NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

At the annual G20 Summit in Mexico last June, the G20 Challenge in Inclusive Business Innovation celebrated some of the world’s most accomplished social entrepreneurs. Moreover, in order to showcase the winners and share lessons learned at a local level, it began its Regional Inclusive Business Workshops, which bring together select groups of social entrepreneurs, ecosystem builders, policy makers, and academics to discuss salient challenges and innovative ways to surmount them.

The first workshop took place last September in Berlin.

Two weeks ago in Mumbai, India, the second workshop – the Asia Regional Workshop – served as the day-long kick-off to the Sankalp Unconvention Summit. (Click here for more coverage on the Sankalp Unconvention Summit.)

The workshop started with Anil Sinha from the International Finance Corporation (IFC) and Amitava Chattopadhyay from INSEAD setting up the high-level discussion around inclusive business models. Soon, the forum launched into smaller group discussions with the G20 Challenge winners at the forefront of the conversations. They were:

• K. Hari Prasad, regional CEO, Apollo Hospitals
• Mahesh Josyabhatia, CEO Southern Africa, Bakhresa Group that helps BoP households launch bakeries
• Dilip N. Kulkarni, Jain Irrigation Systems
• Rahul Chavan, executive of Corporate Social Responsibility, Waterlife India that builds and runs water purification plants

You can access all the winners’ profiles here.

All of the panelists represent inclusive businesses that have grown to be million- and billion-dollar companies (in annual revenue), employ thousands and impact hundreds of thousands more. All of the companies tackled massive, critical needs that had not, at the time of launch, been addressed in the Indian marketplace.

Prasad from Apollo Hospitals commented, “30 years ago, there was no tertiary healthcare in India.” Apollo Hospitals brought tertiary care to the subcontinent at the same quality of foreign hospitals for a fraction of the cost.

Seeing that the majority of the Indian population lived outside metropolitan areas, Apollo knew it needed to innovate to reach the masses. With a relentless focus on relevance to the rural context, lowering the capital expenditure per hospital bed, and cutting operational costs, Apollo was soon performing a bypass surgery for $2,000, which in urban India cost double that amount. Then, to reach scale, Apollo cracked the code of securing skilled man- and woman-power who were from the rural areas and wanted to stay there, a common challenge for Indian rural enterprises.

The idea of integrating customers into the core of an enterprise existence was a recurring theme throughout the small group discussions.

Chaven from Waterlife India said that involving rural youth was the clincher in their model. “Local youths from the community take care of the whole thing,” he explained, from running the plant, to sales and distribution.

Waterlife India was not alone in putting communities at the center of their model.

Jaipur Rugs has local artisans play supervisory roles to even graduates from top Indian business schools. Jain Irrigation Systems has trained 1,000 youths from 1,000 villages to sell their farm technologies. And another enterprise trains rural Bihari girls who would otherwise have been married in their early teens to become optometrists.

Considering that in India it is common to find four different consumer behaviors in a 100-kilometer radius, getting the customer involved at every level of their business – from product development to management to distribution – was crucial in their innovation trajectories. Obviously, this strategy has given them immense rewards in the form of scale and impact. In fact, as Kulkarni noted, the social angle has allowed them to increase profits in the most quintessential example of the market-driven impact that ventures covet.

But Kulkarni emphasized something surprising – it can’t stop there. He explained that most social enterprises make the fundamental error of stopping at economic livelihood creation. In reality, the needs of the people are greater: health, education, and emotional issues, for example. Therefore, Kulkarni’s extension workers go deeper by fostering real relationships with the people they serve, and by staying engaged continuously with the customers. This, he described, made the difference.

After several stimulating sessions around the idea of innovation – business model innovation, innovations in financing, managing innovation, and open innovation – Susanne Dorasil from BMZ expressed gratitude and satisfaction about the exchange of ideas at the workshop.

“We had to convince people that social enterprises want to share and have a spirit for tackling challenges, not a spirit of pure competition,” she said. “So, thank you for showing that it’s possible.”

Beyond collaboration, the regional workshop should be applauded for one thing: in an ecosystem rife with ambiguity and hardship, for showcasing some of most inspiring Asian social entrepreneurial models that budding social entrepreneurs can strive to emulate.

The next workshop will take place on June 5 in Medellin, Colombia in the framework of the Inter-American Development Bank’s II BASE Forum International.