Sustainable Business Transformation

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Posts Tagged ‘Social Enterprise’

HPA Talk: CleanTech Mentoring Workshop

Posted by Hemant Puthli on March 19, 2010

[Text of a talk delivered at the ‘CleanTech Mentoring Workshop‘ on March 19, 2010 aimed at introducing HPA and outlining the scope and nature of our advisory services]

Good afternoon!

First, let me thank TiE Mumbai, CII and New Ventures India for hosting this event and for inviting me to talk about who we are and what we do. I shall endeavour to keep this simple and brief, along the lines of an “elevator pitch” as it were, since the time allocated is quite short.

Think of HPA as a network of independent experts — high-content, seasoned industry professionals — brought together by a shared vision and held together by bonds of trust. Trust in each other’s capabilities as well as value systems. Since our associates are based in different geographies across the world, and also travel a lot, we use technology and communications tools to collaborate on projects and work as a virtual team. Quite often, we refer to HPA as an experiment in cooperative consulting, since each of us has their own independent practice as well, but we come together on a common platform to serve clients that need specific competencies that our associates bring. Each of us has had prior work experience of anywhere up to 25 years with some of the biggest global brands in our respective industries. So that’s a one-minute overview of who we are.

Regarding what we do. Simply put, we help businesses perform better through more effective use of technology, and we help technology providers perform better by strengthening their business management capability. Our work centers around the meeting ground of business and technology and we approach this intersection from both sides, assisting buyers as well as sellers through advisory services focused around Strategy and Governance. We weave our advisory services around the theme of sustainability, which we characterize by 3 criteria: social relevance, environmental responsiveness and economic viability. This is conceptually very similar to the “triple-bottom-line” approach or the “3P” model which I’m sure most of you may be familiar with. In this way we distinguish ourselves from traditional management consultants and business advisors with their legacy frameworks and methodologies.

In our experience, we have observed that each technology start-up is born out of a unique combination of two great strengths — technology innovation capability and the spirit of entrepreneurship. However, there is a third ingredient that goes into the secret sauce which makes a start-up successful. It involves depth of management capability and in many cases this is not always abundantly present within the start-up core team.

Let’s be clear about this: things like vision, strategy and risk appetite cannot be outsourced. The start-up already has some kind of a vision and some kind of strategy in mind, and has already placed its bets on its execution capability, else it would not exist. But what start-ups do require is help in the articulation and independent validation and verification of the entrepreneurial vision and strategy. And from that point on, they need help in aligning the various delivery vehicles that will translate ideas into action. That is where we come in — we help social entrepreneurs, including cleantech companies like yours, by offering the depth of our collective mix of management expertise and experience that you can draw on, to do the following things: shape your strategy and develop your business plans, build and enhance your execution capability and help in governing your operations. As a bonus we also sometimes throw in the ability to leverage our collective Rolodex of contacts, where possible.

In a nut-shell, that is what we do, and I would be delighted to meet the cleantech entrepreneurs over lunch, answer questions and explore mutually rewarding opportunities.

Thank you!


Posted in Governance, Strategy, Technology | Tagged: , , , , , , , | 4 Comments »

Case Study in Social Entrepreneurship: Grassroutes

Posted by Hemant Puthli on March 15, 2010

[Content sourced from Inir Pinheiro, the social entrepreneur behind Grassroutes, and edited by Hemant Puthli]

India’s remote villages are now attracting city dwellers who are eager to step away from the stress zones of their office cubes and the complexities of urban life, in search of clean air and a simpler, earthier way of life – if only for a few days.

The village of Purushwadi is 140 miles (220 km) away from Mumbai city, the hub of international business and the financial and entertainment capital of India – a hot, grimy, polluted, noisy and crowded metropolis of at least 20 million people living in the greater metropolitan area. But in a few short hours, inhabitants of the “Maximum City” can reach a different world, where they can swim in the crystal clear waters of a river, help farmers thresh wheat, chop wood with a long handled axe, and eat home–cooked meals with peasants in the dim light of their rustic homes. Purushwadi is perched high above mean sea level, in the jagged hills of Maharashtra. Life for the locals has hardly changed for several centuries. These simple farmers live in mud-brick houses with dried cow-dung floors and earn their income from the cultivation of rice, wheat, millet and pulses. There is no electricity or running water and the day revolves around hard work in the fields under the harsh rays of an unforgiving sun. As a tourism destination, this is not exactly a beach resort with plenty of five-star properties to choose from, each with a world-class spa to rejuvenate yourself. Villages like Purushwadi offer you rejuvenation of a different kind — deep hands-on contact with raw, authentic rural Indian life in its natural habitat. Tourists to Purushwadi say that their journey has been worth it, just for getting a refreshingly different perspective on life away from the daily routine of making money and climbing the career ladder.

About 70% of India’s population of 1.1 billion lives in the villages. As mega-cities like Mumbai expand, fuelled by the country’s economic boom, the gap between the urban rich and the rural poor widens as never before. It is not difficult to see how this could result in the making of a socio-economic time-bomb. Responsible rural tourism is one of the most effective ways in bridging this gap and bringing these disparate communities together. Responsible rural tourism involves, for example, bringing city slickers and urban youth groups from places like Mumbai to villages like Purushwadi for a weekend. These tourists are keen to experience the poetry of the earthy life in rural India, of being in touch with nature and of spending a couple of days with people who live by modest means through simple farming. Grassroutes is a responsible rural tourism movement that is building a network of village tourism destinations across India, wherein the tourism model is owned, managed and run by local village communities. Grassroutes has made it possible for people to get into such villages and realize the true beauty of rural India. Their idea is to get communities to connect. The revenue generated through tourists trips is used to supplement the income of the villagers – and more importantly, encouraging and enabling them to stay back and continue with their lifestyle instead of heading to the city to look for work. According to Grassroutes, the poor and marginalized do not need charity or sympathy — they need opportunities to provide for themselves. And Grassroutes’ mission is to provide them with precisely those opportunities, while also providing urban dwellers a chance to experience something unique and special.

Grassroutes’ vision entails the conservation and promotion of local lifestyles, knowledge systems, environments, economies and traditions by enabling and empowering local communities to access sustainable opportunities. Grassroutes recognizes that lack of access to opportunities is one of the greatest challenges facing rural India. And this in turn leads to exploitation of already over-stretched natural resources, migration to larger towns and cities, which in turn leads to congestion in those urban centres. At a more intangible level, this also results in erosion of local culture, traditions, lifestyles and sense of community. The Grassroutes model has three key aspects to it: (1) facilitating the development of the village as a tourism destination (2) marketing and product development of tourism in the village and (3) quality control and monitoring of tourism in the village.

Grassroutes selected responsible rural tourism as a means of creating sustainable opportunities keeping in mind the fact that tourism is one industry that represents the greatest multiplier effect in economic development. Tourism also provides a platform for interaction that facilitates cultural osmosis and exchange of thought and understanding. These factors, coupled with the fact that entry costs are relatively low, make responsible tourism a very attractive opportunity for social entrepreneurs looking to engage in sustainable development. Historically, tourism has also been the greatest exploiter of local communities and responsible rural tourism is a model that reverses that trend. Responsible rural tourism places the local community at the epicentre of the tourists’ journey while also giving a great experience to the tourist, thereby mitigating the down-side of tourism. The ultimate aspiration of Grassroutes is to create sustainable opportunities in rural India which would give local communities the impetus needed to maintain and celebrate their unique way of life, leading to conservation of local lifestyles, traditions, knowledge systems, biodiversities and local economies.

For more information please visit or drop them a note in the comment box below.

[Disclosure: HPA is assisting Grassroutes through mentoring and advisory on strategy and general management issues]

Posted in Economics, Environment, Society | Tagged: , , | Leave a Comment »

The Art of Giving

Posted by Hemant Puthli on September 25, 2009

Further to the last post (below), on the subject of Charity, here’s an interesting talk by Jacqueline Novogratz, the founder of Acumen Fund.

Clearly, it’s time to change the way we give!

Posted in Economics, Operations, Society, Strategy | Tagged: , , , , , , | Leave a Comment »

Charity 2.0: Partnership, Not Patronage

Posted by Hemant Puthli on September 21, 2009

While it is a fact that several charitable organizations, the world over, are doing good work in helping developing communities, societies and economies, it is also a fact that there are charitable organizations that are either wasting resources or subverting the very causes that they claim to espouse or, worse, doing both. This is mostly because the idea of charity, arising as it does out of a present-day variation of the feudal concept of ‘noblesse oblige‘ (which in turn arises from a benevolent variation on the theme of self-interest) carries within itself the seeds of its own failure. Presented below are examples of some of the risks that are intrinsic to charity initiatives:

1. Power: Charity tilts the balance of power in favor of the donor. It provides the donor with political leverage over the recipient, and therefore gives the donor the opportunity to determine the scope, pace and extent of the recipient’s development and also the opportunity to influence other incidental factors that impact the recipient’s growth and future prosperity. This could lend itself to abuse in situations where such power falls into the wrong hands. In many cases, charity has prevented recipients from evolving solutions that might have been better than the ones the donor is willing to fund or provide for. In such cases, charity serves as a strategy to suppress potential competition.

2. Dignity and Dependency: Charity tends to deprive recipients of their dignity and self-esteem, especially in situations where it does not provide them with opportunities to independently improve their own socio-economic conditions. Charity also undermines the basis for catalyzing entrepreneurship, drive and innovation in recipient communities and instead replaces it with a ready justification for complacency. Recipients grow dependent on aid and are not equipped to deal with a future that does not bring in as much aid as they require.

3. Dumping:  Charity easily becomes the vehicle for handing-down legacy products and technologies that are ready to be retired from their lifecycle or, worse, are being withdrawn from donor-side markets due to known defects or harmful effects. Obsolete products are usually more expensive to maintain, and defective / harmful products are clearly undesirable. In some cases, recipient communities could be used as testing grounds for new products (especially in the life sciences sector) whose impact is not clearly known. This is another potential area of abuse.

4. Wastage: Since charitable initiatives do not have a profit motive, there is no incentive to control wastage of resources (including money). Such organizations are open to the risk of becoming fertile grounds that breed inefficiency and/or corruption (if not one, then the other; worst case, both). In order to avoid this, controls need to be enforced through external audits and tighter internal checks and balances, both of which add to costs and thereby drain scarce resources.

A more effective approach to socio-economic development would be to shift the paradigm, from a traditional not-for-profit donor/recipient model built on patronage, to a ‘social enterprise’ model that is based on the same economic principles and financial disciplines of mainstream for-profit businesses, and which builds on a spirit of partnership. The fundamental difference between these two models is characterized by the fundamental difference between the spirit of patronage arising from self-interest and the spirit of partnership towards a common goal.

While the partnership-based social enterprise approach also brings its own risks (such as the potential to levy usury interest on loans), adequate competition in the social enterprise domain would go a long way in checking such exploitative tendencies and monopolistic opportunism. Suitable regulatory mechanisms (including the requirement for better corporate governance, and for standards in performance reporting) would also help in ensuring that social entrepreneurship initiatives retain integrity in their efforts to promote growth and development. This may not be a perfect solution, since every approach brings its own risks, but it would certainly be more sustainable than one based purely on the charity of patron communities.

There’s an old proverb that goes “Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.” To that, social enterprise can only add “Help him set-up a fishing business and you put him on the path to prosperity in his own lifetime as well as for his future generations.”

Posted in Economics, Governance, Society, Strategy | Tagged: , , , , | 17 Comments »

Taking “Green Shoots” Literally

Posted by Hemant Puthli on September 4, 2009

Food for thought from TED Talks …

As we reboot the world’s economy, Geoff Mulgan poses a question: Instead of sending bailout money to doomed old industries, why not use stimulus funds to bootstrap some new, socially responsible companies — and make the world a little bit better?

Hope the right people are listening!

Posted in Economics, Environment, Society, Strategy | Tagged: , , , , | Leave a Comment »

Convergence: Evolution of Sustainable Business

Posted by Hemant Puthli on August 26, 2009

The diagram below represents the three generations of evolution of organizations and corporations, ending with convergence, in the 3rd generation.

HPA - Evolution of Sustainable Business

Historically, through the Industrial and post-Industrial era, we have seen the rise (and rise) of the traditional ‘profit-oriented’ corporations whose main objective was to create wealth for its stockholders and investors. Several such corporations also felt a moral obligation to give back to society, and accordingly funded charitable initiatives to help and support various elements of society, mainly the underprivileged communities. In more recent times (especially post WW II), we saw the emergence of the traditional ‘purpose-oriented’ organization whose main focus was on social development and/or environmental protection. In the organized sector, some of these were Government-funded donors of ‘aid’ while others were Non-Government Organizations (NGOs) funded privately. In the unorganized sector, individuals, associations, clubs etc. took up social and environmental activism towards the same or similar objectives albeit at a smaller scale and perhaps more locally focused.

The second generation (mostly in the present time) is manifesting two trends: (a) the move towards efficiency and competitiveness on the part of the purpose-oriented organizations, and (b) the move towards responsible citizenship on the part of profit-oriented corporations. Purpose-oriented organizations are focusing on cost management, productivity and other parameters of efficiency and effectiveness (‘cheaper / faster / better’) that have typically been characteristics of the traditional approach, culture and discipline of mainstream business. The emergence of the ‘social enterprise’ and ‘social entrepreneurship’ is a key milestone in this journey of evolution. Social enterprises are just like other enterprises, except that they focus on social causes and serve ‘customers’ of a different type. On the other hand, profit-oriented corporations are taking on more responsibility for their actions and for the impact of their operations on the environment as well as their host societies in locations where they operate. This is visible through their Corporate Social Responsibility (CSR) programs and ‘Green’ initiatives (in syncretic co-existence, but seldom integrated with the mainstream business), which  are signs of a growing awareness and the sense of urgency to respond to challenges in these key areas, on the part of the corporate sector.

In a not-too-distant future, we will see a confluence of these two streams of evolution, converging into a single type of organization / enterprise — the sustainable business. The sustainable business will seek to make a profit, but through a purpose. It will try to be socially relevant, environmentally responsive and economically viable all at once, in a cohesive fashion. It will develop its own way of integrating what were hitherto seen as diverse and contradictory objectives, into the holistic goal of sustainability.

Posted in Economics, Environment, Organization, Society, Strategy | Tagged: , , , , , , , , , , | Leave a Comment »