Protocol Clarification

Derek Newberry — Wed, 09 Apr 2008 10:59:05 -0500

Hi Erik, Thank you for the informative correction to my earlier post - this gives a very clear idea of the difference between BoP approaches that emphasize selling to the poor and the co-venturing approach that you lay out in the BoP Protocol. This is an important distinction to make for me and our readers as the BoP hypothesis has taken root and is sprouting an ever more diverse array of discussions on who the BoP are and how businesses can engage them. Please do continue to contribute your knowledge on this subject and of course keep all of us at NextBillion apprised of your future publications! -Derek

Guest Post: Erik Simanis Explains the BoP Protocol

Rob Katz — Tue, 08 Apr 2008 13:09:32 -0500

Guest blogger Erik Simanis is Co-Director of the BoP Protocol project. Erik co-founded the Base of the Pyramid Learning Laboratory in 2000 with Professor Stuart Hart. He holds a BA in Spanish from Wake Forest University and an MBA from the Kenan-Flagler School of Business (University of North Carolina at Chapel Hill); he will soon complete his Ph.D. in strategy at Cornell’s Johnson School of Management.

Editor's note: Simanis' thoughts were initially posted as a comment to Derek's recent post, BoP = 1, SME = Global. They have been adapted, with Erik's permission, as a full-length post. NextBillion.net encourages debate on different business approaches within the BoP movement.

By Erik Simanis

Thanks for this post, Derek, and for the reference to our work on a corporate innovation process for the BoP (aka, the BoP Protocol.) I did want to make a small correction/addition to your description of that process. Importantly, the BoP Protcol is NOT about how to do "deep listening," nor simply how to understand the BoP customer's "true needs." We contend that such an approach, which reflects a very traditional corporation innovation process, is (counter-intuitively) the reason why so many of the initial corporate BoP ventures have produced lack-luster results, both for companies and communities. It also leads to weak competitive positions for the company and exposes them to low-cost knockoffs.

The problem, therefore, isn't a lack of "good customer data" or new methods (like co-creation or quick ethnography) to get that data; the problem is the very belief that new businesses (particularly in the BoP) are built on "customer data!" When you do business development with that as the organizing framework, it inevitably leads to a transactional relationship with BoP communities and fosters the view that the company's primary interest is simply to "sell stuff to the poor."

The BoP Protocol, instead, is about how companies can engage in "deep dialogue" with BoP communities and, through that process, to creatively marry each others’ resources, capabilities, and imaginations in forging a new business.

(This post continues past the break; click "Read More" to continue.)

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Protocol Clarification

Guest Post: Erik Simanis Explains the BoP Protocol