How can innovation theories be applied to water technology innovation?

Abstract

The world faces urgent, multi-faceted problems in terms of water; water supply crises have been identified as one of the top five global risks to society in each of the last seven years according to the World Economic Forum. Existing technologies and policies are not adequate for tackling these problems; innovation is urgently required. However, innovation adoption in the water sector is a slow process compared with other industries; the water sector itself is necessarily conservative, and regulation-bound. It is also fragmented, with the US for example having over 161 thousand public water supply utilities. Only a fraction of research efforts yield a marketable product or device. At the same time, innovation in the water sector is of increasing interest to venture capital investors.This paper addresses a problem which is hampering the meeting of these growing interests and needs; the dynamics of water innovation are under-researched, and there is a lack of clear, agreed terminology. As an example, the phrase “disruptive innovation” has drifted significantly away from its originally-intended academic meaning. The authors critically review two theories of innovation: Disruptive Innovation Theory, and Innovation Diffusion Theory (IDT). While important, Disruptive Innovation Theory is found to have limited applicability to water – for example, there are limited opportunities for lower-end innovation which competes on price in a regulated market like water, and there is also limited opportunity to be market-creating. Although the question arises: is there a market-creating equivalent of the Ford production line that would unlock solutions to water problems in developing countries? Innovation Diffusion Theory is found to be more applicable to water, with some important caveats. In conclusion, this paper proposes a practical framework, with industry examples, for studying water technology innovation. Such a framework could provide a common shared basis to support further research into this topic, including the question: can the disruptive potential of an innovation be predicted?