revolutionary empowerment monash university presentation
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Development of entrepreneurship in third world communitiesTRANSCRIPT
SME – Entrepreneurship Global Conference, Melbourne 3-4th July, 2008
Revolutionary Empowerment: A Re-look at Spirituality, Cultural Integrity
and Development
Murray HunterSME Unit
University Malaysia Perlis (UniMAP)
Some Wisdom from similar situations
The Concepts
To equalize rural-urban affluence requires a great effort of imagination; …. Systems of ideas and values that suit relatively affluent and educated city people are unlikely to suit poor, semi-illiterate people. Poor people cannot simply acquire an outlook and habits of sophisticated city people. If the poor cannot adapt to the methods, then the methods must be adapted to the people.
E. F. Schumacher
Competitive advantage grows fundamentally out of value a firm is able to create for its buyers that exceeds the firm’s costs of creating it. Value is what buyers are willing to pay, and superior value stems from… providing unique benefits that more than offset a higher price.
Michael E. Porter
God does not change the conditions of a people until they change their inner shelves
Qur’an 13:11
Opportunities are a product of our mind and these visions can become the design of our future with skilful and creative utilisation of scattered existing and forgotten resources to create great unimagined synergies. This is the true power of creativity that God has given humankind.
True Empowerment only comes from economic development rather than
political meansThe Kadazan/Dusun People in Sabah, Borneo
“I fought the law and the law won”
Sunny Curtis and The Crickets 1959
Background
• 2-3 million population with different ethno-cultural background
Background
• Predominantly rural population
• Lagging along in national development
Background
• Lower education disposition
Background
Background
• Currently unable to benefit from growing
tourism industry
Background
• Ageing farmer population
Background
• Limited knowledge of potential
opportunities and matching skills
The Major Blocks to Development
• The current “psych” of farmers
• Growing rural unemployment
• Unbalanced affluence (town-rural)
The Probable Causes
Lack of Ideas
Lack of education and skills
Narrow mindset
Feeling of powerlessness – lack of access to markets
Lack of resources
Lack of will
Existing Approaches
Not necessarily market orientated
Dependent on local ‘champions’ to convince others to follow
Work on a model that may not necessarily suit Pattani, i.e., farmers in Satun younger than
Pattani.
• Other Agency Programs
Existing Approaches• OTOP
Successful where participants are entrepreneurial.
The channel has become too crowded to provide special attention to new communities
May not be an effective medium to provide sufficient incomes to ‘novice communities’
What Can be Done?
Ideas Opportunities Solutions Realisation Performance
Spots Evaluates Selects Targets
Creativity Innovation Strategic Thinking
Management Capability
Capabilities Governing Competitive Scope
Competitive Advantage
Costs: to customers Knowledge: Industry/market/technical/p rocess Relationships: Customers/suppliers/distri butors/relative power Structure: Ability
Differentiation
Competencies Entrepreneurial, Opportunity
Identification, Network, Conceptual, Organisational, Strategic, Commitment,
Resources
Culture
Values
Beliefs
Assumptions
Leadership
Theories in action verses Espoused
Norms and group behaviour Organisational
learning (single or double looped
Productivity & effectiveness
Stories, myths, heroes, artifacts, informal behaviours
Negative Attributes
Positive Attributes
Destruction
Growth
The Cultural Dialectic
Innovate --------------------------Avoid mistakesThink long term--------------------Live for todaySave money----------------Spend for the futureWork by oneself---------------Work as a groupBe flexible------------- Follow rules and normsCollaborate-------------------------------Compete
Make your own decisions---Make joint decisions
Opportunity is a Construct
Ability to make linkagesAnchoring a source
of innovation
Having the right Skills
Networks
Resources
Product/MarketStrategy
VisionPlatform
Dream, ego, aspiration, greed, survival, education
ExperienceReference & Benchmark
Cognitive, hemispherial & field Perception
Source Explanation Examples
The unexpected success, failure or
external occurrence
Success of a revolutionary product or the application of technology from one industry to another, sudden or unnoticed demographic changes caused by wars, insurgencies, migration, etc.
Apple computerRapid decline of Proton’s market share
An incongruity between reality as it actually is and
what it ought to be
A change that is already occurring or can be made to occur within an industry. It may be visible to those inside the industry, often overlooked or taken for granted.
Sugar free products and sugar replacements due to concern for healthIncreasing demand for travel and holidays due to increasing incomes and leisure time
Inadequacy of an existing
technology or business process
An improvement in process that makes consumers more satisfied based on an improvement or change in technology.
Caffeine free productsMicrowave ovensMobile phones
Changes in industry or market
structure
New ways and means of undertaking business based on identified opportunities or gradual shifting of the nature of the industry.
Health care industryEducation industry – private education
Perceptual changes
Changes in peoples awareness founded on new knowledge and/or values or growing affluence leading to new fashions and tastes
Leisure and exercise industry aerobics & gyms
Demographic changes
Gradual shift of demographics in population by age, income groups or ethnic groups, etc
Establishment of more retirement homes
New knowledge New knowledge or application of existing theoretical knowledge into an existing industry that can create new products not previously in existence
Video and VCD industryRoboticsBiotechnology
Cultural Paradigm
Pee
r g
rou
ps m
en
tors
, s
oc
iety
Chance & Fate
Paradigm Personality Paradigm
Strategic Paradigm
Creativity Paradigm
Action Paradigm
Interpersonal Paradigm
Skills Paradigm
Infl
ue
nce o
n o
the
r p
ara
dig
ms
Co
mm
itm
en
t a
nd
eth
ics
So
cia
l &
Ed
uca
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Bac
kg
rou
nd
Ide
nti
fy a
nd
ex
plo
it
op
po
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ies
Res
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rce
gath
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ng
Cu
sto
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rien
tate
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Sen
se o
f ac
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men
t
Mo
tiv
ati
on
&
dete
rmin
ati
on
Ad
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isk t
akin
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See
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id
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tify
o
pp
ort
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s
Inn
ov
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ve
In c
on
tro
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f th
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sin
es
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Ab
le t
o in
sp
ire
peo
ple
Ab
ilit
y t
o w
ork
w
ith
pe
op
le
Netw
ork
ing
Exp
eri
en
ce
Tec
hn
ica
l s
kil
ls
So
ft s
kil
ls
Tale
nts
& a
bil
itie
s
He
alt
h,
pe
rso
nal e
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fo
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tim
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, in
sp
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&
se
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ink
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, te
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ills
, id
ea
s,
op
po
rtu
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ies
, so
luti
on
fi
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En
vir
on
men
t, p
eers
, fa
mil
y,
cu
ltu
re, re
ali
ties, m
oti
vati
on
, d
ed
icati
on
, self
assu
ran
ce,
self
perc
ep
tio
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ora
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, re
sp
on
sib
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acco
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bilit
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akin
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nd
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Sele
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/in
div
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netw
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terp
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, d
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ub
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Up
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on
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So
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&
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Po
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eg
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, e
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, ta
len
ts
an
d a
bilit
ies
Attributes of the Entrepreneur
The elements of innovation
Culture Ego
Strategic Thinking
Innovation
FocusCreativity
InterpersonalInteractions
Hunter, Baharuddin (OUM) & Rozhan (UIA): Alpha Model of Innovation
Tempera -ment
Ability
Skills
Learning
Creativity
Solutions Opportunities
Ideas
Creativity
Lateral thinking
Serial Thinking
GroupEducation
Culture
Strategic Thinking
Personality
Hunter, Baharuddin (OUM) & Rozhan (UIA): Alpha Model of Innovation
A
B
C
D
Visual Holistic Intuitive Innovative Conceptual Imaginative
Conservative Structured Sequential Organised Detailed Planned
Interpersonal Kinesthetic Emotional Spiritual Sensory Feeling
Logical Factual Critical Technical Analytical Quantitative
Number Crunchers Human Machines Achievement Orientated Performance-Driven
Administrators Bureaucrats Production-Orientated Task-Driven
Teachers Social Workers Feeling-Orientated Value-Driven
Entrepreneurs Explorers Future-Orientated Risk-Driven
Attribute Small Business Entrepreneurial Business
Risk Risk is to be avoided by undertaking a business activity that is already proven to be successful. Therefore business models will not be novel.
Ideas and opportunities are always risks. Every village and every person is unique and will have different ideas that suit them.
Need to Achieve A small business is totally orientated towards a financial return.
Financial return may not be the prime motivator. Individuals and groups may want to produce something they like and have pride in.
Creativity An enterprise will fit into a proven model so not much creativity is needed.
The enterprise from the first idea may be driven by many types of creativity, and creativity itself may be a source of satisfaction.
Flexibility A small business is a business operated through a disciplined routine in most cases.
Individuals and groups may be looking for maximum flexibility in an enterprise, so it can fit in with their life, rather than they have to fit in with the small business.
Change Small businesses rely on little environmental change for success.
Change in the environment may suit individuals and groups as they don’t want to get locked into routine, and change prototes their creativity.
Independence Financial independence is the objective. We are already independent and don’t want a business to lock us into a strict routine.
Foresight A daily, weekly, monthly or seasonal cycle that is predictable.
We may have to keep coming up with new things to keep the enterprise going.
Initiative There are very tight resources to have much initiative.
We rely on initiative to keep going, and all initiatives are considered.
Control of destiny The future is controlled by sales in the marketplace.
The future is in our hands of what we want to be.
Commitment Total commitment. I want to be committed on my terms.
Leadership I am the leader and do all tasks. Leadership is defined by tasks.
Chemical Raw Materials Packaging
Style
Branding
Promotion
Finance
Logistics
Company Fit Manufacturing Processes
Competencies
Competitors
Material Availability
Sourcing
Trends
Tastes
Technology
International Markets
Domestic Market
Relative Competitive Advantage
Channels
Regulation
Feedback
Feed forward
Pioneers Early followers
Early
Majority
Late
Majority
Late
Followers
Product LifecyclePotential Profitability
Time
Concept
Risk Taking
Competitive
Risk Taking
IP Value &
NoveltyIP Value
Prof
it
Tissue Culture
Actualisation
(The Artist) Self-fulfillment
Rice
Soap Fresh
Vegetables
Most Household Cleaning Products
Water Purifiers
Fashion Clothes (e.g. Jeans)
Chewing Gum
Car Air Fresheners
Travel & Vacations Fine Fragrances
Aromatherapy products Luxury cars
Nutraceuticals & herbs
Books Fine Dining & Processed Foods
Study after retirement Fresh vegetables (Organic)
Esteem (The Executive)
Achievement, prestige,fulfillment
Social (Worker) Family, relationships,
workgroups
Safety (The Farmer) Home, Security and stability
Physiological (The Hunter) Basic Biological Needs – Food, water, air
Staples: based on survival (fear)
Necessities: based on what is good (existence)
Community: (acceptance)
Responsibility: (hope)
Fulfillment: (dreams)
Figure 1.x: An Islamic Business Framework
Ad-Din
Al-Ilm
Al-Iman
Al-Amal
Syar’iah
Fard’ain
Fard Kifayah
Halal Toyyibat
Tahwid
Ibadah
Amanah Al-Falah Ummah
Musharakah Al-Ta’awin
Al-Fasad
Shu’ra
Overseas Halal Food Product
Organic Farming Concept
From the soil to market
Look for novel strategies
Farm
What to grow?
How to grow?
When to grow?
How much to grow?
Basic agriculture
Basic farm management
Group management
Cash Management
Logistics
Timing & storage
management
Fresh Retail
Retail Management
General ManagementCustomer service
SalesProduce selection
BrandingVertical supply chain
The Business Model
Value added productsFertilizers & cosmetics
New Product Development
MarketingSales
The Village “MBA”“Moving by Action”
Aveda The Body Shop Thursday Plantation
Sureco Hain CelestialGroup
Est. Sales USD120million (1996)[i] USD619mil
(2006)
USD1.5Billion (2006)[ii]
USD85Million (2006)[iii]
USD40Mil[iv] USD738Mil[v] (2006)
Location USA UK Australia Malaysia USA
Established 1978 1976 1976 1999 1926
Products Personal Care Personal Care Personal Care Herbs Organic food and cosmetics
Basic Philosophy To sustain the environment and
give back to communities
Social humanitarianism activism on many
issues
Natural tea tree
products/natural medicines
Halal & Toyyibaan
Free of artificial ingredients,
Kosher foods
Ethics Yes
Green Yes Yes Yes
Natural Yes Yes Yes Yes
Organic Yes Yes Yes
Community Yes Yes Yes
Cultural
Religious/Spiritual Yes Yes
Mode of Distribution Direct Marketing/Salon
Retail and e-Commerce
Direct and through
distributors
Direct Marketing
General distribution
Owner Estée Lauder Companies Inc.
Loreal Chris Dean & Family
Private Ownership
Listed company
C.K. Tang, Bukit Bintang
Cosway
Specialty shops in KL
Kuah, Langkawi
OTOP (Under IMT-GT) Working on MOA with them now
Taman Warisan, Putra Jaya
Internet
Eventual Export
Ava
ilab
ility
Incr
ease
s
Usefulness Increases
Media Reports
Ideas
Data
Information
Knowledge
Wisdom
The Continuum from media reports to wisdom in relation to availability and usefulness
Issue Comments
Focus Paradigm Requires focus on concept of food where present focus is on cultivationThis requires researchThis requires entrepreneurship approachConcepts not understood by farmers
Basic Research Needs access to worldwide dataRequires availability of suitable germ-plasmasRequires basic R&D to determine whether crop technically suitableRequires basic R&D to determine if potential crop is economically feasible
Crop Management & Processing
Propagation technologiesHow to plant, cultivate & manage to cropHow to harvest, extract, store and handleHow to processHow to packageTransportation and storage
Marketing Infrastructure Require coordination of production with demandRequire correct channels of distributionRequires a marketing strategy
Economies and Logistics Requires enough volume to economically transport and distributeRequires solution to inconsistencies of quality and production
Organisation Need committed people with strong leadership and trust
Government Need to translate support into actionNeed funding allocations
Finance Very difficult to obtain funding for these projects
Consumers Need efforts for education & promotion
Umbrella Brand (Marketing Company)
Network
R&D Support Cluster
Entrepreneurship
Ideas Opportunity Identification How to make
skills Market Skills
Foods
Herbs &
Cosmetics
Other
Traditional Products
Funding through
“prospectus”, Unit Trust,
Zakat, Closed Markets
Direct Marketing
Internet
Collaboration with larger companies
(MNCs)
Selected Markets
Potential Micro Finance to Producers
Organic Farming, Fairtrade, Halal, etc
Business CarbonFootprint
1. Recognition 2. Desirability
Selected branding paradigm to highlight the project’s offering and values the group stand
for in the international marketplace. (see figure branding typologies). This branding
should show natural (fully natural products)Organic, Sustainable production,
Community involvement, cultural and religious identity, and within an ethical
business framework.Trademarks and certain Copyright
Information
The product technology, i.e., natural, organic, cultural and spiritual aspects should
be reflected incorporated into the product. Thus the products require specific new
knowledge, process and protocols to achieve these ambitions.
Patents, Registered Designs, Proprietary Knowledge and branding
3. Form 4. Emotional Connection
Product manifestations must reflect where and why the products exist through copy,
materials and form.Copyrights and Trademarks
The products should reflect the consumer ambitions for natural and organic products
with a cultural and spiritual base and understand their direct contribution to the
community.Brands and Trademarks
The company would act according to the following principals;1. Commitment to Social Justice in Organic Agriculture 2. Transparency and Accountability 3. Direct and long-term trade relationships built on trust and mutual respect. 4. Equitable distribution of returns to stakeholders5. Communication and information flow 6. Skills development and capacity building 7. Internal ethics, and8. Professionals manning the PC, support the local community[i].
[i] Principals set out for peoples companies by Dr. Subash Mentha, Bangalore, India, as communicated to the author.
Technology
Scientific knowledge used in practical ways in industry
Oxford Dictionary Definition
Scientific
A way of doing something or thinking: Careful and logical
(Adj.) Oxford Dictionary
Innovation
The introduction of new things, ideas or ways of
doing things Oxford Dictionary
Invention
The Ability to have a new or novel idea
Novelty
the quality of being new
that there “is also the tendency for Asian countries, including Malaysia, to deal with the issue of values in development by Importing many technologies and systems wholesale from
abroad without going through the process of mental transformation necessary to master them fully. Although
Malaysia is going through rapid transformation, our growth is one without development in the context of knowledge
contribution to science, engineering and technology. As long as we are consumers and operators of
sophisticated techniques, plants and technologies imported wholesale from abroad, we are to a certain
extent undergoing a technology-less form of industrialization. This transformation of values and attitudes is a key issue
in the nation’s development agenda”[i] .
[i] Asma, A., Going Glocal: Cultural Dimensions in Malaysian Management, Kuala Lumpur, Malaysian Institute of Management, 1995, P. 179.
• Minimise Production scale to account for initial low sales/production quantities and lower capital
investment
• Mobile GMP Facility
• Simplified Technology
Resources & Finance
Resources (Infrastructure)
Zakat
• One of the 5 pillars• Distributive justice (juristic & mandatory)• “zakat revenue can be spent under tamlik
mechanism for providing an opportunity or raising productivity of the poor. Viewed from the long term perspective the poor would become in time self-reliant, hense reducing the national burden of spending money on social security schemes.”
Khaliq Ahmad 2002 Intellectual Discourse Vol. 8, no. 2 (IIUM)
Element Existence
Values Most spiritual doctrines and religions have very positive values towards enterprise, independence and empowerment. These have to be brought to the surface of some cultures or sub-cultures, i.e., refocusing on the functional rather than the dysfunctional aspects.
Confidence Confidence is a group phenomena and can be improved through engagement of group processes to achieve new ways of seeing.
Ideas The skills of ideation can be developed through access to communications technology and developing both partial and whole brain thinking.
Potential Opportunities By linking ideas to markets, modes of entry, resources and skill needs, potential opportunities can be constructed.
Product Focus on themes rather than marketing mixes, look for ways to incorporate consumer fears, existence, acceptance, hopes and dreams in the product (spiritual materialism)
Markets Markets exist in various forms and segmentations with much more fragmentation, coupled with the ability to communicate are potentially accessible to village communities. Identify aspirations of consumers, connect products and channels to these aspirations.
Technology Technology is a way of how to make and do things. Product manufacture can be undertaken in scaled down models to suit decentralization, small unit output and flexibility. The focus is on how to do things in more cost effective ways, within the existing cultural socio-organisational setting.
Competitive Advantage In many FMCG markets competitive advantage has more to do with theme, schema and branding, through selected channels of distribution, than economies of scale. The product is a fulfiller of dreams.
Skills Not all the skills taught at formal educational institutions are needed to start an enterprise. In this regard its only necessary to provide people with what they need from the point of view of business, product development and production. There is a need for the “village university” to focus on showing people how to see, learn how to do and connect to consumers.
Agency/Networks Through modern communications technology (internet & travel) it is now possible to contact and interact with very wide groups of people, including agencies of interest, customers, grant agencies and sourcing know-how.
Logistics Logistics have advanced in recent years and can be coupled together such as the internet and EMS to create direct logistic systems between producers and consumers.
Resources We have to learn to use what we have and utilize these limited resources innovatively. There are many methods of alternative funding that can be explored and set up, i.e., Zakat, unit trusts, closed equity markets, etc.
Organisation New forms need to be generated from often discarded forms such as cooperatives. Cooperatives can exist at both production and market levels. People can form their own companies under umbrellas, organizations should be focused on linking the young with their older generation. Coalitions can be sort with larger organizations in developed countries for branding and market purposes. Organisations have to fit with existing social schema and develop from there, as people are ready.
The Challenge
OTOP Thailand
Farming in Fiji
Farming is primarily subsistence agriculture
Taro Yam Cassava Ginger
Chillis
Sunday
Monday Morning
Monday Afternoon at the Melbourne Wholesale Market