SESSION 1:
Why the BoP should care about profiting from the ToP
Aishwarya Ratan, Microsoft Research India
The framers of the Bottom of the Pyramid (BoP) phrase and approach – C.K.Prahalad,
Stuart Hart, and Alan Hammond – present it as a way for businesses, large and small,
domestic and multinational, to target the poor primarily as consumers, and sell products
and services to them at low cost, large scale, and thin margins to gain a new revenue
stream. While profitable to the company, they argue that such inclusion in the marketplace
is simultaneously effective in helping the poor exit poverty in a sustainable fashion.
Critics of the BoP approach like Karnani argue that neither are there significant
profits nor significant poverty alleviation outcomes to be had from selling to the
poor. Instead, involving the poor in the marketplace as producers and workers and
improving their productive capabilities through public investment is what is required
to systematically alleviate poverty. It would appear that given the deep linkages
between consumption and production at the household level, the magic bullet to end
poverty must involve advancements in both products/prices and earnings/wages.
In this paper, we view the entire private sector and economic development debate through
the eyes of the BoP. Were the BoP household or individual to examine the status quo,
it would be clear that great profits are to be had from selling to those at the Top
of the Pyramid (ToP). We examine these two contrasting foci, i.e. viewing the BoP
primarily as consumers vs. producers, from a poverty alleviation standpoint, using
evidence from field studies in rural India. Comparing 'social enterprise' private
sector initiatives that focus on the poor as producers of innovative products and
services against those that target the poor as consumers, we present a preliminary
assessment of which market-driven path facilitates greater impact on helping the poor
exit poverty. We end with pointers on how inverting the classic BoP premise through
direct linkages of the very poor as cooperative producers of niche products/services
with the very rich as target consumers can make real inroads into ‘ending poverty
through profits'.
Moving the Bottom of the Pyramid Upward:
Mobile Phones and the Expansion of Economic Networks in Morocco
Hsain Ilahiane, Iowa State University
John Sherry, Intel Corporation
According to the International Telecommunication Union, there were 3.3 billion mobile
phone users worldwide by the end of 2007, equivalent to a penetration rate of 49 percent.
In Africa, for instance, only 4.7 percent of the population has access to the Internet
while mobile users have surpassed landlines and represent about 90 percent of all
telephone subscribers (ITU 2008). While these are remarkable numbers, it is also true
that the vast majority of the world’s population still has no access to such information
and communications technologies (ICTs). Partly as a result of this situation, and
partly out of recognition that ICTs bring efficiencies to information and economic
transactions, a number of researchers and practitioners have turned to ICTs as tools
for poverty alleviation and sustainable development in the developing world. The thinking
is that by making technology available and lowering the costs of access to information,
ICTs will enable those in poor communities to better accomplish their own economic
goals, and possibly lift themselves out of poverty. Associated with this approach
is a shift in development thinking from “top-down” planning by states or foreign NGOs
to an emphasis on “bottom-up” global market forces, regarded as critical for ICTs
“to gain wide, robust and long-lived usage” (Best and Maclay 2002:76). This shift
has also resulted in new ways of rethinking the role and participation of multinational
corporations (MNCs) and the state. Prahalad and Hammond assert that “prosperity can
come to the poorest regions only through the direct and sustained involvement of multinational
companies” (2002:49). Markets that were once either too difficult to reach or too
poor and informal to be of interest can, so the thinking goes, be made accessible
and profitably addressed through the use of information technology.
As a portal for communications, asynchronous messaging, entertainment and information,
the mobile phone has become the manifestation of the “digital age” for many of the
world’s poor. And yet, amid the growing body of literature on the cultural effects
of mobile telephony in affluent economies, in particular those of Scandinavia, Japan,
and North America, less attention has been granted to technological adoption as a
direct outcome of daily socio-economic needs and behavior patterns in the developing
world. This paper addresses these issues in the context of Morocco. Between 1998 and
2007, the majority of Moroccans has gone from no phone ownership to ownership of mobile
phones. Currently, more than two thirds of the population has a mobile phone, that
is, about 20.5 million subscribers. This rapid adoption rate can be understood as
the result of two major contributing factors, both of which will be explored in this
paper: the neo-liberal economic reforms undertaken by the state in the mid-1980s,
and the ease of use and utility of the mobile phone. This exceptional penetration
rate of mobile telephony, as elsewhere in the developing world, underscores the degree
to which this new technology has become part of everyday routines, and has been tinkered
with to serve various communicative and economic needs. In this paper, we are concerned
with ways in which urban and poor skilled and semi-skilled laborers use the mobile
phone as a tool to organize a newly networked work life. Based on ethnographic and
quantitative evidence, we argue that mobile phone use expands the productive opportunities
of certain types of activities by enhancing social networks, reducing risks associated
with employment seeking, and enabling bricolage or freelance service work, resulting in income increases. Our hope is that this paper
will spur more discussion and research interest on the practical social and economic
effects of mobile technologies in the developing world.
SESSION 2:
Women's Sociality, Infrastructure, and the Making of Payments Space in Cairo
Julia Elyachar, UC Irvine
In this paper, I show how women’s practices of sociality in Cairo--visiting, talking,
gossiping, helping out, and maintaining relationships--has created what I call an
“infrastructure of communicative pathways” that has long been central to the texture
of life and the political economy of survival in Cairo. The paper shows how this
infrastructure became visible in the 1980s and 90s through NGO-mediated financialization,
and is being redrawn as “payments space” and “digital space” by large corporations
investing in mobile phone technologies and e-payments
How M-PESA fits into and alters financial habits:
The results of the financial diaries project
Olga Morawczynski, University of Edinburgh
The M-PESA application has grown rapidly since its introduction into the Kenyan market
in March of 2007. It has acquired a user base of over five million, and an agent network
of over five thousand. This paper will provide a detailed analysis of M-PESA usage patterns in low-income
Kenyan communities. It will show that the application is frequently being used for
person-to-person (P2P) transfers between urban centres and rural areas. Urban M-PESA
users make, on average, six of these transfers per month. The paper will further reveal
that M-PESA is being used for savings by both banked and unbanked users. In some cases,
the application is becoming a substitute for some of the informal savings mechanisms.
This paper will draw from a financial diaries project, which took place from September
to December of 2008. During this period, fourteen diaries were distributed in both
urban and rural locations. The first batch was distributed in Kibera, an informal
settlement on the outskirts of Nairobi. The majority of the participants in this group
were male urban migrants. Most of these used M-PESA to transfer money back to their
rural homes. The second batch of diaries was distributed in villages around Western
Kenya. The majority of the participants in this group were female, and the wives of
the urban migrants. The results of a fourteen month ethnographic study will also be
used to substantiate the arguments of the paper. During this period, time was spent
in Kibera and a small village in Western Kenya. The financial habits of users, and
non-users, were examined.
The paper will begin by introducing M-PESA, and discussing the financial diaries methodology.
It will then proceed to discuss the results of the financial diaries project. It will
emphasize patterns of usage and non-usage. It will also make clear how M-PESA fit
into, and altered, existing financial habits of poor Kenyans. The paper will conclude
by contextualizing the results within the emerging literature on m-banking in developing
countries. It will also suggest areas for future research.
SESSION 3:
Intermediaries and the BoP
Savita Bailur, London School of Economics
The "intermediary" is often considered critical in enhancing the participation of
those at "the bottom of the pyramid" in information and communication technology initiatives,
such as rural community multimedia centres (CMCs or telecentres). The intermediary
in this case can either be the centre manager, those providing technical assistance,
or those providing content for the CMC such as the local doctor, agricultural officer
etc. Yet these intermediaries face several challenges. This paper examines the case
of intermediaries (the centre manager, doctor, vet, agricultural officer) involved
in a UNESCO funded CMC in India. It finds that, firstly these intermediaries are effectively
regarded by their superiors as the "bottom of the (developmentalist) pyramid" themselves.
Secondly, they are regarded with some resentment by the local community, as paternalistic
and colluding with the "outsiders". Thirdly, these intermediaries impose their own
technologically deterministic ideas onto the "bottom of the pyramid". It is therefore
questionable whether intermediaries enhance participation or hinder it. We call for
more ethnographic research on understanding the role of the intermediary in the "bottom
of the pyramid".
E-shopping through Drive-by WiFi in Rural India
Jo Tacchi, University of Edinburgh
In this presentation I will explore a particular example of an ICT initiative that
follows the BoP model in a rural area of India. I will compare this initiative and
its attempts to bring emerging digital communication technologies to people through
engaging with them as a potentially viable market for their products, with donor-funded
ICT initiatives that are concerned with how emerging technologies can aid in poverty
reduction. The first initiative uses technologies in innovative ways, combining computers,
WiFi and buses, to provide low cost services that are essentially designed to improve
access to information and products that are unavailable locally. This is similar to
an extent to many ICT for development initiatives, especially in the use of emerging
technologies to increase access to information and knowledge. This presentation will
explore some of the interesting similarities and important differences of these two
approaches.
Taking Prahalad high-tech
Anke Schwittay, RiOS Institute
My talk explores the participation of multinational corporations (MNCs) in the BoP
area and the ways in which corporate access to BoP subjects is created. Based on several
years of ethnographic fieldwork, the focus of my presentation is Hewlett-Packard’s
e-Inclusion program, which took place from 2000-2005. E-Inclusion is often considered
the first major BoP initiative of a high-tech company, and, according to Prahalad,
made the poor “a legitimate subject of senior management discussion.”
A brief institutional genealogy will be insightful to understand corporate dynamics
around BoP initiatives. E-inclusion was started as a skunk work project at the famed
HP Labs in Palo Alto by three ethically-minded long-term employees, underwent a ‘strategic
reorientation’ to a fully-incorporated business initiative and finally was terminated
following a change in HP’s leadership.
E-Inclusion pursued two different strategies for gaining access to the BoP. On the
one hand, it partnered with governments and multilateral development organizations,
and on the other it developed pilot projects that engaged directly with the ‘aspiring
and enterprising’ poor identified by Prahalad as the most promising BoP subjects.
An in-depth investigation of a project that aimed to develop a product for organic
coffee farmers serves to highlight the importance of trust in corporate BoP transactions.
I will finish with a look at the remains of e-Inclusion; some of whose former managers
went on to start BoP consulting companies.
SESSION 4:
The Hidden Phantasm of Corporate Social Structure: The Fight That Surprises Everyone,
Even You
Tony Salvador, Intel Corporation
Large corporations (MNC's, multinational corporations) can be usefully construed as
complex adaptive systems that function across a particular landscape. This is especially
relevant to considerations of MNC involvement in "emerging markets", which we argue
are best construed as unfamiliar populations with definitive, but unfamiliar system
dynamics and social structures; they are not simply "poor" or "underdeveloped". Deciding
to engage in "emerging markets" can be likened to participating in an unfamiliar landscape.
While in general, it's fairly well established that entering new "markets" requires
some level of corporate adaptation, there are three factors perhaps less well known
that may also be helpful for the would be entrepreneur. First, the corporation itself
must adapt to engage with those new potential markets to create sustainable exchange.
However, corporations typically adapt to increase and maintain their fitness becoming
highly optimized for their landscape. Thus, new landscapes pose potential challenges.
Second, in "emerging markets", per se, there is a relatively high likelihood that
the adaptation required will challenge the extant system fitness, posing a "system
threat". The corporate system's overall "survival instinct" will then meet any innovation
with systemic resistance, which unless otherwise addressed, will result in failure
of the new engagement. Third, the corporate system's extant social structure will
more often than not vitiate any appropriate adaptation to address and engage the new
potential market -- even if individuals in the system are supportive of the new endeavor.
Thus, the systemic manifestation of social structure is hidden phantasm: unseen, unheard,
unknown and untold. Therefore, the probability of a large MNC innovating to engage
unfamiliar populations to create sustainable markets (systems of exchange) is a highly
improbable event, with no visible means of engagement, the likelihood of which increases
not as a function of "market research", "the quality of the idea" or "the innovativeness
of the technology", but as a function of how adequately and nimbly the corporation
can adapt its otherwise highly successful system dynamics and actively create appropriate
social structures to enable and facilitate an appropriate engagement.
Imagining the Bottom of the Pyramid
Heather Horst, UC Irvine
Prahalad and Hart’s Bottom of the Pyramid (BoP) strategy represents a radical re-conceptualization
of the value of consumers and consumption in the developing world. Yet, and despite
the recognition of agency and the innovative potential of the world’s poorest, BoP
strategies also hinge upon assumptions about the basic desires and needs of the poor
as well as the nature of social change. In this contribution to the “Bottom of the
Pyramid in Practice” workshop, I explore the ways in which telecommunication companies
imagine individuals at the bottom of the pyramid and, in turn, how these visions of
the poor shape the potential for participation and development. Through an analysis
of Digicel campaigns in Jamaica and Haiti, community development initiatives and the
everyday use of mobiles among the poorest members of society, I demonstrate the variety
of ways particular members of the poor are rendered invisible and irrelevant to BoP
strategies. Exploring the close connection between youth, the future and technology
as well as age, conservatism and the resistance to and/or support of change, I argue
that BoP efforts to unleash the untapped potential of the poor tends to emphasize
youth-oriented and public forms of participation, development and consumption. Integrating
this case study with critical analyses of development (e.g. Ferguson 2006, Escobar
1995), particularly the close relationship between technology and economic development
(Escobar 1994), I conclude by considering the implications of such imaginings of the
poor who fail to conform to the youthful, entrepreneurial spirit of the BoP movement.
A New market or Development for the poor? Depoliticizing the Consumer
Renee Kuriyan, Intel Corporation
Dawn Nafus, Intel Corporation
This paper explores the multiplicity of ways by which notions of “the consumer” are
rendered neutral and used as instruments of the state, businesses and individuals.
Building on the work of James Ferguson, we find that the “consumer” can be considered
a new anti-politics machine (1990). We argue that there is a process of depoliticization
that occurs in relation to the consumer that goes beyond pragmatic commodity relations.
This depoliticization abstracts consumers from the cultural frameworks within which
they operate and become tools by which nation-states, corporations, designers, multilateral
organizations and “consumers” themselves are able to construct identities, develop
aspirations, and delineate boundaries between the public and private spheres. Indeed,
the abstracted, decontextualized consumer lays the groundwork for relations between
these entities to be built. It is through “the consumer” that partnerships come together
to serve them.
We focus on the mapping of the figure of “the consumer” onto the poor through public
and private strategies of serving the “Bottom of the Pyramid” with Information and
Communication Technologies (ICTs). With the BoP discourse of the poor as consumers,
there is a conflation of consumer agendas and national development goals. This opens
spaces for the orchestration of specific national, corporate and individual agendas.
For example, it creates opportunities for new forms of engagement for Information
Technology corporations with governments around nation building agendas as they target
new markets of technology consumers. By rendering the poor as consumers, design firms
become able to re-imagine linkages between their traditional concerns and a seemingly
“untapped” market. The individuals living at the BoP themselves use depersonalized
notions of the consumer, often associated with the middle class, ICTs, and cultures
of consumption, as figures of aspiration and part of a process of identity construction.
Nation states participate in government assisted PC purchase programs (brokered by
IT corporations) under the premise of assisting the BoP, or otherwise excluded citizens.
This entails in some cases highlighting the BoP to attract private actors and in other
cases blending the consumption needs of the BoP into a larger national consumption
agendas. The figure of the consumer is used in ways that at once raise the issue of
poor people’s agency and at the same time expands the agency of the myriad institutions
serving them to make claims about progress, and to render particular populations
legible (Scott, 1998) in a simplified, yet strategic process.