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Abstract

The paper analyzes the impact of institutions on the structure of partnerships in subsistence markets (SMs). Grounded in institutional theory and transaction cost economics, the reasoning suggests that partnerships will adapt to the co-existence of SM-specific and external institutions in SMs. SM partnerships will include multiple partners from multiple sectors, each compensating for different institutional gaps in SMs. They will replace governance mechanisms discussed in the literature, such as formal contracts and equity, with substitutes better suited to SM contexts, including informal contracts, in-kind contributions, and gifts. The importance of these mechanisms will depend on the institutional distance between SM-specific and external institutions. Finally, different governance mechanisms will co-exist within the same partnership, as partners originating in the SM will rely on SM-specific institutions, while partners originating outside the SM will prefer to rely on external institutions where possible.

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... The user-centric conceptualization of barriers to adoption also goes beyond the literature on institutional gaps (see, Parmigiani et al., 2015;Rivera-Santos et al., 2012), in which barriers are described primarily from an environmental perspective. Our model corresponds to this literature by suggesting that adoption problems are most likely to be resolved when all potential barriers/gaps are eliminated at the same time, as even a single barrier can be a reason for not adopting a technology-holding product. ...
... The bundling strategy can thus compensate for missing input and service markets. In line with this argument, research on institutional gaps argued that stakeholders should collaborate to provide a more complete solution when multiple institutional gaps hinder adoption (Nakata et al., 2012;Rivera-Santos et al., 2012). Each stakeholder then brings in different products and services for the bundle. ...
... This reduction in transaction costs is important in the smallholder context where poorly functioning input and service markets often increase transaction costs (Dillon et al., 2017;Gollin, 2014;Hazell et al., 2010). In contexts of institutional gaps where there are market barriers that hinder smallholder access to inputs, stakeholder collaboration can provide effective solutions to address barriers (see, for example, Parmigiani et al., 2015;Rivera-Santos et al., 2012). Through coordinated action, stakeholders in smallholder agriculture can bring in separate pieces of inputs, products and services, as well as leverage resources to develop and offer a more compelling product bundle with even more pronounced value for smallholders. ...
... Such LCs are different from those of developed countries. Supply chain managers that plan to engage in BoP business must have a clear perspective of the LCs in BoP markets and their differences from traditional markets at the top of the pyramid, including the effects of these LCs on their functional operations [18,19]. Firms involved in BoP projects that are not adequately prepared to initiate appropriate changes in formulating their business strategies or adapting their business/supply chain processes [20] will be more exposed to the risk of failure. ...
... The importance of the institutional environment has been highlighted in various domains, such as entrepreneurship [18,[21][22][23], partnership and collaboration [19,23], network analysis [19,23], and value creation [24]. However, there is scant research on supply chainrelated issues in BoP markets from the perspective of LC. ...
... The importance of the institutional environment has been highlighted in various domains, such as entrepreneurship [18,[21][22][23], partnership and collaboration [19,23], network analysis [19,23], and value creation [24]. However, there is scant research on supply chainrelated issues in BoP markets from the perspective of LC. ...
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Article
An important market that is receiving increasing attention by firms relates to the poorest at the Base of the Pyramid (BoP). BoP businesses contribute to the first UN Sustainable Development Goal that calls for an end to poverty in all its manifestations. BoP businesses are regarded as financially and socially beneficial for both participating firms and poor communities. It is, however, understood that success in BoP markets cannot (and should not) be assumed, as it demands a profoundly different view towards managing supply chains. Focusing on this issue, our conceptual study contributes to the emerging debates in BoP and supply chain management research by elaborating the notion of legitimacy contexts (LCs) at BoP. We draw on institutional theory to characterize the LCs in BoP markets and discuss their implications for key supply chain functions. We argue that firms often design their supply chain functions for BoP business using their own LCs as opposed to those of BoP actors. This implies ignoring the institutional distance between BoP markets and firms and reveals a key culprit in the failure of BoP projects. We offer practical implications for firms intending to engage in BoP business.
... Pragmatically, collaborative approaches of value creation are said to improve the performance of BoP initiatives by helping mobilize a broad spectrum of resources and social network to achieve systemic social impact (London & Hart, 2004;Nahi, 2016). BoP firms can draw benefits by developing new capabilities that integrate their resources with those of external actors, or by pursuing collaborations that open up new sources of innovation and growth (Rivera-Santos et al., 2012;Sanchez & Ricart, 2010). For multinational corporations, working with local actors creates greater understanding of local market and institutional conditions (Rivera-Santos et al., 2012), while also helping bridge their "liability of foreignness" by improving their legitimacy (Dahan et al., 2010;Lashitew & van Tulder, 2019). ...
... BoP firms can draw benefits by developing new capabilities that integrate their resources with those of external actors, or by pursuing collaborations that open up new sources of innovation and growth (Rivera-Santos et al., 2012;Sanchez & Ricart, 2010). For multinational corporations, working with local actors creates greater understanding of local market and institutional conditions (Rivera-Santos et al., 2012), while also helping bridge their "liability of foreignness" by improving their legitimacy (Dahan et al., 2010;Lashitew & van Tulder, 2019). ...
... The emphasis on engaging diverse stakeholders for creating social value is also shared by the related streams of literature on sustainable business models and cross-sector partnerships (Caldwell et al., 2017;Freudenreich et al., 2019;Seitanidi & Crane, 2013;Yang et al., 2017). While enabling greater social impact, collaborative strategies help BoP firms integrate their capabilities with the resources of the ecosystem to create new entrepreneurial and innovation opportunities (Rivera-Santos et al., 2012;Sanchez & Ricart, 2010). For multinational corporations, collaborations with local actors can improve understanding of local market, and institutional conditions (Rivera-Santos et al., 2012), while also giving access to synergetic inputs such as local knowledge, contacts, and social legitimacy (Webb et al., 2010). ...
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Article
The literature on Base of the Pyramid (BoP) strategies emphasizes that creating social value requires collaborative, multi-stakeholder business approaches. However, there is limited understanding of how businesses can successfully coordinate such value creation processes in the developing economies that face significant institutional voids. This study adopts a business model perspective for analyzing social value creation processes that span organizational boundaries. We introduce a novel, theoretically grounded business model framework that helps conceptualize social value by locating the various loci of value creation, and the stakeholders that partake in creating and capturing this value. We subsequently analyze the mechanisms of social value creation in M-Pesa, a renowned boundary-spanning mobile money system that has advanced financial inclusion among tens of millions of users in Kenya. The results show that information and communications technology can help advance social value creation by reducing the cost of coordinating boundary-spanning business models that integrate diverse societal stakeholders. The results further point to uneven distributional outcomes in self-governing social value creation strategies where the focal firm plays a coordinating role.
... North (1991,97) describes markets, as institutions, as "humanly devised constraints that structure political, economic and social interaction." Institutions impose both informal constraints (such as sanctions, taboos, customs, traditions, and codes of conduct) and formal rules (such as laws and property rights; Lawrence and Suddaby, 2006;Rivera-Santos et al., 2012). Thus, markets enact both the formal and informal "rules of the game" and maintain the key organizing principles that reduce the uncertainty of market exchange (North, 1991;Thornton and Ocasio, 2012;Godinho et al., 2017). ...
... These two cases show that three key elements play significant roles in subsistence markets (North, 1991;Rivera-Santos et al., 2012): (a) the different types of institutions governing communities and the disruptive nature of market interventions for those institutions, (b) the informal institutions (based on local and situated shared knowledge), and (c) formal institutions (based on regulation). ...
... Hence, scholarly attention has focused on the divides (Rivera-Santos et al., 2012) or voids (Mair and Marti, 2009) occurring when parallel governing institutions fail to connect. Rivera-Santos et al. (2012) assert that organizations need to collaborate to bridge institutional divides. They do so at the microlevel through individuals and communities, at the mesolevel by defining their organizational activities and relationships with partners, and at the macrolevel by influencing or reflecting with government-level narratives and policy (Tracey et al., 2011). ...
Article
The void between formal and informal institutionalized practices that coexist in subsistence marketplaces can render them inaccessible to subsistence consumer–merchants. We conducted an in‐depth auto‐ethnographic study of Novo Dia Developments, a social enterprise in Maputo, Mozambique, seeking to make the housing market accessible. Our study extends the extant understanding of the transformation of subsistence marketplaces in two ways. First, our study characterizes the institutional work done by a social enterprise to open up a subsistence marketplace. Second, our study theorizes the business models in use as a mechanism through which institutional work can be organized and performed, by (a) transforming an idea for market change into new market offerings and practices that begin to fill the void, (b) materializing and making visible other institutional voids that need to be filled, and (c) serving as a juncture at which formal and informal institutionalized practices can connect.
... The challenges make it hard to take action without appropriate partnerships (Rivera-Santos, Rufín and Kolk, 2012;Hahn and Gold, 2013;Hazlewood, 2015). ...
... Business creation at the BoP societies is an effort initiated by private actors (Rivera-Santos, Rufín and Kolk, 2012;Hahn and Gold, 2013). It contains the partnership of commercial stakeholders (i.e., local suppliers, customers, and local entrepreneurs), non-commercial stakeholders (i.e., civil society; community groups, and NGOs), and public sector stakeholders (i.e., local governments), 1 Badry (2009) explains that an effective partnership of multinational companies in low-income markets depends on the social embeddedness, having relational (tie) and structural (strength) dimensions. ...
... Although, this study does not answer how cross-sectoral partnerships should take place, it recommends having stronger ties for building trust and familiarization with other stakeholders. distributed globally and locally (Badry, 2009;Rivera-Santos et al., 2012;Stibbe and Prescott, 2016). ...
Thesis
The importance of the field of design is increasing in the face of complex problems humanity has been facing. Respectively, the orientation of design is shifting from products to strategies that facilitate corporate transformation. In parallel with this transformation, designers take new and diverse roles. However, there is a knowledge gap regarding these roles. This study aims to explore the roles the designer (author) takes in a multinational home appliances company through the innovative product development for the African Bottom/Base-of-the- Pyramid (BoP) communities. Its goal is to propose a model built on research data. The research methodology comprises the designer’s auto-ethnographic inquiry of long-term practice-led research within the new product development case and its analysis with grounded theory. The results show that the designer plays six diverse and contemporary roles throughout the new product development process. The significance of this research comes from shedding light on the contemporary designer roles in the context of innovative product development for a complex problem.
... By "meaning system," we refer to the basic assumptions around work values and norms that inform day-to-day practices (Barkema et al., 1997;Brannen & Salk, 2000;Selsky & Parker, 2005). Each partnership actor brings with them their individual values as well as the values and work practices of their home organization's culture, alongside the wider meaning systems present within the sectoral spaces in which each organization is situated-public, private, or nonprofit (e.g., Murphy et al., 2012;Rivera-Santos et al., 2012). Partners often face fundamental stumbling blocks around differing conceptualizations of both the nature of, and ideation, regarding solutions to the grand challenge (Dentoni et al., 2018;Fan & Zietsma, 2017;Ferraro et al., 2015). ...
... Although some research exists related to individual-level meaning systems (e.g., Sloan & Oliver, 2013), there has been much less focus on this level of analysis. Overall, the lack of emphasis on multilevel meaning negotiation in partnerships is problematic as it leads to under-specification and/or misspecification of levels of analysis; this is particularly so given that these levels of meaning-making are characterized by continuous permeable boundaries with actors who function as insider-outsiders (e.g., Hardy et al., 2006;Lawrence et al., 2002) and who carry assumptions about work, values, and practices that are tied to individual, organizational, and sectoral meaning systems (e.g., Murphy et al., 2012;Rivera-Santos et al., 2012). More empirical work is, therefore, necessary to understand the multi-level meaning dynamics of partnerships with private, public, and nonprofit sector influences, and how these dynamics affect inter-organizational collaboration (Athanasopoulou & Selsky, 2015;Quelin et al., 2017). ...
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Article
While multi-stakeholder partnerships are emerging as an increasingly popular approach to address grand challenges, they are not well studied or understood. Such partnerships are rife with difficulties arising from the fact that actors in the partnership have different understandings of the grand challenge based on meaning systems which have distinct and often opposing assumptions, values, and practices. Each partnership actor brings with them their individual values as well as the values and work practices of their home organization’s culture, alongside the wider meaning systems present within the sectoral spaces in which each organization is situated—public, private, or nonprofit. Yet, there is little understanding of how actors in multi-stakeholder partnerships negotiate multi-level meaning systems to reach partnership goals. In this 16-month ethnographic study, we take up a negotiated culture perspective to holistically examine the negotiation of multi-level meaning related to a focal grand challenge in a multi-stakeholder partnership established to end homelessness in Western Canada. Based on our findings, we contribute a process model to explain the ongoing negotiation of multi-level meanings in multi-stakeholder partnerships working to address grand challenges.
... These objectives are a) growing shared value in subsistence contexts (Bridoux & Stoelhorst, 2016;London, Anupindi, & Sheth, 2010), b) inclusive distribution of shared value (Henderson & Williams, 2013), and c) fair distribution of shared value (Santos, Laczniak, & Facca-Miess, 2015). Operationalizing these social innovation goals requires forging mutually beneficial alliances not just with suppliers and competitors (Ozdemir, Kandemir, & Eng, 2017), but also with key actors in local communities, who have been hitherto excluded from the marketplace (Rivera- Santos, Rufin, & Kolk, 2012;Sridharan, Barrington, & Saunders, 2017;Venugopal & Viswanathan, 2017). In this research, we set out to understand the processes that social enterprises employ to forge mutually beneficial relationships with actors in subsistence contexts to catalyse institutional changes for fostering inclusive social innovation. ...
... However, subsistence marketplaces operate within a web of locally evolved informal-institutions, shaped by social interactions (Webb, Tihanyi, Ireland, & Sirmon, 2009). Consequently, there are stark differences in norms, values and beliefs across these contexts (Rivera- Santos et al., 2012). Based on deep investigations of social enterprises, extant research offers a number of prescriptions for organizations operating in subsistence marketplaces to negotiate these institutional differences (Mason & Chakrabarti, 2017). ...
Article
Social enterprises can play an instrumental role in addressing major societal challenges in subsistence marketplaces through the creation of shared value. However, there are many social barriers in subsistence contexts that exclude vulnerable groups from participating in, and benefiting from, the shared value creation process. These social barriers are contextual in nature and arise from sources such as gender-based discrimination or caste-based discrimination. The exclusion of such vulnerable groups undermines the goal of inclusive social innovation and sparks concerns of elite-capture of shared value in subsistence marketplaces. In this paper, we highlight how social enterprises can overcome the concern of elite-capture of shared value by fostering inclusive social innovation in subsistence contexts. Our research draws from a longitudinal inductive study of nine Indian social enterprises operating in industrial markets such as agriculture and logistics. We apply and extend insights from institutional work perspective to uncover three principal mechanisms for fostering inclusive social innovation, namely – a) relational work, b) inclusion work and c) equity work. These mechanisms work in concert to facilitate the a) creation of shared value in subsistence contexts, b) inclusive distribution of shared value, and c) fair distribution of shared value.
... transportation, healthcare and worker training. Especially in low income countries, such collective goods are absent, and "partnerships will typically include multiple partners from multiple sectors, to compensate for institutional gaps and substitute for missing market actors" (Rivera-Santos et al., 2012: 1721. For local optimization, those partnerships are often critical. ...
... Finally, Chipp et al. (2019) argue although the internationalization literature is dominated by an atomistic view of the single MNC, a loose network may be better able to collectively deal with locational challenges of the least developed locations. Like Rivera-Santos et al. (2012), they point out that the loose network can include governments and local communities, but they conceptualize the network primarily as a network of firms. They give the example of the South African MNC Imperial Logistics that establishes operations sometimes classifiable as wholly-owned subsidiariesin the key locations where it operates. ...
Article
Host countries' level of development affects internationalization from emerging markets. The challenges and opportunities firms face, the resources and assets they need, and ultimately how they internationalize are shaped by whether firms internationalize to developing or developed countries, and whether they operate within a single or across multiple levels of host country development. I propose a typology of four firm strategies to deal with different host location types: local optimization, global consolidation, brokering and niche filling. Local optimization happens when firms seek out less competitive markets in similar and lower income countries, managing institutional and infrastructural challenges through collective action. Firms seeking global consolidation manage their limited capabilities and legitimacy through mergers and acquisitions as they springboard from low to high income host locations. Suppliers in global value chains and the customer-facing partners of advanced multinationals in low income countries are arbitrageurs between high and low income countries. They use brokering to avoid head-on competition with advanced multinationals, but to grow, firms must retain their primary relationships while developing non-competing relationships. Niche filling involves firms targeting knowledge-intensive offerings at lucrative high income markets, managing their smaller resource base vis-à-vis competitors through non-equity or digitally-enabled modes of internationalization. Firms can simultaneously use different strategies for different types of foreign markets.
... Embeddedness in social structures can inhibit opportunistic behaviors, and foster the development of trust and reciprocity. The incentive to adhere to norms and build reputation reduces uncertainty, and enhances cooperation among network members (Rivera- Santos et al., 2012). ...
... Externalities can be positive or negative, and refer to indirect, long term outcomes that are attributable to interventions by BoP businesses. Negative externalities in the form of increased inequality, crime, and decline of subjective well-being can reduce overall social value (Bhuiyan and Ivlevs, 2019;Hall et al., 2012), whereas positive externalities in the form of institutional change can lead to a lasting improvement in social value (Rivera-Santos et al., 2012). ...
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Article
A growing body of research looks into business-led efforts to create social value by improving the socio-economic well-being of Base of the Pyramid (BoP) communities. Research shows that businesses that pursue these strategies—or BoP businesses—face distinct sets of challenges that require unique capabilities. There is, however, limited effort to synthesize current evidence on the mechanisms through which these businesses create social value. We systematically review the literature on BoP businesses, covering 110 studies published in business and management journals. We start by using bibliographic analysis to map the broad contours of the literature in terms of its common theoretical and empirical approaches, intellectual core, and evolution in time. We subsequently conduct a qualitative content analysis on the identified articles to synthesize their main findings. The analysis leads to a conceptual framework that explicates the antecedents, constraints, capabilities, and contingencies that drive social value creation. In addition to providing a rich and systematically organized account of the evidence, our analysis provides a critical reflection on the ethical dilemmas of social value creation efforts for the BoP, and outlines promising avenues for future research.
... In the international business literature, informal institutions are often presented as either complements to strong formal institutions or substitutes for weak or nonexistent formal institutions (e.g., Abdi and Aulakh, 2012;Boddewyn and Doh, 2011;Palepu, 2000a, 2000b;Stephan et al., 2015). Seen in this light, informal institutions can provide access to social and practical connections embedded in local networks, thereby bridging the gaps in some institutional voids (Khanna et al., 2010;Meyer et al., 2009;Miller et al., 2009;Rivera-Santos et al., 2012). In the context of internationalization in emerging economies with weak formal institutions, companies' reliance on informal networks and institutions may make export more difficult by limiting information flow and firm aspirations (Barnard, 2010;Estrin et al., 2018;Luiz et al., 2017). ...
... Active and humble efforts to reach out and listen to business leaders, despite any frustrations experienced, are likely to produce better results than taking a more passive and formal approach. More broadly, given the role of subnational informal institutional factors in ameliorating and exacerbating institutional voids, the active orchestration of subnational networkssuch as those suggested in studies of tourism destinations (Ritchie and Crouch, 2003), regional economic development (Kulenovic and Cech, 2015) and economic geography (Lee and Saxenian, 2008) should result in the more effective implementation of formal national policies such as export promotion. ...
Article
We explore the mechanisms through which subnational informal institutions exacerbate or ameliorate voids in national formal institutions. Informed by a within-country, cross-sub-region case comparison, we find two exacerbating mechanisms: Competition between the logics embedded in national and subnational institutions and the sabotage of a formal national institution by a void in a subnational informal institution. We also find two ameliorating mechanisms: Strong subnational informal institutions substitute for weak national institutions and bridge voids in formal institutions. Finally, we identify the conditions of expectation alignment and engagement associated with the competition, sabotage, substitution, and bridging mechanisms. Our findings contribute to institutional theory by providing a more subtle and contingent understanding of the interaction between informal and formal, and subnational and national, institutions. Our results also suggest ways in which constrained managers and bureaucrats can reduce the effects of voids in national formal institutions.
... Partnerships enable exchange of complementary resources and cocreation of solutions (Mvulirwenande and Wehn, 2019;Wehn and Montalvo, 2018a) and better innovation diffusion (Ramani and Mukherjee, 2014). In addition, local organisations have been shown to diminish the social and institutional distance that multinational enterprises often face in developing markets (London and Hart, 2004;Rivera-Santos et al., 2012b;Webb et al., 2010). ...
... To our knowledge, previous studies have not recognized and discussed this temporal aspect of collaboration with partners. Partnerships, where national and international NGOs and development agencies have a key role, may be different from typical partnerships in more affluent markets (Hahn and Gold, 2014;Hietapuro and Halme, 2015;Mvulirwenande and Wehn, 2019;Rivera-Santos et al., 2012b;Webb et al., 2010). Utilizing partners and innovation intermediaries who understand field circumstances and local operations is an effective strategy, but shared objectives, mutual understanding with the partners and internal knowledge on the innovators side are required -aspects, that have also been recognized by other water innovation studies (Mvulirwenande and Wehn, 2019;Wehn and Montalvo, 2018a). ...
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Article
Innovation processes face significant and not well-understood uncertainties in resource-constrained environments in developing countries. Through a case study of a water innovation process focused on Kenya, this article studies the prevailing uncertainties and management principles. With the help of a framework that combines information on technological, organizational, commercial and social aspects, our study identifies uncertainties in four distinctive stages of resource-constrained innovation: (1) Ideation and conceptualization, (2) Learning-based product and business development, (3) Scrutinized product and business development and (4) Commercialization. We recognize three principles required to manage uncertainties and develop successful resource constrained innovations: (1) the utilization of versatile research and development approaches, (2) building internal acceptability, trust and legitimacy and (3) leveraging range of partnerships and networks to access complementary resources and capabilities in different process stages. Our findings suggest that management of uncertainties requires proactive utilization of partner networks and context-specific strategies in different stages. With this research, we contribute to the understanding of innovation processes by advancing process-based knowledge of water innovation, uncertainties and related management strategies in resource-constrained environments.
... Intermediate outcomes influence final-outcomes whilst final-outcomes have a feedback effect on digital marketing resources and capabilities (Clark, 2007). Finally, guided by the work of (Aidis, 2005;Rivera-Santos, et al., 2012) institutional barriers negatively influence digital marketing performance. This study considered two types of outcomes, intermediate and final outcomes. ...
... Secondly, organisations must target developing positive intermediate outcomes as they influence final outcomes. In addition, institutional barriers negatively affect performance therefore, organisations must consistently lobby for a formalised environment or develop associations that help create favourable environment (Rivera-Santos, et al., 2012;Mair, et al., 2012). To researchers, the study implies vigorous testing of the model in different developing markets contexts, and in different industries to come up with widely acceptable framework and contributions. ...
... Through social capital, social enterprises can access resources that can be difficult to acquire through traditional market exchange (Mair & Marti, 2009). Ties with stakeholders can confer legitimacy, inhibit opportunistic behavior, foster trust and reciprocity, and enhance cooperation (London & Hart, 2004;Rivera-Santos, Rufín, & Kolk, 2012;Lashitew et al., 2022). ...
Article
Social enterprises seek solutions for some of society’s most pressing problems through the development of commercially viable businesses. However, pursuing social impact is often at odds with financial viability, and social enterprises need to engage with a wide range of stakeholders to access tangible and intangible resources to overcome this tension. While the current literature emphasizes the need for social capital within social enterprises’ supply chain relationships, it does not consider the costs associated with the development of such capital. This article examines how social enterprises develop social capital in their supply chain relationships and how this social capital affects their ability to pursue impact and viability. Using data from in- depth interviews with nine social enterprises, the findings indicate that the roles and positions of beneficiaries in supply chains determine the appropriate forms of social capital needed to sustain simultaneous impact and viability. The empirical insights highlight that structural and relational capital are most valuable within core supply chain relationships, while cognitive capital is most beneficial within peripheral relationships aimed at enhancing competitiveness. Further, social enterprises sometimes relinquish power in their supply chain relationships to prioritize impact but develop relational capital to mitigate threats of opportunism. This study advances a contingent view of social capital in cross-sectoral supply chain relationships and provide valuable implications for managers pursuing impact.
... Rural women tend to avoid the use of sanitary napkins as they are not sure about the methods of disposal and believe that if any male member of the society sees them disposing of a sanitary napkin, it would bring shame to the woman concerned (Ray and Dasgupta, 2012). An institutional divide therefore emerges, which points to a mismatch between values, needs and beliefs of recipients as opposed to innovators, that has often been observed in BOP ventures (Angeli and Jaiswal, 2015;Rivera-Santos et al., 2012). Moreover, problems of awareness, acceptability and availability, rather than affordability only, make disposable sanitary napkins largely unsuitable in these contexts, which reconfirm the experiences of other BOP initiatives (Anderson and Markides, 2007;Angeli and Jaiswal, 2015). ...
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Article
Apt menstrual health management is crucial to the livelihood of low-income, base-of-the-pyramid (BOP) women as well as to environmental conservation. However, knowledge is still scant about the factors underpinning women's preferences towards menstrual products, and whether and how the environmental impact of different solutions matter to women's choices. We address this gap by proposing a socio-ecological perspective to understand whether a product's low environmental impact enhances low-income women's uptake of sanitary napkins, thereby supporting poverty alleviation objectives but also efforts geared towards environmental protection. Results from a discrete-choice experiment involving 164 women (n = 1148) in two Indian slums in Delhi and Ahmedabad show that sanitary products' biodegradability is the most important attribute affecting women's preferences towards menstrual hygiene management solutions, which also significantly interacts with women's socio-economic and socio-cultural characteristics. Our findings highlight the potential for business models to find positive synergies between environmental protection and poverty alleviation goals and to situate solutions within the larger socio-ecological context of receiving communities.
... Corporate social innovation, despite being a relatively recent concept in the literature, has in its genesis strategic partnerships and joint creation of value (Altuna et al., 2015;De Silva, Al-Tabbaa & Khan, 2019;Doherty, Haugh & Lyon, 2014;Herrera, 2015;Lashitew, Bals & Tulder, 2020;Lusch, Vargo & Gustafsson, 2016;Vargo & Lusch, 2017). However, for these partnerships to be effective, organizations must promote a healthy institutional environment, without instability, excessive bureaucracy, corruption, and difficulty in accessing resources, markets, or products (Doh et al., 2017;Rivera-Santos, et al., 2012). At this level, it is important to mention that access to local resources by organizations is always a sensitive issue, as a society must recognize legitimacy in organizational activities (Verleye et al., 2018). ...
Chapter
Football coaches often play a differentiating role for the clubs, helping them to survive in a demanding mediatic, changing, and competitive environment where innovation may arise regarding leadership. This chapter seeks to unveil the perceptions of football coaches as leaders and the role of the football clubs' organizational culture in affirming this leadership. Studies on leadership constitute a broad field of organizational and management theories, highlighting the role of personality traits, as well as the organizational and social contexts surrounding the leaders' actions. As there is no significant academic literature on football coaches and leadership, it was sought to explore the coaches' perceptions as leaders, as well as the influence of the clubs' organizational culture in which they developed their activity. Based on 22 interviews with football coaches of reference clubs, this chapter highlights their difficulties, demands, and needs to deal with their professional context.
... Shah (2016) illustrates the potential role of design thinking in the superior performance of producer organizations. Extant research also points to the role of bricolage and institutional entrepreneurship, multi-sectoral partnerships and compensatory structures in overcoming institutional constraints faced by BoP producers (Kolk, 2014;Mair & Marti, 2009;Mair, Martí, & Ventresca, 2012;Rivera-Santos et al., 2012). Similarly, Jagadale et al. (2018) argue that empowering the poor with the capabilities for creation, design, and governance of marketing systems could help them benefit from economic growth and improve their condition. ...
Article
The Base of Pyramid (BoP) narrative has been dominated by the consumption perspective, as compared to producers’ perspective. The literature on the constraints faced by BoP producers in such resource-constrained environments remains scattered and fragmented. This paper, therefore, systematically reviews and integrates previous studies dealing with constraints of the base of the pyramid producers. Synthesizing various strands of literature, we suggest eight propositions related to BoP producers’ constraints. We also provide an extended typology of constraints faced by BoP producers. The psycho-social constraints, organizational constraints and institutional constraints are three constituent categories of this extended typology. Drawing from the marketing system view, the article also provides a conceptual framework for advancing a multi-level, recursively related and process-based understanding of these constraints. The article also provides useful directions for future enquiry and explicates several implications for researchers, managers and policymakers.
... Filling such institutional voids is often the aim of CSPs because in these gaps, social and environmental issues of substantial magnitude may arise. For instance, this applies to developing and subsistence markets or base-of-the-pyramid initiatives (Hamann & April, 2013;Reficco & Márquez, 2012;Rivera-Santos et al., 2012;Sakarya et al., 2012), where communities and nonprofits contribute to the cultivation of the business eco-system. Another example is post-war societies in which multiple actors partner for peace and development (Kolk & Lenfant, 2015). ...
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Article
Cross-sector partnerships (CSPs) addressing economic, social, and environmental issues continue to be a vibrant topic in management research and beyond. However, compared to the exogenous factors that drive collaborative advantage through structures and governance, the endogenous problems of collaborating across different institutional logics, residing at the micro-level of interactions among partners from the business, government, and nonprofit sectors, have received scant attention. The preoccupation with success factors often leads to a bias toward the problem-solving capacities of CSPs at the neglect of the considerable barriers to successful collaboration across sectors. This study addresses this shortcoming and extracts an institutional approach of CSPs from an integrative review of the literature combining bibliometric methods with qualitative reviewing. A bibliometric map shows how the literature is divided into several clusters, each addressing a specific type of CSPs but not engaging much in exchange with other clusters. Zooming in on the clusters provides a more nuanced picture of how institutional theory has hitherto been applied to CSPs. We build on these pieces of the puzzle and assemble them into a preliminary framework that accounts for inter-institutional conflicts in CSPs and actor-level responses to these conflicts. Our framework introduces a new analytical platform that facilitates multi-level research, bringing the micro-level of individual actors back in and connecting it with institutional frames at the macro-level.
... A new mixture of current and new technologies can be used to solve problems, whether in energy supply or other areas (Walsh & Linton, 2000). In meeting the challenges faced by consumers with different types of needs, most researchers tend to favor a research approach for solving the problems encountered and seek a balance between disruptive innovation and sustainable development (Adegbile & Sarpong, 2018;Hemphill, 2010;Rivera-Santos, Rufin, & Kolk, 2012). ...
... Weak institutional environments with unstable rules of law, red-tape, corruption, and limited input availability and/or accessibility in product, capital and labor markets, i.e., those with institutional voids, expose corporations to a broader set of contractual hazards and hinder the effectiveness of partnerships Khanna & Palepu, 2010;Rivera-Santos, et al., 2012). Partnerships in developing countries may be exposed to hazards of value appropriation by organized groups lobbying for price reductions and other changes that can impede corporate investments (Quélin et al., 2019). ...
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Although corporate social innovation studies in developing countries acknowledge the importance of firm resources and capabilities for attaining social goals, they overlook the way in which these interact with broader institutions to generate successful outcomes. We address this gap by exploring the relationship between firm resources-capabilities and institutions that is conducive to meeting both business and social interests in developing countries. By employing a fuzzy-set qualitative comparative analysis of corporate social innovation projects performed by joint ventures of Dutch SMEs and their local partners in developing countries, we show that firm resources and/or capabilities complement strong institutions in these countries. Corporate social innovation can also be facilitated by firm capabilities in running highly legitimate projects that substitute institutional voids in these economies, attesting to multiple paths that corporations can take to achieve social innovation.
... Therefore, the BoP depends on other SC partners for alleviating and overcoming institutional voids and the BoP inclusion paradox.Paradox resolution strategies need the SC perspective. For example, the certificate is bought and supervised by the exporter, and the BoP products are included. Thus, SD can address the paradox, but it is only one means.Rivera-Santos et al. (2012) andParmigiani and suggested that all sectors (i.e., profit, non-profit, and the public) are needed to address institutional voids, each compensating a different aspect. The study at hand supports this by analyzing the SD strategies in the case studies.Second, not all BoP actors enjoyed the SD benefits. SD originating in the profit sector ar ...
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Resulting from divergent business environments between actors, the integration of the base of the pyramid (BoP) into formal supply chain (SC) structures is often hampered by institutional voids, which can result in the emergence of paradoxical situations. This paper analyzes the potential of supplier development (SD) for addressing the BoP inclusion paradox. The study develops a framework based on the assumption that SD enables the development of capabilities and supplier performance, which is especially relevant when operating in BoP contexts. Seventy‐two semi‐structured interviews stemming from two case studies of (a) a local dairy and (b) an international certified pineapple SCs with BoP involvement provide empirical insights into the theoretical framework. Paradox resolution strategies (temporal separation, spatial separation, and synthesis) are related to (direct and indirect) SD practices. The proposed framework and results show that indirect SD can be used as temporal and spatial separation, but not as synthesis strategy. Contrastingly, direct SD can be used as temporal separation and synthesis. The BoP context needs direct SD to address two sustainability goals simultaneously: the social dimension of BoP inclusion and the economic dimension of formal and efficient SCs. This research extends the discussion on paradoxes in sustainability management to SCs, especially to BoP SCs. It is relevant to show that BoP inclusion is neither a sole win‐win nor trade‐off scenario. Resulting paradoxical situations can be addressed by SD, thereby moving to sustainable supply chain management (SSCM).
... 1 The BoP consists of almost three billion people worldwide, with an individual spending power of $2 or less per day (Prahalad & Hammond, 2002). BoP consumers have weak formal or institutional support and a distinct system of beliefs and values (Rivera-Santos et al., 2012). They are also prone to various illnesses due to imbalanced diets, low quality of life, and limited access to healthcare services (George et al., 2015;Marmot et al., 2008). ...
Article
We examine the co-creation of value by bottom of the pyramid consumers in the health services context. Following a qualitative approach, we use the empirical context of the National Rural Health Mission (NRHM) in India, one of the largest healthcare policy interventions in the world. Our grounded theory-based research used semi-structured interviews conducted in 28 villages across three states using a purposive sample (NRHM beneficiaries). The qualitative data were analysed utilising a discovery-oriented approach, in accordance with the value co-creation and service-dominant logic frameworks. We draw insights about the roles of individual agency, the individual’s social milieu, and supplementary forces in affecting different types of individual wellbeing. Our results help to explicate the processes of the exploitation, combination and reinforcement of resources within a co-created healthcare ecosystem, and six propositions explain value co-creation-driven health service delivery. We also discuss implications for marketers and policy implementers.
... In the first stage, the 'BoP' was referred to as 'BoP market' since most BoP studies merely considered the poor as consumers (e.g., Prahalad and Hammond, 2002). However, some BoP researchers (e.g., Karnani, 2007a;Rivera-Santos et al., 2012;Webb et al., 2010) argued that the firms should view the poor as 'business partners' rather than consumers. On this basis, Simanis et al. (2008) proposed the 'BoP 2.0', which stresses the benefits of collaborating with people at the BoP regions. ...
Article
Base-of-the-Pyramid (BoP) is a sustainable proposition that calls on private businesses to alleviate public poverty while fulfilling their own interests. Previous studies show the significance of BoP in the advancement of Sustainable Development Goals. Particularly, in the manner of cooperating with people at the bottom of socio-economic pyramid, multinational enterprises can alleviate public poverty and thus promoting sustainable development at the BoP regions. However, the general state and trend of sustainable development-related studies in the BoP domain are not clear; the popular keywords and theoretical orientations have yet to been determined. This study aims to address these issues by analyzing 273 high-impact articles in the related field from the Web of Science database between 2002 and 2018. A mixed review method is adopted, which combines quantitative bibliometric analysis with qualitative content analysis. The results show that an increasing number of sustainable development-related studies are emerging from the BoP domain, particularly concerning social and economic sustainability in developing countries (or regions). Four theoretical orientations are identified, namely subsistence market, sustainable solution, corporate social responsibility and inclusive business. This study contributes to a deeper understanding of the related research area and at the same time calls for continuing scholarly exploration.
... BoP markets inherently differ from higher-tier markets, as an institutional theory lens reveals (Angeli & Jaiswal, 2015;Rivera-Santos et al., 2012). It is well known that economic resource-poor communities are characterized by institutional isolation and by an idiosyncratic structure of beliefs, sociocultural traditions, values, and norms, giving rise to a non-munificent institutional environment (Angeli & Jaiswal, 2015; and that informal institutions, rather than formal ones, have a prominent role in governing social life in these contexts . ...
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In recent years we have witnessed growing interest at the intersection of two important phenomena: the rise of the sharing economy, and long-standing interest in tackling pressing social and environmental issues at the base of the pyramid (BoP). While the sharing economy offers potential in tackling these issues, we argue on the basis of a growing body of research that its contemporary manifestations have largely failed to live up to their potential. We argue that an important reason for this is that research and practice has tended to focus on corporate forms of sharing platforms and have largely neglected their cooperative peers. In this chapter, we first distinguish corporate platforms from a nascent group of platform cooperatives before developing a typology of platform cooperatives in the BoP. This typology builds on early efforts to construct typologies of platform cooperatives in the Global North and thereby highlights various cases that show potential in overcoming the limitations of corporate platforms while offering important social and environmental benefits. Thus, in addition to the platform worker cooperatives that are at the forefront of the discussion on platform cooperativism in the Global North, we emphasise the importance of inter alia agricultural platform cooperatives and credit and savings platform cooperatives in the BoP context. Our typology helps identify areas for future applications and development, and points to important areas of future research.
... Cross-sector collaborations are generally seen as a means to improve public value [22]. Much of the research in this area focuses on what makes these types of collaborations successful at the partnership level [23,24]. One insight gleamed from this body of research is how challenging it can be to sustain stable cross-sector collaborations over time as partners find that their organizational incentives, structures, modes of governance, goals, and processes ultimately do not fit with those of their cross-sector partners [25][26][27]. ...
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This paper explores how agency was used within a police-hospital collaboration to implement a planned change designed to increase the sustainability of a cross-sector collaboration. A longitudinal, qualitative case study involving pre-and-post interviews with 20 police officers and 20 healthcare workers allowed us to capture multiple perspectives of the planned change over time. Analysis of case study data reveals three major findings: (1) organizations with limited power can have agency in cross-sector collaborations when they are perceived to have legitimacy and urgency; (2) the extent to which the implementation of a planned change influences perceptions of agency depends on the organizational context of the perceiver; and (3) different levels of analysis (i.e., meso versus micro) support different conclusions with respect to the role of agency in the sustainability transition process. More broadly, our study highlights the role of perception when investigating agency within sustainability transitions.
... MFIs typically do not rely on formally enforceable contracts when they give out loans. This "bridging" of two institutional settings is specific to MFIs active in low-income communities (De Soto, 2000;Rivera-Santos, et al, 2012). For instance, the reliance on enforceable contracts through the rule of law applies to retail banks, when they give out loans but not for MFIs, but who on the other hand rely on them when they secure their own funding. ...
Article
Existing literature suggests that microfinance institutions (MFIs) are likely to operate in different institutional environments. Unlike retail banks, MFIs bridge two institutional settings: the formal environment, in which they source their funding and in which they are legally embedded, and the informal environment, in which they operate. This study contributes to a growing literature on microfinance performance by investigating whether the institutional environment of the host country matters for MFIs performance. Using panel data corresponding to 167 MFIs for the period 1997-2008, System GMM Estimator is applied to determine the extent to which institutions affect microfinance performance. Estimation results reveals that MFIs profitability is non-negligibly driven by the surrounding institutional environment. Specifically, MFIs are more profitable in countries with political stability, effective and predictable rule of law. However, the magnitude of the effect is sensitive to MFIs age. JEL classification: E02; G21
... Weak institutional environments with unstable rules of law, red-tape, corruption, and limited input availability and/or accessibility in product, capital and labor markets, i.e., those with institutional voids, expose corporations to a broader set of contractual hazards and hinder the effectiveness of partnerships Khanna & Palepu, 2010;Rivera-Santos, et al., 2012). Partnerships in developing countries may be exposed to hazards of value appropriation by organized groups lobbying for price reductions and other changes that can impede corporate investments (Quélin et al., 2019). ...
... Deep engagement is often attended by fundamental appreciation of the interconnected nature of social challenges and the need for collaborative approaches to convert complex social issues into business opportunities (Rivera-Santos, Rufín, & Kolk, 2012). Such strategies leverage ideas and resources from internal and external sources to create unique business solutions that sustainably mitigate social issues (Austin & Seitanidi, 2012;Brugmann & Prahalad, 2007;Nahi, 2016). ...
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Why do firms adopt inclusive business practices that aim to alleviate poverty or address other social issues? We consider how the nature of motivations, which range from purely intrinsic to purely extrinsic/economic, can lead to variations in strategies towards addressing social issues. Based on a conceptual model, the study develops a set of hypotheses on how different motivation types lead to varying levels of performance in inclusive business practices. We test these hypotheses using a survey dataset of small and medium enterprises that pursue inclusive business practices in Sub-Saharan Africa. The results show that intrinsic rather than extrinsic motives are important drivers of inclusive business performance. While the role of extrinsic motives appears relatively limited, its effects are significantly higher among large firms in a few domains of inclusive business practice. Finally, we find that extrinsic and intrinsic motives do not reinforce each other, suggesting the limited incidence or efficacy of mixed motives among inclusive businesses in Africa. The results point to the need for greater understanding of the conditions that lead to the emergence of mixed motives and hybrid identities in commercial enterprises. Key words: Inclusive business; intrinsic motives; extrinsic motives; Africa; Base of the Pyramid (BoP)
... Fighting against these problems, both BOP and society expect businesses to develop solutions. As the complexity of issues in need of solution requires more than one organization's effort (Rivera-Santos, Rufin, & Kolk, 2012), businesses collaborate with other partners in their attempts to approach BOP. Moreover, according to BOP studies, NGOs (non-governmental organizations) have always been one of the critical partners of businesses for enduring growth in terms of entering into markets of the low-incomed populations. ...
Article
This study investigates the moderating role of a country’s culture as an external contingency factor in the relationship between a firm’s environmental, social, and governance (ESG) performance and financial performance. Using ESG performance data of 4978 firms from 48 countries for 17 years, we argue that the financial return from engaging in ESG varies depending on the countries’ cultural aspects because stakeholder evaluations and appreciations for a firm’s ESG performance differ across nations. We find that a country that espouses a culture of high individualism or masculinity tends to appreciate and reflect on this more explicitly, strengthening the relationship between a firm’s ESG performance and financial performance. Contrastingly, in a country with a culture of high power distance or uncertainty avoidance, firms’ ESG efforts are less likely to be associated with financial performance. Our findings have important implications for multinational enterprises facing various cultural environments when dealing with heterogeneous stakeholder demands across countries.
Article
Risk management in the base of the pyramid (BoP) environment is needed to ensure that firms performance objectives are met. Accordingly, integrating sustainability performance measurement in the supply chain risk management would offer interesting avenues for managing risks in BoP supply chain. Therefore, the paper conceptualizes an intersection between supply chain risk/uncertainty management and sustainable performance measurement. This intersection is then tested by a literature review of 164 BoP SC articles between the years 2000 and 2022. Descriptive, frequency, and correlation analysis identify various risks factors studied in the BoP literature so far, their management strategies and respective performance measures. The findings show a broad strategical aspect of managing SC risks and proffered the tactical or operational level performance measures which along with these practices can manage the related risks. Therefore, their incorporation into the risk management process should be considered. The correlation findings highlight the important role of performance process measures and the impact of these along with the management practices on firm's performance outcomes. The study contributes to supply chain risk and performance management literature by capturing the nexus between BoP and supply chain management.
Article
Partner selection is critical for organisational performance for both core and non-core offerings of a firm. Using a multiple-case study, we analyse the partner selection process related to the firm’s non-core offerings. The analysis suggests that partner selection is a multiple-stage process rather than a single-stage process. Partners are evaluated against the first set of criteria comprising value offering and technological complexity, generating possible decision sets through trade-off. Once the first stage decision is favourable, partners are assessed against another set of criteria at the next stage. For low technological complexity, the criteria are propensity to scale up and competitive advantage, whereas for high technological complexity, the criteria are organisational compatibility and technological sophistication. The decision sets from the final stage conclude partner selection and possible on boarding.
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CSR practices derive directly from strategic actions of companies but, more indirectly, from other factors that influence organizational behavior, such as culture. But talking about culture is something too comprehensive since we have national and organizational culture. At the level of CSR practices, will the framework of values of the leadership and the employees of an organization or the norms and values of the country where it operates be more influential? What is the role played by an innovative culture in the implementation of CSR? How can companies promote corporate social innovation? To answer these questions, this chapter will present some studies and discussions to contribute to the reflection of this issue not only to sensitize organizations to the importance of assuming CSR behaviors in an innovative way but also to analyze the role that culture has at this level.
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Cross-sector collaborations – defined as collective initiatives involving joint work between any combination of public, not-for-profit, and for-profit actors – are increasingly viewed as valuable to foster social innovation and address some of the world’s most pressing societal challenges. However, they are also recognized to be particularly challenging to implement. This chapter reviews the academic literature on cross-sector collaborations produced in the past two decades to understand what makes these collaborations work and identifies three main organizational-level determinants of their success: the characteristics of the partners involved, the structure of the collaboration, and the boundary practices that are used by those that collaborate. We detail each of these determinants and further leverage general knowledge on collaboration to show how they contribute to the two main mechanisms facilitating collaboration, namely cooperation and coordination. Building upon this review, we discuss the limitations and gaps in the existing literature and point to potential future research directions.KeywordsCollaborationsCross-sector collaborationsInterorganizational partnershipsCooperation and coordination
Article
[Open Access] In African countries such as Ghana, microentrepreneurs make formal economy goods and services available to base of the pyramid (BOP) consumers. Multinational enterprises (MNEs) co-opt BOP business models when they enter the BOP market. We conducted a case study of six MNEs and 36 microentrepreneurs in three key sectors. In two sectors (fast-moving consumer goods and telecommunications), reverse bridging enables MNEs to capture value from BOP business models, which has a negative impact on both the financial and social capital of microentrepreneurs. In the third sector (finance), microentrepreneurs are buffered from the negative effects of co-optation through a process of integrating, which enhances their social capital but reduces their financial capital. Our research contributes to the BOP literature, first by demonstrating that financial and social capital are intertwined at the BOP level, and second by analyzing how the negative effects of co-optation can be cushioned by enhancing microentrepreneurs’ social capital.
Article
The extant review studies on the Base/bottom of the Pyramid (BoP) have paid inadequate attention to the producer and entrepreneur roles of the poor. This review article exclusively focused on BoP producers and subsistence entrepreneurs provides an overview of the current state of research on BoP producers and subsistence entrepreneurs. It encompasses 130 articles from 67 peer-reviewed academic journals and develops an organizing framework for classifying these articles. The conceptual model of entrepreneurship in poverty contexts presented in this article illustrates the drivers, barriers, facilitators and consequences of subsistence entrepreneurship. The conceptual model helps to highlight the relevance of contextually informed public support and advocates adopting a collaborative approach for addressing various challenges faced by BoP producers. We also discuss the implications of our article and provide directions for future research.
Article
Purpose The handicraft sector is unorganized, with tremendous opportunities for generating employment, particularly for the non-urban and bottom of the pyramid (BOP) population. The aim of this paper is to revisit the existing supply chain of the handicraft sector to identify the gaps that can help generate better marketing outcomes for the sector when addressed. Design/methodology/approach A mixed method of qualitative and quantitative research has been used. Empirical observations from artisans have been collected to identify different variables impacting the functioning of the handicraft value chain. Findings Different variables were identified and grouped into six important dimensions through the mixed-method research. The components were ranked based on importance, which can help in developing a robust supply chain at BOP for the handicraft sector. Originality/value Studies on the supply chain of the handicraft sector are rare, and none has tried to understand issues in an integrated way directly from the artisans. This study has captured the voices of the artisans, and through qualitative and quantitative data analyses, the main reasons for the artisans' pain points were identified. This can give directions to a viable business model for the handicraft sector.
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Social Venture Entrepreneurs (SVEs) invest in supply chains with the aim to ignite businesses, but with a vision on how to transfer ownership to third parties. The present study explores the definitions and forms of ownership envisioned by local stakeholders and the extent to which these are in line with the SVEs’ way of thinking. Using qualitative case study analysis, perceptions of legal and psychological ownership are compared between local stakeholders and social venture management in the specific context of a particular SVE initiative among local Maasai communities in northern Tanzania. It is concluded that different groups of stakeholders have different definitions of ownership forms, transfer and criteria. Social Venture Entrepreneurs will need to organize their definition of ownership around a perspective shared by its stakeholders, in order to realize the mission for which such businesses were initiated within regions that these businesses operate in.
Article
Technological progress and the rise of short video platforms have created new possibilities for the marginalized communities. This paper explores how such platform-based business model innovation can foster entrepreneurship from the base of the pyramid (BOP) and include poor people into value creation activities by sharing their skills, experiences and their normal farming and life activities. Through an in-depth case study of a successful platform which has hundreds of millions of active users from the BOP, we developed a content-based new inclusive digital business model for grassroot entrepreneurs; and identified the mechanisms that makes such a platform fair and inclusive for the poor. The paper analysed its impact on income creation, capabilities development, and social capital development at the BOP, as well as its impact on the growth of BOP entrepreneurs, and the enabling factors that are essential for the scale-up and success of such a business model. Policy implications are also discussed.
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Our research builds on existing literature examining institutional voids in emerging economies. Using data from two cases of mining FDI in Argentina, we conceptualize the triggers, processes and consequences of informal institution-building by a social movement. We found the cases to exhibit different ‘community sustainability orientations’, enabling two contrasting strategies, ‘bargaining’ and ‘gatekeeping’, to address the existing institutional void. This led to the development of new formal institutions – regulated CSR for the former and legal ban on mining operations for the latter case. Our study thus offers insights into the processes through which institutional entrepreneurship by social movements influences MNEs.
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The sharing economy has been predominantly studied in developed country contexts and hence we do not understand it in the base of the pyramid (BoP) context. Considering the unique characteristics of the BoP context, it is worthwhile to explore how sharing economy can be leveraged in such a context. Specifically, we studied the case of a social enterprise operating in India and tried to understand how the organization adopted the sharing economy model for addressing its resource challenges. We found that while faced with the resource challenges of finance, human resource, and knowledge resource, the organization used different sharing such as digital platform sharing, human resource sharing, channel sharing, knowledge sharing, and business model sharing. Our study has important implications for the literature on sharing economy and social entrepreneurship.
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The intensifying poverty and poorer living conditions, the need for greater social welfare along with ongoing damages to the natural environment in several contexts of the world have proved the increasing importance of social innovation for creating positive social and environmental change. This special issue addresses to the limitations in social innovation literature by providing insights into the role of inter-organizational collaborations in the process, practice and outcome of social innovation. Thus, the papers published in this special issue advance current knowledge and scholarship on different aspects of the social innovation phenomena occurring in inter-organizational contexts. The current paper reviews existing perspectives and studies on social innovation undertaken inter-organizational contexts, develops the future agenda for improving scholarship on social innovation occurring through inter-organizational collaborations, and provides the development of new theoretical ideas by focusing on some key studies in the literature and papers published in this special issue. With a focus on subsistence contexts that are characterized by limiting institutional environments, this paper identifies the types of partnerships that are being formed by social enterprises and individual social entrepreneurs, and how they may facilitate and foster social innovation practice and performance through social value creation.
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Social entrepreneurship in Ecuador has reached a level of importance, both in the economic and social spheres as well as at the academic and scientific level, thus becoming an important indicator for the socioeconomic development of a country. From a theoretical point of view, this paper performs a conceptual review, and analyzes policies and regulations related to popular and solidarity economy that provide an appropriate frame of reference for the study of this subject. The main objective of this work is to analyze the phenomenon of social entrepreneurship from an evolutionary, sectoral and gender perspective, approaching the main characteristic elements of this type of entrepreneurship, adopting the case of Ecuador in the period 2000–2018 as an analytical context.
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Inclusive business as a model at the base of the pyramid is a relatively recent unit of study in academic literature. From the institutional perspective, businesses are affected by norms, process, rules of moral and ethics behavior, which have not been studied for the base of the pyramid in inclusive businesses, much less in agricultural cooperatives. The objective of this research is to identify institutional factors that can affect agribusiness inclusive models. In this research, agricultural cooperatives of banana production in the province of Magdalena - Colombia, are the unit of analysis to identify institutional factors. The method of review of institutional factors is the multiple cases (six banana cooperatives) with a simple unit using an inductive analysis. The results show that institutional factors both formal (certifications, quality standards, social responsibility policies and economic incentives) and informal (cooperation, improvement of quality of life, generation of social capital) promote the development of inclusive businesses in cooperatives of the base of the pyramid. The research is a first step to show its potential replication in other agricultural industries and even in other economic sectors.
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Purpose Base-of-the-pyramid (BoP) markets are frequently characterized by institutional voids. However, it remains unclear how institutional voids impact corporate and supply chain risk and performance. This intersection will be analyzed in this paper. Design/methodology/approach This paper presents a systematic literature review of 94 BoP papers published between 2004 and 2019 in peer-reviewed, English-language journals available on Scopus. Drawing upon established frameworks for examining institutional voids, supply chain risks and BoP performance, frequency, and contingency analyses are conducted. Contingencies are established to provide insights into the associations between different constructs from the selected frameworks. Findings Supply chain risks are pervasive in the BoP discourse, especially when BoP markets are characterized by institutional voids. The frequency analysis of the constructs suggests that the key supply chain risks discussed in the BoP literature include social risk, credit risk, product market and operating uncertainties, knowledge and skill biases and decision-maker risks due to bounded rationality. The contingency analysis suggests that institutional voids are associated with supply chain risks that affect performance. Research limitations/implications A theoretical framework aligning three research streams in the context of BoP calls for future studies to test the causality of highlighted constructs that are significantly associated. The analysis is confined to the constructs that are taken into account based on specific conceptual frameworks. Practical implications The study provides practitioners with a framework to manage supply chain risks in BoP-related firms to enhance firm performance. Managers can use key dimensions of supply chain risk, such as the product market, the input market and operating uncertainties, to evaluate performance in the BoP context. Originality/value Specifically, this research has strengthened the inquiry of supply chain risks in the presence of institutional voids that may have an impact on firm performance
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Purpose This study aims to highlight the processes that private organisations implement to improve access to health care services for low-income communities in Brazil. Design/methodology/approach A qualitative research based on a comparative case study was conducted in São Paulo. A for-profit organisation and a not-for-profit one were compared to scrutinise how they adapt themselves to the social context they are embedded in; while improving their service accessibility. Findings Both kinds of organisations have succeeded to reach their goal of improving the access and reducing the time frame of health care services to low-income populations. Their initial business model (BM) makes them face their own challenges that they face with different strategies. It affects their way of communicating, their organisational culture, the patients’ expectations and their level of inclusiveness. Research limitations/implications The research is context-dependent because of the specific conditions of the health public system in Brazil. When shaping health care BMs, the national context must be taken into account and the service marketing components should be used to enhance patients’ value co-creation in the health care service delivery process. Practical implications The research gives insights to organisations that seek to adapt their BM to improve health-care access to low-income populations. Social implications Health-care access plays a key role in improving populations’ living conditions and reach one of the sustainable development goals of the United Nation. Originality/value Health care services access at the bottom of the pyramid remains under-studied. The paper brings value by comparing for-profit and non-profit organisations, which have the same social goal of improving health-care access to low-income populations while developing different practices to deal with their own challenges.
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Main aim of the paper is to investigate the correlation between social entrepreneurship and development of local self-governments, in order to effectively and efficiently steer the potential of this form of entrepreneurship towards greater inclusion of socially vulnerable groups and improved development of local self-governments. Authors have developed a conceptual model that investigates the effects of social entrepreneurship on self-government development, as well as the impacts of self-government development on the perception and attitudes towards this type of entrepreneurship. The research results show that the respondents think that activities of social entrepreneurship have a positive influence on the development of local self-government; they also believe that main barriers to stronger development of social entrepreneurship in local self-governments are vague status of social enterprises, poor access to funding and a general lack of entrepreneurial spirit. The results provide an important contribution to policy makers to identify and understand the link between the development of social entrepreneurship and local self-governments.
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The article analyses aspects of the cross-sector partnership of NGO and business actualizing the context of the governance dimension and collaborative value creation. The theoretical part of this article revealed the formal (contractual) and informal (relational) governance mechanisms, which influence the behaviour of partners in the cross-sector partnership. Moreover, the research presented organizational and partnership perspectives of the governance in cross-sector partnerships. The case study strategy was applied to conduct empirical research in Lithuania. It was found out that value creation based on collaboration in cross-sector partnership is influenced by partnership context that consists of macro and mezzo stimulating and limiting factors, characteristics of NGO and business organization, selection of a proper partner as well as formal and informal mechanisms of partnership governance.
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Sustainable development goals (SDGs) have become increasingly important for today's firms as they build sustainability strategies that integrate SDGs into their core activities. Addressing these goals collaboratively, in line with SDG 17-partnerships for the goals, has gained momentum, hence the growing literature on sustainability-oriented partnerships. However, addressing SDGs through partnerships is not straightforward. For firms, contributing to SDGs through alliances and partnerships requires building environmental capabilities and embracing new value frames; in other words, going through the complex process of inter-organizational learning. This paper reviews the literature on sustainability-oriented partnerships with a focus on the inter-organizational learning process. As a result of the review, a model of inter-organizational sustainability learning is presented. This model captures the different levels and types of the inter-organizational learning process; partner and partnership characteristics that impact learning; the environmental conditions that set the conditions for learning to take place; the catalyst and inhibitors of learning; and finally outcomes of learning. This model expands and reorganizes the existing scholarly conversation about inter-organizational learning in the context of sustainability-oriented alliances and partnerships and offers a learning-based understanding of sustainability partnerships to practitioners. Based on the review, the paper proposes ideas for future research and contributes to the development of a future research agenda in the area of sustainability-oriented alliances and partnerships.
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Developing countries view foreign direct investment (FDI) as a vital contributor to economic growth by augmenting domestic capital and enhancing efficiency through transfer of new technology, marketing, and management skills. Even though the factors that influence FDI have been examined in the context of developing countries, the role of state fragility has been underexplored in the literature. Drawing on institutional theory, we develop hypotheses on the link between state fragility and inward FDI. Based on data from 93 fragile countries from different geographical areas, the study shows the influence of state fragility on human flight and brain drain and the role of the latter in causing economic decline. It also explores the mediating roles of human flight and economic decline in the relationship between state fragility and inward FDI flows and identifies economic decline as an important path linking state fragility and FDI.
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The bottom of the pyramid (BOP) in the global distribution of income has been promoted as a significant opportunity for companies to grow profitably. Under the BOP approach, poor people are identified as potential customers who can be served if companies learn to fundamentally rethink their existing strategies and business models. This involves acquiring and building new resources and capabilities and forging a multitude of local partnerships. However, current BOP literature remains relatively silent about how to actually implement such a step into the unknown. We use two BOP cases to illustrate a strategic framework that reduces managerial complexity. In our view, existing capabilities and existing local BOP models can be leveraged to build new markets that include the poor and generate sufficient financial returns for companies to justify investments.
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Project-based cross-sector partnerships to address social issues (CSSPs) occur in four “arenas”: business-nonprofit, business-government, government-nonprofit, and trisector. Research on CSSPs is multidisciplinary, and different conceptual “platforms” are used: resource dependence, social issues, and societal sector platforms. This article consolidates recent literature on CSSPs to improve the potential for cross-disciplinary fertilization and especially to highlight developments in various disciplines for organizational researchers. A number of possible directions for future research on the theory, process, practice, method, and critique of CSSPs are highlighted. The societal sector platform is identified as a particularly promising framework for future research.
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Deciding on the boundaries of a firm as it expands abroad is a critical decision for managers. Despite the rapid growth in research addressing this issue, many questions remain unanswered. In this article, the authors review the international entry mode choice literature, identify weaknesses and shortcomings, and provide suggestions on how researchers can add to the knowledge of mode choice and help managers make better international boundary decisions.
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During the past four years, Avon's 450,000 U.S. sales representatives have raised $22 million to provide access to breast cancer screening and education. The representatives often incorporate breast cancer awareness into their conversations with clients and provide related literature. The National Alliance of Breast Cancer Organizations and the YWCA. are Avon's partners in this effort. American Express and Share Our Strength, an anti-hunger organization, have joined forces on multiple endeavors since 1991. Among them are Taste of the Nation, an annual nationwide series of fundraising events, now in its seventh year, supported by thousands of volunteer restaurateurs and chefs and Charge Against: Hunger, a national cause-related marketing campaign that ran for three years.
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Extending scholarship on industry clusters, this article reconsiders the relationship between development and marketing opportunities in base-of-the-pyramid market (BOPM) nations. Recent literature on industry clusters suggests a set of theoretical themes regarding cluster efficiencies, governance, adaptability, and performance. These themes are scrutinized using an extended case employing longitudinal, ethnographic data collected from an indigenous leather-working cluster in West Africa. The authors’ findings provide guidance in identifying local clusters with global market potential in BOPMs. They lead us to a dynamic market-driven transformational model of BOPM clusters. Consequently, the authors recommend several keys for leveraging investments in boundary-spanning firms in BOPM clusters. Finally, the article demonstrates the value of microlevel, longitudinal analyses in assessing cluster performance in BOPMs.
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In August 2006, 85 academicians and practitioners from industry and the nonprofit sector came together on the campus of the University of Illinois at Chicago for a conference unlike others in recent management research history. This conference focused on the subsistence marketplace and its constituents – the billions of individuals and families living in substandard housing, with limited or no education; having limited or no access to sanitation, potable water, and health care; and earning minimal incomes. Subsistence consumers and entrepreneurs have been largely ignored by contemporary marketing and management research and practice, but are poised to become a driving force in 21st century economic and business development. It is expected that as many as 1 billion new consumers wielding discretionary income will enter global markets before 2020. In addition, even among those consumers who lack discretionary income, it is expected that they will be much more active in the marketplace in the near future, because of expanded access to products and information through the Internet and wireless technologies (Davis & Stephenson, 2006). Moreover, the combined purchasing power of these consumers, already in the trillions of dollars, is likely to grow at higher rates than that of consumers in industrialized economies. These factors come together to suggest that consumer markets will need to adjust radically to the needs and demands of these emerging markets over the next 2 to 3 decades, even though companies and scholars across the business disciplines know very little about subsistence consumers. It was this need for knowledge about subsistence marketplaces that inspired the conference and the research presented here.
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The potential contribution of companies as partners in furthering development objectives is frequently mentioned, but has received limited research attention. What has also remained unclear is to what extent companies can play such a role via the various individual and collaborative means available to them. Collaborative efforts include not only the more well-known partnerships with nonprofit (non-goernmental) organisations (NGOs), but also with governments, and even with both parties. This paper analyses the characteristics of development activities undertaken by companies individually and jointly via public-private, private-nonprofit and tripartite partnerships. Using multinationals originating from the Netherlands as empirical setting, we find that private-nonprofit partnerships are most common, with tripartite and public-private partnerships only emerging, also due to divergent views between business and government. Most partnerships are directly linked to companies� core activities or focus on the sector or supply chain. A broad, macro development orientation mostly occurs in (tripartite/bilateral) partnerships involving nonprofit organisations. The paper also discusses the implications of the study for partner roles and effectiveness of partnerships, as well as for research and practice.
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Indigenous communities find themselves at the losing end of socio-economic changes taking place in diverse contexts of development. Changes in property rights to land and related resources such as forests and water have universally had adverse effects on their livelihoods, which are almost absolutely dependent on these resources and the ecosystems to which they belong. The historical processes behind these changes have their political, economic and cultural specificities. A deep understanding of transitions in property rights in the traditional habitations of indigenous communities is crucial in capturing these specificities and the socio-economic consequences of the changes. Property rights could be described as the set of economic and social relations that define the position of each individual with respect to the utilization of a resource (Furubotn and Pejovich 1972).
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SC Johnson's sustainability strategy has led it to a unique partnership in Nairobi with a local community organization and groups of Kenyan youths. Together, they are pioneering a new business model, a product of field testing the Base of the Pyramid protocol, to create mutual value in Kenya's largest slums. The venture's first year produced many surprises, lessons, successes, and disappointments—and reinforced SC Johnson's commitment to drive social change and economic empowerment by partnering with communities at the bottom of the economic pyramid. © 2007 SC Johnson & Son, Inc.
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Although base of the pyramid markets are significant sources of entrepreneurial opportunities, the nature of entrepreneurship in these markets is not well understood. Additionally, these markets remain largely underserved by multinational enterprises (MNEs). Given theoretical and practical gaps associated with these issues, we integrate entrepreneurship, institutional, and network theories to discuss how the entrepreneurship process of MNEs is negatively affected in base of the pyramid markets. We then explain how partnerships with nongovernment organizations (NGOs) can offset such negative effects due to NGOs' high degree of localized knowledge, social embeddedness within multiple informal networks, and ambidexterity in dealing with diverse stakeholder groups. Both economic and social benefits can result from such partnerships.
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Relational exchange arrangements supported by trust are commonly viewed as substitutes for complex contracts in interorganizational exchanges. Many argue that formal contracts actually undermine trust and thereby encourage the opportunistic behavior they are designed to discourage. In this paper, we develop and test an alternative perspective: that formal contracts and relational governance function as complements. Using data from a sample of information service exchanges, we find empirical support for this proposition of complementarity. Managers appear to couple their increasingly customized contracts with high levels of relational governance (and vice versa). Moreover, this interdependence underlies their ability to generate improvements in exchange performance. Our results concerning the determinants of these governance choices show their distinct origins, which further augments their complementarity in practice. Copyright © 2002 John Wiley & Sons, Ltd.
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In contrast to prior studies examining strategic alliances as discrete governance structures (e.g., alliances vs. M&A, equity vs. non-equity agreements), we investigate their particular contractual features. The analysis examines the dimensionality of the contractual complexity construct and investigates the determinants of firms' adoption of various contractual provisions. We find two underlying dimensions of contractual complexity, based upon the enforcement and coordination functions of different contractual provisions. The evidence reveals that firms' usage of particular contractual provisions is a function of asset specificity as well as whether the alliance's duration is pre-specified or open-ended. The findings also speak to the debate surrounding the roles of prior ties and trust for alliance governance. Firms that have collaborated with each other in the past are not less likely to negotiate enforcement provisions; rather, repeat collaborators are less likely to adopt contractual provisions that are informational in nature and are geared to the coordination of the alliance. Copyright © 2007 John Wiley & Sons, Ltd.
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We compare and contrast business networks at the Base of the Pyramid (BOP) and at the Top of the Pyramid (TOP), and analyze their implications for multinational enterprises (MNEs). We first identify the specificities of BOP environments in terms of competitive environment and institutions. Building on this analysis, we develop a series of propositions regarding the impact of these specificities on the structural characteristics of BOP networks, their boundaries, the characteristics of their ties, the diversity of their partners, and their evolution over time, as compared to TOP networks. Our analysis suggests that major differences exist between both types of networks along all dimensions and that these differences have important implications for MNEs active in BOP environments.
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Nongovernmental organizations (NGOs) have emerged as major actors in international business. NGOs have assumed a particularly prominent role in influencing the interaction between business and governments over the terms of international business rules, norms, and practices, especially the conditions applied to international investment projects. In this paper, we argue that the rise of NGOs as important institutional actors requires new perspectives on state–firm interactions in an era of increasing globalization. Host governments and multinational corporations (MNCs) must now critically assess the potential impact of nongovernmental actors on investment plans and projects. Drawing from institutional, agency, and stakeholder theory, we develop a model to help organizations evaluate and assess the relative importance of NGOs to the stability and longevity of international investment projects and the emergent impact of NGOs on investment projects at different stages of the investment cycle. We use the specific circumstance of infrastructure privatization and state-owned enterprise restructuring to demonstrate the potential value of this perspective to MNCs and host governments. We suggest this approach is also useful in evaluating classes of other stakeholders, and in examining other situations in which governments, companies, and NGOs negotiate over the terms of international business exchanges.
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The Village Network is a unique model of poverty alleviation involving the collaboration of a host subsistence market community and a nonprofit organization, typically a university, with a multidisciplinary academic module. All parties in this partnership stand to gain from collaboration. The subsistence market benefits from the skill set and labor provided by the university. The university benefits by placing their students in a position to apply theory guided by the social and economic development experience and insights of the indigenous village leadership. The coordinating organization improves relationships and fosters growth in developing communities. The discussion then focuses on insights about subsistence marketplaces that emerge from this initiative.
Article
Over 4Â billion people live in what is commonly referred to as the "bottom of the pyramid" or as subsistence marketplaces. These individuals and families live in substandard housing, with limited or no access to sanitation, potable water, and health care, have low levels of literacy, and earn very low incomes. Scholars and practitioners alike suggest that the problems existing in subsistence marketplaces demand the attention and involvement of responsible businesses and that doing business with consumers in such marketplaces can be both socially responsible and profitable. This research explores the strategies and tactics currently being used across commercial and social enterprises engaged in subsistence marketplaces. The analysis leads to recommendations about marketing practices currently used by companies and organizations that are successfully operating in subsistence marketplaces.
Article
Microfinance contracts have proven able to secure high rates of loan repayment in the face of limited liability and information asymmetries, but high repayment rates have not translated easily into profits for most microbanks. Profitability, though, is at the heart of the promise that microfinance can deliver poverty reduction while not relying on ongoing subsidy. The authors examine why this promise remains unmet for most institutions. Using a data set with unusually high quality financial information on 124 institutions in 49 countries, they explore the patterns of profitability, loan repayment, and cost reduction. The authors find that institutional design and orientation matter substantially. Lenders that do not use group-based methods to overcome incentive problems experience weaker portfolio quality and lower profit rates when interest rates are raised substantially. For these individual-based lenders, one key to achieving profitability is investing more heavily in staff costs-a finding consistent with the economics of information but contrary to the conventional wisdom that profitability is largely a function of minimizing cost.