Darian Rodriguez Heyman's Blog, page 8

Changes at the Base of the Pyramid Will Transform Markets in Latin America and the Caribbean

From 2000 to 2010, Latin America and the Caribbean enjoyed a remarkable wave of sustained economic growth. This growth helped improve the incomes and welfare of millions of people living at the base of the pyramid (BoP) – households that earn less than US$10 a day (in 2005 dollars).

According to the World Bank, nearly 70 million people increased their purchasing power significantly and 50 million Latin Americans escaped poverty over the decade.  This sea change dramatically altered their aspirations, priorities, and interactions with their societies.

Yet could the upward mobility on the income ladder experienced by the BoP in the region imply a smaller market size in this segment or decreased demand for high-quality, accessible goods and services?

No. Even as the BoP population’s growth has slowed, the opportunities for doing business with them have never been greater.  Not only are those living at the base of the pyramid better off than a decade ago, but today there are tens of millions of people that have increased their incomes enough to afford discretionary expenses. Many have unmet needs in education, health, housing and financial services, among other sectors.

How are families at the BoP allocating this discretionary income? Will there be an increased demand for goods and services that might have been traditionally perceived as luxuries for this segment, such as information and communications technologies? What are the opportunities for the private sector to get in on the ground floor with these budding consumers who will become Latin America and the Caribbean’s middle class in the next decade?

One key example of the opportunities that await companies willing to provide innovative products for the BoP is the telecommunications sector.  Today more than 90 percent of the BoP report having a cell phone that they use, on average, seven times a day. However, 73 percent say they have standard phones – in an era when smart phones are revolutionizing industries in the developed world. The BoP in Latin America currently sees smart phones as gadgets that allow one to listen to music and take better pictures – hence most people see no added value in owning one.

The market opportunities that emerge from the low penetration of smart phones combined with higher spending in this sector by the Latin American and Caribbean BoP segment could be transformative.  Telecommunication and technology companies could increase the sales and usage of smart phones, and achieve greater market penetration.  They could also connect the BoP with the growing universe of application developers who have played a key role in creating new markets in developed economies – and who would be given a blank canvas to work with in these communities.

Content providers could reach this segment with educational, health and financial services apps, to name a few. For example, access to mobile health services through smart phones could allow the prevention, diagnosis, and treatment of diseases.  Banking apps could allow the BoP to access credit and other financial products without going to a bank branch, which carries a high opportunity cost with respect to time and lost wages.

Importantly, the anonymity offered by mobile apps can help address the BoP’s mistrust of institutions and face-to-face interactions outside their own communities. Innovative smart phone companies that are able to offer the right value proposition to this evolving market segment – combining quality, price and the right marketing approach – will have the first movers’ advantage, as they will have created a strong brand position in the emergent Latin American middle class market.

The Third BASE Forum in Mexico City, Mexico, taking place June 29 to July 1, 2015, will connect innovative companies, thought leaders, impact investors and development institutions to ask and answer some of these key questions.  The future middle class of Latin America awaits those companies that can come up with the right answers in the coming decade.

Same City, New Story

Asegedech, a 59-year-old Ethiopian grandmother of three, has seen tremendous progress in her city of Addis Ababa in her lifetime. Sitting with her daughter Hirut, who just gave birth to a healthy baby boy in a public hospital, she can tell you how far the Ethiopian capital has come since she gave birth to her children in the same hospital in the 1980s.

“When I gave birth 30 years ago, there were a lot of challenges,” she said. “We did not know about prenatal care during my time. You might not get medical attention, even if you were a bleeding mother. You would receive abusive words from the nurses when you were in labor. They would rebuke us when we asked for help.”

People in Addis Ababa used to worry whenever a woman was pregnant, Asegedech said, because so many mothers died.

“Now things have changed and the services have been improved,” she said. “Now we do not hear about maternal and newborn deaths very often.”

Her daughter Hirut started prenatal care when she was eight weeks pregnant. She went for regular check-ups and received the medical guidance and support she needed throughout her pregnancy.

“They told me to come anytime if there is any problem,” Hirut said. “When I came here to deliver my baby, I received a warm welcome. I was worried about giving birth, but they made me feel comfortable.”

Hirut’s story is a common one in Addis Ababa these days. The city has made some of the greatest survival gains of any city since 2000, with the mortality rate of children under five dropping by half from 2000 to 2011, according to Save the Children’s new “State of the World’s Mothers” report.

Save the Children releases this report each year just before Mother’s Day, offering an assessment of the well-being of mothers and children around the world. This year’s report focuses on a vulnerable group of children that urgently needs more attention – those living in urban poverty.

Addis Ababa and Ethiopia’s cities as a whole, according to the report, have seen child deaths among the poorest 20 percent of urban children fall by more than 40 percent from 2000 to 2011.

The difference in urban Ethiopia since Asegedech was a new mom is the establishment of a network of health extension workers mobilized and supported by the government, who work peer to peer, reaching out to communities and urban slums on the margin, linking them with essential care.

This innovative program has helped Ethiopia make huge strides in narrowing the urban child-survival gap. In 2000, the poorest children in Ethiopia’s cities were 3.6 times as likely to die as the wealthiest, whereas in 2011, that survival gap had been drastically lowered, with the poorest children twice as likely to die as the wealthiest.

For the first time in history, more than half the world’s population lives in cities, and six out of every 10 people are expected to live in cities by 2030. Addis Ababa has experienced substantial growth in the past two decades.

Private sector investment in the city has been booming, communication technology has expanded, and many people have moved there from other parts of the country. These changes, along with the nurtured socioeconomic progress and the government’s commitment to the health extension program, have influenced tremendously positive health trends in Addis Ababa.

Women and children in the city are getting more health care than they did more than a decade ago. The number of hospitals – both public and private – have increased from 25 to 34 from 2000 to 2011, facilities providing primary health care increased from 23 to 75 in that span, and use of prenatal care has risen 83 to 94 percent. Public and private health facilities are also now providing family planning and immunization services, and many more nurses have been trained and employed.

It takes a government and a community to effect the full-scale changes in care for mothers and children that Addis Ababa has seen. The difference, for Asegedech, Hirut and countless others, is the opportunity to fully enjoy those first moments with their grandchildren and children.

“They are taking care of her very well here,” said Asegedech of her daughter’s delivery experience. “It’s really nice.”

 

FORUM2015: Food: Our Best Health Solution

FOOD, FARMING AND THE FUTURE: HOW CAN WE FEED A GROWING GLOBAL POPULATION RESPONSIBLY?

FRI, APRIL 17, 2015; 13:15 – 14:30

A panel at this year’s Forum on scaling agriculture responsibly began with a provocative statement by moderator Debra Dunn (Stanford University’s d.school): In the future, how we produce and distribute food will be the biggest driver of people’s health.

Whether all delegates agreed, there was no question that improving food production is necessary. What ideas are not working?

Certification

Programs such as the Fair Trade and Forest Stewardship Council (FSC) certifications have created a $100BN market for better products, says Jason Clay of the World Wildlife Fund US, but they ultimately reward top producers when it’s the worst quartile of producers that should be the focus in increasing production.

Top-down solutions

“If you ask people to comply, you get compliance. If you ask them to solve a problem, you get innovation,” said Clay. Illustrating this, Jocelyn Wyatt of IDEO.org described an effort in Kenya to introduce banana flour as a food staple; it was nutritious and plentiful, but women didn’t know how to cook with it, so it went unused.

Fragmentation and competition in NGOs

NGOs working to support smallholder farmers need to coordinate to improve effectiveness. These organizations, says Clay, still tend to focus on imposing competing technologies on farmers rather than strengthening institutions that will support farmers in the long haul. “We need NGOs to stop doing and start influencing. We don’t need parallel institutions and…redundancy.”

Current levels of waste

Kathleen McLaughlin of the Walmart Foundation put current levels of food waste upstream and downstream of retail at 32 percent, and this waste is estimated to produce over 10 percent of greenhouse gases each year.

These are formidable challenges, but were matched in the discussion with a healthy list of what is working.

Climate change as an opportunity to stabilize value chains

“Never let a crisis go to waste,” said Willy Foote of Root Capital, comparing tactics coffee-producing countries have taken to tackling issues created by coffee rust. While crises are best avoided, they can galvanize people who normally don’t work in a coordinated fashion to take action quickly and effectively.

Introducing innovation through stable farmers

Wyatt highlighted findings that working with stable farmers first actually benefited the more vulnerable, less stable farmers, by road testing innovations and creating local mentors before introducing a new technology.

Better data, more efficiently and accurately collected

Metrics help draw money to problems, and also motivate the right behavior across the board. Wyatt highlighted an example of farmers taking better care of pollinators once it was demonstrated that doing so improved yield.

Aggregating smallholder farm production

Smallholder farms easily experience instability due to lack of insights on what to produce and when and where to sell, lacking credit, and faced with poor infrastructure. Plugging smallholders into aggregator networks allows goods to flow through stronger market linkages and creates a conduit through which investment flows back to growers.

How can people be fed with less destruction and disenfranchisement? There’s no magic solution, but sharing failures and successes bolsters the hope that we can find a way.

FORUM2015: What’s So Funny? Comedy and Social Change

WHAT’S SO FUNNY? THE ROLE OF COMEDY IN SOCIAL CHANGE

FRI, APRIL 17, 2015; 11:45 – 13:00

Among the many entertaining episodes at this year’s Forum was a panel on the role of comedy in social change. For all the presenters, humor makes their messages more palatable, but how it works is slightly different in each case.

Breaking taboos

Talking or hearing about bodily functions in public is awkward, and Mechai Viravaidya (Mechai Viravaidya Foundation) and Jack Sim (World Toilet Foundation) diffuse the embarrassment with jokes.

Sim makes nonstop wisecracks about using toilets; his humble potty humor is entertaining and easy to listen to, drawing audiences into discussions about sanitation and hygiene before they know it.

Similarly, in distributing condoms and birth-control pills, and in encouraging men to get vasectomies, Viravaidya makes birth control silly but ultimately inevitable. For example, through school programs that have teachers and students competing to blow up or carry water-filled condoms, or by giving out condoms through a “Cops and Rubbers” program, the condoms become familiar, and the taboo is removed.

Creating receptiveness

As Caty Borum Chattoo (Participant Media) demonstrated with comprehensive research, humor can open the door to sympathy. In creating earnest public-health programs with the Gates Foundation, Borum Chattoo realized that these were likely only reaching those already convinced; they were “not wrong, but very much the same.”

With another Gates Foundation grant to explore a new kind of storytelling, Borum Chattoo and team realized “if we followed the jokes into the social issues, maybe we were onto something new.” They created the series Stand Up Planet, sending comedian Hasan Minhaj to India and South Africa to find stand-up comedians addressing these issues. They then studied the show’s effect on viewers.

The results? While viewers didn’t necessarily learn a great deal about tackling the issues, they became more empathetic to those affected, and rated themselves more likely to take action in the future.

Exposing cracks in the monolith

Bassem Youssef created a successful show in Egypt, , which poked fun at the Morsi regime through its satirical content. Though satire’s function is to critique, in some cultures and countries, social and political critique is dangerous, even illegal, and Youssef himself shut down the show after three seasons, out of concern for his family and colleagues.

But perhaps more important for broad social change than its content is Al-Bernameg’s ability to inspire. Youssef showed Egyptians that without insulting religion, it’s possible to criticize the ways in which leaders abuse religious and political authority. It may not be the standard approach, he said, but he’s proud to have demonstrated “that satire is not afraid of power, but power is afraid of satire.”

FORUM2015: The Number Fetish

SCALING SOCIAL IMPACT: FROM EXPLORATION TO ACTION

FRI, APRIL 17, 2015; 11:45 – 13:00

by Dalumuzi H. Mhlanga

In his book Moral Lives of Leadership, Robert Cole writes about a profound conversation he had with an inspiring woman who had worked very closely with some of the most recognized leaders of the twentieth century. He writes, “I had my (psychoanalytic) doubts about anyone’s selflessness, and she made clear she understood what I suppose could be called, ironically, the narcissism of selflessness, the way one can attract attention to oneself, gain satisfaction for oneself, through an insistent, apparently sacrificial interest in others.”

The only reason I have found this reflection to be important is the very important question: When we seek to scale social impact, who do we really scale for? Is it always to make sure that we impact as many lives as possible? Or is it to feed our collective “narcissisms of selflessness” through which, as social entrepreneurs, we can congratulate ourselves and go to bed with soothed, even inflated, egos for the millions of lives we have reached?

Skoll Awardee Joe Madiath drew attention to this as he reflected on his work with Gram Vikas. In particular, he pointed out how his work went against the grain by relentlessly pursuing inclusion based on a recognition that aiming to reach 70 to 80 percent of families in the villages Gram Vikas worked in was not enough. Often, it would be the case that the excluded 20 to 30 percent of families had been marginalized for centuries. As such, while a reach of 80 percent would look impressive, it would have undermined his organization’s mission.

It was therefore refreshing for the discussion in the room to move in the direction of encouraging each other to determine the rate of scale, based on the nature of the problem social entrepreneurs aim to solve. Based on whatever the core “secret sauce” of the innovation is, scale can then be achieved at what is a more “natural pace”, rather than one determined by external pressures.

When the nature of the problem and people’s needs are considered as central, even in questions of scaling social impact, we can more effectively make sure that we are aiming to reach millions of people, less so that we can make the point around dinner tables, and more because we truly are committed to making lasting impact.

FORUM2015: Storytelling: The Engine of History

THE STORY OF CHANGE: REVOLUTION BEGINS IN THE IMAGINATION

THU, APRIL 16, 2015; 10:00 – 11:15

“Fuelled by cocktails, bloody-mindedness, and wanting to move people and act to make change” was what unified the panelists and moderator in this session. Each panelist talked about the story they were currently telling and the impact it has had or the impact they hope it will have.

The power of storytelling for social change has been discussed at the Skoll World Forum for many years. Film, art, and narratives can bring about change by bringing voices otherwise overshadowed or forgotten to public awareness.

Charmian Gooch, Co-founder of Global Witness, discussed the film Virunga. The film has brought a voice to a forgotten part of Congo that is home to the last mountain gorillas. A dedicated group of park rangers risk their lives to protect this site of great cultural diversity against militia groups, poachers, and corporations that are trying to take control of the nation’s rich natural resources.

The story is a powerful combination of investigative journalism and nature documentary. The film has spurred over 600 news stories about the plight of Africa’s first national park, and these along with a strategic rollout plan from Global Witness and the filmmakers has brought the film to the attention of key political figures.

Dawn Porter of Trilogy Films is trying to bring a very different issue to the attention of the world. Unlike the session’s other presenters, her films are not based in developing countries, but rather in the United States, where there is an ever-increasing gap between haves and have-nots.

Alongside this widening poverty gap is a climate of extremist religion, which is having further detrimental effects on the lives of the poorest people. In her latest film, Trapped, she brings to the world’s awareness how women’s rights in America are increasingly determined by where they live.

She specifically focuses on the growing amounts of legislation that are further restricting planned parenthood clinics in the southern and middle states. In some areas around 60 percent of the patients at these clinics are living below the poverty line and have no medical insurance.

Woman are turning to desperate measures as states are closing down all the free women’s health facilities. There is now only one abortion clinic in Mississippi and a further five states will soon be in the same situation.

What all the panelists made really clear is that storytellers have a duty to bring the real voices of the unheard to the world’s attention and to do it in a way that doesn’t further the agenda of those with power. Rather, storytelling should bring a voice to those otherwise muted. Storytellers “are the engines of history,” said Pamela Yates of Skylight.

FORUM2015: Five Ways to Bring About Impactful Change at the City Level

CITIES: ENGINES OF TRANSFORMATIONAL CHANGE

FRI, APRIL 17, 2015; 10:00 – 11:15

Innovation happens at the intersection of ideas and cities – this was one of Benjamin Barber’s opening comments. Barber observed that, compared to states, cities are better able to foster citizen participation and encourage meaningful local change.

This type of local change can have far-reaching impacts, well beyond the city where it was first implemented. The session brought forward many innovative and useable tips on how to bring about city-level change, applicable in all contexts.

Speak the language of city planners: money

Rodrigo Guerrero, the mayor of the Cali, Colombia, told us the key to getting funding is to learn to talk in economic terms and show the economic return on investment. Planners and governments think in money.

For example, no one cared about Cali’s high rate of homicides and other violent crimes. But when Mayor Guerrero proved that the violence was wasting an amount of money equivalent to 15 percent of GDP, $80 million in funding was found that has helped over 800,000 of the city’s poorest individuals and cut rates of violence by over 35 percent.

Think in terms of data

Publically available and honest data is important and helpful to bring about change, and also to prove that change has happened. Data showing change will keep people inspired to stay involved. “We have to understand where we are and where we want to get to,” said panel member Sue Riddlestone of Bioregional.

Give real and practical examples

All the panel members spoke of the importance of giving people real examples to show that change was possible. Hypotheticals or good ideas don’t resonate. You must show citizens how people just like themselves have brought about real change in their cities.

Benjamin Barber gave the example of “participatory budgeting”. This is where a small amount of the city’s budget is controlled by citizens, who decide how it should be spent. This kind of budgeting exercise is now happening in 600 cities.

In another real-world example, Sue Riddlestone talked about the success of Bioregional’s community framework called “One Planet Living,” which was used by the mayor of London as the basis for all the London Olympics planning and building, and is now proving effective throughout the whole of Wales.

Communities of action

In Rio de Janeiro, Brazil, 1 in 13 of all 20- to 29-year-olds now participate in Meu Rio. Meu Rio is a platform to help organize and bring people together, virtually and in real life, with shared goals to help them bring about the changes they want to see.

Alessandra Orofino, co-founder of the platform, warned of waiting for top-down change and the problems of corrupt leadership. She spoke of the change that groups of like-minded people can bring about if they are just given the organizing tools for citizen lobbying and bottom-up political pressure.

Inspire from inside

A lot of the discussions were framed around bottom-up change and the problems of top-down approaches. Problems such as corruption among municipal leaders are very serious issues in a lot of places. However, Mayor Guerrero reminded us of the power of internal influence. Not all people in positions of power are corrupt and believing you can bring about change and talking to likeminded people in government bodies can bring results.

As Benjamin Barber reminded us, cities can keep people involved more easily than states. With over 80 percent of the developing world and 54 percent of the whole world’s population now living in cities, we must “give cities a chance” in showing us how to bring about impactful change for the benefit of all.\

 

FORUM2015: Increase Happiness with the Impact Jackpot

FIGHTING POVERTY, DESIGNING FOR HAPPINESS

WED, APRIL 15, 2015; 13:30 – 14:45

“If we are not creating happiness, why are we bothering with this stuff?”

Kevin Starr, Director of Mulago Foundation, emphasized the importance of happiness in the fight against poverty. This might not be part of the day-to-day concerns of a social entrepreneur. But after hearing his wise words, I strongly advise that it should be.

Costa Rica came out on top as the happiest place on earth, with 86 percent of people reporting that they lived happy lives. Why? It was not just about the surf, but rather due to long life expectancies, peace, low corruption, steady growth, and a “pura vida” culture.

Togo was rated the least happy place on earth, with only 26 percent of the population feeling they had a happy life. The reason for its population’s dissatisfaction with life came from the hereditary dictatorship the country has endured for the last 50 years, terrible infrastructure, high corruption, government-controlled industry, and a “complaining” culture. The Togolese feel even worse off in the shadow of their rapidly-progressing neighbor, Ghana.

Sadly, Togo is not the only unhappy nation. Looking at nations where happiness is at its lowest, we see four common characteristics: anxiety, loss, lack of social mobility and aspiration, and feeling relatively worse off than a neighboring country.

Equally, looking at the happiest nations, Starr suggested four common characteristics that bring about happiness. In happy countries, people feel that all their basic needs are met, they have prospects throughout life to aspire and work toward, there are lots of zero-sum activities (reciprocation), and everyone has the ability to participate.

Interestingly, money was not one of the most important factors for happiness. Starr instead characterized it as a “basic need” in our “cash world”. This argument of moving beyond a rubric of using only GDP to measure a country’s success aligns with the Social Progress Index (SPI).

The SPI aggregates social and environmental indicators that capture three dimensions of social progress: basic human needs, foundations of wellbeing, and opportunity. The index focuses on outcomes, rather than inputs.

As GDP increases, happiness does not necessarily follow suit. There is a level of GDP where a nation is relatively well off on average, and at which happiness increases due to many other factors besides wealth. Thus, as Starr showed using graphs of GDP plotted against happiness levels, we can make a huge impact on a country’s overall happiness by working with the poorest individuals in that society, significantly increasing the nation’s overall lifetime happiness.

Starr called this sort of country-wide and long-lasting impact “the impact jackpot.”

FORUM2015: “I Had the Answer, But He Didn’t Have the Question.”

EVERY CHILD IN SCHOOL & LEARNING WELL: A CALL TO ACTION

THU, APRIL 16, 2015; 11:45 – 13:00

A lunchtime session on Pratham’s work teaching children in India surfaced great lessons on the importance – and limitations – of storytelling. Pratham’s new CEO, Rukmini Banerji, captured the audience’s imagination with a powerful story, at the same time as she highlighted that action is inspired by a different sort of experience entirely.

Banerji described an episode from her years administering the Annual Status of Education (ASER) assessment used by Pratham to gauge baseline and progress against education goals. As a courtesy, she asked a village headman for permission to give the survey in his area. He agreed, and when she returned to tell him the ASER was completed, he could not believe the outcome. He marched down the road asking children questions from the very basic questionnaire until he was convinced that Banerji’s results, showing that only one-third of students had passed, were correct.

Episodes like these have led Banerji to realize that you can engage someone with a story, but without firsthand experience with the problem, they will not develop belief that causes change. Summarizing her encounter with the village head, she said, “He was not curious to begin with. I had the answer, but he didn’t have the question.”

Pratham and PAL Network, Pratham’s new sister organization in East Africa, still struggle with how to recreate this experience for a broad audience – to “make people feel this as a problem [so] action will start.”  But the realization that this is what’s needed was a critical first step.

FORUM2015: Scaling Social Entrepreneurship

AN ECOSYSTEMS APPROACH TO SCALING SOCIAL ENTREPRENEURS

WED, APRIL 15, 2015; 11:45 – 13:00

Chris Jurgens, Director of Global Partnerships at USAID, led a lively dialogue. Delegates from nonprofits, major funders, convening organizations, and more discussed the challenges and opportunities of major collaborations to achieve scale. They found:

This is an area where we must do better.

While ecosystems-level scaling is a new approach to social entrepreneurship, many lessons can be gleaned from industry sectors.

Coalitions are key, but must acknowledge the tension between competition and collaboration.

It is exciting to see how many innovative organizations are working in each issue area – but with all those players, many fear competition for funding resources.  How can we create an environment where organizations can take advantage of the healthy benefits of competition, but work together towards change?

In creating coalitions, it’s important to have a leader whose interest is making this facilitation happen.

In ecosystems conversations, each player must think critically about what they can bring to the table.  Facilitators are essential to guide that process – they connect the dots, help players define roles, and make the issues relevant to big funders.

Money!

Ecosystems-level collaborations are essential to transforming systems, but without a clearly defined and measurable impact, many funders shy away. There must be a shift that helps funders understand that finances and resources are required to continue past these conversations to achieve large-scale change.