Tackling Grand Societal Challenges: Understanding When and How Reverse Engineering Fosters Frugal Product Innovation in an Emerging Market

Societies are confronted with grand challenges that require the efforts and coordination of diverse stakeholders. In this context, the role of for-profit organizations has become vital in addressing such challenges. Drawing on the strategy tripod perspective, this study investigated the influence of reverse engineering on frugal product-innovation performance (PIP) through the mediating effect of frugal innovation (i.e., cost innovation, and affordable value innovation). In addition, we examined the moderating impact of the industry environment (i.e., technological turbulence) and institutional context (i.e., legal inefficiency) on this relationship. We tested our hypotheses using time-lagged data from 243 small to medium-sized enterprises (SMEs) in an emerging economy – Ghana. Results from our analyses show that several of our hypotheses are supported which offers important implications for the indirect impact of reverse engineering on frugal product-innovation performance in the context of resource-constrained emerging markets. These findings extend the grand challenges, strategy, and innovation literature.