Innovation Post

Hello,
In previous post I tried to bring you closer to Frugal innovation and its examples and showed you what impact they have on world most influential markets.

(http://www.innovation-post.com/?p=43)

In this post, I`ll try to connect the core of Frugal innovation with Serbia and its market.
To recollect most crucial elements of Frugal innovation I`ll quote my previous post:

Key elements of Frugal innovation :
1. Outsource all non-core activities
2. Use technology in imaginative ways
3. Apply mass production techniques in unexpected areas

Serbia in these days is little known by its outsourcing potential, but in fact respected number of Europe`s and North America`s companies choose to outsource their business to Serbia.

Why is that you wonder?
It`s pretty simple: High quality work force for low wages.

Serbia`s standpoint by elements:

1.Outsource all non-core activities

Serbia is ideal ground for Frugal innovations because of large number of capable experts that can solve high level system problems by developing solutions that are cheap, practical, efficient and accessible. There is no longer need for Asia, there is great outsourcing potential with far better infrastructure in the heart of the Balkans and in the Europe itself.

Serbia had one of the toughest educations systems in the Europe that mustered legions of bright and resourceful work force. As Serbia passed through some of the toughest times in its history with recent wars and economical transition, many of those bright people fled all over world to become best and most respected workers in their companies. Many of them stayed behind to try to rebuild what was left.
Serbian intellectual elite is represented with 11% of Serbia`s population overall.  Downside is 22% of overall unemployment (but great for outsourcing). Currently there is 22 000 young students that are seeking job, waiting for the chance to put to use their hard earned knowledge and bring prosper to their employers. In various sectors: banking, ICT, Production and Engineering, smart companies are investing with the support of Serbian government. That fact was recognized by some of most influential companies in the world, that chose to invest in this untapped source of profit. Boy, they were right!

Belgrade, the capital, has been awarded as the City of the Future for Southern Europe 2007 by the fDi Magazine.

• Selection criteria – economic potential, cost effectiveness, human resources, IT and telecommunications, transport, quality of life, and FDI promotion.

In 2008 the municipality of Indjija was ranked among the Top 25 Most Attractive locations for foreign direct investment in Europe by the fDi Magazine.

“Serbia is forecast to make the largest improvement in the business environment in the region of Eastern Europe between 2009 and 2013. Out of 16 countries included in the research, Serbia will be leading the region in terms of business reforms by a wide margin”.

PricewaterhouseCoopers ranked Serbia as the 3^rd most attractive manufacturing and 7^th most attractive services FDI destination among emerging economies.

Ernst & Young recorded nearly 150 inward investment projects in Serbia in 2007, 2008 and 2009 – the 2nd best performance in the South East Europe region.
So as fertile ground to super quality outsourcing, Serbia gets + for good foundation for Frugal innovation. Low cost, high quality workforce is perfect ground for Frugal enterprise.

Source: http://www.siepa.gov.rs/site/en/home/1/about_siepa/

2.Use technology in imaginative ways

Precisely that potential of bright and resourceful citizens, gives Serbia unique ability to generate low cost, but brilliant products and services.

Confronting limited resources, bad economic state, and tough legal restrictions Serbian experts are largely used to work with limited resources, bad conditions and to seek direct and cost-efficient ways to indulge market needs. Interesting fact is that universities and institutes apply the least patent applications, especially business related. So, one of the recent great initiatives is combining technology potential of the academic research and their spin-offs to industry leaders investors and business intelligence. Using DataStation platform as an infrastructure in future will allow more intimate connection between university and industry, and hopefully spawning large amount of useful and efficient ideas, products and services for start-ups. This way technology that is developed, can be really used and commercialized.

Downside is definitively embarrassing outcome of IP protection rights for the patents and inventions. Serbia has 299 patented products and services this year from several thousand of registered inventors. That is compared to 14.435 patents from Germany just a fragment. Luckily, there are ongoing initiatives in strong innovation entities within Serbia that are constantly working on spreading the knowledge and help with IP rights protection and constant encouragement of creativity and innovation overall. Innovation landscape is changing for sure.

Serbia`s innovators are well known winners of many worldwide competitions. For example, they collected and won 6 gold medals and 3 silver ones on the worlds most prestigious fair of science and innovations based in Moscow, called “Archimedes” . There is quality on the work here.

Examples:

Best results are in medicine, pharmacy and industrial machines, construction projects.

Hazelnut chopper – Former workers in construction of aircraft parts from Utva in cooperation with Milan Grubanov from Pančevo, constructed unique chopper that can chop and classify over 100 kilograms of hazelnuts per hour. This automated machine could make major difference in in region as one of the best competency advantage from the rest of the competition. (source: http://www.b92.net/biz/vesti/srbija.php?yyyy=2011&mm=12&dd=11&nav_id=564828)

Strawberry Tree – Several students of Serbia led by Miloš Milisavljević won the European Commission competition of renewable sources of energy with their project in the category of “Cuts in Public spending”.  From 309 projects, as youngest participants their work on Public solar light mobile recharger took the throne by right. They call it “Strawberry Tree”.  (source: http://www.blic.rs/Vesti/Drustvo/247679/Studenti-iz-Srbije-pobedili-na-takmicenju-Evropske-unije )

3. Apply mass production techniques in unexpected areas

Strong IT companies and software engineers lead the way for this section. Major productivity, efficiency and quality of developed solutions in ICT sector is prime jewel in the crown of Serbia`s market.

Combining best practice techniques from industry and PM methodologies with local mentality and resourcefulness leads IT companies to thrive.

Example:

DataStation – Cloud based innovation management software platform. Using Cloud and SaaS model from its birth 2005, and applying custom techniques and methodologies in combination with world best practices to uncover one of the unique and best software solutions for innovation management in the world. Young,unique and experienced IT company with special mission – to push the boundaries of software engineering beyond to excellence with the touch of peculiarity.

Engage outsourcing potential, low cost high quality work force and strong ICT.

Scratch the surface, there may be a diamond underneath.