Frugal Innovation Jugaad

Frugal Innovation Jugaad

Frugal Innovation Jugaad

Frugal Innovation Jugaad

Frugal Innovation

In many African countries, housing is one of the most sensitive issues affecting the lower income groups. In South Africa for example, close to 13% of the 14.3 million households are informal dwellings (Statistics South Africa, 2011). The term "informal dwelling" is often used in South Africa to designate shacks, corrugated-iron structures and other makeshift shelters. The above statistics represents about 1.8 million households (between 7.2 and 10.8 million people). Informal structures are often made of highly combustible materials such as wood and cardboard which pose serious safety and environmental concerns. The structures are easily damaged and exposed to the external elements meaning that people often live in damp, very hot or very cold conditions. The other concern is inadequate or lack of sanitation and running water which constitute a serious health hazard for the population. Similar conditions are present in many parts of Africa.

In order to address this problem and as part of public policy, the South African government took a number of initiatives. It became one of the few countries in the world where the right to 'adequate housing' of all citizens is enshrined in the constitution. According to section 26 of the constitution, the state has an obligation to take "reasonable legislative and other measures, within its available resources, to achieve the progressive realization of this right [to housing]." (Republic of South Africa, 1996). In order to translate this commitment into results, the first fully democratic South African government, immediately upon taking office in 1994, embarked on a far-reaching economic policy framework called the "Reconstruction and Development Programme", widely known as the RDP (Republic of South Africa, 1994). Despite these serious efforts to address the lack of housing, the Department of Human Settlements (the government department in charge of housing) estimates the current backlog to still be of at least 2.1 million units affecting 12 million people (Times Live, 2010). As a result of rapid urbanization and demographic pressure, this backlog keeps growing. Recent service delivery protests across South Africa have, once again, shown the plight of the poorest and the urgent need to address their challenges (Burger, 2009).


One family company in South Africa called Moladi took advantage of this yawning market and developed an appropriate technology for the construction of low cost houses. The company was founded by Hennie Botes and it developed a new way of building walls which replaced the conventional brick walls. In November 1985, Botes started experimenting with a mould system which would enable him to cast entire walls at a time, rather than single bricks. He also quickly realized that if he could cast one wall, he could actually cast all walls simultaneously for an entire house or a building, by pouring a concrete-based mortar into the casting and removing the casting once the mixture had dried inside the cavities (Coetzer, 2010). Botes looked at different types of materials that would be appropriate for the formwork (or casting), and initially looked at steel and wood, before settling for injection-moulded plastic components. This method was cost-effective as assembling plastic panels required no skilled labour in the form of carpenters and welders, which are in short supply in South Africa. The plastic mouldings enabled him to successfully cast a wall. The basic concept was born, but Botes had many more milestones to reach: both on the technology side, and with regards to bringing the product to the market.

In 1987 Botes worked with a chemical engineer to formulate a chemical which mixed with the concrete, aerated the wall, ensured it was waterproof and gave the wall better thermal properties compared to block structures. This mix is now patented as "MoladiCHEM" and is used as an essential ingredient of the mortar mix. The next milestones were reached during the 1990s. Moladi first had to obtain quality accreditation and conform to all the regulatory requirements needed to comply with essential building standards. In 1994, the company obtained certification from the South African Council for Scientific and Industrial Research (CSIR). Basic robustness tests were then conducted and certified by the South African Bureau of Standards (SABS). The tests included a water penetration test, a soft body impact test and a chisel impact test (Coetzer, 2010). In all three standard tests, walls built through the Moladi test surpassed the minimum standards required. Monolithic structures such as Moladi walls also contain the key advantage of being able to withstand natural disasters like earthquakes. Additional milestones were reached as Moladi earned awards for its technology. In 1997, Moladi received the SABS Design for Development Award, and in 2006, it won the Housing Innovation Award jointly awarded by the National Homebuilders Registration Council NHBRC and ABSA Bank (one of South Africa's main banking institutions).

The first moladi house was completed and sold in 1987 in Springs, an industrial city east of Johannesburg. But most of the firm's commercial successes were reached outside South Africa. During the 1990s, Hennie Botes established partnerships with property developers and construction companies based mainly in Central and South America. Through these partnerships, Moladi's technology was rolled out and used by developers in Mexico and Panama. Its biggest project to date is in Mexico, where a 1,000-unit project was completed in 2006. This initial expansion in emerging markets was consolidated in the late 1990s and 2000s, during which time Moladi expanded its network of partners on the African continent, and in India. Today, Moladi has appointed agents in charge of promoting and distributing its technology in Ghana, Botswana, Mozambique, Namibia, Sudan, Kenya, Zambia, Angola and Nigeria. Moladi also gets a stream of visitors from other parts of the developing world, including from Nepal, the Philippines and Iraq.

The essential contribution of Moladi's technology to frugal innovation lies in how the solution has addressed the six key challenges faced by developing countries when it comes to housing:
  • Lack of resources
  • Insufficient funds
  • Lack of skilled labour
  • Time constraints
  • Work flow control
  • Waste management

Social Entrepreneur - Social Innovation

The Moladi innovation has departed from a traditional brick building process. This innovation, aside from its inherent contribution to building technology, has also created value by eliminating inefficiencies in the traditional brick-based process. The end-users of Moladi houses are, ultimately, the people whose lives Moladi says it wants to change; people at the base of the economic pyramid who are in need of affordable housing and shelter.

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