How OVH practises frugal innovation

I joined OVH in September 2017. I’m a specialist in innovation financing, and my main priority at the moment is bringing value to research and development activities. What really makes us stand out is that innovation comes from everywhere within the company, and exists in different forms. In this article, we’ll explore the concept of frugal innovation, see why it is a good fit with our company culture, and take a close look at a few examples.

Frugal innovation is the ability to to improvise an efficient solution in a difficult situation, using as few resources as possible. Our PolRADs (water blocks for cooling processors), our water-cooling systems, and even our VAC (our anti-DDoS defence system) are examples of frugal innovation that was achieved in OVH.


Frugal innovation as a concept

Frugality is a way of working with simplicity, using low resources. Frugal innovation, or Jugaad Innovation, is doing the best you can with as little as possible.

The concept emerged in India, where companies don’t have millions of dollars to invest in research and development, and as a consequence, the population can’t get the latest trending high-tech products. With this in mind, concrete problems need to be resolved on a daily basis. And as a result, we need to rethink complex products in order to offer them to a larger number of people. For example, some villages aren’t powered by electricity, but everyone still needs to keep food fresh. To meet this need, the Miticool fridge was invented. It is a refrigerator that functions without electricity, and works via the principle of evaporation in order to keep fruit and vegetables fresh for a few days.

In the West, we talk more about ‘System D’, otherwise known as ‘bricolage’, which is very reductive. One of the first Western companies to adopt this principle was Renault-Nissan. From that point onwards, experts began referring to it as “frugal engineering”. It is worth bearing in mind that this shouldn’t be confused with frugal innovation, which aims to make the best of a low set of resources, and focuses on low-cost innovation. Its objective is to reduce costs without letting quality suffer as a result.

And we can’t talk about frugal innovation without mentioning Navi Radjou, who popularised the concept of Jugaad with his conferences and – above all – with his two works: Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth (2013) and Frugal Innovation: How to do better with less (2015)*.


In what ways does OVH innovate frugally?

Frugal innovation is based on six main principles. Let’s look at how each of these principles aligns with OVH’s methods and mindset.

  1. Engage and iterate: Engagement and iteration are reflected in our interpretation of agility. Our R&D teams are not confined to their labs. They work very closely with other OVH teams, and regularly engage with customers in order to carry out their projects iteratively.
  2. Boost agility: This involves using new tools and manufacturing processes to speed up model and prototype creation, and evaluate our hypotheses. The usage of 3D printers and laser-cutting machines fosters creativity amongst our makers. Thanks to our emphasis on manufacturing locally, we can also react quickly to varied requirements in all of our datacentres.
  3. Create durable solutions: A cloud service provider’s activity can easily go against a durable development approach, due to both energy consumption and electronic component usage. Through the work carried out by our R&D team to optimise our server cooling processes with air-cooling and water-cooling technology, we’re able to remove all air conditioning from our datacentres. This durable approach is also reflected in the creation of multi-purpose products, which can serve multiple functions, and be used for a range of different applications.
  4. Shape customer behaviour: This involves making the customer feel richer while consuming less, through products with a higher added value. This way, the customer’s loyalty is won with products and services that are well-suited to their needs. This is reflected in our focus on automating operations as much as possible and, more recently, on gathering and analysing the data generated – such as key statistics on how our customers use our services – to create value.
  5. Co-creating value with “prosumers”: Consumers are not passive, and play a part in designing products and services. Since the company was founded, customers have always played an active part in developing the solutions offered by OVH. In 1999, mailing lists were used as a special place for teams of developers and sysadmins to exchange ideas with users. More recently, social networks, customer events and OVH Labs have taken over as platforms for the exchange of ideas, where we give our customers the opportunity to play an active part in designing and testing our future products and services.
  6. Collaborate with innovative partners: This is also called Open Innovation. We’re continuing to cultivate our startup culture with the Digital Launch Pad, our startup support programme, and by exploring new applications of our infrastructures. To further increase the speed at which we produce innovative technology in spite of our company’s size, we collaborate with creative, local SMEs. We also carry on co-innovating with partners such as Cisco, Intel and VMware, who are global players, always working to design cutting-edge technology.


A few examples of frugal innovation technologies from OVH

The most obvious example, closely linked to OVH’s development, is the application of water-cooling technology to our servers. With matching resources, we can boost server performance without consuming more energy, and maintain a regulated temperature for the machines to function. This is one of several designs that have played a key part in OVH’s success, and did not require heavy investments in R&D. Thanks to the ingenuity of our teams, an efficient solution was found, in spite of any constraints.

Since then, almost all of our cooling strategy – from hardware components to datacentre construction – follows this philosophy. Our water blocks were designed to optimise this process with incoming water cooled to a set temperature, and the temperature of hardware components kept at an estimated 80°C. Another example is the fact that our datacentres are located in existing buildings, chosen for their structural quality as well as their proximity to power supplies. Although these buildings are not specifically designed to host datacentres, they can also be the root of specific constraints when it comes to cooling. For several years now, we have worked on designing datacentres that are as modular as possible, in order to gain further agility when we open a new building.

A final example of this is on the software level. Because of our business as a cloud services provider, part of our activity is dedicated to building and managing a global fibre optic network, and more specifically, our anti-DDoS protection. We could have chosen to do this by building a defence system with costly, closed-source network components, but we would not have had control over it. In other words, our protection against DDoS attacks would have been reliant on third parties, and our reactivity in terms of developing it would be reduced. This is why we decided to build the VAC – our anti-DDoS defence system – using FPGA and open-source DPDK building blocks, in order to offer anti-DDoS protection to all of our customers at no extra cost.

One of the keys to OVH’s success is its ability to develop and promote frugal innovation, both in IT itself and industry as a whole. It does this by supporting and fostering creativity in all of its employees, whether they are doctors, engineers, maintenance technicians, or even interns. Human diversity is one of the pillars that supports this organisation. As Albert Einstein famously wrote, “We cannot solve our problems with the same thinking we used when we created them”.


*Radjou, N., Prabhu, J., & Ahuja, S. (2013). Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth. John Wiley & Sons. Radjou, N., Prabhu, J., Polman, P., & Mulliez, V. (2015). Frugal Innovation: How to do better with less (2015). Economist Books.