The pursuit of sustainability has emerged as a powerful path to grow business. Sustainability projects are often co-funded by companies and local governments. In developing economies, public policies are focusing on macro-economic disruption due to sustainability issues. Therefore, large companies are developing alliances with local governments on public-private partnerships (PPP) in implementing norms and enhancing social value. The PPP initiatives have often generated social awareness among people and inculcated environmentally conscious consumptions in society.
In this context, challenge-based research is a systematic journey to explore solutions for social and industrial problems, as we discuss in our new book Challenge-Based Learning, Research and Innovation. Leveraging Industry, Government and Society (Palgrave MacMillan, 2023). The futuristic outlook of the industry might be towards achieving net-zero carbon economy in a net-zero industry with net-zero products, services, processes, and production systems. This includes obtaining solutions to green energy, water conservation, zero-emission, waste reduction to zero level, and managing cradle-to-cradle approach, addressing positive ecological impacts in the built environment.
The convergence of challenge-based research with learning continuum and innovation has emerged as the new trend of business modeling. Interactions in the global society have become an increasing requirement for the researchers to use creative thinking skills to meet the social, ecological, and industrial challenges.
Such research learning has been adopted by many companies and received increased attention in academic research. As people are connected to both societal and industrial advancements, digital technologies have increasingly encouraged the challenge-based research in agriculture, non-farm entrepreneurship, housing, energy, and sustainability.
The challenge-based research and learning guide companies to develop frugal innovations and technology, which leads to superior value propositions within society and industry. For example, low-cost and ecological housing using the recycled polyethylene bottles, intelligent green house to support organic cultivation, and renewable energy-based household products such as water heating systems. Accordingly, challenge-based research can create social value and leverage industrial needs as well by finding solutions through actionable research.
This kind of research has been adopted by many customer-centric companies like LEGO, using collective intelligence generated by the crowd. The company has grown over the philosophy of low-cost alternative to creative wooden building blocks to technology-driven mechanical building-blocks’ giant, relying on customer input and analysis of their personality and behavior. Crowdsourcing has emerged as a creative tool for companies today to expand their outreach to customers, map their perceptions, and understand behavioral implications of customers in business. Thus, this tool has led to delivering collective intelligence, which helps the companies in building the business.
One of the major concerns with challenge-based research is to effectively manage the transfer of technology to industry and end users of innovation. Transferring the product and processes technology in accordance with the market demand and inculcating user experience are complex. Knowledge transfer on innovation and technology explored through the challenge-based research is largely based on the exchange of individual’s experiences and work-related knowledge of the research team.
Therefore, product designing, and commercialization of innovative products are closely associated with the co-creation process through customer/user engagement. Such co-created and coevolved technologies are easy to transfer through digital platforms and social applications. Sharing specific knowledge is derived from the collective intelligence, and collaborative research with partnered companies lead to an accelerated transfer of technology process in diffusing innovations among target users, industry, and market.
Agility and agile transformation are two facets correlated to business performance. Agility in managing social and technology-based challenges is required to conduct challenge-based research, implement its outcomes, and measure the industry responsiveness in innovation and technology derived from the research. The change of mind among consumers is induced by self- and social concepts that govern business strategies, technologies, and end user values to leverage market competition. In addition to customer satisfaction, a majority of business operating models are mainly driven by corporate values by putting people first and agility.
Challenge-based research is used in product innovation and design of equipment. While coevolving with academics and stakeholders, firms can identify appropriate technologies, carry out innovations, and prepare for effective technology transfer through training programs on face-to-face and digital platforms. The technological revolution has driven the digital transformation as firms are engaged in co-creating value in industrial markets. Among the many forms of technology development, digital technologies have encouraged artificial intelligence, which has the strongest pervasive impact.
Most companies in the emerging markets are transforming their global value chains and planning to coevolve domestic enterprises with advances economies multinational enterprises as a helix effect. The helix effect is visible to the companies as vertical partnerships with large firms while horizontal collaborations with local network are jointly orchestrated. Exploring new opportunities, right decision-making, and a design-to-market strategy by building alliances with large companies have been the major focus of double helix approach of small companies.
The success of double-helix approach needs a transformational leadership at both business organizations to help in redesigning organization, creating value chain, developing global standards, investing in business process improvement, and strengthening the backwards and forwards business linkages.
The challenge-based research focuses on evaluating the production and business alternatives through digitalization and network channels. The mobile applications have also contributed extensively to propagating the use of online platforms to manage the business-to-consumer and busines-to-business activities during the Covid-19 pandemic situation.
The scope of frugal innovation has gained significant importance during the turbulent trade and economic situations. The use of frugal innovation has emerged as a novel way to serve low-income customers in developing countries and encourage niche businesses models. The need to find and adopt new technological platforms designed to offer strategic services arises for the start-up enterprises in emerging markets.
The authors are Professor and Director of the Institute of Advanced Materials for Sustainable Manufacturing at Tecnológico de Monterrey (Dr. Arturo Molina) and Professor of Marketing, Management, Innovation and Entrepreneurship at EGADE Business School (Dr. Rajagopal).