Frugal Innovation and Innovative Creation

5Back to Common Sense: Towards Frugal Environmental Innovation (FEI)

The technical progress resulting from innovation gradually allows for productivity gains without, however, compensating for competitive pressure each time. Thus, the technological development of Emerging Countries (ECs) is leading to competition for western companies on what used to be their quasi-exclusive competitive advantage: innovation (defined as a managerial process that values what is new with a commercial purpose (Perrin 2001)). From the beginning of the European Industrial Revolution (IR*), the entrepreneurial spirit required a human, technical and financial organization based on investment and innovation. However, technological innovation is costly (Stead 1976), especially in terms of one of its key elements, R&D (Mansfield 1984). Furthermore, that the link between R&D expenditures and technical and/or commercial success has not been established (Kamien and Schwartz 1982). The hypothetical profitability of technological innovation is a dilemma because of the level of investment required (corresponding to sunk costs (Baumol and Willig 1981)) and its strategic renewal at rising cost to create or maintain barriers to mobility (Caves and Porter 1977). The race to innovate in order to obtain competitive leadership implies, a priori, an effort of radicality (Schumpeter 1939) often poorly rewarded when commercial success is the main concern (Abernathy and Clark 1985). The apparent distribution of roles ...