The biggest barrier to innovation is a lack of funding, so frugal innovation has an immediate advantage. Doing things on the cheap means less work in finding money and lower risk overall (as well as other benefits – see Frugal Innovation: Not just for tough times). However, any innovation means change, and change will always meet resistance.
Perhaps the biggest barrier frugal innovation faces is ignorance. This approach has gained some media attention and even a place or two in academia, but it is so new that the term isn’t even fixed yet. (Frugal engineering is an equivalent term, according to Wikipedia.) Naturally, this makes many decision makers, who are introduced to a frugal innovation project before they have become comfortable with the approach, uneasy. Saving money is great, but being a pioneer takes courage.
The traditional customers for frugal innovation — people with less money, even people at the base of the economic pyramid — can also become a challenge. Is this charity work or a real business opportunity? Do we know anything about these customers? How lucrative can a business be if it goes after pennies? One of the big selling points of frugal innovation is the way it benefits the poor and brings them into the marketplace. While not all frugal innovation projects provide products and services to the poor it is part of the reputation for this approach, and that can make decision makers nervous.
Simplifying and finding substitutions are essential parts of frugal innovation. They allow local labor and materials to be used. But subtracting value and using “junk” or “waste” is contrary to the quality ethos that dominates many businesses. Providing products and services that are acceptable and within reach of new customers may be a good business model, but it can hurt the pride of many executives. They may even feel that it will threaten their reputations with their premier customers. (I’m reminded of a story in Zen and the Art of Motorcycle Maintenance about a man who resists using a beer can to provide a needed shim for his expensive motorcycle. Technically, it works. But his aesthetics make it impossible.)
Of course, it is often more necessary in frugal innovation to reach outside your organization — even out to people who are not part of your company, but many people lack the social skills, confidence, and trust to do this effectively.
None of these barriers are insurmountable. In fact, because “desperate times call for desperate measures,” much of the success for frugal innovation has been found in developing countries where barriers are overcome since there are few alternatives. Most of these barriers fall in the face of fresh perspectives and education, putting the benefits of frugal innovation within reach of all of us.