海角大神

Could the next big breakthrough in medicine or technology come from the developing world?

We Americans may聽think of poorer nations as hotbeds of war and disease, a place to send our charity checks. But emerging economies are actually an invaluable breeding ground for innovations that could change lives in the United States.

In a process known as 鈥渞everse innovation,鈥� multinational corporations are rolling out cheap, easy-to-use products in Africa, India, and China and then bringing them 鈥渉ome鈥� to Western markets.

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Examples of reverse innovation range from the prosaic 鈥� low-cost Levi鈥檚 jeans that聽聽and hit American stores last spring 鈥� to the revolutionary: a portable, seven-pound heart monitor developed by General Electric engineers in聽.

聽is an adjunct professor at Dartmouth鈥檚 Tuck School of Business and has written an influential聽聽on reverse innovation with his 鈥渟uper star鈥� (according to The Economist) colleague .

In an interview with聽Latitude News, Trimble argued that globalization is forcing big, bureaucratic companies like GE and Proctor & Gamble to change the way they do business.

鈥淓merging economies,鈥� he says, 鈥渁re the globe鈥檚 high-growth hotspots, and most of the world鈥檚 growth over the next two decades will be there. It used to be that you could grow a big corporation at a good clip in just the US, Europe, and Japan. That鈥檚 not the reality anymore.鈥�

In order to stay competitive in the global marketplace, Western companies have discovered they must tap into emerging economies, where experts predict that 聽will live by 2030. And multinationals can鈥檛 just 鈥渄umb down鈥� existing products for consumers in the developing world by stripping away features and lowering the price.

鈥淚f you鈥檙e trying to serve the people that live rich in poor countries, the old model is fine,鈥� says Trimble. 鈥淏ut the needs of the middle class in the developing world are rising dramatically. The challenge when you go from the U. to, say, India is that where before you had one consumer with $10 to spend, now you have 10 consumers with $1 to spend. So there鈥檚 no way you can take your rich-world company and just customize your product for the middle class.鈥�

Other experts agree.

鈥淵ou really have to start from scratch,鈥� says 聽, a professor at the Hult International Business School in Boston. 鈥淚t鈥檚 not business as usual. These are different places with different markets, different consumers, and different needs.鈥�

For example, Lawrence explains, India is a very poor country with a very high rate of heart disease. But GE鈥檚 standard electrocardiogram (ECG) heart monitor wouldn鈥檛 do much good there. It weighs 65 lbs., costs thousands of dollars, and requires a good deal of electricity and training to use. In India, most people don鈥檛 live near a hospital or clinic, and the power supply can be intermittent at best.

So GE engineers in Bangalore designed the聽, which is hand-held, runs on batteries, and retails for just $800. Lawrence says that the product has great potential for poorer rural and urban areas in America, as well as emergency rooms and doctors鈥� offices.

Chris Trimble points to another GE product, a cheap and portable ultrasound device called the聽聽that was聽developed in China and is now for sale in the US. 鈥淭he current generation of kids is the last one that will need stethoscopes to dress up as doctors,鈥� he says. 鈥淭he next one will be carrying around these hand-held ultrasound devices.鈥�

Reverse innovation has actually been happening for a long time, according to聽, who teaches entrepreneurship at Hult. The sports drink Gatorade, for example, was born in 1965 after University of Florida scientists noticed a study showing that carbohydrate-rich drinks helped save the lives of Bangladeshi cholera patients (it鈥檚 called Gatorade after Florida鈥檚 football team, the Gators, who used the drink to re-hydrate).

But Grandinetti argues reverse, or 鈥�,鈥� innovation has a lot of room for growth as consumers and corporations look to cut costs. 鈥淟ook what鈥檚 happened to the global economy,鈥� he says. 鈥淭here鈥檚 no question people are living on different budgets than they have in the past. The West has moved to a different mindset about purchasing, and there are all sorts of opportunities for innovation at the bottom of the pyramid.鈥�

Reverse innovation is, in part, a defensive strategy. Foreign companies like Tata (cars), Mahindra (tractors), Mindray (health care) and Lenovo (technology) are all making cheap products and selling them in domestic and, increasingly, Western markets. If big multinationals don鈥檛 keep up, they鈥檒l find their markets have been 鈥渃annibalized鈥� by low-cost competitors from abroad.

And Trimble says Western corporations still have a long way to go:

鈥淩everse innovation is still an emerging phenomenon. Companies are working on it, doing some things 鈥� but not everything 鈥� right. It鈥檚 tough because these are companies like GE, like Pepsi, like Proctor & Gamble, that have grown up in a different world.

鈥淚f you look at these big multinationals,鈥� he says, 鈥渨hile they may have both a technology and a sales team in India, chances are they鈥檙e not even in the same city. And chances are they report back to different people in the US.鈥�

For Trimble, perhaps the most important take-away of reverse innovation is what it means for today鈥檚 students. 鈥淔or young people to be successful later on,鈥� he argues, 鈥渢hey鈥檒l have to be just as curious about the needs and opportunities of places like Brazil and India and Japan as they are of those in the US. That鈥檚 pretty daunting.

鈥淭here are places in America that are very worldly. But for the most part, this country is pretty insular, and it鈥檚 going to be an enormous challenge for us.鈥�

鈥� at , an online news site that covers stories showing the links between American communities and the rest of the world.

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