Frugal Innovations

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8. Bharti Airtel

A change in mindset triggered radical management innovation at Bharti Airtel, resulting in the cheapest mobile talk time in the world, at $1 US cent a minute. Instead of focusing on average revenue per user, Bharti Airtel realised that signing up millions of Indians each generating a tiny revenue would still generate large overall revenues, and if costs could be lowered enough, large profits.

To achieve this they took collaboration to extremes. They outsourced all functions except for six. Clever contractual arrangements allowed the company to incentivise quality whilst still profiting from predicted growth. They also cooperated with competitors on necessary passive infrastructure which conferred no competitive advantage.