Porter’s 5 forces for the development sector:
– by Arpitha Rao
If Michael Porter conceived of the 5 force analysis for the development sector then it would be anchored around collaboration and not competition.
In the development sector, funding and innovation are not zero-sum games where if one organisation or idea prospers then it is a dictum for the annihilation of others. The core aspect of any scalable and sustainable solution for social problems is one of ‘taking people along’.
1. Myth: When the pool of funding is limited then SPOs (social purpose organisations) compete amongst each other (rivalry among competitors, supplier power)
Reality: Collaboration among all existing players in a win-win fashion is the survival mantra for social sector
In our work at Sattva, we have repeatedly witnessed donors (both institutional and individual) trying to onboard as many funding and delivery partners as possible. Where there is a powerful idea oftentimes there are innovative financing examples (such as impact bonds, collaboratives, co-funding etc.,) to the rescue.
2. Myth: Solution providers are reluctant to share equal power with the buyers/community members (bargaining power of the buyers)
Reality: All long term successful solutions have community ownership at the heart of design and execution
Social purpose organisations like SEWA, Jan Sahas etc., and funders (World Bank, Echidna Giving, Porticus etc.,) alike have deployed large-scale programs with participatory design and execution as the modus operandi where community members are equal partners in planning and implementation. In the light of global movements such as Black Lives Matter, Me-Too the global north funders from U.S and Europe who are invested in Indian interventions are also increasingly engaging in conversations with the communities to uphold the notion of ‘nothing about us without us’.
3. Myth: SPOs that have unique solutions keep innovation within their organisations (threat of new entrants+subsititute solutions)
Reality: If social solutions do not open themselves up for critique and adoption by all relevant partners and community members then they will soon fizzle out or prove expensive to sustain
Given social sector is riddled with wicked problems, for any one organisation to conclusively solve a problem in a region alone is next to impossible. The varied formal networks/collaboratives/coalitions and informal partnerships in the social sector are a testament to the fact that new entrants are not only welcomed but the existing players design their programs to enable the entry of new players and their already existing solutions.
Arpitha Rao is a Senior Engagement Manager and is based in our Bangalore office. She currently leads Foundations Advisory and Government Advisory work focusing on strategy work for regional and international philanthropic foundations. Before Sattva, Arpitha has worked with Deloitte Consulting, Teach for India, India Literacy Project, and Greatest Common Factor. She followed up her Engineering degree with a Masters from TISS and an MBA from ISB.
This piece was originally published on LinkedIn.
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