This presentation was delivered to the International Transactions Clinic at the University of Michigan Law school on 12 April 2011.

1. Hearing the Voices of
h f
the Base of the Pyramid
Ted London
University of Michigan

2. U-M Law School 2011
A New Starting Point
The ““Old”” Framing:
Is there a fortune at the BoP?
A Better Framing:
How can we create a fortune with the
base of the pyramid?
© Ted London
Source: London and Hart. 2011. Next Generation
Business Strategies for the Base of the Pyramid.

3. U-M Law School 2011
Profits + Poverty Reduction?
Core Principle: Mutual Value Creation
The greater the value created for those living at the
BoP, th
B P the greater th value created f th B P venture
t the l t d for the BoP t
OR?
Making money or generating
p
publicity off the backs of the
y
poor?
© Ted London
What are the impacts of BoP ventures on
poverty alleviation?

4. U-M Law School 2011
The Value of Impact Assessment
Understand who at the base of the pyramid is impacted
by these ventures and how they are affected
Focus on maximizing impacts, not just measuring them
From monitoring and evaluation
g assessing and enhancing
g g
Guide strategy: Improve future actions
Opportunity to hear the voices of those we seek to serve
Develop deeper knowledge of the relationship between
profits and poverty alleviation
BoP I
B P Impact Assessment Framework
tA tF k
© Ted London

5. U-M Law School 2011
BoP Impact Assessment Framework
Seller Buyer
(Distributors (Consumers Community
or Producers) or Agents)
Economic Well-Being
Capability Well-Being
Relationship Well-Being
© Ted London
Source: London, T. 2008. “The Base of the Pyramid Impact
Assessment Framework: Understanding and Enhancing
Value Creation”

6. U-M Law School 2011
BoP Impact Assessment Framework
Seller Buyer
(Distributors (Consumers Community
or Producers) or Agents)
+/- Income, income +/- Economic +/- Local livelihoods
stability consumer surplus and income
Economic Well-Being +/- Access to +/- Economic +/- Other businesses
credit/new debt
dit/ d bt productivity
d ti it serving community
i it
incurred (e.g. competition)
+/- Skills, knowledge +/- Health and +/- Perceptions about
+/- Contentment;
/ morbidity education, healthcare
Capability Well-Being quality of life +/- Self-confidence, +/- Aspirations of
dignity women, minorities
+/-
+/ Household roles +/-
+/ Network access +/-
+/ Gender equity
+/- Social status +/- Power of +/- Relationship with
Relationship Well-Being
intermediaries (e.g. environment
dependency)
© Ted London
Source: London, T. 2009. “Making Better
Investments at the Base of the Pyramid”

7. U-M Law School 2011
A Dynamic Process of Value
Creation
C i
Business Model of BoP Venture
Strategic Analysis
Use Findings to Enhance Use Findings to Design
Business Model Design Process for Tracking Impacts
Performance Analysis
Use Findings to Enhance Use Findings to Enhance
Business Model Design Process for Tracking Impacts
© Ted London

8. U-M Law School 2011
Ideas Action
(Formerly Scojo)
© Ted London
Photos: Courtesy of Jordan Kassalow

9. U-M Law School 2011
If you cannot clearly demonstrate and
articulate your value proposition for the
y
BoP, someone else may do it for you
If you cannot clearly assess and
enhance your value proposition f th
h l iti for the
BoP, you should not be involved in BoP
venture development
t d l t
Thank you! © Ted London