Management goes to bottom of the pyramid

INNOVATION: A Fortune 500 company will form business partnerships with slum-dwellers in Mumbai.

Slum-dwellers of Santosh Nagar, Goregaon (Mumbai), will soon be business partners with a Fortune 500 American company (name yet to be disclosed) that plans to invest money to set up a nutrition unit at the slum as a pilot project.

Eventually, the company plans to expand this model and even set up a factory on a national scale where other slum communities too could partner with it.

The model came to life with a business plan that was jointly devised by management students of S P Jain Institute of Management and Research (SPJIMR) and BoP (Base of the Pyramid) Protocol Project consultants, Cornell University, U.S. Named the BoP Protocol, the plan aimed at providing a business development approach that facilitates commercial partnerships between multinational corporations (MNCs) and BoP.

Companies too benefit from such models since they spend a fraction of what they would otherwise be spending on Research and Development.

The methodology involves the use of local knowledge, resources, and creative enterprise that is present in low-income communities such as slums.

Five first-year MBA students of SPJIMR formed a team and implemented the programme.

They approached the NGO which was working in the slum and through its help managed to arrange a stay with the community for four days. The project was carried out in in three phases.

The first phase called immersion/opening up involved establishing a rapport with the community. Once the team acquired the community's confidence, the second phase of actual need assessment was carried out where four workshops were held using Participatory Rural Appraisal techniques.

The focus of the workshops, conducted over a week, was on needs, resources and aspirations (qualitative data gathering) of the community.

"In our interactions with them, we came to know that they all are looking for opportunities to grow. They want to study and learn computers. They have little access to the basic amenities in life but they do not complain about it," said Kanika Malhotra a team-member.

Later workshops were held to generate business ideas with the community. The community participated in group exercises which enhanced their awareness about various business aspects, about the businesses which would be successful in the community and how they could leverage their own and the company's resources to the best advantage.

"The idea is to combine MNCs and low-income group communities to get involved in business plans so that they own the business and help in marketing," said Rahul Lele, another team-member.

"The aim was to come up with a business idea which involved them as co-owners of the business venture. At the end, a business concept emerged which was created by the community and hence had their whole-hearted support. SPJIMR is in the process of finalising the details of the Business Plan. A company will be formed with the players having stakes in it. This will ensure that all involved partners are clear about their respective roles and responsibilities," said professor Parimal Merchant.