achieving breakthrough innovation

They must radically rethink the entire business model — technology choices, distribution, pricing, scale, workflow, and organization. Fine-tuning the existing business models will not work. That is why the bottom-of-the-pyramid customer base is the best friend that a company focused on breakthrough innovations ever had. This unfamiliar market with very low discretionary income provides sufficient distance from the current top-of-the-pyramid customer base to force institutions to change their practices.

Rather than researching markets, they must immerse themselves in the lives of their target consumers. At the bottom of the pyramid, there are tough challenges in access, awareness, affordability, and availability, and only those who are grounded in the reality of their consumers’ lives will understand their priorities. The consumers themselves may not articulate their needs.

They must accept constraints. They cannot do all things; they must do a few things very well. Many people have come to believe that creativity must be unconstrained; in practice, however, breakthrough creativity requires an explicit acknowledgment of limits.

They must not innovate in isolation. Breakthroughs occur when there are clusters of innovations, taking place continuously over time, in small experiments from which companies learn rapidly, and in an ecosystem involving many collaborators and partners.

None of these changes will be possible without a clear and unflagging commitment to a strategic intent. In the case of Indian health care, that is the intent of serving all people with world-class quality at prices they can afford. Guided by that value, the process of breakthrough innovation is a market development task; it is very different from the challenge of serving an existing market more efficiently.

The Innovation Sandbox by C.K. Prahalad

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