization
In Part 2, Reverse Innovation in Action,” Govindarajan and Trimble shift their attention to mini-case studies of eight major companies (Chapters 5-12, Pages 75-188), citing real-world situations that demonstrate an abundance of do’s and don’ts during initiatives to develop macromarkets with products that appeal to microconsumers. For example, in Chapter Six, Govindarajan and Trimble explain how Procter & Gamble realized that its success in emerging markets required it to innovate the “Un-P&G Way” because unfamiliar customer needs “trump” leading-edge technology. In Chapter Eleven, “PepsiCo’s Brand-New Bag,” this major multi-national company had to learn how to “think globally but snack locally”
Readers will also appreciate the provision of a “Reverse Innovation Toolkit” in Appendix A. Govindarajan and Trimble include several practical diagnostics and templates that will help business leaders expedite their reverse innovation efforts. In fact, they make brilliant use of reader-friendly devices throughout the book, notably “Playbook Lessons” and “Questions for Reflection. Here in a single volume is probably about as much as any business leader needs to help her or his global company to use reverse innovation to avoid or reverse the negative trends and tendencies that can weaken an organization when it attempts to do business in emerging markets.