Companies are showing a growing interest in the 3 to 4 billion people who live on less than USD 6 a day. Conquering this market requires breakthrough innovations, and Good Enough Innovation enables social business players to create products that combine economic viability and social impact. An interview with David Menascé, Professor, HEC Social Business/Enterprise and Poverty Chair.
Social business, Bottom of the Pyramid, Good Enough Innovation… are we talking about the same thing ?
While the ultimate objective is the same – reconcile economic sustainability and social impact – these terms do, however, refer to different practices.
The Bottom of the Pyramid (BoP) concept invented by CK Prahalad schematically refers to both a population segment – the 4 billion people living on less than a few dollars a day – and a strategic approach which aims to invent both economically profitable and socially positive business models.
The notion of social business is a bit different. The ambition of social business, which was popularized by Professor Muhammad Yunus, is to invent economically sustainable models with the express aim of achieving a social objective. As state aid falls short of needs, it involves inventing economically sustainable mechanisms to solve social problems – access to water, energy and sanitation – with a distribution of added value that is different from the one made in traditional strategies. Indeed, Muhammad Yunus based social business on the “no loss, no dividend” principle, whereby any profits generated are to be reinvested in the social business.