August 22, 2012
August 21, 2012
An indepth look at the lives of these enterprising migrant workers has recently been conducted and the findings giving rise to numerous perspectives on the problem. Probably the most critical with respect to future trends is this one from the Financial Times:
Many are independent informal-sector entrepreneurs, and the most visible have been the Chinese traders establishing themselves in marketplaces from Lagos to Lusaka.Using contact networks from home or among other migrants, they establish supply chains which import Chinese goods at a price and volume that existing traders struggle to match.Oh dear, history has been known to have a tendency to repeat herself quite well. Sitting here in Singapore, near enough to Malaysia, one cannot help be aware of the history of this region and the role that initerant Chinese migrant labour from Southern China has played in developing this city into a world class capital.
As well as angering local rivals, these newcomers also raise the heckles of African governments who prefer Chinese migrants to be large-scale investors creating new employment rather than direct competition for established local enterprises.
In July, the Malawian government introduced a law banning foreign traders from operating outside the major urban areas, following protests against the impact of Chinese immigrants on Malawi’s small businesses.
Such complaints are now familiar in other parts of Africa.
But will that happen in the various African countries responding above in the snippet? And would a little bit of competition provide the impetus for laidback rural markets to suddenly hop and jump like bazaars tend to do in the East? We don't know, we've never seen it happen so in front of our eyes, only recalling bits of history from our pasts. @bankelele tells me about a book he's reading on the Economic History of Kenya and the tensions inherent in the three pronged population of locals, the British and the Indian traders. Yet, one cannot deny the historical influence of a multicultural trading society such as on the Swahili Coast and by the way of the East African Railway, on the quality of entrepreneurship in Kenya as acknowledged by all their regional neighbours.
Even tiny little Singapore acknowledges the value of injecting external influences on the quality of future innovation by encouraging migrant workers, of all professional levels, to arrive on the island and work. The tensions show up in the newspapers, even as we get accustomed to being served by Filipina sales people and Mainland China waitrons while a Bangladeshi may arrive to paint the house.
Meanwhile, Britain is upto her old tricks of stirring the pot of inter-ethnic discontent among people who live in her former colonies. They've been doing it so long that they are probably not aware of consciously recognizing the inflammatory nature of their handwringing "Will China eat our tea while India eats our lunch?" being the essence of the cries. China, in the meantime, emphasizes the opportunity by showcasing their "Africa Towns" springing up in trading cities. What shouldn't happen, however, is the demonization of the Chinese migrant worker, like back in the early days of the previous century in California.
This is a difficult trade-off to make. Either path, at this point, makes sense.
August 20, 2012
Richard Heeks wrote about the early history of these changes in a paper entitled The ICT4D 2.0 Manifesto. Mr. Heeks explained the difference in earlier attitude between the first programs, and the projects in the field today. Early programs relied upon "technovelty" and focused more on spreading access as quickly as possible instead of on thoughtful implementation. He generalizes the outcome of those early projects into a few words: “failure...and anecdote[s].” Often programs would return with great stories about how technology had changed one individual's life, without analysis to the larger effects. Past the promotional materials, positive impact became difficult to assess, which in turn led to many projects today being framed by sustainability, scalability, and evaluation.Reading through, I can honestly say that this applies to all technological innovations aimed at the rural African, the base of that pyramid or for social impact. For most of 2012, I've been involved in assessing the current status of a social enterprise in East Africa, and these points from the article resonate:
As speakers talked about their projects, and the effect they had, they all listed off their lessons learned, including:
Sounds amazingly like basic advice for user driven innovation, minus the jargon, from the frugal engineer's point of view (#5 Why reinvent the wheel when first prototypes abound?)
- "Building trust and credibility is crucial"
- "Research tech context before strategizing"
- "Technology should serve the goal, not be the goal"
- "Try to find out if there is an alternative to technology"
- "Use the technology that is already in place to limit training needs"
I hope this shift in thinking, as observed among the ICT4D practice, finds a way to influence the startups and social enterprises in more basic services such as cooking, lighting, defecating et al.
One of the most fascinating things that emerged from my immersion in the informal trade of China made consumer electronics in Kenya last month was the role played by "fakes".
We assume that cheaper copies of well known brands attempt to fool the customers. Packaging and brand names echo the look and feel of the original as far as they are able and the entire exercise is one of "bait and switch". In fact, this is not the case at all. Nobody is fooled and people know exactly what they are buying.
What is interesting, however, is how these "fakes" are sold.
Shopkeepers - whether the upcountry retailers catering to their local, rural customer base or the wholesalers back in the Central Business District dealing with rural stockists - offer you a choice. They display both the original brand, a genuine product of quality with warranties and whatnot, and the "fake" version, whose only guarantee is caveat emptor, and leave it up to you to assess your willingness to take a risk.
Their words often follow along the lines of "Here is the original Nokia, costing so much and doing this, this and this, while here is the China made product closely resembling the above but has these additional features and costs only so much". Everyone is completely aware of the lifetime value of either product and the risk involved in ending up with a dud.
It is upto the customer to decide if they want to spend for durability and reliability and quality or make the tradeoff for a short term gain in features, upfront cost and the caveat of a short lifespan.
This approach seems to fit within the constraints of the informal economy's cash flow volatility as well as the customer demographic's mindset around brand value and product performance. No one that I spoke to, either at the wholesaler, the shopkeeper or the customer level, seemed to feel that the "fakes" were an attempt to defraud them in anyway.
Its a pragmatic approach to affordability and aspirational ownership.
August 19, 2012
The good news is that factoring shared value into valuations is a straightforward process. Investors simply need to ask companies the right questions. While these might vary by company or industry, the four below offer a good starting point:Beyond the title and this snippet from The Guardian article, I'm wondering if I actually have anything further to add other than the fact that if more social impact investors asked this question, the better the chances of a new social enterprise actually growing and scaling.
1. Where will future revenue growth come from? Namely geographies, demographic groups, etc.
2. How will (new) products and services reach these (new) markets?
3. How will access to and efficiency of resources (raw materials, employee talent, etc.) be guaranteed?
4. How stable are supply chain operations across different geographies? ~ The Guardian, August 2012
August 7, 2012
Continuing the thread of thought from the previous post, what was once a productivity tool for word processing, data analysis, document management – aah, the days when we were told that the paperless office was right around the corner – has become in fact a communications tool.
Now, if we take a step back from that thought, and look at it from the point of view of value analysis, identifying the basic function and secondary function of this ‘gadget’ or ‘machine’ – there has been a reversal in terms of what the basic function of this tool is and what the secondary function. Similarly, the next step is assign ‘value’ to each function – therefore, if one were consider that the trend towards the majority of the applications that were originally available to us ONLY in terms of what was on our hard drive [or floppy if you're old enough to remember Scripsit] now available freely online [thank you google] for the most part, how does this effect the ‘value’ of each function – the processing function [cpu] and the communications function [being able to access the internet]?
Today, I don’t need my fixed location desktop or even my portable laptop to access my workspace [except for MS Office and even that is out of habit more than anything else].
I can go and sit down at any connected machine anywhere in the world that allows me access to the interweb and I can write and post to my blog, access my research and bookmarks, look up my photograph collection and pay my rent.
But that’s just ‘playing around’ online, that’s not your real work, some might say. It depends, I’d answer. We are at an inflexion point here, imho, and as the digital infants growing up totally and wholly immersed in an internetworked world start to go to ‘work’, how do you think they will collaborate, communicate, connect and conduct commerce?
Today, I don’t simply interact with this computer, I interact with other human beings on other devices around the world, via the computer’s keyboard and connection.
So the basic function of this tool and the secondary function of this tool, for me at least, has reversed itself over the past decade, one could say, conceivably.
I value this box more today for its current primary function of allowing me to access the webworld than for its secondary function of allowing me to track my recipes, balance my checkbook or write a neatly edited document that can be prettily printed.
Originally published April 23 2007
August 2, 2012
Nairobi's Central Business District - Luthuli Avenue is the heart of the electronics and consumer appliance trade for Kenya. Chinese businessmen can be seen mingling with Somali traders and wholesalers come from all over the country to see "what's new". I saw recently introduced solar powered refrigerators (just 60W) on display, direct from China but was not permitted to photograph.