A Tailored Approach to BoP Business Training Programs (25 pg)
Introduction
With over a billion low-income entrepreneurs across the globe running small-scale enterprises, Nobel Peace Prize winner and Grameen Bank founder Muhammad Yunus champions people living in poverty as natural entrepreneurs and business creation as a viable pathway out of poverty. In the last twenty years, this sentiment has sparked a lively movement to support the launch and development of enterprises run by people living in poverty. To fortify the development of these business ventures, a proliferation of organizations have developed training programs that teach business skills to support populations living at the bottom of the economic pyramid (BoP) in their efforts to build enterprises that provide livelihood income.
In January 2017, MIT D-Lab’s Practical Impact Alliance (PIA) launched a working group convening 12 nongovernmental organizations and multinational organizations to analyze instructional approaches and skill sets in a way that would answer the question, “What are the most effective business training approaches for a BoP population?” The working group, which gathered monthly to share ten case studies of business training programs used to help people living in poverty reach their full potential as entrepreneurs, was co-led by MIT D-Lab and Pact World. Four of the case studies presented over the course of the PIA working group sessions were provided by member organizations and six were presented by guest speakers selected for their unique approach to teaching business skills to a BoP population. As many of the organizations in the working group offer business training to low-literacy beneficiaries, the group focused on instructional tools specifically designed for people who have not had the opportunity to gain literacy skills, including simple rule of thumb and technology-enabled approaches.
The case studies showed that training programs vary greatly based on population served and desired outcomes. Although young people ages 15 to 35 currently only make up 17% of the world’s total population, they comprise 40% of the unemployed, and in Africa, they make up 80% of people without jobs. Therefore, many organizations focus on this population and Dare to Innovate, Phosboucraa Foundation, International Labor Organization (ILO), and MOVE all presented entrepreneurship training cases specifically designed for young people. Ultimately, businesses are launched by this age group to provide employment when other, more conventional job opportunities are unavailable.
Case studies presented by BRAC’s Graduation Program and World Vision targeted smallholder farmers, who make up 80% of the more than one billion people living on less than $1.00 a day. These programs use marketing and financial planning as a means to inspire better business practices and instill confidence in these entrepreneurs. Danone, Global Alliance for Clean Cookstoves (GACC), and Pact World all used agency enhancement to develop business-training programs that target low-income women. The final case study, presented by Luephana Universität Lüneburg, offered a closer look at curriculum used for personal initiative training, which can be effectively applied when targeting low-income entrepreneurs in general.
Over the months, as case studies were discussed, a framework for building BoP business training programs began to emerge. It starts with clearly identifying the target beneficiaries and desired outcomes and then connecting these variables by pairing instructional approaches with specific skill sets. What follows is a guide that details this proposed framework.
The practitioner’s guide is broken into two distinct sections. The first section outlines 5 instructional approaches for teaching business to a targeted BoP population, and the second presents 4 skill sets that are associated with particular outcomes. By pairing instructional approaches with appropriate skills, practitioners can optimize their curriculum design to create training programs that support people living in poverty as they launch and grow thriving businesses.
The three in-depth case studies featured in section two of this guide —GACC, Dare to Innovate, and the ILO — illustrate how practitioners have successfully implemented components of this framework to create livelihood opportunities for people living in poverty through business creation.
It is our hope that this guide will inspire and inform practitioners as they engage in the creation and dissemination of business training programs for a BoP population, while simultaneously addressing social and environmental ills in low-income regions across the globe.
Libby McDonald
MIT D-Lab
April 2018