Study 1: The Bottom of the Pyramid Market as a Source for Disruptive Innovations

Innovations emerging from the Bottom of the Pyramid (BOP) markets have been engaging scholars and practitioners in the last decade. Several concepts have emerged to describe this phenomenon, such as frugal innovation, Gandhian innovation, inclusive innovation, jugaad innovation and reverse innovation, which describe this emerging phenomenon from different perspectives. This emerging phenomenon has the potential to enrich mainstream management theories, however, the BOP phenomenon remains largely under-theorized in academic literature. The aim of this chapter is to embed this phenomenon in disruptive innovation theory and highlight the similarities between these concepts. Further, this study will examine two case studies, namely Narayana Hrudayalaya (NH) and Aravind Eye Care Systems (AECS), two low-cost specialty hospital chains in India to explain why BOP markets can be considered a source for disruptive innovations. The Aravind Eye Care System (AECS) and Narayana Hrudayalaya (NH) hospitals have pioneered a system of providing extremely affordable healthcare to the poor by establishing high volume focused hospital chains. These companies have innovated their business models and processes to enable delivery of highly standardized procedures at extremely low cost. These companies have also innovated beyond their processes to create other product and business model innovations on their own as well as in cooperation with external partners. Thus, they provide a valuable empirical context to examine the innovation capacity of companies serving the BOP.