For Vijay Govindarajan, the Coxe Distinguished Professor of Management, strategy is always bound up with innovation. Govindarajan grew up in a lower-middle class neighborhood in India, in a one-bedroom house he shared with his parents and five siblings. Electricity wasn’t a 24-hour-a-day presence. The experience made an impression on him. “It told me that India has lots of problems and little resources,” he said. “Finding creative ways to move up in life requires innovative thinking. The only way to succeed is innovation.”
Govindarajan got his first chance to test that theory when he was hired to teach at Harvard Business School. He had attended HBS on a Ford Foundation fellowship, which stipulated that he spend two full years in India after he graduated. The job offer from Harvard required him to start in Cambridge just one week shy of the end of the two-year commitment. He took the job anyway, which meant he had to reimburse the Ford Foundation the money it spent on his education. The debt didn’t sit well in his mind. He and his wife made sacrifices. They lived in a third-floor walkup, didn’t buy a car, bought used furniture. Then the dean of the business school gave him an idea to make some extra income: try consulting. His first client was BF Goodrich, and he enjoyed the opportunity to get inside a company, learn their struggle, and help them think it through. “It made me a better professor and it gave me ideas for research,” he said. “Other academics lacked that access, and I liked it.”
For the past 35 years, Govindarajan has worked with leading companies to learn how they’re solving problems nobody else has figured out, and he’s written best-selling books that share their wisdom. This is what is known as the “next practice”—a procedure or approach that only 10 percent of companies have adopted, but which gives them a strategic advantage. As a researcher and author, Govindarajan’s task is to find the “next practices” out there, test if they really are significant, and then show how other companies can implement them in their own businesses.
The most profound “next practice” that Govindarajan has discovered is something he calls reverse innovation, which is also the title of his 2012 book. Reverse innovation is the process of developing new products for the needs of underdeveloped and emerging economies, and then bringing those lessons and innovations back to the wealthier parts of the world. He made this discovery while consulting closely with General Electric, noticing that it had developed a $5,000 portable ultrasound machine for poor areas in China (in the United States, a similar machine costs $300,000), and then sold it to scores of other, richer countries. GE had done a brilliant thing, but its lesson was lost in the enormity of the organization. Govindarajan shared his insight with GE’s CEO, Jeffrey Immelt D’78, who made reverse innovation a top priority for the company the following year.
“I am inspired by practitioners,” Govindarajan said. “I live in the world of ideas, but for me, ideas come from practitioners.”
Read the entire series!
Part 1 - Tuck Strategists: The history of “strategy”
Part 2 - Vijay Govindarajan
Part 3 - Richard D'Aveni
Part 4 - Constance Helfat
Part 5 - Sydney Finkelstein
Part 6 - Giovanni Gavetti
Part 7 - Ron Adner
Part 8 - Andrew King
Article originally published on Tuck.edu, December 12, 2014.
Vijay Govindarajan (VG)
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