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What are the solutions that can help companies scale up inclusive business ventures? In this issue brief, the World Business Council for Sustainable Development (WBCSD) zooms in on the internal organizational barriers large companies face when trying to scale up inclusive business. However, the WBCSD did not limit itself to highlighting problems, but also identified solutions that have been put in place by WBCSD members to overcome those barriers. The issue brief features insights from CEMEX, Grundfos, ITC, Lafarge, Masisa, Nestlé, Novartis, Novozymes, SABMiller, Schneider Electric, and The Coca-Cola Company, and Vodafone. The brief organizes the range of possible internal organizational barriers to scale up inclusive business into three main categories: opportunity cost of investment; strategic and operational misalignment; capability gaps. For each of these three categories of barriers, the brief describes a range of solutions (a dozen in total) illustrated by company examples – from obtaining the support of senior leadership and establishing centers of excellence, to bringing core capabilities in-house, adjusting performance targets and quantifying the total value created by inclusive business ventures. This piece is a contribution to Action2020, the WBCSD platform for business to contribute solutions to environmental and social challenges.
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Scaling up inclusive businessSolutions to overcome internal barriers
November 2013
2
Why this brief?
• Companies of all sizes, including many WBCSD members, are actively testing and rolling out inclusive business models…
• …but scale has so far proven elusive…even for multinational corporations
• Inclusive business models will not scale without a solid understanding of what works and what doesn’t
3
Why this brief?
So far: lots of focus on external market barriers
• Informality• Insufficient market information• Inadequate infrastructure• Ineffective regulation• Uneven cash flows• Limited skills• Etc.
4
Why this brief?
But what about internal organizational barriers? • Much less commonly acknowledged or
discussed• Solutions lie within direct control of
companies themselves
How to analyze the key barriers and showcase WBCSD member
solutions to overcome them?
5
Process
Builds on hands-on experience of a dozen WBCSD members • CEMEX, Grundfos, ITC, Lafarge, Masisa, Nestlé,
Novartis, Novozymes, SABMiller, Schneider Electric, The Coca-Cola Company, Vodafone
Expert insights• Erik Simanis (Cornell University), Ezequiel Reficco
(Universidad de los Andes), Mike Kubzansky (Omidyar Network)
WBCSD Regional Network partner inputs• BCSD Argentina• Center of Excellence for Sustainable Development,
Confederation of Indian Industry
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Results
Barrier 3
Capability
gaps
Barrier 1
Opportunity cost
of investment
Barrier 2
Strategic and
operational
misalignment
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Solutions
Barrier 3
Capability
gaps
Barrier 1
Opportunity cost
of investment
Barrier 2
Strategic and
operational
misalignment
Solutions• Adopt a portfolio approach• Obtain senior leadership support• Quantify total value created• Find outside investors
Solutions• Start with the business plan• Get out of the corporate greenhouse• Adjust performance targets• Establish a separate company
Solutions• Utilize external partners• Bring core capabilities in-house• Support professional development• Establish centers of excellence
8
Solutions
9
Taking action
This piece is a contribution to the WBCSD’s Action2020 platform for action
Our aim: catalyze further action, gain greater insights, and create an environment that is more conducive to scaling up inclusive business
Filippo Veglioveglio@wbcsd.org Tel. +41 22 839 31 08
www.inclusive-business.org
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