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debrief 8
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Seminar: Unilever applying Jugaad Innovation principles in rural India
Topic Number: 8
Industry Studies 1
Overview
In this seminar we will examine a form of innovation that is of particular importance in the East and gaining traction in the West.
Jugaad Innovation uses a variety of tools and techniques to help organisations innovate in a more frugal manner. We will take the case of Unilever’s Project Shakti and explore how they managed to implement a strategy, perhaps unconsciously using the principles of Jugaad Innovation.
We will initially look at how Project Shakti started and then in groups explore how the principles of Jugaad may apply to different aspects of their approach.
3
• Be able to determine the key principles of Jugaad Innovation
• Apply these principles in the live case of Project Shakti
• Determine and describe the key challenges Unilever faces
• Demonstrate an understanding of the context and environment that facilitate innovation of this nature
Learning outcomes of this seminar
4
Analysing Project Shakti through Jugaad Principles
Seek opportunity in Adversity
Do More with Less
Think and Act Flexibly
Keep it simpleInclude the
marginsFollow your heart
5
Seminar structure
Get into groups of 4 & choose one of
the 6 Jugaad Innovation principles (cant be the same as
anyone elses)
Each group will have 20 minutes to research
How their principle applies to
Project Shakti
Groups will have 10 minutes
to present your findings &
5 minutes of Q&A
Why did Unilever started Project Shakti
?
Project Shakti: The OriginsIn 1990s HUL wanted to expand its reach in rural India. It had a choice to adopt the traditional distribution model which could have set the cash registers ringing. But HUL adopted an approach which was rooted in its belief of ‘Doing Well by Doing Good’. It created a unique micro-entrepreneurship model with the aim of integrating business interests with societal need.
This model has been guided by the belief that the private sector can help create solutions to social challenges through innovative strategies that meet both business and social objectives. By promoting micro-enterprise, Project Shakti not only made great business sense but also had deep social impact.
Sustainable investment
opportunity for village
community/rural women.
Increase in the household income of poor families
of Shakti Entrepreneurs
Empowerment to
rural women
Better standards of living though
access to health and hygiene
products.
Benefits of Project Shakti:
Project Shakti: Objectives
• HUL’s New Venture Division identified rural India as a key source of growth and competitive advantage
• HUL argued that access to rural markets would be the big differentiator among FMCG companies
• Business objectives: extent HUL’s reach into untapped markets and to develop its brands through local influencers
• Social objectives: provide sustainable livelihood opportunities for underprivileged rural women
An evolutionary path to Project Shakti
Source: Rohithari and Rajan, 2006
Group 1:Include the
margins
Including the margins: PS Target Audience
A huge opportunity at the BOP
http://www.wri.org/sites/default/files/pdf/n4b_full_text_lowrez.pdf
Progressive customer base
Source: Unilever.com
Group 2: Seeking Opportunity in Adversity
Adversity: Infrastructure/Business Potential Matrix
Source: Rohithari and Rajan, 2006
Key Characteristics: Adversity
Poor infrastructure to reach these villages
Low market potential
No existing distribution network
Low awareness
A significant opportunity; an untapped market
Source: Rohithari and Rajan, 2006
Key Characteristics: Opportunity
c600k villages untapped villages
Strong peer to peer network
Growing awareness of brands
Social need for better quality products
Explaining Project Shakti: Vijay Sharma
View video: http://www.youtube.com/watch?v=XIUydDLvvoo
Group 3: Following their hearts (and
heads)?
Following their head and HEART to rural India…Market Creating and CSR?
Source: Unilever.com
Following their head and HEART to rural India…Market Creating and CSR?
Source: Unilever.com
View video: https://www.youtube.com/watch?v=utSYAkQi5hY#t=31
Following their head and HEART to rural India…Market Creating and CSR?
Source: Unilever.com
A Path Set for Growth
The project is being customized and adapted in several South-East Asian, African and Latin American markets
like Bangladesh, Sri Lanka and Vietnam. In Bangladesh and Sri
Lanka, it is being promoted as project Joyeeta and Saubaghya respectively.
Source: Unilever, 2014
Group 4: Do more with less
Getting the price point right: Creating Affordability
Overcoming poor distribution: Peer to peer selling
Using technology as an enabler to deepen relationship
i-Shakti is an IT-based rural information service network that has been developed to provide
information and services to meet rural needs in
medical health and hygiene, agriculture, animal husbandry,
education, vocational training and employment
and women's empowerment.
Group 5: Keep it simple
Easy distribution model
Source: Rohithari and Rajan, 2006
Group 6:Think and Act Flexibly
Acting to overcome challenges
Source: Slideshare, 2014
Choosing their sales team; a women initiative
• Women are the target consumers for most of HUL products
• Rural women constituted the most marginalised group in society
• Rural women were more likely to appreciate the additional income than affluent ones in urban areas
• Women were more likely to access into homes of potential consumers in villages
• Focus on women would have greater impact on the entire household – leads to improvements in health, hygiene and education levels
• Most men would be occupied with other employment and would not devote as much time to the activity
However now also include men; Shaktimaans
The programme was extended in 2010 to include ‘Shaktimaans’
who are typically the husbands or brothers of the Shakti ammas. Shaktimaans complement our Shakti ammas. They sell our
products on bicycles to surrounding villages, covering a larger area than Shakti ammas can do on foot. There are over
50,000 Shaktimaans across India. Each shaktimaan covers around 3
villages in his own village’s vicinity which is a larger area than
a woman, Shakti amma, can cover on foot.
Any questions?
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