Not all products diffuse at the same level and the same rate. But they affect how firms, industries, Governments, and society function. For example, Apple’s magical success has been due to sustaining iPhone innovation diffusion. On the other hand, the fight against COVID largely depended on sustaining vaccine innovation diffusion. In retrospect, the mission of the Government, Industries, and Firms helping society to keep dealing with issues and advancing broadly depends on sustaining innovation diffusion. But the challenges vary, and they are affected by several factors. For example, although both are innovations, the challenges of sustaining the diffusion of the iPhone and COVID vaccine are not the same. Broadly, sustaining innovation diffusion depends on (i) perceived value, (ii) cultural traits, (iii) competition, (iv) externalities, (v) affordability, (vi) availability of resources, and (vii) the environment. Hence, we need to investigate the means and issues affecting innovation diffusion to theorize it.
- Sustaining innovation diffusion as public goods
- Incremental advancement keeps sustaining innovation diffusion
- Reinvention opens a new wave of innovation diffusion
- Frugal innovation runs short in diffusing innovations
- Grassroots innovation demands scalability for sustaining diffusion
- Role of competition for sustaining innovation diffusion
- Externalities, resource availability, and environmental implications highly matter
Sustaining innovation diffusion as public goods
So far, Roger’s theory surfaces in our understanding of the dynamics of innovation diffusion. In pursuit of articulating the diffusion of innovations as public goods, like the COVID vaccine, Roger observed five categories of adopters. They are (i) innovators, (ii) early adopters, (iii) early majority, (iv) late majority, and (v) laggards.
As we may recall, at the beginning of the availability of the COVID vaccine as a free public good, only a small portion of citizens showed up to get a doze. They belong to the innovator group, followed up by larger mass—early adopters. The fear factor about unknown side effects and efficacy, among others, were inhibiting the wide-scale adoption. Measures such as follow-up studies about the efficacy and side effects, awareness campaigns, and incentives led to adoption by the large two segments—early and late majority. Measures like restrictions on travel and office attendance led to compelling the last group—laggards–to adopt vaccination.
Hence, Rogers articulated such a diffusion pattern of innovation as a typical bell-shaped curve. Consequentially, the cumulative effect of diffusion through different segments adds up as a standard S-Curve. Although such a theory has been dominating our understanding of innovation diffusion since 1962, technological innovation in a market economy significantly differs from it. Besides, challenges in sustaining innovation diffusion as a profit-making venture in a competitive market are quite different.
Incremental advancement keeps sustaining innovation diffusion
Unlike innovations such as the COVID vaccine as a public good to solve a problem, technological innovations show up in primitive form. From the light bulb and gramophone to the smartphone, they have invariably emerged in embryonic form. In the beginning, due to very low utility, only a few customers show a willingness to pay. Besides, that payment is not sufficient to generate profitable revenue. Hence, despite having latent potential, technological innovation diffusions face high barriers. Therefore, innovators face the challenge of sustaining innovation diffusion.
Awareness campaigns or incentives play small or ineffective roles in overcoming this barrier. The challenge is to keep increasing the willingness to pay and decreasing the cost. Hence, innovators embark on a relentless journey of improvement through a flow of incremental ideas—making innovations better and cheaper. Such a role of ideas is vital for sustaining innovation diffusion.
For example, the diffusion of even the magical iPhone came to an end within one year of the release of the first version. Hence, to sustain the diffusion of the iPhone, Apple has been releasing successive better versions, offering increasing value for money. Consequentially, the diffusion of the iPhone has extended from 1 million of the first version to over 200 million of the iPhone 12. Similarly, incremental advancement has been playing a vital role in diffusing automobiles, microwave ovens, television, computer, and many more great innovations. Car evolution is another great one. Unfortunately, Rogers’ innovation diffusion model fails to consider this effect on innovation diffusion.
But despite the passion and effort in pursuing the relentless journey, progression through incremental advancement slows down and reaches saturation. Multiple factors, such as saturation of technology core, environmental implication, and availability of natural resources, among many other factors, are underlying reasons.
Reinvention opens a new wave of innovation diffusion
As explained, the race of incremental advancement in sustaining innovation diffusion ends to keep progressing due to saturation. To overcome it, we need to embark on reinventing by changing the underlying technology core. Change of the underlying technology core opens the opportunity of offering higher quality at less cost, often causing less harm to the environment. Hence, a new path of growth in sustaining innovation diffusion opens up.
For example, gasoline automobile diffusion has been facing the limit due to emissions and a limited reserve of hydrocarbon. Hence, efforts are underway to reinvent it by changing the internal combustion engine by electric battery or fuel cells. Similarly, the diffusion of the incandescent light bulb faced the barrier due to as high as 85 percent energy wastage. But its reinvention as LED light bulb has remarkably addressed this diffusion limitation. Among other great examples of reinvention sustaining innovation diffusion, microwave, computers, television, and music players are notable ones. For example, the music player emerged as Edison’s Gramophone, for which there were no customers to generate profitable revenue. But reinvention waves caused by the change of technology core several times have led to the diffusion of it to even grassroots level in every geography.
Frugal innovation runs short in diffusing innovations
In most cases, technological innovations are not freely available public goods. Hence, affordability plays a vital role in innovation diffusion. Therefore, means of cost reduction have the potential to contribute to sustaining innovation diffusion. Sometimes, cost reduction by removal of certain features and making others inferior creates the temptation of making innovations affordable to low-income groups. We term it as frugal innovation—a strip-down version of standard products. Despite its apparent appeal, often, such frugal innovation approach fails to sustain innovation diffusion.
For example, Raton Tata wanted to diffuse automobiles among the low-middle-income people of India. Tata opted for frugal innovation to overcome the affordability barrier so that families riding motorbikes could adopt cars. To reduce the cost, its design team embarked on deriving a stripped-down version from its popular family sedan—giving birth to Tata Nano. The mission was to remove a few features and make others inferior.
Yes, such a frugal innovation approach made Tata Nano less costly and affordable to target customer groups. But this cost reduction approach also reduced the utility substantially, resulting in customers’ rejection. Hence, the frugal innovation mission of Tata to contribute to sustaining automobile innovation failed. The underlying reason is that perceived value or utility fell far lower than the cost reduction. Therefore, the frugal innovation approach risks failing to contribute to sustaining innovation diffusion. On the contrary, many innovations have been sustaining diffusion due to the exploitation of ideas to make them better and cheaper.
Grassroots innovation demands scalability for sustaining diffusion
People at the bottom of the pyramid keep facing far more difficulties than those at the top in getting their jobs done. The underlying reason has been that they face barriers to accessing state-of-the-art innovations for numerous reasons. Starting from irrigating land to transporting goods, there have been numerous examples. Hence, they come up with ideas of tools around whatever objects are available within their easy reach to help them to perform their daily jobs. And they proceed to implement them with craftsmanship, often by themselves. These are grassroots innovations. Some examples are retrofitting motorcycles with plows, floating vegetable gardens, vertical oyster farming, or having a water cooler made of clay pots.
Of course, grassroots innovations are helpful. They help millions of people at the bottom of the pyramid in less developed countries. But despite their usefulness, they fail to sustain diffusion. Their implications for uplifting people from the pyramid are limited and not scalable. The underlying reason has been that these innovations fail to sustain diffusion. It happens due to grassroots innovators’ failure to pursue persistent, incremental innovation. But in some instances, a few grassroots innovations have scaled up due to continued incremental advancement, resulting in sustaining innovation diffusion. One notable example is the washing machine, starting its journey as a wooden drum fitted with an external handle for rotating inside cloth. Hence, innovators should focus on scaling up grassroots innovations to create sustaining innovation diffusion effect.
Role of competition for sustaining innovation diffusion
As explained, irrespective of the greatness, all innovations appear in primitive form. They need a flow of ideas for incremental advancement, followed by ideas for reinvention. For creating this over years and decades, there should be incentives. It seems that profit-making incentives from ideas of making innovations better and cheaper work far better than mere creativity and regulation to keep diffusing innovations deeper in society. In retrospect, the command-driven economy of the former Soviet Union failed because it did not benefit from innovation evolution due to a lack of profit-making competition.
Freedom of competition to profit from ideas in improving innovations also lead to creative destruction. In addition to the race of incremental innovation, competition also encourages reinvention for sustaining innovation diffusion. Often, new entrants drive the reinvention waves, as incumbents remain busy to keep profiting from the production of matured products. Hence, creative destruction force out of reinvention also unleashes disruptive innovation effects, destroying dominant incumbent firms. But through this reinvention process, innovations find new diffusion paths. Hence, creative destruction has been a vital outcome of competition for sustaining innovation diffusion.
Externalities, resource availability, and environmental implications highly matter
Externalities, resource availability, and environmental implications affect innovation diffusion. For example, despite the favorable impacts on the emission, the diffusion of electric vehicles (EV) will largely depend on the availability of ingredients in making batteries and the implications of e-waste on the environment.
Externalities could be both positive and negative. For example, e-waste produced by discarded batteries, motors, and electronic circuits poses a negative externality, impeding EV innovation’s diffusion. On the other hand, charging stations create a positive externality effect. Besides, the development of profitable e-waste recycling will reduce the negative externality effect on EVs. Hence, innovators should look for incremental advancement and reinvention ideas and complementary innovators to create a positive externality effect, reduce resource requirements, and lower environmental impact for sustaining innovation diffusion.
As explained, sustaining innovation diffusion is vital in succeeding with innovations. In a competitive market, such an endeavor requires making the innovations increasingly better and also cheaper-resulting in less material consumption. It also keeps reducing the environmental footprint.
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