-
‘Hot’ and ‘Bright’ Business Models – Bringing Energy to the BoP
November 10, 2011 Editor 0
Authored by: Martin Herrndorf
‘We have technology – we just need a business model’ is the rallying cry for a whole lot of promising BoP projects. Many of these look good, but still face major difficulties in getting their products in the hands of people, and getting the people (or someone else) to pay for it. The “Energize the BoP!” business model generator provides support in overcoming these challenges.
What’s in a business model?
Academics disagree (that’s their job), but one can consider a business model as “wrapped around” a technology – covering the customer interface as well as how the business develops its products, distributes them, hires and leads its employees, etc.
Especially in BoP contexts, with their scarcity of resources and difficult conditions, having the right, fitting business model is crucial. The different elements of a business model are typically dependent on each other. Using a special BoP distribution channel, for example an agricultural cooperative, without a properly adapted product can lead to low customer satisfaction and high maintenance costs (as cooperative staff cannot provide the same level of support as sales staff in more up-scale markets). Additionally, local conditions may vary – a business model that works in one state in India might fail in the neighbouring one.
dAs a consequence, many BoP pioneers and heroes have very specific business models – and have developed them through a trial-and-error-system. Aravind’s low-cost, high-volume business model was developed by its visionary founder, and is maintained by the family. Selco’s distribution model has been fine tuned over the years (if not decades), with certain setbacks (like disappointing experiences in franchising).
Any faster way?
To some degree though, companies can learn from the business models of successful leaders. And at the BoP, most companies (at least those with a strong mission to alleviate poverty) are more then happy to have their peers learning from them.
Take the example of energy – a pressing sector for progress at the BoP and, luckily, one with a range of (more or less) successful companies and entrepreneurs operating in it. They are the basis of the “Energize the Bop!” business model generator, a publication by Berlin-based consultancy endeva (see NextBillion’s interview with one of its founders).
Their guidebook summarizes business model elements in eight areas – like payments, or human resources – for building a “sustainable” business model (see the figure below).
Beyond the publication, the Energize the BoP-Practitioners’ workshops are designed to help technology providers, energy providers, and consultants develop energy business models for low-income markets. Participants work on their own business models and share best practices; participants will also explore questions like, “how to get access to the carbon market,” or “how to deal with the political environment” (and network!).
The next workshop will be held on Dec. 1-2 in Berlin (you can also download the detailed agenda of the workshop as pdf).
Good luck in developing those ‘hot’ and ‘bright’ business models required to bring energy to the poor!
Related Posts
How ICT Can Have Socioeconomic Impact on Base of the Pyramid Consumers
Building Business Models
Deploying e-health service innovations – an early stage business model engineering and regulatory validation approach
The Embedded Enterprise
The Hidden Pitfalls of Inclusive Innovation
Executing Lean Growth Strategies
Categories: Next Billion
Tags: bop, Business model
Stop Thinking Outside the Box Motivation to become an entrepreneur: a study of Nigerian women’s decisions
Subscribe to our stories
Recent Posts
- Entrepreneurial Alertness, Innovation Modes, And Business Models in Small- And Medium-Sized Enterprises December 30, 2021
- The Strategic Role of Design in Driving Digital Innovation June 10, 2021
- Correction to: Hybrid mosquitoes? Evidence from rural Tanzania on how local communities conceptualize and respond to modified mosquitoes as a tool for malaria control June 10, 2021
- BRIEF FOCUS: Optimal spacing for groundnuts in smallholder farming systems June 9, 2021
- COVID-19 pandemic: impacts on the achievements of Sustainable Development Goals in Africa June 9, 2021
Categories
Archives
Popular Post-All time
- A review on biomass-based... 1k views
- Can blockchain disrupt ge... 764 views
- Apply Now: $500,000 for Y... 760 views
- Prize-winning projects pr... 717 views
- Test Your Value Propositi... 706 views