Bill Drayton

Valeria Budinich

<article-ideainbrief class="article-ideainbrief">
 <h4 class="ideainbrief-title">The Idea in Brief</h4>
 <div class="ideainbrief-contents">
  <p>The time is ripe for collaboration between for-profit businesses and mission-driven individuals and organizations.</p>
  <p>By forming “hybrid value chains” the for-profit and citizen sectors can together remake global economies and create lasting social change. Businesses offer scale, expertise in operations, and financing. Social entrepreneurs offer lower costs, strong social networks, and a deeper understanding of customers and communities.</p>
  <p><strong>Example:</strong> Local citizen groups helped to persuade Amanco, a maker of water-conveyance products, that small farmers in Mexico represented a significant market opportunity. They partnered with the company to organize farmers into loan groups, promote irrigation technologies, and even install systems. The social entrepreneurs are helping the farmers get financing so that they can afford Amanco’s products. This newly created drip irrigation market is worth about $56 million a year—and farmers are enjoying higher yields.</p>
 </div>
</article-ideainbrief><p>We are witnessing a sea change in the way society’s problems are solved, work is performed, and businesses grow. Collaborations between corporations and social entrepreneurs can create and expand markets on a scale not seen since the Industrial Revolution. These markets will reach everyone, but especially the 4 billion people who are not yet part of the world’s formal economy. They will offer new and remarkable products and services in sectors as diverse as education, transportation, and finance.</p>

nJ8ACvG2P2BVMvTOElOsECXHsNeZLb/GZFXXeHUn13jB3nlQYw2yLNKwE+PHA26RoOtOpRp32FNZkNYbg8APbFAJBfyeoT7LXOzhjH96TBjJ+ud2fYGMl2+kCExhtfBY

<p><span class="reprint">Reprint: R1009C</span></p>
<p>The citizen sector, composed of millions of groups worldwide that are attempting to address critical social needs, has long been regarded as understaffed and inefficient. But it has grown and matured over the past three decades, say the authors, both of Ashoka: Innovators for the Public. Citizen sector organizations (CSOs) are attracting talented and creative leaders, and their work is changing the game in critical industries such as energy and health care. For-profit companies now have an opportunity to collaborate with CSOs to create new markets for reaching the four billion people who are not yet part of the world&#8217;s formal economy.</p>
<p>The power of such collaborations lies in the complementary strengths of the partners: Business offers scale, expertise in manufacturing and operations, and financing. Social entrepreneurs offer lower costs, strong social networks, and deep insights into potential customers and communities. The authors call this framework the hybrid value chain. In one example, Colcer&#225;mica, a Colombian manufacturer of kitchen and bathroom tile, collaborated with the human-rights organization Kairos, which recruited and managed a sales force of previously unemployed women, to reach a low-income market. Within three years sales had grown to nearly $12 million; the living conditions of more than 28,000 families had been improved; and 179 saleswomen were each earning $230 a month.</p>

A New Alliance for Global Change

Reprint: R1009C The citizen sector, composed of millions of groups worldwide that are attempting to address critical social needs, has long been regarded as understaffed and inefficient. But it has grown and matured over the past three decades, say the authors, both of Ashoka: Innovators for the Public. Citizen sector organizations (CSOs) are attracting talented and creative leaders, and their work is changing the game in critical industries such as energy and health care. For-profit companies now have an opportunity to collaborate with CSOs to create new markets for reaching the four billion people who are not yet part of the world’s formal economy. The power of such collaborations lies in the complementary strengths of the partners: Business offers scale, expertise in manufacturing and operations, and financing. Social entrepreneurs offer lower costs, strong social networks, and deep insights into potential customers and communities. The authors call this framework the hybrid value chain. In one example, Colcerámica, a Colombian manufacturer of kitchen and bathroom tile, collaborated with the human-rights organization Kairos, which recruited and managed a sales force of previously unemployed women, to reach a low-income market. Within three years sales had grown to nearly $12 million; the living conditions of more than 28,000 families had been improved; and 179 saleswomen were each earning $230 a month.

A New Alliance for Global Change

Summary.

Partner Center