Filippo Veglio

Modelling Inclusive Business Success: Online course on managing key BoP biz barriers kicks off in fall 2013

Companies of all sizes are actively testing and rolling out inclusive business models. But scale has so far proven elusive. In the past few years, more and more observers have begun to point out that relatively few inclusive business models have achieved the potential for scale. This holds true also for ventures developed by large multinational corporations, which might have been considered the ideal vehicles given their vast resources, efficient systems, and global reach.

The barriers to scale are numerous, multi-dimensional, and interdependent. In a forthcoming short paper that we are finalizing here at the World Business Council for Sustainable Development (WBCSD), we include among the internal barriers faced by companies the topic of capability gaps. In our view, the extent to which capabilities need to be adapted or built from scratch is a critical factor in companies’ ability to scale their inclusive business models. Gaps can range from the ability to manage informal distribution channels to providing inventory on credit to processing hundreds of thousands of small transactions. It is often possible to acquire the capabilities necessary to pilot an inclusive business model successfully. But to scale, those capabilities need to be widespread.

When it is clear what core capabilities a company needs to build in order to bring an inclusive business model to scale – or when a company would like to encourage inclusive business solutions to emerge in other parts of the business or other parts of the world – one approach is to create professional development experiences for staff. “Learning-by-doing” experiences, like special stretch projects and immersion in base of the pyramid markets, is one option. Novartis, a Swiss multinational pharmaceutical company, takes such an approach with its Entrepreneurial Leadership Program. Started in 2010, the program matches teams of mid- to senior-level managers from across the business with local teams in low- to middle-income countries to develop inclusive business solutions to pre-identified challenges.

In order to contribute to strengthening capabilities, the European BoP Learning Labs and the WBCSD decided to team up to offer an e-learning course this autumn. The course will target technical and middle management professionals who aim to improve their understanding and skills on approaches to developing, implementing, and scaling inclusive business models.

In six modules spread across the period September to November, the course covers all the essential topics to build a successful inclusive business:

1. Inclusive business innovation: To develop successful solutions, companies are well advised to include stakeholders in the innovation process. The module provides an introduction to inclusive business and the concept of open innovation.

2. Market understanding and marketing: The basic ingredient for a successful business case is a solid understanding of one’s target group. The module explains how to gather relevant data and what to take into account when addressing the target group.

3. Last mile distribution: Distribution networks at the base of the pyramid are usually weaker and far different from mainstream markets. The module explains how to effectively and efficiently reach out to the target group, including for payments and after-sales service.

4. Financing: Inclusive businesses require access to adequate sources of finance to support early stages of opportunity identification all the way through to later phases of scaling up. This module will provide an overview of financial mechanisms to support inclusive business, including donors and impact investors.

5. Partnering: Since markets need to be created rather than penetrated, implementing of inclusive business ventures almost always requires collaboration with non-traditional partners, including NGOs, donors, public agencies, foundations and impact investors. The module introduces these different actors and provides tips for effective cross-sector partnering.

6. Results measurement: Inclusive businesses combine social and commercial returns. In order to be accountable to stakeholders and to manage and improve results over time, measurement is key. This module introduces different approaches to results measurement and explains the basic terminology and steps.

Our intention is that over the span of the course, participants will be able to work on their own inclusive business plan and receive feedback from experts. They will also have the chance to network with other practitioners and exchange experiences with leading companies.

We look forward to this course, and encourage anyone interested to visit to find out more. The registration deadline is Aug. 15. The program fee of 2,000 Euros (USD 2,600) covers tuition and all learning materials.

Base of the Pyramid