Re: [GKD-DOTCOM] Profitability as an Indicator and a Driving Force
Can I echo this? We started a $1.7 million technology center in Ghana exclusively with philanthropic/social motivation, but quickly moved from a 'non-profit' model to a for-profit private sector investment. There are all sorts of benefits positioning yourself in the private sector, from attracting certain personnel, investors, strategic partners as well as having a disciplined financial environment to operate within. The problem is that I think we lack more models of this hybrid social/profitable venture. There's no easy way to explain (or replicate!) our motivations and people tend to be extremely suspicious when you say that you seek a social return over and above a financial one (this is slightly different to starting a business that also has 'social' goals). I'd like to argue that a good social objective (actually delivering something people want or need) may even be better crafted if left (to varying degrees) to the marketplace itself to vote by buying the services themselves (affordability is key here, and various assistance can help target and serve under-served communities... InfoDev is about to leverage our organization to incubate some SMEs). Anyway, not being purely 'social' or purely 'profitable' has left our model of investment somewhere in the middle and I think there's no language for us to have a comfortable conversation. I also have encountered some NGOs that don't want to be involved in our programs to discuss or promote ICT4D because there's a profit element in our organization. That's really frustrating. I don't quite know whether the development world has really gotten to the point where they can have an honest discussion about leveraging the private sector to deliver services. I hear lots of talk about this, and some 'transformative' period at the World Bank, but they still seem to be estranged partners unwilling to have constructive dialogue to truly co-operate. I think people should be able to make profits out of delivering socially beneficial services. But what words do we use, how do we classify this, how can we assess motives and reward in a more modern vernacular. What does 'social' mean anyway? And I also think that in many developing communities there is a donation-dependency syndrome, where gifts are the model people are comfortable with, attracted to, and receives the social recognition in the media. Clearly, there's been a historical context where outside intervention merits a decent amount of suspicion with regard to motives. But I just hope that participants on this list, and working in this area, can recognize a variety of models for development that harness the private sector and social entrepreneurship. I think it may be a much quicker, more efficient, and more responsive model than traditional development organizations that are focused on next year's board meeting to secure the next round of funding. Mark Davies BusyInternet Ghana www.busyinternet.com On Tuesday, November 9, 2004, Al Hammond [EMAIL PROTECTED] wrote: Sam Lanfranco makes some nice points about profitability as an indicator and driving force, even for non-profit or socially-motivated projects. I'd like to turn the point around and argue that being profitable, or the profit motive, is not a good basis for judging the social motivation or social potential of an activity. In effect, I'd like to challenge the more-or-less automatic assumption, which I see expressed in many parts of the NGO and development communities, that a for-profit activity cannot also have a socially beneficial goal. Of course, many businesses have no social motivation. However, in our research, we have found that many of the successful companies in BOP markets have an explicit social metric or goal as well as a business goal. This is true in large companies as well as in entrepreneurial start-ups. I agree that profitability is, in several senses, an important indicator for many activities--and I think that the profit motive does not disqualify an entity from also having a social motive. This DOT-COM Discussion is funded by USAID's dot-ORG Cooperative Agreement with AED, in partnership with World Resources Institute's Digital Dividend Project, and hosted by GKD. http://www.dot-com-alliance.org and http://www.digitaldividend.org provide more information. To post a message, send it to: [EMAIL PROTECTED] To subscribe or unsubscribe, send a message to: [EMAIL PROTECTED]. In the 1st line of the message type: subscribe gkd OR type: unsubscribe gkd Archives of previous GKD messages can be found at: http://www.dot-com-alliance.org/archive.html
Re: [GKD-DOTCOM] How Can ICT Create New Business Partnerships?
Dear Colleagues, Barry Coetzee raises an issue I know is the focus of research, for example, within Community Economics, and is certainly the object of a popular debate here in the United States. A parallel example: Recently a number of communities in the USA have passed regulations effectively barring a major company, Walmart, from locating in their markets, apparently because they recognized the broader impacts that might have on the mix of employment, economic growth, etc. Much of the conversation here seems to focus on how large corporations can somehow address low-income market segments. Barry Coetzee seems to be wondering if we're addressing the right question. Cheers! Jeff Bureau for Economic Growth, Agriculture and Trade Office for Energy and Information Technology RRB 4.06-066 1300 Pennsylvania Ave NW, Washington, DC 20523-3800 Tel +1 (202) 712-1956, Cell +1 (301) 728-2160, Fax +1 (202) 216-3466 Email [EMAIL PROTECTED] http://www.usaid.gov Keyword:ICT On Monday, November 8, 2004, Barry Coetzee wrote: Our philosophy is that we HAVE to make the poor (the majority of our population) profitable. They will be our only market once the MNCs have 'cherry-picked' the top-end of their market. My experience is that there are very few partnerships with MNCs. They buy-out the locals if they see any profits. However, as their focus is actually their home states, they do not want to build on the local industry, but to further distribute the products and services that they developed at the head-office. Thus, my experience is that, in general, MNCs look after their own interests. In Africa that tends to be the top end of the market. The result of this is that the difference between the haves and the have nots tends to increase with the advent of MNCs. ..snip... This DOT-COM Discussion is funded by USAID's dot-ORG Cooperative Agreement with AED, in partnership with World Resources Institute's Digital Dividend Project, and hosted by GKD. http://www.dot-com-alliance.org and http://www.digitaldividend.org provide more information. To post a message, send it to: [EMAIL PROTECTED] To subscribe or unsubscribe, send a message to: [EMAIL PROTECTED]. In the 1st line of the message type: subscribe gkd OR type: unsubscribe gkd Archives of previous GKD messages can be found at: http://www.dot-com-alliance.org/archive.html
Re: [GKD-DOTCOM] Profitability as an Indicator and a Driving Force
The first rule of business is to have a list of objectives. This list describes the reason you are in business in the first place, and it informs your business plan. Now, making money does not need to be the first or most important reason for being in business. However, if making money is not one of your top three objectives, you are not likely to be in business for very long. This does not in any way suggest that making money is incompatible with providing a social benefit. But it does mean that if you want to provide a social benefit, and especially if you want to provide this social benefit on a wide scale (either a large enterprise or thousands of tiny replications), then you must figure out a way to provide this social benefit at a profit. The reason for this is quite simple: The many people who must buy in to your socially beneficial idea also need to earn a living, and the only way that can happen is if your enterprise is profitable. Just a thought, learned from my father at a tender age. --Bob Spear Dr. Robert J. Spear Past President, Maryland Distance Learning Association Professor, Computer Information Systems Prince George's Community College Largo, Maryland 20774 phone: 301-322-0156 fax: 707 982-7178 ~~~ Experience is that marvelous thing that enables you to recognize a mistake when you make it again. ~~~ This DOT-COM Discussion is funded by USAID's dot-ORG Cooperative Agreement with AED, in partnership with World Resources Institute's Digital Dividend Project, and hosted by GKD. http://www.dot-com-alliance.org and http://www.digitaldividend.org provide more information. To post a message, send it to: [EMAIL PROTECTED] To subscribe or unsubscribe, send a message to: [EMAIL PROTECTED]. In the 1st line of the message type: subscribe gkd OR type: unsubscribe gkd Archives of previous GKD messages can be found at: http://www.dot-com-alliance.org/archive.html
Re: [GKD-DOTCOM] Can Technology and a Business Approach Make Globalization Work for the Poor?
Chetan Sharma points out that technology by itself may not generate jobs. But entrepreneurship certainly does--and the examples of Germany and Finland he points to may reflect lack of an entrepreneurial culture more than anything about technology. And technology can play a role in helping create entrepreneurial opportunities or in supporting small enterprises. The Sanchalak's that run ITC echoupals generate additional income from their entrepreneurial role as the computer hosts, the kiosk and PTO entrepreneurs in India phone and (growing) Internet networks are a similar example; so too the village phone entrepreneurs in Bangladesh and South Africa and now Uganda. Both the need for shared-access points--the dominant model for access to connectivity among the very poor and even the not so poor in developing countries (even in middle-class, urban Peru, for example) and the entrepreneurial opportunities such needs create and can create are a prime example of how the spread of ICT networks can help stimulate job creation. Allen L. Hammond Vice President for Innovation Special Projects World Resources Institute 10 G Street NE Washington, DC 20002 USA V (202) 729- F (202) 729-7775 [EMAIL PROTECTED] www.wri.org www.digitaldividend.org On 11/8/04, Chetan Sharma asked: Why do small European economies such as Germany and France, who have always embraced technology and have such a huge technological advancement, have major employment problems? Why does Finland, despite home-grown Nokia, continue to languish with unemployment and joblessness? If we do not have jobs of any nature--if we do not even have stable livelihoods--then what has been the worth of Globalization and technological advancement? ..snip... This DOT-COM Discussion is funded by USAID's dot-ORG Cooperative Agreement with AED, in partnership with World Resources Institute's Digital Dividend Project, and hosted by GKD. http://www.dot-com-alliance.org and http://www.digitaldividend.org provide more information. To post a message, send it to: [EMAIL PROTECTED] To subscribe or unsubscribe, send a message to: [EMAIL PROTECTED]. In the 1st line of the message type: subscribe gkd OR type: unsubscribe gkd Archives of previous GKD messages can be found at: http://www.dot-com-alliance.org/archive.html
Re: [GKD-DOTCOM] Is Profitability Essential for Sustainability?
On 11/9/04, Jean-Patrick Lucien wrote: How about an NGO running a franchise where they license those cyber-cafes to small entrepreneurs. Jean Patrick Lucien, to add to your comments, perhaps, better still would be to allow these individuals to run the cyber cafe on a day basis for a small fee which would cover the franchise fee (apportioned daily); the day owner should be able to keep the remainder of the day's earnings. This way the poorer individuals would be able to afford the cost and we are creating an enabling environment and increasing opportunity, almost the same way as Unilever India created the sample size soap bars to offer to the BOP market. Just as Barry Coetzee suggested, we need to scale our product to the requirements of the BOP market. Nevine Gulamhusein, Tel: 281-980-4747 Ext 359 Fax: 281-980-4787 This DOT-COM Discussion is funded by USAID's dot-ORG Cooperative Agreement with AED, in partnership with World Resources Institute's Digital Dividend Project, and hosted by GKD. http://www.dot-com-alliance.org and http://www.digitaldividend.org provide more information. To post a message, send it to: [EMAIL PROTECTED] To subscribe or unsubscribe, send a message to: [EMAIL PROTECTED]. In the 1st line of the message type: subscribe gkd OR type: unsubscribe gkd Archives of previous GKD messages can be found at: http://www.dot-com-alliance.org/archive.html
Re: [GKD-DOTCOM] Is Profitability Essential for Sustainability?
John, my quick response is that regulation follows public sentiment and values, thus, for me an appeal to branding is a consistent touch stone in that persuasion of the public, involving people in a values shift. We don't pay the gas taxes they do in Europe because our higher value is the open road rather than the impact on global warming. Reaching an EU level of environmentally sound level of regulation would require branding our impact on the environment more than our desire for open road, heavy-footed independence. On 11/4/04, John Broomfield [EMAIL PROTECTED] wrote: One observation to the comment on Branding. I'm not sure I agree with Kevin Jones (or maybe I just missed the context?) that ...the pricing changes coupled to getting externalities to be included in the cost of goods sold is a branding issue... I agree brand is important in terms of increasing the likelihood that consumers will pay a higher price for goods which cost more because of a pricing component which compensates for externalities. In this sense a particular brand is providing some intangible value to consumers who buy into (or can be persuaded to buy into) the approach that Kevin outlined below. Brand is also doubly important in this context if particular organizations are acting in isolation in taking on this additional cost burden while competitive products or services continue to enjoy a free ride. However I'm guessing that regulation/legislation forcing or incentivising (maybe through tax breaks) all producers of a particular product or service to internalize some of the external costs of production - and therefore create a level playing field for all - plays a more important role here. Especially for products and services which are becoming more commoditized and consumers are therefore buying more on price than values or attributes associated with a particular brand. Creating conversations between technology marketers and their customers Kevin Jones co-founder, Microcast Communications This DOT-COM Discussion is funded by USAID's dot-ORG Cooperative Agreement with AED, in partnership with World Resources Institute's Digital Dividend Project, and hosted by GKD. http://www.dot-com-alliance.org and http://www.digitaldividend.org provide more information. To post a message, send it to: [EMAIL PROTECTED] To subscribe or unsubscribe, send a message to: [EMAIL PROTECTED]. In the 1st line of the message type: subscribe gkd OR type: unsubscribe gkd Archives of previous GKD messages can be found at: http://www.dot-com-alliance.org/archive.html
