This report focuses on how the basic “meaning” of inclusive business has been transformed over the past decade – and why an increasingly diverse range of profitable new models and opportunities is opening up for companies in almost every industry as we move into the 2020s.
Developed by - Accenture Development Partnership
Synopsis – This report is based on a wide-ranging literature review, interviews with 30+ experts in business, finance, policy-making and academia and on a new evidence base of 300+ inclusive business examples, including 120+ case studies developed during the course of the research.
It recognises that while multi-national companies (MNCs) have funded thousands of pilots over the past decade, very few have scaled up and been replicated in more than 5 countries or reached more than 30 million people. Furthermore, the best-known successes that are held up as examples to inspire others are actually very hard to replicate and often show little evidence of profitability.
However, based on reviewing market landscape of new examples, it finds that inclusive business is now becoming fundamentally much “more digital”, “less Western” and increasingly “more profitable”.
In particular, it highlights four trends and illustrates them with case study examples:
- VC-backed start-ups are growing rapidly by using digital platforms to engage with the BOP
- A new generation of MNCs who serve the BOP as their ‘core business’ are emerging from developing countries (particularly China, India and Nigeria) and successfully ‘going global’
- Competition, disruption and ‘sustainable investment’ trends are prompting Western MNCs to invest in developing markets venturing, although some have been discouraged by experiences with less profitable, non-digital models in the past and many are unaware of the emerging BOP opportunities and trends affecting their industries
- Many visionary intrapreneurs and entrepreneurs are finding creative ways to turn our worst global problems into valuable opportunities (e.g. expanding BOP access to toilets and clean water, affordable housing, electricity, mobile phones, connectivity, identity, property titles, credit scoring, education, health, food and formal jobs)
This report makes it easy for business leaders to see what tangible new opportunities are emerging in their own sector by categorizing inclusive business examples into 60+ model types and mapping them across 13 industries.
It identifies five underlying factors that are driving fundamental change in this market landscape and enabling new examples to scale much faster (i.e. new technologies, new business model features, falling unit costs, network effects and synergies, macro-trends).
Actions for MNCs – this report argues that current trends in technology, investment, urbanisation, network effects etc. will only continue to accelerate and will open up many new opportunities at the BOP for MNCs in virtually every industry in the 2020s. It recommends that business leaders:
- ‘Re-imagine’ what inclusive business means today and how it will evolve in the next decade
- ‘Re-position’ ahead of visible shifts in investor preferences happening today and explicitly link innovation capabilities with purpose and social impact
- ‘Re-evaluate’ if they have the right mandate, strategy and capabilities to properly explore the many examples of inclusive business that can already be profitably replicated today and to co-design even more profitable, digitally-enabled models that can ‘pivot or fail fast’, ‘scale quickly’ and ‘transition successfully’ into the core business
Tools and guidance – The report provides:
- A new ‘inclusive business market landscape’: i.e. a categorisation over 60 model types, mapped across 13 industries and tagged according to whether they include known instances of:
- Venture capital investments in start-ups
- Venturing by Western MNCs
- Core business for MNCs from developing markets
- Catalogue of over 120 ‘one page’ case studies which include a description of the inclusive business model, the year it was founded, the locations it is now in, the scale it has reached, the impact it has had and the financial results where available (revenue, profit, funding etc.), plus a short analysis of the lessons or implications for other MNCs
- Database of over 300 inclusive business examples with data gathered where available