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Perspective 2.0

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Sunset over the satellite network

Posted: July 2nd, 2008, 10:40am PDT by Niti Bhan

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June 30th 2008, Bellagio, Lake Como, Italy

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Responding from the shores of Lake Como

Posted: June 28th, 2008, 1:55pm PDT by Niti Bhan

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Dan Buchner, VP Innovation & Design, Design Continuum demonstrating his support for an innovative prototype to increase understanding of the challenges and needs at the BoP thus improving the success rate of design for social impact. (the event refered to in the post referenced below, from where i'm live blogging right now)
Who needs whose help here?

I say we can do more good at home than abroad — not that we can do no good. Our skills and connections can, of course, be valuable to people in other places than our own. But if we are to exchange value — rather than just take it, like cultural tourists — what do we have to offer? ~ John Thackara, Guest post, Design Observer

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The increasing global influence of pay as you go OR do you need a 'top up'?

Posted: June 25th, 2008, 12:30am PDT by Niti Bhan

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Fuel is already a pay as you go - or prepaid - necessity just like airtime for the mobile phone. While upto 90% of the African continent is on prepaid mobile plans - Egypt as high as 98% - the average across Europe is unexpectedly high as 70% when you consider that in the US its only 15% that are prepaid.

As fuel prices rise and begin to pinch wallets and the household budget, there will be an increasing need to control your monthly expenditure. The fundamental concept of prepaid is that you top up on the item purchased - for example electricity can be purchased as 'pay as you go' in rural south africa - when you have the funds available and make do without when you don't or until the next paycheck.

Will there be an increasing shift in the US towards prepaid accounts that can be managed and controlled for a variety of services which were earlier billed at the end of the usage period as consumers become more conscious of the need to predict expenditure?

And will this shift occur in the mobile phone space? If it does, is the US wireless industry geared for this shift? If our troubles in April finding a prepaid SIM card in San Francisco any indication, we expect to see some disruption in the market in the near future.

Dave expects a slightly broader shift, perhaps one away from a credit driven economy towards one that is either more cash based or using debit/bank cards instead. So the big picture is a move away from credit, which of course is increasingly obvious, but this is at the micro level of your average consumer since credit isyet another unexpected total at the end of the month rather than some kind of prepaid or pay as you go accessibility to funds such as the debit card.

What does this imply for the 'market' or 'economy'?

This shift away from credit, in an economy designed to run on easy credit and cashless transactions, will create great flux. We think its going to be a big shift, potentially, because as the mindset of the American consumer shifts towards greater risk averseness, due to the economic conditions, they will begin to display many of the traits we have observed in the BoP markets.

While the majority at the BoP display their patterns of purchase and buying behaviour due to the factors of uncertain and unpredictable incomes, thus dependent only on the cash they have on hand, something that the majority of American consumers won't face, they will still however become increasingly likely to spend only the money they have available rather than take the risk of living on credit. The era of 'buy now, pay later' has perhaps ended.

And our prelimenary Google searches show early indications of a far deeper, larger shift. One that perhaps is more akin to an undertow than simply the current tide of economic troubles that face the United States. For example, we discovered that over the same period in the recent past, countries like India and China, with historically significant proportion of their population subsisting below the poverty line, have actually managed to make a as significant difference to the quality of life and economic conditions for a great many of them.

So much so that a recent BBC Radio 4 program aired in Great Britain asked the question - should the UK be sending financial aid to India when today there were not only a greater number of billionaires in India than the UK but also India herself was sending financial aid to many other developing nations.

Dragging this data point back to the US scenario, there has been a greater increase, proportionate to population, of people slipping below the poverty line during this same period, going back quite a few years than simply the recent economic crisis.

So, we ask, what does this mean?

Is it that like water finding its own level, the global income disparity is leveling off? Or is this an early signal of a shift in socioeconomic power balance to the other side? Is the latter, while immensely satisfying to the Indians and the Chinese and a shock to the system that Europe has begin to acknowledge and absorb, necessarily a good thing for the future of our planet? Schadenfreude doesn't sit well with either karma or the Buddhist philosophy of do no harm.

Perhaps instead we have a global opportunity, at this moment in time, while it is not yet too late for the train that we see hurtling down the tracks, to find a middle path. One where instead of the expected or much feared global jostling match for ever scarcer resources, we learn to share a more balanced or fair portion of the leftovers. Perhaps the time has come to pay as you go rather than buy now, pay later. The bill has come in the mail

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Mobility is addictive in its freedom

Posted: June 23rd, 2008, 7:24pm PDT by Niti Bhan

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Before I left the US and got wholly immersed in the mobile world as I have done now, I used to have broadband cable access to the internet connected to my desktop PC. I couldn't understand why anyone would need wireless access in one's home.

After having lived in my parents home in Singapore for the past few months {when I am there, 'at home' and not camping out in some hotel/service apt } with full wireless access, I've wholly understood just how liberating the experience is and how positively addictive. This struck me today as I've been taking a short break between two work related stints in Europe - we're in copenhagen tomorrow - and there's just one cable connection that three people need to share. We're taking turns plugging it into our laptops rather than all of us being able to surf together.

That's when I truly understood and appreciated all pervasive wireless internet access, regardless of the device or tether.

I wonder if building castles in clouds will be a good thing or a bad thing? ;p

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Emerging Futures Lab: Principles for bridging the global value gap

Posted: June 17th, 2008, 4:04pm PDT by Niti Bhan

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Dave and I have been talking about the ways one can address the wicked problem we face in our own work, that of the value gap between mainstream consumer culture's value propositions on one hand and the BoP customer's mindset and values on the other.

Here are some principles we think make sense for the design of products, services and business models for the underserved and overlooked in the developing world.
1. Find the Value Gap - for any particular industry, product or service space, identify the gap between existing solutions available and their value proposition as it maps on to the values/mindset for the BoP market. This exercise will not only provide the filters by which to later evaluate conceptual solution spaces but also the "unmet need" or opportunity space that can be filled.
2. Maximize constraints; minimize resources - simply due to the challenges of addressing the BoP market successfully, this principle remains constant as a condition and criteria for the design of anything. And taking the thought a step further into the needs of the future of the planet etc this principle becomes even more crucial when making any new product for a global market.
3. Maximize the freemium - if you're a startup in this space or just wishing to create a lean organization with minimal impact on the cost of the end result for the BoP market, using as many freely available tools simply makes sense. Web 2.0 exists to be used effectively and efficiently. Also maximizing the freemium aspect of your solution helps ensure greater user acceptance and lowers the dropout rate in the BoP market.
4. Cross pollination first - The first two principles help identify a general solution space and the design constraints, the fourth is the first place to look for answers. What existing solutions are already out there, whether by a well known MNC like a Tata or a grassroots solution developed on some farm in Uganda. Why reinvent the wheel when you can use it as a precursor or a first prototype from which to build your eventual solution?
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Ergonomidesign of Sweden

Posted: June 17th, 2008, 12:00pm PDT by Niti Bhan

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Jakob Boije of Ergonomidesign takes our photograph after wrapping up and handing over the project we've been on with them the past two weeks in Stockholm. The oldest design studio in Sweden, Ergonomidesign was founded in 1969 - before most of us were - and is housed in a national heritage site, a former missionary school.

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Bringing down the interface

Posted: June 16th, 2008, 2:25pm PDT by Niti Bhan

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Recent experiences and conversations have opened my eyes to the way I use the internet these days. Put another way, what is my blog but a place to explore conceptual directions and thoughts with added functionality that a plain old diary doesn't have - three dimensional referencing. Paper and pen is two dimensional, but online, using the blog application, I can keep the basic idea down to a minimum of explanations, distilling it down to its essence, and simply using links and images to support thoughts and ideas.

Taking that thought a step further into the reaches of the internet itself, accessed through Google, I can park my entire body of work, research links, references, images, thoughts, notes to myself in a wide variety of locations chosen for the appropriateness for the need. Then when I need to access something or reference it, its all out there, simply waiting to be found again, there's not even a need to cross index or categorize it. Google will find it for me. Of course, you have to know what's out there and how to look for it, but haven't we gotten that experience already with gmail?

This means that with the exception of NDA or proprietary stuff which stays on the hard drive or in gmail if I send everything to myself, everything else is available in the cloud. And my eeePC - now slowly becoming my primary travel machine - is perfectly suitable even with the original 4GB flashdrive.

The interweb is now my playground. Or to quote the poet, William Wordsworth,
"----Pleasure is spread through the earth
In stray gifts to be claimed by whoever shall find."

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B is for....

Posted: June 15th, 2008, 7:14pm PDT by Niti Bhan

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Next stop

Posted: June 15th, 2008, 7:11pm PDT by Niti Bhan

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Pity our stop was Midsommarkransen.

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Serving niche markets

Posted: June 15th, 2008, 7:08pm PDT by Niti Bhan

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Enough Bolivians in Sweden to see these posters around town in Stockholm.

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Pimped antiques

Posted: June 15th, 2008, 7:01pm PDT by Niti Bhan

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IKEA's secret

Posted: June 6th, 2008, 12:28pm PDT by Niti Bhan

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Run out of clever names for flat pak furniture? Check out the subway map for inspiration.

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Sky over Stockholm

Posted: June 6th, 2008, 11:58am PDT by Niti Bhan

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Might have floated over from Helsinki, do you think? The sun really doesn't go down in summer - this photograph was taken from a rooftop bar after 8pm.

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Attention European readers: We're in Europe in June

Posted: June 2nd, 2008, 8:25am PDT by Niti Bhan

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We're in Stockholm, Sweden tomorrow for a workshop on the BoP and find our schedule reasonably flexible for a few days after the 9th in case you'd like the opportunity to meet David and myself. Email us to plan for a conversation.

We've also got a few days open for meetings anywhere in Western Europe from the 12th until the 24th when we have the day available in Copenhagen. After that its Milan on the 26th for a designer's summit at Bellagio, on the shores of Lake Como before leaving for Torino (yay!) on the 30th. Two more days open are the 4th and 7th of July for meeting up in Europe if you're interested in knowing more about how our field experience in Africa and South and South East Asia can help you. Or we can give a short presentation to your team on the consumer mindset of the people at the base of the pyramid in developing nations. Looking forward to hearing from you.

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The first emerging markets bank

Posted: June 2nd, 2008, 8:17am PDT by Niti Bhan

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David saw these advertisements by Standard Bank splashed across the South African dailies and their positioning statement as "Africa's first emerging markets bank" caught his eye. It was the first time that an established bank had taken this communications approach, emphasizing their centuries old African roots rather than any global high flying heritage. Here's a snippet he sent me,
'A feature of our approach to growing Standard Bank's Africa presence is investing in local capacity and being African. Strong local teams ensure we remain relevant to the customers and communities we serve in different markets. This understanding of local conditions, cultures and markets allows us to provide products and services tailored to in-country customer; clients who operate across borders and international clients.'

'We remain committed to making a real difference to financial services in Africa and other emerging markets. We aim to ensure our long-term sustainability by harmonising the needs of our customers, our people and our shareholders and by being relevant to the societies in which we operate.'
He adds that while its certainly inspiring to see their messaging, he hopes that they can match their promises as well. Check out their presence across SubSaharan Africa.

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Thoughts for a crazily busy week

Posted: May 30th, 2008, 7:48pm PDT by Niti Bhan

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Converging global market trends - the 4P's of opportunity

Posted: May 25th, 2008, 7:58am PDT by Niti Bhan

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Unlike the established mature markets of the West, where the average consumer's wealth and purchasing power led to the design and development of sophisticated high margin, high value products such as top of the line home appliances, consumer electronics, automobiles and central air-conditioning, the rapidly developing economies of BRIC, South Africa, Turkey, Egypt et al have some significantly different characteristics.

Chief amongst these is the existence of an emerging consumer market (ECM) - those "bottom of the pyramid" segments of society living on uncertain incomes in much of the world. Of these, upto 70% could be living in rural areas with the minimum of infrastructure that we take for granted in our daily lives such as potable water, reliable electric supply and roads and transportation.

As established global brands reach the limit of 'feature creep' innovation in the next iPod or RAZR; they're looking to these new markets as opportunities for growth and profits - witness Nokia's global success in mobile handset sales across the developing world. Meanwhile, innovative regional brands referred to as local 'dynamo's' by BCG are making waves of their own. Jaguar, anyone?

And due to the growing awareness of the economics of climate change and the increasing scarcity of available natural resources, there is a realization that the mainstream consumer culture of 'throwaway', 'disposable', 'make to break' that characterizes the majority of the products designed and manufactured in the West today is unsustainable in the long run. Yet the alternatives cost more money.

Today, businesses must take an entirely new set of criteria into consideration when looking to create products or services, whether its for their domestic markets or particularly if they wish to be successful in the new economies.

The four factors that are converging to form new opportunity spaces in light of these changes, are:
1. Planned Obsolescence
2. Premium on green
3. Poverty
4. Population
If planned obsolescence is made obsolete, then products that are meant to be replaced every six months, a year or three years as they go out of style are instead designed to be timeless, durable, long lasting and repairable or recyclable; they consume less materials and are sustainable over the long run.

If price is a premium for sustainability, 'green' or environmentally safe, the majority of those who wish to minimize their impact on the environment can't afford to do so. Affordability will lower the barriers for mass adoption, lowering prices and effecting change.

If poverty is a criterion, the creation of sustainable business models that aid social and economic development imply profits as well as income for emerging consumer markets. Social entrepreneurs have made long lasting positive change.

If population numbers are considered, high volumes of sales imply lower costs thus lower prices, thus reaching many more than could currently afford to purchase necessary goods and services they aspire to own as well.

If these 4P's can drive the way products are designed, planned and manufactured, they create more value that benefits the many while using fewer resources and lowering the environmental impact.

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Lessons in the sand: Redrawing the poverty line

Posted: May 23rd, 2008, 6:02am PDT by Niti Bhan

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The Economist reports on the most recent work by Martin Ravallion and two colleagues, World Bank researchers who first drew the global poverty line at "a dollar a day" over a decade ago. Starting again from scratch and based on new data, the team has erased the old and announced the new international poverty line at $1.25 a day.

Here's snippet,
They gather 75 national poverty lines, ranging from Senegal's severe $0.63 a day to Uruguay's more generous measure of just over $9. From this collection, they pick the 15 lowest (Nepal, Tajikistan and 13 sub-Saharan countries) and split the difference between them. The result is a new international poverty line of $1.25 a day.

Why those 15? The answer is philosophical, as well as practical. In setting their poverty lines, most developing countries aim to count people who are poor in an absolute sense. The line is supposed to mark the minimum a person needs to feed, clothe and shelter himself. In Zambia, say, a poor person is defined as someone who cannot afford to buy at least two to three plates of nshima (a kind of porridge), a sweet potato, a few spoonfuls of oil, a handful of groundnuts and a couple of teaspoons of sugar each day, plus a banana and a chicken twice a week.

But even in quite poor countries, a different concept of poverty also seems to creep in, the authors argue. It begins to matter whether a person is poor relative to his countrymen; whether he can appear in public without shame, as Adam Smith put it.
Can you hold your head up among your neighbours? That might be a more dignified way of assessing the concepts of "poor", "low income" and purchasing power parity. I've mentioned before that its far more difficult to live on a low income in the US than it is in India. Simple things like being able to buy a single cigarette or half a cabbage all the way to paying nominal rents for a couple of sheets of corrugated iron held by salvaged bricks and door still allow many who work in the metro's of India to live close to their work.

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Xenophobia in South Africa

Posted: May 23rd, 2008, 1:15pm PDT by David Tait

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The recent xenophobia violence reminds me of the early nineties and late eighties, when there were always army vehicles going into townships early in the morning, when I was off to school. Army personnel used to go into townships, often driving over shacks, shooting at will and generally 'keeping the peace'.

Those were bad times. I hoped that after '94 all that would be behind us, there was ecstatic hope when Mandela showed us that forgiveness and understanding was possible, and was the best way forward.

Mandela showed people that he was a true leader, a person who had high morals, he was and still is a role model, a hero to many South Africans.

Over the past decade, morals mean less and less, politicians get caught being criminals, but nothing much happens, this is the message been sent to the people of South Africa, that if you do something bad, its okay, its even admirable. If leaders are doing it, and they are getting away with it, what stops everybody else taking the moral low ground?

So what happened in SA recently? There have always been foreigners in SA and there have been South Africans living in exile before, in countries like Zimbabwe.
Can it be blamed on rising food prices, increases in petrol and the growing unemployment? What fear crept into people's minds that foreigners were taking away jobs, making life for South Africans harder? If anything foreigners should be admired, leaving your home, learning a new language, sending money home and managing to keep it all together is hard.

What is needed is some moral leadership, not force that just makes people angry, but involvement in communities, the whole community, foreigners and locals, people who live next door to each other. The same person who lent you a cup of sugar yesterday whose house is burned to the ground today.
So, what does the future hold? Will the violence continue, will there will be prolonged instability? What will people going back to Zimbabwe do? I can only hope that somebody, perhaps Mandela can sway people to think before they continue to disrupt the country and people's lives.

Photo credit; Nicole Johnston, M&G

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EMweekly - every Thursday on Putting People First

Posted: May 22nd, 2008, 4:13pm PDT by Niti Bhan

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Back in October, on the 2nd to be exact, I'd announced I'd be launching a weekly newsletter focusing on emerging markets. After long last, the EMweekly series has been launched via Putting People First and you can see today's issue here. Earlier editions are available here. Do subscribe!

Here's that announcement to refresh your memory:-

In a previous post on emerging market trends influencing new products, services and strategy, I'd touched upon three global macrotrends that were increasing in importance -

1. poverty or the bottom of the pyramid, that is, the aspiring and emergent consumer class in developing nations who were improving their quality of life, both rural and urban;
2. the environment, sustainable strategies and products;
3. and finally the emerging markets in developing nations, particularly India and China, increasing in importance as their purchasing power grew large enough to influence the design of products and services.

And taking all three together gives rise to a fourth macrotrend, particularly in corporate strategy and planning issues, that is CSR or corporate social responsibility.

My sense is that these trends are part of a larger shift that will affect global business, markets, design and other service offerings in some way or the other. So in response, I plan to start a weekly newsletter broadly covering these areas, interspersed with the occasional longer article on a particular trend or topic and how it would impact marketing or design strategy. Let me not describe these too much, so as to not narrow the subject area too soon. The focus will be on identifying the opportunity spaces, as far as possible, for revenue generation; new products, services or business models.

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