Thursday, September 22, 2011

Business Model not only a matter of sustainability but also a matter of humanity(for fourth class meeting)


We are keeping talking about the importance for the end-users to pay for the product they get by themselves regardless of the amount of money they pay.  It seems to be a widely accepted consensus that the sustainability of an innovation heavily depends on its price when it’s marketed to the consumers. Or at least there is the accessibility for consumers to be able to pay the not ultra-low price. I believe this is the main reason why when the Four A’s is mentioned, affordability also comes the first.
On the other hand, we often find business in private sectors proliferate quickly than we can possibly imagine. They seems to have magic power to reach the remotest consumers, nurture the best distribution channel, locate the most profitable niche markets, create the most efficient and effective mechanism to fulfill the business mission.  Even though they don’t think themselves as NGOs, NPOs, or social enterprises, they surprisingly have brought many good things to this world, especially to those most needy domains. And unanimously every private sector spares no efforts to make the price as low as possible so that a large population can be reached. P&G created cold-water detergent for people to do lundrary with cold water, which save electricity power originally used to heat water; FedEx combines copy service with documents delivery service, which not only improves efficiency and saved company operational cost but also saves oil or gas consumption broadly speaking; Waste Management company in order to improve business profits and make full use of those garbage they transport, they increase the usage of renewable materials; Danone sells yogurts in small packages to decrease the price and increase the market acceptability both for retailers and end-users, through which the company profits soars and at the same time people live in rural area can either make money out of it or improve healthy condition with using it……
If the current NPOs can be more financially independent, find a way to be self-sustain, and build up a connection directly between end-users and product or service suppliers, they can go further on the journey to do good deeds for community, especially those extreme have nots. It’s more effective to solve problems using business model.  
This is true not only from economy stance but also more importantly from a basic sense of respect of humanity. If the poor keep getting things distributed to them for free on behalf of saving them or helping them, we may at the same time disrespect them as capable human being who can solve basic survival needs through hardworking. Also donating and taking, or giving and taking are dominantly controlled by haves under current situation. It might also be a good thing for have nots to pay the things they get so that they can gain a sense of being capable of doing something, which will largely motivate potentials deep inside of them. When we know that market buying power collectively in poor world actually take up a very influential part of lots of profitable companies’ overall profits, we can’t overlook the power behind individuals.  

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