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Deliver Value to the Poor, Not Yesterday’s Technology

Reverse innovation is not about giving yesterday’s technology; it is not about giving cheap products.  It's about giving value because poor people want value.

Poor people don’t want yesterday’s technology, they don’t want cheap products.  What they want is value.  And the question is how can you deliver value?  Let me give you an example, there’s a company in India today which is creating exciting growth opportunities in hospital beds, surgical beds, because the hospital industry is a very fast growing industry in India.  And you need surgical beds.  


Now, what this company is doing is the price of a surgical bed that they are able to offer to the hospital is no different than the competitors.  Let’s assume for the sake of argument the competitor is offering a surgical bed for $10,000; they are also offering a $10,000 bed.  So it is not about lowering costs. What this company is doing is they are telling the hospital, we can save you 40 percent space if you use our surgical bed.

Now why is space-saving so critical for hospitals?  If anyone has gone to a hospital in India what you see is patients are sleeping all over the place.  It is a highly crowded place.  If you can save 40 percent space on a surgical bed then that means I can put 40 percent more patients into my hospital.  And if I can put 40 percent more patients into my hospital, not only am I treating 40 percent more patients, I’m also getting more revenue because those patients will use my x-ray machine, my MRI machine, my cat scanner etc.

Now, how are they able to save 40 percent space?  Their surgical bed is no smaller than the competitor because patients don’t want a smaller bed. They want the same size bed.  So what they have done is they’ve tried to understand the customer problem. 

In most surgeries when you have a surgical bed and imagine there is an IV machine which is standing outside which is occupying space.  So they built the IV machine into the surgical bed. Similarly, the customer records are kept in a chest of drawers or something, so they built a space inside the surgical bed where you can keep customer records.  Similarly, the disinfectant to your hands is kept somewhere in the bathroom. Many times the nurses don’t even go there because it’s too much trouble to go there.  They have build the disinfectant into the surgical bed.  Similarly, the patient may bring his clothes and so on and so forth and you are given another space for keeping their bag, underneath the bed.

This is not about low-cost. This is about understanding the customer problem and delivering the best value.  Therefore, reverse innovation is not about giving yesterday’s technology; it is not about giving cheap products.  It’s about giving value because poor people want value. They don’t want cheap products.  And understanding their problem and solving that is the key for reverse innovation.

In Their Own Words is recorded in Big Think’s studio.

Image courtesy fo Shutterstock


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