Wednesday
April 22
2009

Al Hammond

A Must Read!

“Emerging Markets, Emerging Models”, the report on BOP entrepreneurship from Monitor Group is probably the most important new study in the last couple of years. Unlike some recent, fairly derivative reports, this one is based on some intensive original research -covering 270 enterprises and a careful analysis of 9 business models- and focused on the key question: why haven’t most BOP efforts scaled? I highly recommend that you download it and read it in its entirety.

My own observations are fully supportive of the report’s conclusions, especially the barriers faced by single product, go-it-alone distribution channels and the imperative for community-scale infrastructure, for para-skilling services, and for arranging high-through systems that use scarce talent very efficiently. The last two approaches are essentially complimentary, and can be used in tandem.

I would go a bit further than the report, however, and suggest that overcoming the barriers to BOP businesses is particularly difficult for large corporations, because many of the solutions that appear to work require intimate knowledge of BOP mindsets and often local presence in those communities -not easy for corporate to implement. Moreover, partnering with NGOs or community groups may be the best way to open such channels, and that, too, is a challenge for most businesses (and most NGOs): the right frameworks and toolsets are by and large not yet in place. To me, that suggests that successful models are most likely to be built not by large companies but by social entrepreneurs. The large company role may come later –they can invest in such efforts, and they can buy them when they are already at scale, and they can usefully source new technology to continually upgrade products and services.

Such conclusions are, to my reading, latent in the report but not spelled out. Nonetheless, to say that takes nothing away from the quality and usefulness of this new resource.

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