Archive for the ‘Technology’ Category
Mobile Banking in 2010
Mobile Banking technology has played a huge role in financial service delivery, and therefore financial inclusion. The industry and its players have also moved rapidly to develop partnerships with social enterprises engaged with delivering financial services to low-income markets, be it microfinance institutions, technology enterprises, large-scale commercial banks and so on. In this post Robert Moore, Villgro Fellow 2010, reviews literature that provides insight into the working of the industry.
“Mobile banking may be an industry I would like to start a business in: There are millions of people with phones but not bank accounts – mostly in developing countries”. This quote is from my first blog post of 2008 on www.poorbillionaire.com and marks the day I started taking a big interest in the mobile banking industry.
If you take a lesson from the telecommunications industry you can see that the developing world has “skipped” a step in development: starting with no phones at, skipping land lines, and adopting mobile phones. If this could influence the banking industry the developing world can go from having no bank accounts at all straight to mobile banking – both a leap in the standard of living for the poor and a leap in the progress of the banking industry. Think of all the things you can do with your mobile that you can’t do with a landline and you will start to realize the impact this change in the industry will have.
To support the growth of this industry a conference called the Mobile Money Summit was started in 2008. An example of this conference’s impact is showcased in a paper produced from the 2009 summit titled “Accelerating the Development of Mobile Money Ecosystems ” which talks about how quickly this industry is growing and how the challenges both as a market opportunity and as a poverty alleviation tool are being better understood.
But the paper I really want to talk about is Nexbillion.net Editor Nathan Wyeth’s three part article titled “Report from the Mobile Money Summit”. His introduction says: “My hope in attending the summit was to share with NextBillion readers the state of the industry and what can be expected in the future outside of places where mobile banking and payment systems have already taken significant hold – namely Kenya and the Philippines (and significant branchless banking in Brazil) – as well as indicate how mobile money systems can be brought into base of the pyramid business models not only for microfinancial services but far outside of the financial services sector – in health, education, agriculture, energy, and more.”
His article brings you up to speed about the potential of this industry and teaches a little about the developing world market. Part one – “State of the Industry” talks about the industry’s markets structure, business model structure, and the banks’ need/priority of “stability before inclusion”. The idea that the poor will actually except negative interest on savings accounts if they are able to save their money securely is one of the interesting concepts that he mentions in Part two – “Product Innovations to Reach the Poor” and that credit profiles can be generated based on current mobile banking transactions for future use in microloans. Part three – “Learning from Agent Networks” discusses the distribution channels involved in making this all happen.
Nathan’s article is a worthwhile read for those interested in Mobile Banking or a glimpse into the world of developing economies and one of the angles that is being used to approach them.
Technology, Innovation and Gender
In February we featured a study by the International Council for Research on Women titled “Bridging the Gender Divide: How Technology can Advance Women Economically.” Villgro Fellow 2010, Jeanne Chen takes another look at this piece, focusing on how social enterprises can be more conscientious of the gender gap in innovation.
Technology and innovation are two words that form a pillar of social enterprise – even social enterprise itself is still considered an innovation. Social enterprises seek to develop technologies with the underlying assumption that they will increase productivity or create opportunities for social economic advancement. Some technologies are simple like the treadle pump, and others are complex like solar lanterns, but all of them help the BoP and it’s this latter benefit that we invest in. As social entrepreneurs, we’re obsessed with measuring this benefit and finding new ways to scale the impact further – in short we want to know that everyone who can benefit from this technology is adopting it. All the aforementioned statements are frequently discussed, but what we don’t hear enough about is whether these successful innovations are reaching men and women equally or whether there is a gender gap to adoption of technologies.
The International Council for Research on Women (www.icrw.org) recently published the report “Bridging the Gender Divide: How Technology can Advance Women Economically” (downloadable here: http://www.icrw.org/files/publications/Bridging-the-Gender-Divide-How-Technology-can-Advance-Women-Economically.pdf), which focuses on understanding how technology for the BoP differs in its impact on men versus women and what measures can be taken to ensure more inclusion of women. Four main barriers to adoption were identified:
- Lack of education and technology literacy: women are often excluded from opportunities to learn the new technology
- Time poverty: domestic responsibilities leave limited disposable time for tech exploration
- Social norms: women are often not in the habit of operating technology, or adoption would require women to enter a public arena (i.e., market) outside their customary comfort zone
- Limited economic means: domestic finances are most often controlled by the men of the households, leaving women unable to make a purchase decision to adopt innovations
These barriers can be overcome when developers of the technology or the social enterprise promoting the innovations take efforts to address the root causes, starting with including women in the design process. ICRW gives an example of the the Upesi rural biomass stoves, which were designed with inputs from women and consequently were adopted. I find this point to be one of the strongest recommendations – it addresses a systemic concern that prevents women adoption. As long as technology continues to be designed by men, women adoption will be low, perpetuating social norms that continue to support the existing gender gap. Sometimes, the solution is as simple as making a technology like a cooking stove, a height that women can reach. ICRW also suggests that inclusion of women in the design process can help to overcome many of the technology literacy and social norm barriers.
Other recommendations are centered on customizing the last mile distribution to address the awareness training needs, purchasing financing, and distribution through channels catered to women. By providing financing or bringing the innovation directly to the women, rather than relying on market place distribution, women are enabled to make the adoption. It is only through active efforts of the social enterprise to convert women adopters that this is possible.
ICRW provides the example of Solar Dryers in Uganda, which were financed by a partner NGO, enabling women to dry fruits for commercial consumption. As in the Solar Dryer example, technologies which can either create income generating activities or increase the productivity of women can go a long ways to contributing to their economic advancement. In addition, ICRW cites that the indirect benefits of increased productivity can also reduce the barrier of time poverty.
Overall, what I find most compelling and the most important point to takeaway is the need to examine and reevaluate how we think about the potential impact of a technology on helping the BoP. Social enterprises need to be more conscientious of the gender gap in innovation adoption and need to be vigilant in their efforts to address this gap.
One particular example comes to my mind of an innovative successful business model, who could benefit from thinking about their social impact with respect to an adoption gender gap. VisionSpring (www.visionspring.org), an organization recently partnered with Villgro, uses a high touch-point sales distribution model to bring low-cost reading glasses to the BoP across southeast India. VisionSpring’s customer demographics are heavily skewed towards men even though there are many women who attend the eyecamps and should be customers. There seem to be two primary reasons for the gender divide between VisionSpring’s customers. The first is that eyeglasses are perceived as aesthetically unappealing, which trumps the value of clear vision. The second is that women are less likely to have disposable income and the economic means to make the purchase. Both these reasons are problems that should be and can be addressed by the social enterprise. Awareness campaigns for the importance of proper reading glasses in the preservation of vision, not to mention the benefits of increased productivity, can be conducted to overcome what is essentially a misguided social norm that is a barrier to wearing glasses. Women can also be engaged in sourcing frames that are more aesthetically appealing. Finally, some form of partnership with a microfinance institution to finance the purchases is also possible to overcome the economic concern.
The point I want to emphasize is not how VisionSpring can work to increase its female customers, but rather that it needs to proactively think and evaluate the impact of its technology to identify how to overcome the gender gap. This is true across all social enterprises. Even though many social enterprises have introduced game changing technologies to the BoP, I think if we look closer, we would see a divide in the impact by gender. This gap is one that needs to be overcome if we truly want economic advancement for all of the BoP – of both women and men.
Scenarios for Technology and Development
The story of technology and development has many bright spots: the mobile banking revolution, the treadle pump and so on. The importance of technology in the developing world has grown significantly over the years.
However, the continued growth and adoption of technology is not always certain. For philanthropists, investors alike, it is important to understand how the adoption of technology might develop in the future. This will enable them to adopt the right strategy for supporting the adoption and diffusion of not just technology, but the right kind of technology.
The Rockefeller Foundation remains committed to this goal. To this end, they have detailed several scenarios for the development of technology, and strategies to work under each scenario. The findings are presented in their report, “Scenarios for the Future of Technology and International Development.”
In this report, they present the following global scenarios:
- Lock Step: A world-wide form of tight, top-down government and control and more authoritarian relationships, with limited innovation and citizen resistance.
- Hack Attack: Where an economically unstable and shock-prone world in which governments weaken, criminals thrive, and dangerous innovations emerge.
- Smart Scramble: Where economies are depressed, and where individuals and communities develop localized, makeshift solutions to a growing set of problems.
- Clever together: A world where highly co-ordinated strategies emerge for addressing both urgent and entrenched world issues.
For each scenario, the report details timelines, technologies that might emerge, the role of philanthropy — the opportunities and challenges that they may face, and a “day in the life of” sketch.
The scenarios are both interesting and provocative — and are meant to be so. Read more about them here.
How Innovation Really Works (and 10 ways to recognize an innovative enterprise)
Think for a minute of the following: the jet plane, the television, the Internet, and the cell phone. What do each of these have in common?
Now, think about this. The jet plane effectively shrunk the world, making travel between Singapore and New York only 22 hours. The Internet allows a passenger wishing to travel between Singapore and New York to book his ticket from the comfort of his home. The cell phone allows him to check-in for his flight while driving to the airport, or to simply use his cell phone to access the airline-generated bar code that acts as a boarding pass. And the television (or an adapted version of it) entertains him while he travels the 16,000 km to his destination.
In short, each of these are or have been path-breaking. They, among countless other technology, have changed the course of the everyday life in several ways. Would we consider them innovative? Almost certainly so, I would think.
The term ‘innovation’ however is often used loosely. Often, it refers to simply anything new. The Monitor Group in India recently released a study it jointly conducted with leading business publication, Business Today titled, “How Innovation Really Works.” The report takes on the notion of innovation as simply “launching new products.” Through examples based on an Indian context, the report frames innovation against a proprietary framework — the Montior Group’s Ten Types of Innovation.
The frameworks defines (business) innovation as being “path-breaking, disruptive, and sustainable.” It divides the ten types of innovation into four broad categories: Finance, Process, Offering and Delivery.
Further, it lists out particular types of innovation under each of the category. Let’s take a look at what these types of innovation are, and the enterprises used to illustrate them.
Finance innovation involves Re-inventing Business Models and Creating Extended Networks. An example of the former can be found in Gyan Shala, a no-frills schooling project in Gujarat and Bihar. An example of the later can be found in FabIndia, which created an extended network of 17 community-owned companies that supply its products.
Process innovation involves two kinds of innovation — an Enabling Process and Core Process. An enabling process is one which supports an enterprise’s primary work, while a core process are capabilities that others can’t duplicate. An example of an enabling process is the Gujarati newspaper Dainik Bhaskar, which uses an external network to get news input through potential consumers. Thus indirectly building its own subscriber base. Core processing innovation can be seen in the working of Moser Baer, a CD/DVD manufacturing firm which diversified its operationg to the home-movie market.
Offering innovation can be found in three ways — Product Performance, Product System and Service. The report refers to TCS’s software product BaNCS as an example of a product performance innovation. Recognizing the benefits of using technology to make banking services more accessible to rural markets, TCS developed the “cloud computing” based software to provide branchless banking services to the State Bank of India. A product system innovation creates ways in which individual products can connect with each other to create a larger system. Case in point, ITC’s e-choupal. The system developed by ITC enables farmers to connect via village kiosks, creating a agri-commodity procurement platform. And lastly, a product service innovation is where companies create value in engaging with the customer once the core product has been purchased. An example of product service innovation mentioned in the report is TCS.
The last category of innovation accroding to the framework is Delivery Innovation. Delivery innovation can be in three ways — through an innovative channel, a distinct brand, and creating value through a unique customer experience. Moser Baer rapidly expanded through the Indian market by creating a distribution channel that banked on widespread, targeted outreach. Being able to release a home movie within a window period of 10 days to six months created a unique customer experience, which has contributed significantly to its growth. ITC’s e-choupal, beyond creating an innovative system has also been able to innovate further via leveraging the e-choupal brand to build its network.
The examples used in the study are not necessarily a reflection of the kinds of companies that might fit the bill. However breakthrough innovation almost always include multiple types of innovation, atleast 3-4 of the 10 within the Monitor Framework (the study selected eight organizations that fulfilled this criteria).
Clearly the framework might not lend itself to all models that exist. Still it is a useful way to recognize where greatest value lies, and to help build a business with lasting impact. Investors, incubators and other enablers interested in creating lasting social value too can use this framework as guideline towards assessing which enterprises to back.
Read more about the BT-Monitor study here, and tell us what you think about it. Also, have you come across a social enterprise that fits into this framework?
Technology Enabled Entrepreneurship under Poverty Alleviation Programme
Technology plays a big role in the development of a society. India’s own economic growth has largely been possible because of the advancement in telecommunication technology made in the early 1990s.
The poor too, it has been demonstrated, can benefit greatly from technology. Simple technology such as the cell phone has enabled women in Bangladesh to increase household income, or has provided an easy way for a construction contractor to pay salaries to his migrant employees in northern India.
Several social enterprises today are making use of technology to impact lives. Villgro itself has worked with several such enterprises in the past.
Technology also has a significant role to play in the agriculture sector. Very often farmers are not able to maximize their profits because they are unaware of the optimum price for their produce, and sell it to middle men at much lower rates. Access to information, is therefore vital. And technology plays a role in filling this gap.
Sanjay Mohapatra, in his article ‘Technology Enabled Entrepreneurship under Poverty Alleviation Programme’, takes a closer look at one technology-based solution developed for farmers. Not only does the article show how technology can help maximize profits, but it also demonstrates that the investment in technology actually results in surplus which helps in improving the living conditions and helps in poverty alleviation.
Read the entire article here.
Agri-biotechnology in India
Biotechnology has been in the news recently for not the best reasons. The proposed introduction on Bt Brinjal raked up much controversy across the country. Agri biotechnology is not new, however. In 2002, the Government of India approved the commerical cultivation of Bt cotton. This lead to the growth of agri biotech among biotechnology firms.
Recent increase in government support – through dedicated R&D laboratories, regulatory framework and policies – has contributed to this growth. Private participation is also on the increase.
The potential is however met with its own share of challenges. India has perhaps gained notoriety for stemming several international patents filed for agricultural produce that has been indeginous to this part of the world for years – basmati rice and turmeric powder to name a few. The need for stonger laws is one such challenge.
A 2007 study by Rabobank delves into these future of agri-biotechnology and addresses some key issues and challenges. For more on the report, visit www.rabobank.com/far
Telecentre Sustainability: Lessons from India and Africa on Implementing a Social Enterprise Approach
Telecentres have been playing a growing role in empowering those without access to technology or information. Their users are found among school children in Zambia to farmers in India.
Increasingly governments have been spending money on establishing telecentre systems. In 2005, the Ghanian government began launching hundreds of telecentres across the country. Not only do telecentres extend access to ICT, they also foster the exchange of ideas, civil and government participation in development and so on.
Can telecentres be commercially-viable social enterprises? This is the question that Mayanja Meddie looks at in her paper, Rethinking Telecentre Sustainability: How to Implement A Social Enterprise Approach – Lessons from India and Africa. In this paper, the author explores different approaches — from Drishtee in India to Centre Songhai in Benin – to telecentre sustainability and analyzes the strengths and weakness of each approach.
Read the full paper here.
Science and Technology in Civil Society
The following article has been contributed by Professor C. Shambu Prasad, Associate Professor at Xavier Institute of Management, Bhubaneswar.
The role of civil society in influencing public opinion towards more democratic and developmental approaches is now well-recognised in diverse fields such as health, education, livelihoods, issues relating to disadvantaged social groups and the environment. Yet, science and technology in India is predominantly seen as the preserve of the state, and more recently the market. In the linear model of innovation, civil society is seen at best as having a role in extension or the delivery of technology produced elsewhere. This paper, a study of science in civil society, questions this assumption through the case study of the work of a
civil society-led initiative in spirulina algal technology. It highlights the need for an institutional transformation of the scientific establishment into learning organisations if they are to focus on development with a pro-poor or human face.
Read the entire article here.
Strategic Partnership in Promoting Technology Incubation in India
India is fast becoming a leading Research and Development center for many of the world’s large multi-nationals. The R&D focus is leading to a growing “knowledge economy,” one that has been receiving a lot of recent government support.
In this paper, author Dr. P.K.B. Menon discusses the role of the Government of India’s Science and Technology policy, and the individual roles played by associated entities in the development of technology for the country’s small and medium enterprise sector.
Read the full article here.