About Nesta

Nesta is an innovation foundation. For us, innovation means turning bold ideas into reality and changing lives for the better. We use our expertise, skills and funding in areas where there are big challenges facing society.

Learning from frugal innovation: three lessons for local government

The task is clear: local government and the wider public sector in the UK must innovate in order to reconcile the growing demands on social and other services with shrinking budgets and conditions of ongoing economic uncertainty.

They also must exploit the opportunities presented by devolution. Using digital technologies and data will be essential in achieving this and, as Nesta’s recent report Connected Councils highlights, councils could save as much as £14.7 billion a year by becoming 'digital by default'. However, wholesale digital innovation typically requires up-front investment, so how in an era of constrained budgets do you find the initial funding for such projects?

Maybe there is another way to look at this problem. Frugal innovation is the ability to ‘do more with less’ – to develop cheap and high-quality products or services that not only create business and social value, but are competitive and minimise the use of resources such as energy, capital and time. Frugal innovation originally emerged out of developing countries like India, but as real incomes and government spending are decreasing in the developed world and environmental awareness is rising, Western consumers, business and governments are turning to ideas such as frugal innovation. So how could the principles and practices of frugal innovation be relevant to local government and digital transformation in particular? Three clear lessons stand out.

1. Build nimble and experimental teams

Local government is already used to doing more with less and innovation under constraint is a hallmark of frugal innovation. In fact, across the globe, some of the best examples of new, creative approaches to digital and data innovation at a local government level have emerged out of small teams that do not have large budgets but have been given the time and space to discover and experiment with iterative and incremental methods on small-scale projects. Often a key resource in organisations is not primarily finance, but human energy.

For example, in Mexico City, the Laboratorio para la Ciudad (Laboratory for the City) is the city’s small experimental office for civic innovation and urban creativity. It aims to spark major change through small, realisable steps that rely on small-scale interventions, prototyping, and building social capital. If Laboratorio para la Ciudad’s experiments prove successful at a micro-scale, the city looks to adopt them at a larger scale, either at a policy level or as citizen initiatives. One recent project, Mapatón CDMX, piloted an app over two weeks that incentivised citizens to ride and map the routes of the city’s many unofficial buses or 'peseros'. Data generated from this exercise surpassed the city government’s capacity to measure the origins, destinations and trajectories of these buses, building a case for the further generation of open data through collaborative action. The next steps will involve testing how crowdsourced data can be integrated into public decision making. Step by step, Laboratorio para la Ciudad and its partners are using small-scale and low-budget experiments to build a case for more open government and the strategic use of technology and data to solve public challenges.

It’s worth remembering that even the world-renowned Mayor’s Office of Data Analytics (MODA) in New York City initially began with a small team, limited budget and a 'bootstrap method'. It tackled first those problems that were immediately solvable and didn’t require sensitive data (e.g. housing violations instead of adult social care), and was able to quickly demonstrate proof of concept and gather momentum for public and political support for further work. In contrast to traditional large-scale projects with considerable set-up costs and long-term commitments, MODA’s approach was largely frugal, it was not simply ‘cheap’, but targeted bite-sized incremental projects that could have a larger cumulative impact over time.   

2. Experiment with cheap technologies

Existing frugal innovations can often be applied to new areas. For instance, cheap computing kits such as the Raspberry Pi and the Arduino motherboard are enabling those groups and individuals with limited resources to innovate in ways only larger organisations could previously. In Bristol, the Knowle West Media Centre used a Raspberry Pi 3 and DH22 temperature and humidity sensor to create a Frogbox, which allows residents to measure the current temperature, humidity and dew point in their property. Bristol City Council is now interested in how Frogboxes can help residents better understand and address problems of condensation and damp in their homes, and for those living in rented accommodation, offer a way for tenants to provide clear evidence of condensation or damp to either their landlords or the council.

City-wide sensing and the Internet of Things (IoT) is being hyped as a major opportunity for the public sector and local governments should look at projects such as the Frogbox as examples of rudimentary low-cost experiments in citizen sensing which can bolster momentum and appetite amongst politicians and citizens for the wider adoption of IoT. In fact, IoT networks are already undergoing a process of frugal innovation themselves, with SK Telecom in South Korea launching its first commercial low-cost IoT network.

3. Embrace communities and sharing economy models

Local communities are full of dedicated and tech-savvy people involved in volunteering, social enterprises, startups, makerspaces and other activities who, knowingly or not, are themselves frugal innovators of sorts, working on technologies, platforms and services that were previously available to an affluent few, and making them more accessible and open. Nesta’s recent 50 New Radicals 2016 contains several examples. As some councils increasingly collaborate and co-operate with the community to help deliver services, they should look to work with these sorts of innovators. 

Moreover, the emergence of sharing or collaborative economy models adds another dimension to how frugal innovation might operate in developed nations, as the increased trading and sharing of assets or skills through digital platforms has made more items and services readily available at lower costs to people who might otherwise be unable to access them. Discussions about the sharing economy tend to focus on exclusively profit-orientated services such as Airbnb and Uber, but how might local governments exploit sharing economy platforms to better connect residents with council resources and services? For instance, Wheeliz in France is an online peer-to-peer rental service for wheelchair-adapted cars. Through a sharing economy model, Wheeliz has made renting adapted vehicles more affordable and accessible. Could working with sharing economy platforms like Wheeliz or even uberPOOL help councils find ways to stretch community transport and mobility allowance budgets further?

Final thoughts

Amidst the crushing budgetary challenges facing local government, a call for more frugal innovation could come across as a naive attempt to merely redefine obstacles as opportunities. Also, while local authorities should be free to explore new frugal approaches, decentralised and local initiatives may not deliver a total overhaul in digital transformation amongst local authorities. Arguably, a well co-ordinated Local Government Digital Service is necessary to realise the wholesale digital transformation of local government. 

However, these sorts of solutions will take time to coalesce. In the meantime, by practising elements of frugal innovation, local government can continue to build a culture of innovation and experimentation, encourage employees and local residents to trial and iterate low-budget and small-scale solutions, and embark upon a more sustainable and digitally inclusive process of innovation. Frugal innovation can also help build momentum, political will and appetite for future digital change, while reducing the risk of embarrassing public sector IT overspends. Moreover, frugal innovation is an alternate understanding of innovation that draws upon different contexts. By exploring frugal innovation, local government might realise there is as much to learn from what is happening in Delhi as there is from more conventional examples of successful innovators in Western Europe and North America.

Image credit: Jared Smith, CC 2.0 license


Oscar Nowlan

Oscar is an Intern in the International Innovation team, researching innovation trends and developments from around the world. He is particularly interested in public service reform.