Innovating on a Tighter Budget

by Andrea Meyer

Point: Innovation doesn’t have to be expensive


Current surveys indicate that more companies are reducing innovation budgets this year, but the good news is that innovation doesn’t have to be expensive. Here are two stories that show how to innovate inexpensively:

J.B. Hunt was just a truck driver in the 1940s when he saw that rice mills in Arkansas were disposing of rice hulls by burning them. Rice hulls are the fluffy tough fibrous shells removed to create white rice. The waste hulls gave Hunt an idea: he contracted with the mills to haul away their rice hulls, and then he sold the hulls to poultry farmers as chicken-house litter. After Hunt’s revelation of the potential value of rice hulls, others found additional innovative uses for the material: pillow stuffing, high-fiber additives for pet food, natural building insulation, filler for injection-molded plastics, and using rice hulls to improve apple juice extraction.

Similarly, old rubber tires are being ground up and made into roads and shoes. And clothing & outdoor gear maker Patagonia asks customers to bring in their worn-out Capiline® clothing (a polyester fabric) rather than throwing it away. Patagonia has devised a way to break down the discarded fabric into plastic chips and then re-spin them into new synthetic yarn. Given the increasing concerns about proper waste disposal, waste products provide attractive opportunities as no-cost or low-cost sources of innovative raw materials.

In addition to innovating with waste products, companies can leverage fallow innovations. During the early 1980s, IBM Corp was spending at least a hundred times more on R&D than Apple Inc. But upstart Apple found a way to leverage some new underutilized technologies (the computer mouse, high-resolution display monitors, the power of the 32-bit microprocessor and the graphical user interface) to create the Lisa and then the Macintosh. What existing technologies could you put to use in new ways?


  • Survey existing supplies of materials and streams of byproducts
  • Look for materials that are underutilized or are discarded
  • Consider how those materials might be recombined, repurposed, or refurbished for other, valuable applications

For More Information:

Patagonia’s Common Threads Garment Recycling Program

“Innovation to the Core” by Peter Skarzynski and Rowan Gibson

Author of more than 450 company case studies and contributor to 28 books, Andrea Meyer writes & ghostwrites about innovation, IT and strategy for clients like MIT, Harvard Business School, McKinsey & Co., and Forrester Research. Follow her at and

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