Bringing Symbols of Prosperity to the Masses

What is the value of owning a car?  What benefits do 4 wheels and a roof offer to the driver?  As someone who lives in Chicago and commutes every day – on a morning like this when it is 15 degrees Fahrenheit outside, the immediate answer is safe, efficient, dry and especially warm transportation.  Safety comes first in my mind because when it comes right down to it, a car is the box on wheels that protects the cargo – you and your family – when an accident happens.

Would you believe though that owning a car rather than say a motorcycle could improve your social standing and increase your marriage prospects?  In America where we worship our cars it would seem odd to consider that car ownership bestows that kind of value but why else do young men lust after a high powered 1968 Nightshade Green GTO hardtop or a sleek BMW convertible or a massive jacked-up Ford F-150 truck with large knobby tires?  To be cool and impress the girls, of course.  Cars are all about status.  One just had to stroll the aisles of the Chicago Auto Show which wrapped up 10 days ago to see what the auto manufacturers were selling: power, prestige, thrills, excitement with the appropriate amounts of safety and convenience peppered in as well.  For some young men, their car defines them – it symbolizes their freedom, their power, their virility, their style.

GTO

In an earlier post I examined Dr. Paul Polak’s focus of designing for the other 90 percent of the world.  By the other 90 percent he of course means focusing innovation efforts on helping improve the lives of those who scratch to survive each day by improving their access to food and water, energy, education, healthcare, revenue generating activities, and affordable transportation.

Tata Motors has focused on delivering that last benefit – transportation – to the masses in India and perhaps to the world.  On January 15th, the largest auto manufacturer in India unveiled their rumored $2500 car (or 100,000 rupees), the Nano.  It may not have been unveiled at the Detroit Auto Show but it instantly became the talk of that show.  Tata drew a line in the sand and declared that they were prepared to pursue the very low end of the market, the consumers who today cannot afford an automobile but instead make do with a motor scooter or if they are lucky a 3 wheel rickshaw.

3 Wheel Rickshaw

The Chairman, Ratan N. Tata described his personal inspiration for the car:

I observed families riding on two-wheelers – the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family. Tata Motors’ engineers and designers gave their all for about four years to realise this goal. Today, we indeed have a People’s Car, which is affordable and yet built to meet safety requirements and emission norms, to be fuel efficient and low on emissions. We are happy to present the People’s Car to India and we hope it brings the joy, pride and utility of owning a car to many families who need personal mobility.

Family on scooter

He doesn’t go into the full details though of what it means to own a four wheel rather than a 2 or 3 wheel vehicle in the Indian villages.  Of all things, owning a 4 wheel vehicle increases the marriage prospects and perception of success of the man/family who owns it.  An excellent Forbes article describes the work of the project manager who oversaw the development of the Nano, Girish Wagh, and what he learned in his earlier efforts to develop a truck that would compete with the 3 wheeled motorized rickshaws that many farmers use.  By doing something no one had ever done at Tata – talk to customers! – he finally found the key insight.  As the article explains:

In 2000, Ravi Kant, Managing Director of Tata Motors, needed someone to take on a risky project–to extend the truck line beyond the sturdy Tata mainstays. Kant wanted one cheap enough to compete with three-wheeled, motorized rickshaws and even considered building a small, three-wheeled truck.

Before starting the project, Wagh did something no one at Tata Motors ever had: He talked to customers. The three-wheeler men inevitably insisted on a cheap, dependable truck that could go from village to market carrying, say, 200 chickens, a ton of onions or potatoes, or 2,000 eggs. One night, as sunset approached, Wagh stuck with one rickshaw driver. “I kept asking the question. Why? Why? Why do you want a four-wheeler?” Wagh remembered. Finally, he got the real answer. It turned out it wasn’t really a problem of chickens or eggs. “If I had a four-wheeler, I would have better marriage prospects in my village,” the young man said. Drivers of three-wheelers are looked down upon in India. Wagh realized that four wheels had emotional, not just practical, appeal.

When Tata Motors brought out the bare-bones Ace truck in May 2005 for just $5,100, it had a monster hit: The company sold 100,000 in 20 months. To try to keep up with demand, it offers the truck only in white to save the time it takes to change colors in the factory paint shop. Tata is building a new factory that will be able to turn out 250,000 a year starting this month.

So when Tata Motors needed someone to take charge of the company’s most ambitious plan yet–to build the world’s cheapest car ever–Ravi Kant, who by then had become the company’s managing director, again turned to Wagh. Wagh remembers what he learned marketing the little truck. “People want to move from two-wheelers to four-wheelers,” he says. “Today they can’t afford it.”

Drivers of 3 wheelers are looked down upon in India which means that people want to move from 2 or 3 wheel to 4 wheel vehicles and today they can’t afford it.  Two wheeled scooters and motorcycles sell for $675 to $1600 and the per capita annual income is ~$800.  So this begins to make it feasible for millions of people in India and other developing countries to own a car.

Tata Silver Family

Now I’m not going to go into the contentious side of this question because there really are significant concerns with adding more cars to the already crowded streets in India or any country for that matter.  Increased petrol dependency, increased consumption of a dwindling resource, and let’s not forget about air quality and the ozone layer.  All kinds of people are coming out of the woodwork to say what a bad precedent this is likely to create.  Because every car manufacturer out there is studying this little car very closely.  It wouldn’t pass emissions tests today in the United States or Europe.  And it isn’t exactly a safe vehicle but when compared to the alternative (four on a scooter) or an open rickshaw it actually performs quite well in the safety category.  But it does bring inexpensive, reliable, and comfortable transportation within the reach of millions of people who otherwise would literally be left out in the rain.  Is it the right answer?  Hard to say, but it is a brilliant example of one company’s focus on improving the prospects and lives of very low income people in a developing country.

And let’s not forget, that this is the same company that was announced by Ford Motors as the leading bidder for the Jaguar and Land Rover brands and production facilities.  So in one month, a big little company in India jumped out on the world stage and put the luxury and the economy car manufacturers on notice that they are planning to make a VERY big splash in the world automotive pond.

Designing for the World’s Poor

The Q Drum

Recently BusinessWeek released their annual issue focused on the Most Innovative Companies which celebrates the 50 most innovative companies in the World.

Now wait, before you click on that link, think about what innovation means to you, consider what you might perceive to be a true product or service innovation.  OK, now what companies deliver that kind of innovation?  Who do you think are the hottest innovators out there?  I don’t even have to be Carnac the Magnificent with the envelope to my head in order to tell you exactly what company and product first came to mind.

What is it?

Wait for it…the Apple iPod.

Ok, so maybe I was wrong on my first guess, but I guarantee with 88.5% certainty if you’re younger than 50 that if it wasn’t the iPod then it was Google.

How do I know this?  Because those are the top 2 companies according to BusinessWeek’s survey (whose results were determined by asking senior management at the 1,500 largest global corporations based on market capitalization, an online panel of BusinessWeek readers, and subscribers to the Knowledge@Wharton email newsletter).  But I could have told you that without even asking such an august group because every time I ask potential K&A job candidates or clients to name an innovative product, I have to start off with the disclaimer that I do not want to hear the knee jerk answer of Apple.  The marketing slogan for Apple may have once upon a time been “Think Different” but these days, everyone seems to think like Apple.

But what does this have to do with the price of tomatoes and the title of this post, Alain?  And it’s a good thing you asked because I was just coming to that point.

What exactly is innovation?  Look, everyone has an answer to that question.  And all of them essentially say that it is about delivering something new at a minimum and those who really think about it expand this to developing a culture or attitude focused on delivering the products and services that dynamically anticipate the future and precisely solve the problems faced by the target end user.  The overused sports analogy is a quote from the Great One himself, Wayne Gretzky, when he said, “I skate to where the puck is going to be, not where it has been.”

Well, in my mind, BusinessWeek’s list certainly identifies companies that a statistically valid group of bright individuals believe represent innovation.  But of course every single company they identified is in the Fortune 500 – I haven’t verified that fact but let’s at least say that I would be surprised if there was a company on the list you don’t know because every one of them is a constant part of current business conversation and all are regular subjects of Wall Street Journal articles.  What am I saying?  Well, you go ask Senior Managers at the top companies in the World who they think are the most innovative companies and of course they’re going to identify their peers – the companies they either wish they worked for or find themselves regularly frustrated with because they are a competitor.

But what if you went and asked the world’s poorest – who do you think they would identify?  Ah, yes you say, now Alain is finally getting to the point.  Yes, I do sometimes take a winding path before getting to the crux of my thoughts – remember it’s the journey not the destination that makes life so enjoyable.

Well, the NY Times has a fantastic article discussing Design that Solves Problems for the World’s Poor.  The focus is on Dr. Paul Polak, the founder and CEO of International Development Enterprises and an exhibit being held by the Cooper-Hewitt National Design Museum in New York City that honors the inventors dedicated to serving “the other 90 percent.”  That 90 percent number has reference to Dr. Polak’s statment that the world’s cleverest designers spend their energy catering to the world’s richest 10 percent creating items like wine labels, couture, and Maseratis.  Dr. Polak calls for a revolution to reverse that silly ratio.

So it would seem, this would mean that true innovation is something that significantly improves the quality of people’s lives.  Or as Jebediah Springfield (Simpsons reference here) said, “A noble spirit embiggens the smallest man.”

The prime example and one that is so simple yet so elegant it should simply be the picture next to the Webster’s Dictionary entry for innovation, is the 20-gallon rolling drum for transporting water.  That’s the picture you see at the top of this post.  As the article says, millions of women and girls spend many hours doing each year — fetching water. Balancing heavy jerry cans on the head may lead to elegant posture, but it is backbreaking work and sometimes causes crippling injuries. The Q-Drum, a circular jerry can, holds 20 gallons, and it rolls smoothly enough for a child to tow it on a rope.

How amazing is that?  How simple is that?  The article and the attached video go on to discuss other efforts that designers are taking in order to help the impoverished improve their quality of life and make a profit while doing so.

To me, these are the real heroes, the real innovators and the ones who deserve celebrating.