How do we go from here?

I read Atanu Dey’s take on Innovation and Entrepreneurship in India in response to a question put forward by Sramana Mitra on her blog Why is the entrepreneurial ecosystem in India not coming together as well as it needs to?

Atanu makes a strong pitch for leveraging existing solutions for development, reasoning that India has not yet reached a stage where we need “cutting edge research and development.” It is sufficient to implement known innovations, he conjectures. A compelling argument but I feel there are a lot of points that need to be bought out in this respect.

To start with, let us understand that we are talking about two things “Does India need (more) innovation?” and “Why does India not innovate as much as it needs to?” And, in my opinion, the answer to the latter does not lie in the former.

Coming to the first question, India does need more innovation, in fact it needs lots of that. Why? A few reasons:

1. India cannot simply follow the development process that US followed. It can take cues but trying to imitate exactly the same cycle will lead to half baked results. To be sure, innovation does not necessarily imply high technology. It also implies a technology/concept that apart from being “innovative” is implement-able too. We did not have to go through the “pager usage phase” to reach “cell phone mobility” even though we did try that. Lets take up rural innovation. We need to innovate and find out ways to increase yields on small land holdings. We need to innovate when it comes to connecting villages to the national mainstream using IT and Internet. Innovation not just in terms of technology but in terms of pricing, marketing, sales & distribution. Isn’t the Amul cooperative model innovative? Ecoflo from Bhinge Brothers[PDF] is one such innovation in rural technology.

2. India needs scale. Incidentally while attending a class at CSIM, Chennai on Saturday, I had stated the same point. India cannot blatantly import models of growth or innovation from developed countries because of its sheer size. Being a democracy makes the task even more challenging. Taking cues from countries like Brazil seems more pertinent especially when it comes to designing solutions for the masses. Dr K L Srivastava at CSIM Chennai made a point in the class, that scale is not always the case – citing disability related issues as an example. In my opinion, looking at absolute numbers the “niche” in India dwarfs similar numbers in US. Scalable solutions are really important.

3. India is a unique country. When I say this, my point is not to allude towards our rich culture and the related. I am trying to draw attention to myriad languages, populations, cultural differences, attitudes, motivations. Even solutions customized for India may not necessarily work for the entire country. Regional innovation is also important. To give you an example, an Internet based micro lending organization like Rang De faces a lot of initial skepticism from lenders because of the non-profitable NGO thinking that social development is generally associated with.

4. India needs to leverage the technology to create more technology. The “low hanging fruits” of existing innovation may have either gone bad or may not even suit my palate. But I can use the seeds of these fruits to create hybrid varieties which I may be able to consume.

Coming to Sramana’s question of why are we not as innovative as we need to, a lot of answers have already been put on her blog. However, innovation is an exponential function. And the required start has been made. Readers can read this blog to find out innovations being undertaken in the social development sector. Not to mention, the Indian solutions like Tata Ace and Nano, Bajaj’s experiment with fuel efficiency. Aravind Eye Care may be cited as an exception that proves the rule – innovation is to be expected from the youth. But, nevertheless, it does prove that innovation can come from any field/age. We have organizations like RIN (Rural Innovations Network) and SRISTI which are fostering and encouraging innovation. One field that is seeing considerable traction is financial inclusion and for the right reasons, of course. I am hoping to see more progress in this one field which in turn will be one of the catalysts for more innovation.

I have been amazed at the optimism we share at TC-I, but it should not be mistaken for foolhardiness. It may be because we have the right balance in terms of experience and intellect.

Op-Ed: The Intersection between Self-Interest and the Social Good

Today, I attended a lecture at the Ahmedabad Management Association (AMA) entitled, “Social Entrepreneurship: Challenges and Strategies,” by Lisa Nitze, Vice President of the Global Entrepreneur to Entrepreneur Program at Ashoka. One of the themes that the lecture touched upon was the concept of “self-interest”, and how the effectiveness of social entrepreneurship ventures lies in aligning the interests of public, private, and non-profit parties. As an example, she cited an Ashoka fellow who enabled slum dwellers to organize into collectives, invest in slum property, and negotiate with corporations in need of land for commercial purposes. From this transaction, slum dwellers were then able to purchase another piece of land, construct low-income housing units, and build small stores for the purposes of sustaining income. In this case, a a win-win situation, right? Everybody goes home happy.

So where am I going with this? I don’t disagree with the premise that human beings operate on the basis of self-interest, though the statement does sound like a rather dismal assessment of the human condition to me. Neither do I disagree with the point that there is immense potential in the nexus between self-interest and social good – if I did, it would be impractical, and to a large extent, irrational, because it would be too idealistic to expect both the end and the means to be driven by “unselfish” principles. Clearly, profit and social good are not mutually exclusive, and neither should they be for the purposes of long-term sustainability.

So here’s the question – to what extent is the intersection between self-interest and the social good viable? If a private party is involved in a project intended for the benefit of the underprivileged, to what extent can profit be extracted (to put it crudely) from the community before the partnership becomes exploitative? In a transaction that is not dictated by social / moral values, but rather, profit maximization, how can we account for these types of conflicts of interest? More broadly, with the sudden surge of interest in social entrepreneurship and socially minded business models, where can the line be drawn between mutually beneficial and inherently exploitative ventures?

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A New Fashion in Goodness

A refreshing op-ed, written by David Brooks in the NYTimes, focuses on the trend of social entrepreneurship. Titled “Thoroughly Modern Do-Gooders,” the article is overall positive about the field and lauds its pioneers as “some of the smartest and most creative people.” Brooks likens the field to a growing fad:

Fashions in goodness change, just like fashions in anything else, and these days some of the very noblest people have assumed the manners of the business world — even though they don’t aim for profit. They call themselves social entrepreneurs, and you can find them in the neediest places on earth.

Brooks also differentiates this wave of social entrepreneurship with past experiments:

The older do-gooders had a certain policy model: government identifies a problem. Really smart people design a program. A cabinet department in a big building administers it.

But the new do-gooders have absorbed the disappointments of the past decades. They have a much more decentralized worldview. They don’t believe government on its own can be innovative. A thousand different private groups have to try new things. Then we measure to see what works.

He attests that these new do-gooders are in some way redefining the connotation of the word since “they are data-driven and accountability-oriented,” instead of merely ideological. Social good as an end is not the simple case any more; the drive and means are just as relevant.

Most importantly, Brooks raises the question of how best to encourage and take advantage of this burst of social innovation. What types of policies, programs, funds, etc . need to exist in order to maximize on this age of creativity by modern do-gooders?