The concept is even more appealing in the current situation of the COVID-19 pandemic. With the change of business climate, many companies are now focused towards providing affordable quality products which suit current and new markets. The new initiative is hoped to enable companies to develop their ideas into frugal products that meet the expectation of their targeted customers.

The programme is also aimed at inculcating a strong innovation culture amongst the SMEs and at introducing methods to structurally organise and manage ideas towards solutions that can succeed in the market.

The principal tenets of Frugal Innovation, as per Fraunhofer IAO’s definition, are summarised as follows:

In the programme, the SMEs worked with various innovation methods such as Persona, Kano Model, Conjoint Analysis and Price Sensitivity Meter to help the SMEs to formulate and improve their ideas. It included top-down solution trimming as well as bottom-up solution exploration in order to develop user-oriented frugal products and services. Several interview sessions with potential customers were also held either through live sessions or via online survey forms.

With a frugal mindset instilled among the SMEs and frugal strategies incorporated into their business models, the SMEs are now in a better position to achieve sustainable competitive advantage in the long run.

During the review sessions, the companies have acknowledged the advantages of using the structured methods in understanding their potential customer needs. Surprisingly, many have discovered that what they thought were their customer needs are no longer valid. The methods introduced have allowed them to visualise and map out the ideas versus the needs and using this information, they are able to discuss with their potential customers and validate their ideas. In the end, they are able to draw up a business plan which supports their idea.

In conclusion, the programme has been a success in terms of imparting knowledge to SMEs in expanding their ideas towards embracing the frugality concept prior to refining and developing their products. Under the SIRIM-Fraunhofer programme, these companies will have the opportunity to utilise the technology intervention fund in 2022 for product development. It is hoped that with the success of the pilot programme, many more SMEs will follow suit and embrace Frugal Innovation in developing new products and new business opportunities.

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