From Gurgaon to har-gaon
Offshoring large data projects to rural areas can work wonders for the inclusive growth agenda
Jyoti Pande Lavakare / February 26, 2011, 0:43 IST
If you attended all three days of the TiE Entrepreneurship Summit in New Delhi recently, you’d be forgiven for thinking that there was a compelling subtext of social activism inbuilt into the entrepreneurial ecosystem. Almost every session touched upon inclusive growth and wealth sharing — and doing well by doing good seems to be be the new start-up mantra.
More generally, I find that more and more entrepreneurs are building a social objective into their start-ups — “conscious capitalism,” and now suddenly the term “triple bottomline” (TBL) is the new cool. (TBL, for you un-cool folks out there is one which integrates social, ecological and financial objectives – people, planet, profits – when evaluating a company’s bottomline.)
This is all great news for a developing country like India, especially since the the intangible benefits of social transformation spread much beyond the corporate entity. And although social benefits can never be quantified, they are highly valued. Which is probably why although business entrepreneurs like Steve Jobs are as admirable as social entrepreneurs like Muhammad Yunus, it is the latter who gets the Nobel Prize.
But let me not lump all socially valuable activity under one noble umbrella — and label it all social entrepreneurship. I’ll simply accept the division of all social engagement into social service, social activism and social entrepreneurship as defined in the Stanford Social Innovation Review (http://www.ssireview.org/), and then focus on one particular hybrid strand that can be especially valuable for India. It has been around for many years — call it rural off-shoring, remote-sourcing, whatever. But the concept essentially is the outsourcing of outsourced projects from urban hubs to semi-urban and rural centres.
It is what this earnest-looking gent sitting next to me at the entrepreneurship summit explained his business-to-rural start-up, B2R Technologies, does. “We let social objectives feed into business objectives.” Their motto? Rural ethos, business ethic, says Dhiraj Dolwani who co-founded B2R with another ex-NIIT entrepreneur and has three centres in Uttarakhand. “We compete with and work for BPOs,” says Dolwani.
He is not the only, nor even the first, to set up such a venture. In south India, four ex-Wipro entrepreneurs have started NextWealth Entrepreneurs Pvt Ltd whose tag line is more direct: “Social Uplift through Entrepreneurship.” NextWealth, according to its co-founder and CEO Mythily Ramesh, functions more like a non-profit — where business objectives feed social objectives. So it falls somewhere between a traditional profit-making and a not-for-profit firm (like the US-based non-profit Samasource which gives “dignified, digital work to marginalised people across the world”).
Both provide training, sales and marketing support — Samasource to socially responsible BPOs in emerging markets from its central office in San Francisco, NextWealth to local entrepreneurs in rural areas. But Samasource’s model has a greater element of social activism than the entrepreneurship model that B2R and NextWealth follow. Its US-based teams work with clients, break up large data projects into smaller packets and farm them out to chosen participants.
Actually, the real power of the whole rural offshoring idea lies in its simplicity. It merely replicates the same outsourcing model that has created BPOs in Gurgaon and Bangalore, serving the West by leveraging educated, skilled and semi-skilled workers in India. Except that, rural offshoring creates mini-Gurgaons in the real gaons in rural India, as work gets further outsourced to business units across smaller towns and villages, by leveraging local engineering and other graduates — the rural educated, unemployed.
As a business model, it is unexceptional. However, its social returns are overwhelming — because it is educated youth who are far more likely to be aware of their relative poverty and turn to violence. Bringing jobs to the doorsteps of the unemployed instead of bringing people to the jobs can arrest, perhaps even reverse migration. But more importantly, creating jobs in rural areas without causing displacement can help prevent social unrest — like the current Maoist insurgency. It is hard to imagine that anyone who has the option to stroll through paddy fields to a productive, paying job and take bidi-breaks between gently swaying banana fronds is likely to feel a strong urge to kill and kidnap!
Wealth created and distributed within the local community is more equitable and gives geographically disadvantaged Indians a chance to participate in their country’s remarkable growth story. According to Dolwani, a 50-person centre becomes profitable within six months — plus they serve as vehicles to bring infrastructure to remote villages. Imagine the triple bottomlines here! And imagine the macro-level impact, given that two-thirds of India’s population resides in rural areas.
Samasource (and I) believe that “the lack of economic opportunity is the root cause of crime, gender-based violence and other social ills,” which is why it prefers to give work to marginalised, women, youth and refugees across the world. In India, its partner DesiCrew Solutions Pvt Ltd, has six micro-centres in Tamil Nadu, and gives two-thirds of its jobs to women. Meanwhile, RuralShores – the most region-agnostic company with seven existing centres – says on its website that its objective is “to assimilate rural India into the knowledge economy”.
The fact that a dozen such ventures have been around for a while (eGramIT, Source Pilani, Harva, Source for Change) proves that the model is viable and sustainable. It just needs faster replication to make the overall benefit significant.
By working in non-metro areas, these BPOs have lower overheads and attrition, and pass these benefits on to big-city and overseas client in the form of lower costs — almost 45 per cent lower. Their ability to work in multiple Indian languages, innovate and remotely manage local entrepreneurs while ensuring quality and delivery makes them sustainable. Amazingly, everyone wins.
Digital technology and the spread of low-cost internet access in developing countries have dissolved distances, creating unprecedented opportunities for remote work. “Today’s digital assembly lines allow people with basic training to plug their skills into much larger work streams,” says the Samasource website. Market-based solutions can address poverty only if entrepreneurs have real intent to help the poor. If Indian social entrepreneurs grasp this opportunity and the government helps with infrastructure, large swathes of its population can get extraordinary gains. From being a burden on the country’s economic growth, rural youth can contribute to growth and partake of its rewards. While living at home and walking to work through palm groves.