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Tuesday
May052015

Hybrid value chain and social impact in developed economies

Poverty and economic inequality are global challenges that have an impact on even the most developed economies, as we noted in a post earlier this year. I recently had the pleasure to participate on a panel with an experienced entrepreneur and value chain expert who is involved with i-propeller open innovation -- an initiative to create a platform to allow businesses to address some of the challenges of poverty in Belgium.

Just over 15% of Belgians live in poverty, which affects their material and social wellbeing as well as their health. The i-propeller Business & Poverty platform seeks to use structural and innovative power of business to develop meaningful and scalable solutions. Businesses will, at the same time, be able to gear up their organizations for the future, with innovative solutions and market approaches.

This is an example of a hybrid value chain approach: a process of collaborative entrepreneurship designed to combine the power of innovation and entrepreneurship of the business and citizen sectors. HVCs are partnerships that include social outcomes, but are rooted in a market-oriented for-profit approach. Businesses offer scale and expertise in operations & finance. Social entrepreneurs and their organizations offer lower costs, strong social networks, and a deeper understanding of customers and communities.

We have used this approach in some of our own efforts to test new business models, and look forward to learning of other cases where they have been deployed, or are in the process of being deployed.

Image source: i-propeller

-- Clara Shen

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