The Innovation Strategy Most Companies Miss

**Alison Beard** (0:02)
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**Adi Ignatius** (0:28)
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**Alison Beard** (0:58)
I'm Alison Beard.

**Adi Ignatius** (0:59)
And I'm Adi Ignatius, and this is the HBR IdeaCast.

**Alison Beard** (1:10)
Adi, today we're focusing on how to create products and services with widespread global appeal. But let me start with a question for you.
If you wanted to make something that would be popular around the world, where would you start?

**Adi Ignatius** (1:22)
Well, I guess the obvious example is look for products and services that are successful in one market and try to adapt them to other ones.

**Alison Beard** (1:28)
Like Coca-Cola in different sizes and levels of sweetness or Nike running shoes with lighter mesh or a more basic iPhone.

**Adi Ignatius** (1:35)
Yeah. I mean, they all seem to be doing pretty well.

**Alison Beard** (1:38)
Yes, they are. But our guests today say that a lot of companies actually fail when they try to adapt goods in this way. There might be more value in taking a different approach. Amos Winter, professor at MIT and Vijay Govindarajan, professor at Dartmouth's Tuck School of Business, argued that there's an advantage to tackling international markets first. Using innovation to solve the toughest problems most efficiently there versus starting with offerings for wealthy markets and then watering them down.
Winter and Govindarajan, who goes by VG, are authors of the book Global by Design, How to Create Innovations That Scale, Travel, and Transform. Here's our conversation.
Why should leaders today take a global perspective on innovation from the very beginning?

**Amos Winter** (2:28)
I think you can look at it from a number of opportunity standpoints. One, business. The greatest economic growth in the world right now is in emerging markets. And so that, in addition to the large populations, creates amazing business opportunities. But I think the other opportunity is from a social perspective. All the most compelling issues facing humanity really present most compellingly in low resource settings.
You can make that positive humanitarian impact and make a viable business at the same time.

**Alison Beard** (2:59)
Yeah. Vijay, you and a few co-authors introduced the idea of reverse innovation about 15 years ago now, I think. How does this work build on that?

**Vijay Govindarajan** (3:10)
I would call it reverse innovation 2.0, because the reverse innovation that I pioneered 15 years ago, it was really looking at it from a business strategy point of view. When I accidentally met Amos, I realized reverse innovation has actually two sides. There is a business strategy side, but then there is an engineering side.
I said, wouldn't it be nice to bring these two perspectives together? That's what led to Global by Design.

**Alison Beard** (3:46)
You hear the phrase Global by Design.
The first thought or challenge that comes to my mind is that if you're trying to design for everyone, for the world, you're not really designing for anyone. So how do you address that worry?

**Amos Winter** (4:03)
Well, a big part of making globally attractive solutions is figuring out what core values are shared across many different markets. So I suspect people don't worry about iPhones selling everywhere or Coca-Cola selling everywhere.
There's commonalities between different user groups that you can utilize. And then there's modifications to products that are relatively small that you can make so they best align with different markets to maybe change price point or change feature set. But that core value that's universally appreciated still persists between markets.

**Alison Beard** (4:37)
And do you think that companies still try to target primarily wealthy markets first and then are unsuccessful in adapting to less developed countries?

**Amos Winter** (4:50)
Yeah, very much so. Part of that is historical in that really all product design for the last 200 or so years has been focused on US European type markets.
Part of that I think is still because of a bit of a stigma in that companies can look at poor countries and think like, oh, those are poor people, they can't afford to buy products, which isn't true at all, they're also consumers. But I would say more and more multinationals are realizing that the big economic gains in the world are happening in emerging markets. But even if you see that opportunity, actually realizing it is challenging because now you're designing for different population sets than we've historically designed for.