digitally-enabled development enterprise case studies nevin cohen october 2001
TRANSCRIPT
Digitally-enabled Development
Enterprise Case Studies
Nevin Cohen
October 2001
Global Context
Developed Countries represent 86% of private consumption expenditures
OECD countries captured 67% of global trade in 2000
Wealth of top 200 billionaires = $1.14 trillion
47% of world’s people live on less than $2/day
1 in 3 lack safe drinking water, 1 in 4 are illiterate, 1/5 lack health svcs.
50 poorest countries’ share of world trade declined from 4% in 1990 to 2% in 2000
Source: Gilhooly, 2001 UNDP
Working Hypotheses
1.Digital technologies (ICTs) contribute to economic and social development
-4-3
-2-1
01
23
45
5 6 7 8 9 10 11
GDP/Capita, natural log
Tel
eph
on
es/1
00,
nat
ura
l lo
g
GDP per Capita vs. Telephones per Capita (1997, log scales)
Source: World Bank, 2000
Working Hypotheses
2.ICT-based development can break the link between economic growth and resource consumption
“Structural changes in the economy, facilitated by the Internet, are reducing overall energy use."
Chris LotspeichRocky Mountain Institute, 2000
U.S. Energy Intensity, 1998 to 2020 (in thousand Btu per 1996 dollar of GDP)
10.849.77
9.028.25
7.7
11.14
0
2
4
6
8
10
12
1998 1999 2005 2010 2015 2020
source: DOE, Annual Energy Outlook 2001
Working Hypotheses
3.ICT can improve health and environmental conditions through improved communication, education, transparency
Working Hypotheses
4.To achieve sufficient scale and reach, private sector investments are crucial
Case study research
on-site assessments of prototype ventures and novel business approaches in developing countries document the business model evaluate its successes, challenges, barriers,
and potential for replication document the social and environmental
impacts
Benefits Measured Economic benefits
creating value for the enterprise new or enhanced sources of income and jobs increased productivity / reduced transaction
costs Social benefits
increased human welfare and quality of life increased transparency and participation improved infrastructure Health and safety assistance
Specific Environmental Benefits
activities that help to generate income without intensive natural resource use.
potential for improved citizen participation in environmental governance
Case Selection Criteria
Digital or digitally-enabled
Self-generating, scaleable, and replicable
Potential sustainability benefits
Varied geographically and by business model
Case Studies
Grameen Telecom - Rural Connectivity Infocentros - Community-based Internet Cabinas PRIDE Africa - Microloan and micro-enterprise
efficiency Educ.ar - National Student Portal Sebrae - Small Business Services Portal TaraHaat - Rural Internet Portal Midas/n-Logue Communications - Rural
connectivity
Caveats
Case study data not easily generalized
Hypothesis-refining, not hypothesis testing
Firm level, not national or global analysis
Enterprises are fairly young
Products
Digital Opportunity Initiative
Executive Briefing Paper
Project Clearinghouse
Rural Connectivity:
Grameen Telecom’s Village Phones
“Connectivity is productivity.” Iqbal QuadirGrameen Telecom
State of Telephony in Bangladesh
97% of homes lack a telephone
4 year waiting list Rural-urban
disparity 80% of population
is rural 80% of phones are
in 4 cities
Findings
Income generation for VP operators Value for phone users of ~ 3% to 10%
of their income Improved tracking of remittances Higher income to farmers and small
business people Access to medical, police, govt. svcs. Improved status for women villagers
Foreign Worker Remittances, 1998
Worker remittances (millions US$)
Remittances as % of exports of goods & svcs.
Jordan $ 1,543 43%
Bangladesh $ 1,600 27%
Egypt $ 3,370 27%
Nicaragua $ 200 26%
India $ 9,453 21%
Source: IMF, 1999
Obstacles remain: Significant
infrastructure constraints created by incumbent telecom
Mobile GSM technology is expensive
Scaling Up Micro-finance:
PRIDE Africa’s IT Strategy
Business Model
proprietary software systems loan tracking, financial projections, and
branch office management information
financial intermediary aggregating loans and savings, and
providing consolidated loan tracking, accounting, credit referencing, and credit/debit card processing
Planned “Drumnet”
Information exchange and internal market
Helps clients share experience, pool buying power, eliminate middlemen in business transactions
Findings
Client base of 100,000 Average loan size of $125 reaches East
Africa’s poorest loans finance wide-ranging small
businesses trading operations production of foodstuffs clothing manufacturing
potential to become “poor man’s Visa
Community-Based Content:
The Infocentros Telecenter Model
Business Model
Franchise 100 internet centers by 2002 retaining 10 as regional “mother” centers
Provide or partner to create content: courseware for cyberschools finance apps for small businesses training material for hospitals b2b e-commerce portal
Findings
Meeting or exceeding targets
Findings
Serving educational needs and providing cost-effective, efficient access to information
Helping small businesses to increase efficiency and profitability
Improving communication Functioning as community hubs
Serving WRI’s Mission
Finding ways to transition to a less resource-intensive economy through efficiency by shifting to knowledge-based
enterprises
Improving public access to environmental information