In Rwanda, more than 80% of the population lives in homes with a dirt floor. Approximately 64% of Ghana is engaged in agriculture with little or no access to markets. In India, only 25% of the population can afford a refrigerator. Such poverty-stricken countries are not markets for business – or are they?
Efosa Ojomo, a champion of creating economic prosperity through disruptive innovation, urges you to reconsider. Nonconsumption – what he defines as the inability to purchase products or services to fulfill a specific need or “job to be done” – presents extraordinary business and development opportunities.
A research fellow for the new Global Prosperity arm of the Clayton Christensen Institute, Ojomo makes his case in his latest HBR article with Professor Clayton Christensen, “Africa’s New Generation of Innovators.” They acknowledge that “the starting point is to see nonconsumption not as a dead end but as an opportunity to create new markets. In our experience, too many budding entrepreneurs, in Africa and elsewhere, are stuck in the mistaken assumption that they must wait for development agencies and others to make initial investments in infrastructure and education. The recognition that 600 million people in Africa don’t have access to electricity should be a spur to innovation, not a flag of caution.”
Importantly, such initiatives shouldn’t focus on alleviating poverty, clarifies Ojomo; they should center on creating prosperity through enterprise. And only disruptive innovation – innovation whose business model is targeted at the vast nonconsumption that exists – can make such a mission possible.
Enterprises such as Kenya’s M-KOPA (pay-as-you-go solar energy) and India’s chotuKool (low-cost refrigerators run on rechargeable batteries) are leading the way, creating new markets and paving a path toward prosperity – for their businesses and their consumers. “Because nonconsumption is characterized by struggle, they are guaranteed customers if they are able to help their nonconsumers make progress,” says Ojomo.
Contact us to hear how Ojomo can help your organization do the same.