That Dr. Verghese Kurien touched ziliions of life…literally through Amul…is a well known fact. But I had the good fortune to meet the man who with his quiet business wisdom and foresight taught me much about standing for what you think is right. The year was 1999 and I was spending a huge part of my days being in the centre of managing the controversies around biotechnology and its impact. I was torn by the arguments put forth by my good friends in many civil society organisations and the scientists on the other and everyone in between. In the midst of high strung emotions, lost pragmatism and scientific evidence, I found myself struggling to determine what was right and what I should be doing. That I was a biotechnologist by training seemed very incidental then, as not everything one learns in school can be adapted as such in life! I met Dr. Kurien at a seminar. He was deeply interested in new technologies especially those that have the promise of impacting huge numbers of people on ground and in his very unintrusive way kept asking me questions. When we felt that what we had to discuss was way more interesting that what was on at the seminar, we stepped out and without warning, he held my hand and said- “The people on ground who are the users of any technology, however complicated, are always the ones who know the best. If you can tell them facts as they are and communicate it well, you will find that they will make the best choice. Amul was founded on a sound business model: providing quality products to consumers at an affordable price. It was not built on the promise of removing poverty. The impact of small milk producers getting together to bring costs down while maintaining their quality standards helped them compete with the best. It helped them understand the bigger promise.” I never forgot that lesson.
I apply that whenever its applicable and Dr. Kurien’s advice has always stood me in good stead!
The world is abuzz today with complex definitions of what a “social enterprise” means and how social impact needs to be financially and operationally sustainable. Dr. Kurien showed the world the direction to build a viable, thriving business where it is possible to “earn well and do good” way back in 1950. In fact, I find it no coincidence that we all celebrated Amul turning 50 this year! He founded around 30 institutions of excellence almost all of which are owned, managed by farmers and run by professionals.
Just like million others who have been touched, inspired and educated by the greatness and vision of this man, I pay a small tribute in my own small way to the man who shaped my thinking. RIP Dr. Kurien.
Posts Tagged ‘social enterprise’
“Amul”ya advice
September 11th, 2012Is the crisis in the microfinance industry teaching valuable lessons?
March 22nd, 2011Social enterprises have been touted as the best thing that happened to the world in a long time. Many of its proponents put forward an ambitious agenda of creating jobs, providing training and developing local services in areas of serious and long-standing deprivation, while holding out the prospect of financial viability rather than grant dependency. Without doubt that the momentum in the social enterprise “industry” has accelerated significantly (I have to add here that yours truly jumped the bandwagon two years ago, and has never been happier!!). But is this growth and attention justified? Are communities and their local economies that are supposed to be the main beneficiaries of these businesses benefitting?
I think one of the issues with the term “social enterprise” is that there are inconsistencies in how people define it. And more importantly, how such organizations in the overarching context of privatization and marketization survive and operate. Are these organizations really a radical alternative model for doing business in a social and ethical way?
The present discourse and debate around the microfinance industry is a case in point. Once the poster child of the social enterprise world, the microfinance industry has come about to signify everything that’s gone wrong with the social enterprise trying to be commercially viable. Why is that? Is it because enterprises that have a social agenda can’t be seen as making profits? Or is it that they are now a force to reckon with and the rest of the market forces are just coming to terms with this new force majeure?
Having known the proponents and key players of both Grameen Bank and SKS Microfinance for a while now, I know for a fact that their intent was never in doubt. Both Prof. Yunus and Vikram Akula are visionaries who dared to dream and give a platform for their dreams to bear fruit. And they proved C K Prahalad’s theory that there is indeed a huge opportunity to do business at the base of the pyramid. So what went wrong?
I inherently believe that any enterprise, social or otherwise cannot be impactful and do justice to its stakeholders if it doesn’t become sustainable. Financially, and operationally. But its also true that this new age financially viable social enterprise is seriously altering existing consensual and sympathetic relationships between the for-profit and not-for-profit service providers. Many people, especially the NGO sector and the polity view this as an encroachment of private sector companies into services previously delivered by the voluntary and community sector.
But I also believe that its important for social enterprises delivering value to a certain community and stakeholder not to don the halo of a messiah out to eradicate all evils that are prevelant in our society in one sweep. The microfinance industry has done a lot of good in the markets they have operated. But their marketing pitch has been that of “eradicating poverty”. I do believe it was this mismatch between what they do on ground (which is significant and highly impactful in providing those with no access to any finance to become self-reliant) and what they project and are perceived. And when it comes to owning an important stakeholder, which is the “poor”, the biggest owner of them all, especially in a shaky democracy like we have in the Indian sub-continent, the politicians feel threatened. And that really has been the reason why the wings of an increasingly mature microfinance industry have been cut unceremoniously.
It’s a lesson for all social enterprises that walk this tight rope between marketization and the intent to create social impact. We need to be credible and we need to articulate what we do and position our products and services without trying to over emphasize its impact on society . It’s a classic marketing lesson that we were taught in B-schools that have acquired a new meaning in the context of social business. Also, it’s a sign that the social enterprise model is maturing. We are moving on from fledging entities led by the heroic entrepreneurial individual who performs miracles on a shoestring budget and against insurmountable odds and reaching out for an organization built with solid citizens, well-educated professionals that could run important, properly funded local enterprises efficiently.
In 20 years time, when most for-profit businesses as well as voluntary groups have a strong social enterprise subsidiary, our kids would be learning about these times in case studies of how they fuelled the paradigm change!
The end of charity-The beginning of Social Change
April 14th, 2009I just finished reading Nic Frances’ “The End of Charity”. And while I didnt find the writing gripping, the thought process of the author is far superior to anything I have read in recent times. Also, I found it very relevant considering I have become such a passionate champion of bringing about social change in the real world by working real-time with businesses who will endorse that change and become partners in the process.
The way individuals and entities define themselves today is primarily determined by the place where they have chosen to reside- be it in the “profit-making” space or in the “charity” space. It keeps the sphere of action distinct and therefore when people decide to decide to dole out grants or make philanthropic commitments, their choice becomes simpler.
However, today’s market scenario and the demands of the changing business and societal environment have led to the emergence of a third kind of business model. That of the “social enterprise”. A social enterprise is not merely one that innovates while relying on philanthropic donations and government grants. It locates the interface between a social goal and building a customer base for a service that is based on market realities and driven by an ideology that there could be a sustainable way in which we can bring about social change in a global, market-driven economy.
The question here is- if charity in its traditional form has been able to make a difference to the soceity at large given the magnitude of money that gets circulated? The more I read and understand this route to social change, the more I am convinced that it doesnt impact the fundamental root of the issue.
And the more I get involved with Dialogue Social Enterprise (DSE), the more I tend to believe that the space they have chosen to occupy is the one that will create a social change that is sustainable and a force multiplier. In the last few years, the results they have demonstrated with no obvious effort to market themselves by empowering and employing hundreds of people with disabilities and sensitizing millions of people, to the concept of otherness, while catering to a growing demand for effective learning, is a testimony to this fact. Another example is that of Grameen Bank, a concept that I first came to know when I was thick into rural marketing, almost a decade ago. The bank has been able to do more than any number of charities exisiting in Bangladesh.
Choosing the charity route would have been an easier choice, but I am inclined to think that by using market principles, one can provide a more practical and long-lasting business model that helps the “receipients of charity” merge with the mainstream.
The process is undoubtedly more complex than in a purely-for-profit or a charity organization with no imperative to operate profitably. The need of the hour is to find with like-minded partners, who will support this business model and bring about a social change so significant that the world will sit up and take notice that driving change by operating in the real world- by engaging and operating within society, market and economy is not just possible, but far more impactful.
