JUGAAD OR FRUGAL ENGINEERING
The Eighties and nineties had witnessed the emergence of many new management concepts and techniques which was necessitated by the rapidly changing business environment. Just in time inventory, total quality control, KAIZAN where some of the new concepts which emerged from innovative and aggressive Japanese manufacturers.
In the current highly unpredictable and murky market scenario as the world is gripped in recession, survival is the prime concern of countries and organization. Emerging economies like China and India have to find new ways of overcoming unforeseen problems. Traditional forecasting techniques and contingency plans are of little help, as the global economy hurtles from one problem to the next. To overcome this many Indian managers are using a technique called JUGAAD. The concept may not have crept into many B-school texts, but it is fast becoming a suitable technique which is applicable in emerging economies.
This word of Hindi origin literally means improvisation or ‘to work around’. Colloquially this means creativity. In the Indian context it was a cost-effective way of doing things particularly when you are hampered by the absence of resources. In rural India the greatest problem had always been transportation. Poor roads and the absence of suitable vehicles were perennial problems to the rural Indian. JUGAAD was first applied to address this problem. Farmers in Punjab built a JUGAAD vehicle which was fitted with an agricultural water pump engine. Owing to the absence of basic safety features it is not registered with the Regional Transport Office. Despite its serious shortcomings it serves a common purpose: Cheap transportation, and hence finds favor with rural Indians.
Conceptually, JUGAAD means creating and adapting to unpredictable scenarios. Indian managers finding inspiration in this have given it a different name: ‘frugal engineering’. Application of this concept is not restricted just to technical problems. It has wider application in other areas like, marketing, production and logistics. In recent book entitled JUGAAD INNOVATION authored by Navi Radjou, Jaideep Prabhu and Simone Ahuja, they have mentioned cases relating to the application of JUGAAD by various companies. TATO NANO is a good example of the application of frugal engineering to produce the small car. They have applied it not only in its production department but also logistics. Their initial plan was to manufacture at their plant in Gujarat, and then send the flat packs to local entrepreneurs all over India who would assemble it and deliver it to customers. This was intended to create employment in local communities. When this did not take off, TATA tapped their dealer network to push the car. But many farmers in rural areas were diffident of visiting showrooms manned by sales men in formal suit. TATA immediately redesigned their rural showrooms with salesmen casually dressed and informal behavior.
Another interesting case referred is that of the Chinese consumer goods company Haier. They have a flexible organizational structure, which aims at not mass production but mass customization. In the case of a clogged washing machine in China, the service technician was aghast to find that the farmer was using it to wash the mud of freshly harvested potatoes. Haier found in this not a problem but an opportunity. They realized that there would probably be many who would be using the machine like this. So they invented a machine, which would not only clean potatoes but also peel it!
JUGAAD or frugal engineering is the use of common sense to uncommon problems using common resources. It is not intended to displace technology but adapt it to unpredictable scenarios.
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