Technology as Equaliser

Technology as Equaliser

India’s growth in IT/ITES Industry is clearly a great story has put India on world map. India holds the leadership position as the best IT outsourcing destinations in the world; India is emerging as the best Startup locations in the world and more importantly, it is also emerging as the biggest consumer of digital services such as Internet, mobile subscriber base etc.

All the above strongly holds the view that Indian IT industry can make the transformation with out waiting for Govt. to make it happen. I am not suggesting that Govt. should not do or is currently not doing it – the Digital India programme for example is a mission mode programme of Govt. of India and it can be a huge booster for the Businesses and Government to access and make the lives of nearly a billion people much better! The point is, Industry has the reach, knowhow and the might to infuse transformation in the society.

However, most of the above mentioned changes are missing the majority of our population.

Some staggering statistics on the other side are

  • Nearly 400 M people earn less than Rs 100 /- a day
  • We still have around 300 M people without electricity
  • Over 320M people can’t read or write
  • 42 % of our country is yet to be connected with paved roads.
  • While India’s 10% population is moving into sophisticated use of technology, nearly 900 M people do not use it at all

As per the statistics, over 58% of Indian people work in Agri/Fishing related jobs. The essentials of life – food, that we eat comes from these 58% population who work hard to make us live. Traditionally business have (Dr. CK Prahlad has coined a term called ‘Bottom of Pyramid’ and has written extensively about this segment in his Book ‘Fortune at the Bottom of Pyramid’) seen them as producers and not as respectful consumers. Prof. Prahlad argues that the collective purchasing power of the low-income group segment is worth looking into by business and still making profit, which is a more sustainable model than looking at the segment as ‘Subsidy market’.

There was a study conducted by Professor Mathur, of IIML on the changing Consumer behaviour for the BOP segment, where the segment is ‘aspiring’ to be more involved in above the essential items and their aspiration to ‘affordable indulgence’. Prof Mathur provide ample proof to the various misconceptions about the BOP segment, by comparing the spend patterns in Dharavi (one of the biggest slums in the world) and Warden Road (one of the up-market residential areas of the Country) and shocking statistics suggest that the intermediaries and long bureaucratic chains are resulting in high exploitation of the BOP segments, making them pay more for similar services (e.g. the Dharavi consumer on average ends up paying 100 – 200% interests, compared to the 12% for Warden road consumer)

Now if you look at the fundamental value proposition Technology has the ability to, reduce the Total Cost of Ownership, improve the quality of experience of an end consumer, scale seamlessly to large population, bring transparency for government services, and provide custom built solutions to meet specific customer needs. These are the exact value proposition required to serve the bottom of pyramid segment!

One more value proposition that the segment offers is the ability of the product innovation can help businesses grow for the top of the pyramid. GE’s mobile ECG experiment was one such thing, where the product created for the lower end of Indian market got later promoted to a high value product for the western market. Tata created Nano for the lower middle class households, but it moved up the value chain to cater as a ‘second car’ in the upper-middle class segment.

Technology is perhaps the best equalizer to solve the issues at the bottom of pyramid and create inclusive growth opportunities for a lot more of our country men.