It’s a phenomenon that baffles and frustrates those trying to make a difference in developing countries: you introduce a great innovation that could quickly, easily and significantly improve the lives of people living in poverty and nothing much happens. Why?
The innovations we’re talking about here aren’t complex or hard to understand. They don’t require a high level of education. They are simple ways to raise living standards – and they’re often delivered for free. They are obviously positive: vaccinations for people and poultry, higher-yield strains of wheat, cleaner cooking stoves, condoms against HIV, mosquito nets, making fertiliser out of readily available ingredients, washing hands to prevent germs from spreading best practices in seed planting.
“People in developing countries tend to adopt new products and innovations at a very slow and low rate,” says London Business School alumnus Thomas Zhang. “Even when an innovation is pushed by an NGO, sponsored by a government, backed by a great marketing campaign, distributed effectively by a locally respected person or given for free, it’s not likely to be taken up. Our data reveals that the overall rate of adoption is only around 8%. Why is the adoption of productivity enhancing innovations so low when the potential benefits are so clear?”
Zhang – in his doctoral research supervised by Rajesh Chandy of London Business School and Om Narasimhan of London School of Economics – believes he’s found the answer.
Infrastructure impacts on innovation
Previous researchers looked at individuals’ lack of information, finances or skills for clues. Zhang identified two key issues that have been overlooked in this puzzle after analysing three years’ worth of data from an NGO working in Bihar, India. People can’t innovate when they have no “slack time” – that’s time in the day that isn’t spent working, doing household chores, eating or sleeping. Secondly, poor people in developing countries have little slack time because they lack decent infrastructure.
“The impact of even simple and cheap technological advances can be large and far-reaching in the lives of emerging market populations,” Zhang points out. “But the lack of infrastructure sucks up a lot of people’s time. If, after a monsoon, your road washes away, a simple errand to the store becomes a whole day’s mission. If there’s no irrigation and you have to spend hours each day fetching water for basic farming, that doesn’t leave much time to think about how to do your work better.” Good infrastructure, conversely, increases slack time.
Zhang, who now lectures on innovation and entrepreneurship at the School of Business and Management at Queen Mary University of London, carried out the research with support from the Deloitte Institute for Innovation and Entrepreneurship. He analysed data provided by the NGO Digital Green, which is promoting various scientifically validated innovations meant to increase farming productivity at minimal or zero cost. He also collected data from more than 1,000 poor farmers on what they did every hour of the day. He noticed first, that whereas a typical American has four or five hours of slack time a day, the Indian men and women in the study had just one or two hours.
Zhang then examined the rate of adoption of more than 100 innovations being promoted by the NGO and found a relationship between more slack time and higher innovation adoption. On average, each extra hour of slack time in the day resulted in about a 7% increase in the innovation adoption rate. People who have a lot of slack time are able to think about how to improve their welfare. Getting good infrastructure is a good way of helping people free up their time. In addition, living under poverty brings extra stresses; the water might poison you, you have debts you can’t pay back – so there’s already not much spare mental energy. The lack of slack time can be even more impactful on the poor. ”
Early adopters aren’t who you think
The implications go beyond the developing world, says Zhang. “Marketers have always had a hard time identifying early innovation adopters. A lot of people assume it’s young, well-educated urban people who are the most innovative but that doesn’t always come out statistically. Slack time might be a factor to look at. The busy executive is still using the old BlackBerry because he doesn’t have time to figure out how the new iPhone works. It's the pensioners, the students, the semi-employed who are often the ones using the latest app, because they may have the slack time necessary to figure out the features and benefits of innovations.”
Takeaways for companies, policymakers and individuals
- If you’re a company that relies on innovation in your business – to develop new products, to improve processes, to cut costs – be careful not to fill your employees’ days with routine tasks that leave them no time to innovate. Examples of companies that have benefited from this mindset include Google and 3M – both explicitly set free time for employees to think and innovate.
- If you’re a policymaker, especially in a developing country, factor in the extra slack time impact of infrastructure projects. The benefits from building a major road, for example, are more than just being able to move goods over it. There are also huge benefits from the time people save by no longer sitting in traffic being unproductive. That time can now be used for innovation to enhance productivity even more.
- If you’re an individual, think about how you use your own time. It’s easy to assume that the busier you are, the more productive you’re being – but you need free time to think about how to do things better. A day of back-to-back meetings has no time in it for innovatively improving your own life, business or career. Take some time out to explore new tools and think about ways that can make you more productive.
As well as all of this, Zhang says, there’s an important lesson for how we perceive people living in poverty and their apparent inability or unwillingness to change their ways to improve their lives.
“People sometimes imagine that poor people are less innovative due to some personal or societal flaws. Maybe they have a stubborn attitude or a culture that’s resistant to change, for example. This study suggests it’s worth looking at the physical circumstances in which these people are living. If you took someone from a developed country and put them in a rural environment in a developing country, it’s likely their level of innovation would fall pretty quickly.”