Designed in China, Made in Africa.

In Ethiopia, Transsion Holdings, a Chinese company, is manufacturing handsets costing as little as $10 in an industrial park outside Addis Ababa. Mobile phone models from Tecno, Infinix, and Itel brands, which all belong to Transsion, to be Made in Africa.

Almost 13 years ago, in December of 2005, I wrote my first column for BusinessWeek which began with the sentence “Designed in California, Built in China.” That referred to Apple’s iconic iPod, the MP3 player that industrial design made into a household name, one that led to a whole new medium: podcasting.

Imagine the scale, depth, and level of change that must take place in production planning and control, not to mention supply chains and global value chains, for this continental shift in design and manufacturing to have taken place in less than half a generation.

Berlin’s sustainable lifestyle is our emerging future

Workshop on making your kitchen sustainable, Berlin, 4th August 2018

Berlin is to an environmentally conscious, renewable energy, sustainable ecologically friendly lifestyle what Tokyo’s Harajuku Girls used to be to fast fashion. The pioneer, the path breaker, the evidence of quality of life balanced with conservation. I envy Berliners their city. It is a world city and its still affordable.

Bio is mainstream, not an organic premium, and at the airport the plastic bottle of water was priced 4 times as much as water in a recyclable cardboard container.

There’s no mountains to climb in order to live with a smaller footprint, more leisure time, the calm re-ordering of priorities, the half day off in the sun taking the toddlers to the public fountain to splash and play. This was my introduction to Berlin.

City dwellers would recognize the simplified hyperbole of a short term visitor attempting to grasp the entire sense of the city in a few short days, but forward looking companies, startups, spaces, and people abound. If a “Silicon Valley” of Germany emerges, it will be Berlin.

Rocket Internet is already headquartered there as are any number of startups. The ecosystem is so mature that its hiving off into narrower and narrower specialities. All of which is a good thing to happen as the range and diversity of sustainable solutions that meet the bar of a bunch of EU certifications and regulations is now wide enough and broad enough to show clear patterns of consumer behaviour transformation.

Its almost like Berlin is the living example of the Post Climate Hoax Adapt Immediately era, and its clearly an economically viable and feasible one. And nobody’s apologizing for eating less meat and more vegetables.

Can the structure for innovation planning be used to disrupt itself?

This diagram is from Vijay Kumar’s 101 Design Methods. It is the basis for his structured approach for innovation planning, and the essence of what is taught at the methods driven human centered design program at the Institute of Design, IIT Chicago. Today I want to question some of the fundamental assumptions that underlie it – and from the very beginning of the process, not simply at Phase 5 (Explore Concepts) as given in the book. Some notes on this phase are shared below:

Explore Concepts: In this mode, we do structured brainstorming to explore new concepts. The insights and principles framed earlier provide the starting points for ideation, as well as guides to ensure we’re on track with matching concepts to needs. This helps make our concepts defensible and grounded in reality. In addition to the product and service, ideas for branding, communication, and even business models, are explored. This is the first stage we begin to construct rough (low-fidelity) prototypes – they help focus the team discussions, and provide probes for early user feedback or help the client clarify and refine their product development strategy whilst giving us feedback on the technical aspects.

And the mindsets recommended for this mode include:

  1. Challenging assumptions
  2. Standing in the future
  3. Exploring concepts at the fringes
  4. Seeking clearly added value
  5. Narrating stories about the future

Yet, what I question today is whether these mindsets that encourage experimentation and exploration should come up so late in the process, at the concept development stage, long after research and analysis have been completed? It is true that Vijay says the process is non linear and that a conceptual brainstorm (mode 5) may lead the way into research designed to validate its viability, feasibility and desirability, but this is at the tactical level of business innovation rather than at the strategic level. I question whether its possible to use this powerful and methodical approach to begin with a structured and rigorous questioning of our initial assumptions at the very inception itself in order to over turn the often implicit and tacit drivers of consumption driven growth seeking only to maximize profitability.

Let me share an earlier variation of this diagram first, where the real and the abstract are also mapped on to the process.

It is here, at the real stage, where we seek to understand what is what – through research, before we can analyse it and synthesize our narratives and concepts, where we have the opportunity to question our assumptions regarding the ‘system’. The lower left quadrant where we seek to “understand the real” is where we have the power to make the change that can genuinely disrupt business as usual. Not in the sense of a business model that disrupts but still holds the premise that all profits should flow to the shareholders, or a shift in the corporate’s focus to services from manufacturing but without the explicit articulation of environmental impact or resource conservation. To disrupt business as usual in today’s world would mean starting to question Whom are we serving? Why? For whose benefit? from scratch rather than leaving them unasked, resulting in default assumptions that a business only seeks to innovate to increase its own profits rather than seeking to serve a greater good such as the planet and the wildlife.

The triple bottomline approach captures the end results for those corporations who are already oriented in this way but is there a structured and rigorous planning approach to ensure their near future innovation and strategies align with these corporate goals and visions? And, is there such a flexible tool that the smallest startup can use it to think of how they will choose to do business – after all, it is a choice, and framing it up front in the product and service development process means that it now becomes an explicit choice, a considered decision to be taken, rather than one after the fact or halfway down the process when some inadvertent outcome leads to challenges that were not foreseen.

Sustainable product development already has numerous robust and validated systems and processes, from green buildings to recyclable packaging, what is missing however is the holistic integration of design and manufacturing (which hold the maximum power for good for the planet and the people) with the business thinking and the sustainable revenue generation strategies that can ensure that probability of the innovation’s success is maximized.

And, if we can design the fuzzy front end to be customized to the priority needs of any particular operating environment then following through with this adapted approach to innovation planning for the informal economy or for sub Saharan Africa’s consumer markets will be a cakewalk. Half the current challenge of business planning and corporate strategy in disparate operating environments with very distinctly different conditions is that the methods, tools, and frameworks available to us are all the same, and primarily developed in the context of highly industrialized and information rich consumer markets. They leave assumptions on the conditions and constraints of the operating environment untouched and implicit*.

Thus, going back to the first diagram, where the first mode is Sense Intent:

Sense Intent: Before jumping straight into a project, we pause to consider the world in which our intended users reside. We scan the horizon, looking at technological & socio-economic trends, precursors, competing products, and a variety of other factors that can affect our topic area. All of these offer us a way to reframe our initial problem and help us think of our initial intent and the direction in which we should be moving. This is where our research questions are mapped out, and the problem space described.

This is where the power resides to remake our world. What if we began with the mindset that:

  1. Challenged assumptions
  2. Stood in the future
  3. Explored the fringes
  4. Sought added value and began with articulating for whom (all stakeholders)

And began with the story (5. Narrating stories about the future) about the changes we wished to see, and the impact we wished to have, on our own future, thus inspiring and informing the scope and shape of the research we conducted in order to know people (mode 2) and know context (mode 3) so as to gather the type of forward looking insights we would need in order shape and craft something wholly different from the ground up.

What if we thought about innovation very differently from the current context of a new product or a new service, of looking to disrupt the existing even while seeking to exist within the conventional frameworks of success – profits, scale, reach, impact, fundraising et al

We need new narratives and new goals but ad hoc design fictions and scenarios aren’t going achieve the kind of new we need for the way our planet has changed. Along with the limits of what can be, we have also reached the limits of where our existing methods and tools can take us. And without changing those, at the systemic level, we’ll still be trying to come up with changes within the constraints of what has already been established. We don’t need the existing tools that help us to think outside the box, what we now need are the tools to build new boxes.

 

*This is the tyranny of dominant logic CK Prahalad spoke about.

Open-Source on Hyperspeed: Next generation innovation lessons from Shenzhen

In Shenzhen, 山寨 (shanzhai) has a different meaning than mountain stronghold—yet the term so eloquently expresses a continuity, a history, and a genesis. Shanzhai is a Cantonese term, originally used as a derogatory word for knock-offs — because people from rural mountain villages couldn’t afford real Louis Vuitton or officially produced DVDs of Friends. As a result, there was the cheaper, 山寨 version that was a mere imitation, coming from low-end, poorly run 山寨 factories.

David, along with the scholar Silvia Lindtner, has been researching the innovation ecosystem in Shenzhen for the past few years, and they have proposed the term “new shanzhai.” Part of the original shanzhai economy began with copying DVDs. Since copied DVDs couldn’t be played by name-brand players (an attempt to control piracy or simply due to DVD quality issues), a whole set of products were created to support the copied DVDs — and from there, a wildly creative ecosystem appeared.

This is the new shanzhai. It’s open-source on hyperspeed — where creators build on each other’s work, co-opt, repurpose, and remix in a decentralized way, creating original products like a cell phone with a compass that points to Mecca (selling well in Islamic countries) and simple cell phones that have modular, replaceable parts which need little equipment to open or repair.

Shanzhai’s past has connotations of knock-off iPhones and fake Louis Vuitton bags. New shanzhai offers a glimpse into the future: its strength is in extreme open-source, which stands in stark contrast to the increasingly proprietary nature of American technology. As startups in the Bay Area scramble to make buckets of money, being in this other Greater Bay Area makes it clear why there’s so much rhetoric about China overtaking the US. It is.

So writes Xiaowei R. Wang in her Letter from Shenzhen. Its a timely reminder of the way innovation and invention can play out when there are no secrets left to keep. Pragmatism implies that such extreme openness is not the only path open for intellectual property, but its success in the hyper competitive Chinese market does provide us with clear evidence that such a path is viable and feasible.

One (last) word: Plastics

A UN report issued on World Environment day  showed dozens of nations acting to cut plastic, including a ban on plastic bags in Kenya, on styrofoam in Sri Lanka and the use of biodegradable bags in China. via

There’s a backlash against plastics that is ongoing in many not so noticed parts of the world today. So called ‘weak’ signals from three major economies stand out for the impact in the near and emerging future of their policy shifts towards the material use of plastics.

The first is India, where a recent waste audit in Bengaluru showed that over 60% of the waste littering the streets was from non recyclable consumer product packaging by both international and domestic brands. By 2020, India will abolish all single-use plastics, and introduce a campaign against marine litter, among other things.

The EU has also moved to ban the same, and the proposal also requires EU countries to collect 90 percent of single-use plastic drink bottles by 2025 and producers to help cover costs of waste management and clean-up.

China, on the other hand, has caused consternation among nations who relied on shipping their plastics off for recycling. They’ve banned imports of contaminated waste plastic, leaving questions hanging such as “And how do you get manufacturers to design a product that is more easily recyclable.” Though I find this conversation interesting for its consistent and tone deaf externalization of the problem – waste management is certainly a developing country problem, but materials technology and consumer packaging innovation is a developed country design challenge.

With more than 50 countries waking up to the plastics problem, there’s a deeper shift occurring in the air, beyond our critical need to protect wildlife and the oceans. That of dependency on oil – in case you didn’t know, the bulk of plastic is made from oil.

Here’s a quick round up of something of things happening in these major economies with significant chunks of the world’s population.

India has just approved a massive new 5000 megawatt solar farm, and as the map shows, there’s many more out there in the desert wastes. The Chinese and Indian solar farms are 10x the size of those in North America.

The number of electric cars on the road has more than doubled over the last three years, and of the global sales of electric vehicles (EVs) last year, China contributed more than half. And there’s a shift now from blind growth towards more strategic product development, with greater impact. Numerous European marques are opening factories and R&D centers in China. And India’s doing its best to keep up.

What is going to be the impact of these moves, combined, from these three major economies on the planet? The head of Shell’s Scenarios* team has already developed a scenario called Sky “which shows that changing the ways we transport people and goods is one of the crucial steps toward the world meeting the goals of the Paris Agreement — keeping the increase in global average temperature to well below 2⁰C above pre-industrial levels.”

On a planetary scale, these trends are the future, and products and business models that do not adapt to them are going to be increasingly obsolete, or suitable only for walled gardens. The use of Fahrenheit is but one example. Conserving humanity’s collective home is far more important for all our emerging futures.

 

*Shell originally developed the concept and tools for scenario planning

What can we learn from an informal market?

Documenting Busia Market, Kenya, January 2016 (Photo Credit: Niti Bhan)

I took this photo of Rinku taking photographs during our visit to Busia’s bustling cross border market as a means to document our own work documenting the borderland’s informal trade ecosystem. Sometimes we’re so immersed in our work that we forget to look up and recognize we’re participants too. Document everything, I tell people interested in the how and what of our work, you never know what will be important to capture until later in your analysis, usually when its too late to go back to the field for another look.

So, what can we learn from a visit to an informal market?

The subtext to that question would be “when using human centered design approach to observation and analysis as compared to a regular market visit”?

We’re looking for opportunities. We’re keeping an eye out for what might be missing, a gap or an unmet need. We’re watching closely, often sitting down for a while, or chatting up shopkeepers as often as the fancy strikes us. Its not just window shopping or wandering around aimlessly with a camera. Its entering the market place with a clear focus on learning how it works – what’s the organization of the layout? why are the all these products clustered over there? what is the underlying rhythm of the seeming chaos?

One visit won’t do if you’re looking for opportunities for innovating new products or services for one or more target segments of the market’s population. You might want to make a first recce to get a sense of the whole, and then come back to drill down further into a particular thematic area – is it the delivery men you’re interested in, or the logistics of egg transportation? Or, is it the fresh produce section where you’ve noticed greens wilting in the sun and think you have an idea for a cold chain solution – what would be its business model in this context?

Already, the ideas flow just from thinking about the market. Don’t let the chaos distract you from keenly discerning the system and the structure. That’s where the secret lies.

Stepping up human centered innovation planning for financial inclusion

Two Ugandan analysts from the Financial Sector Deepening (FSD) programme in Uganda write on the need for more human centered product development approaches in the design and delivery of financial services for rural Ugandans, especially the rural poor. One of their suggestions caught my attention in particular:

(iii) Third, to increase the introduction of new game changing solutions by financial institutions the government needs to put in place policies, laws and regulations that allow for new business models and approaches to financial delivery.

Innovative regulatory approaches like “sandboxes”, where startups are allowed to conduct live experiments in a controlled environment, have demonstrated success in developed markets. Regulators can therefore play a crucial role in being financial inclusion catalysts.

The late C.K. Prahalad, guru of serving the poor profitably, first mooted the concept of an innovation sandbox back in 2006, and the essence of his concept has remained an integral part of my own work ever since.

This approach could be called an innovation “sandbox” because it involves fairly complex, free-form exploration and even playful experimentation (the sand, with its flowing, shifting boundaries) within extremely fixed specified constraints (the walls, straight and rigid, that box in the sand).

The value of this approach is keenly felt at the bottom-of-the-pyramid market, but any industry, in any locale, can generate similar breakthroughs by creating a similar context for itself.

What Jimmy Ebong and Joseph Lutwama, the co-authors of the original article linked above, are mooting, however, is an extrapolation of the concept, where the regulatory and policy framework forms the boundaries of the “sandbox” within which various financial services pilots can be tested in the real world.

Committed and forward thinking governments can make the difference overnight for the ‘wicked problem’ of financial inclusion of the rural poor, inspiring innovative human centered solutions to citizen service delivery where its most sorely needed – the resource constrained and inadequate infrastructural operating environments of rural Africa.

 

Note:Mooting” is a favourite word of East African newsmedia, meaning the specialised application of the art of persuasive advocacy.

IKEA in India: Culture Centered Design Strategy

Its taken more than 10 years for single brand retail stores to enter the Indian market, and this year sees India’s first IKEA opening in Hyderabad. TS Ninan introduced their retail challenge succinctly, though he left me wanting more. And this snippet from an interview with the market opening CEO of IKEA in India (who, having laid the groundwork for 6 years, has now left – an interesting and thoughtful strategy right there imo) caught my attention.

In Europe, businesses look at the past, their systems and processes to plan ahead. India does not have a legacy. People don’t look backwards. Here you create the future as you go

Was IKEA’s product, design, and brand strategy going to be as human centered as reports of their 1000 home visits made it seem, or, as the groundbreaker Juvencio Maeztu implies, committing to India means a “culture centered strategy” – that too, one that is customized for each different culture, centered around a metropolitan area. For those who think India is a country, I like to remind them that its closer in concept to the EU, its a single market and currency, but each city has its own languages, culture, cuisine, and clothing, not to mention each state.

Ikea’s global designers meet artisans in co-creation workshops to handhold local artisans design products that meet global quality and design standards.via

I see familiar names in the design article. And I do like the photographs though I recognize my eye is taken aback because the years in Finland have influenced my aesthetic sensibilities closer to the Nordic norm. What I can say is that if this what the Swedes came up with after distilling down their hundreds of home visits, its an excellent integration of two extremes of design language. IKEA will have fun in India, and I suspect they intend to. The takeaway for culture centered design isn’t that “India” will receive one singular design aesthetic or product line but that each one of India’s cultures, both traditional and modern, will be catered to. That is powerful.

Moving from Unbranded to Branded

There’s a larger story here as well. The changes occurring in the Indian consumer market, for instance, and the increase in aspiration, purchasing power, and most importantly, design sensibilities. Back in 1990, during my first job after leaving the National Institute of Design, Ahmedabad, I faced barriers to marketing industrial design services that I suspect don’t even exist now. Product design was imitable and not something one paid good money for oneself. There were corporates who understood our value as a design studio but they were few and far between. Now, IKEA’s entry isn’t into a completely untapped market – there’s competition that’s been born in the last decade, both online and off. And, finally, there’s the handmade artisanal informal sector, who have long copied IKEA products from hand me down catalogs. On the other hand, unlike most consumer brands entering the Indian (or the African market) IKEA recognizes the competition offered by the informal (unorganized, as its known in India) economy, and seems to have addressed it.

What’s interesting about the Wharton analysis from October 2017, is that all the issues it raises seem to have been covered now that IKEA is finally revealing its India strategy as the first store prepares to open this month.

Unlike my concerns back in 2006/7, this time I’m a lot more confident that IKEA will achieve something wholly unexpected in India. I look forward to visiting.

Tecno and Nokia: The tale of two brands

Chinese mobile maker’s original brand strategy succeeds in Africa: Transsion’s Tecno

This year, Nokia got shoved out of the top 10 most admired brands in Africa list, not bad for a company that had lost its way in emerging markets 7 or 8 years ago. As an old (in all senses of the word) Nokia fangirl, here are some of my favourite posts from the heyday of following Jan Chipchase around Africa vicariously through his blog. These days, I tramp my own paths in Africa.

Luthuli Avenue, Nairobi, Kenya, July 2012 [Photo Credit: Niti Bhan]

What’s interesting about this list is Tecno, a mobile phone brand that’s unknown outside of Africa. Transsion Holdings, the Chinese manufacturer that owns this brand has a clear strategy and focus. They own Itel and Infinix brands of phone in addition to the Tecno brand and focus only on the African consumer market. You’ll note Itel is listed at number 16 in the chart above.

According to a report released by market analysis company Canalys, Tecno, iTel and Infinix, which are all sub-brands of Transsion, overtook Samsung with a 38 percent market share in the first quarter, compared with a 23 percent share for Samsung. Via

Rather than the old Nokia strategy of a product aimed at every price segment whilst keeping hold of the mother brand, Transsion has broken branding rules by deploying three brands each with their own persona – Itel for example is very popular for its featurephones among border market traders in Kenya and Uganda due to its week long battery life. Few are aware of Transsion itself. Until its time to add up the numbers.

This brand and design driven original manufacturing strategy reminds me of the work Prof. John Heskett had done in the Pearl River Delta before his untimely death.

John, posing for me when we met in Singapore, back in 2009

This slide captures the essence of his teaching. I only have my class notes.

Transsion’s focus, rise, and brand strategy are all hints of his influence, either directly or indirectly in their approach and work. I’m very glad to be reminded of him today, and I recognize that I will be back writing on more of his work in the very near future.

The comparative global impact of Alibaba vs. Amazon

Alibaba Business School and the United Nations Conference on Trade and Development (UNCTAD) brought 29 young entrepreneurs from 11 countries across Africa to the Alibaba campus in Hangzhou, China for the third eFounders Fellowship cohort.

Chinese corporate soft power influence is production driven, not consumption focused. Alibaba, the e-commerce giant with digital payment tentacles, has been graduating cohorts of young entrepreneurs from Asia and Africa this past year. This initiative is the outcome from Jack Ma’s seminal visit to Nairobi last year, when thousands of young Kenyans waited for him in the sun.

Photo Credit: Abdishakur Mohammed, July 2017, University of Nairobi grounds, Kenya

He talks about entrepreneurship in a digital world, and personally shows up to meet visiting cohorts to talk about taking the lessons learnt from e-commerce in the most challenging environments in China (rural, mobile, social) back home to their own not dissimilar operating environments.

Contrast this with the first thing that comes to mind when you think about Amazon these days – a desperate workforce unable to take a leak, afraid to lose their low waged jobs as worker bees in a humongous warehouse. It keeps prices down and the consumption that runs the billions flowing, but whom does it benefit beyond the shareholders?

It struck me when I saw the news about “Alibaba Global Leadership Academy” that Chinese soft power was increasingly about driving production and growth aka development along their entire value chain, even among putative new consumer markets, whilst the American model was still stuck in a consumption driven mindset of the 1980s first wave of globalization. Buy more cola, wear our jeans, use our credit card, say the American brands in Jakarta or Accra or Nairobi.

The difference in mindset is stark when you think about the tech giants of Silicon Valley looking to uplift with low cost connectivity and internet basics for free, and compare to the Chinese giants thinking about raising the purchasing power first. The english language media would have you believe its all about neo-colonialism for natural resources, but the recent shifts in tactics and strategy seem to imply a less demoralizing mindset than anything evidenced by charitable good works handing out goodies to the downtrodden. Because whatever the agenda, the bottomline will be that at end of the exercise there will be a group left inspired to build their own markets on their mobiles, versus a group left holding a palliative goodie.

“My experience here has shifted my thinking. Before, we were focused on pleasing the investors, but now I see the importance of putting our customers first, then my employees, then the investors,” said Andreas Koumato, 26, from Chad , the founder of Mossosouk, an e-commerce platform. “Let others [benefit], then later, we will gain.”

Production driven social impact is far more powerful than consumption driven. Human centered productivity even more so.