Strategizing for the bottom of the pyramid: an action research into a Mexican agribusiness

Abstract

Purpose While recent research has established that businesses can benefit from engaging with people at the bottom of the pyramid (BOP), the authors know little about the practices that managers can use to effectively strategize this ethically sound and financially attractive proposition and turn it into new business. Design/methodology/approach To address this gap, the authors reported on an action research study in which the authors collaborated with a major Mexican agribusiness, ANSA, to expand its market through value co-creation with the country’s poorest farmers. To shape the strategizing, the authors combined dynamic capability theory and options theory, and the authors used the asset hexagon framework to understand the BOP population’s needs. Findings The authors offer a detailed account of how ANSA’s management team collaborated downstream with distributors and farmers and upstream with suppliers to grow a new micro-franchise business that increases the well-being of the poorest farmers and creates additional business opportunities. The research describes how firms can strategize and implement new business ventures for co-creating value with the BOP population. The results are a process model and related propositions for strategizing value co-creation with BOP. Originality/value The authors offer new empirical insights, a grounded process model and model-related propositions on strategizing BOP options. As such, the study contributes to the BOP literature by joining critical ethics with actionable knowledge of how such efforts may unfold and by demonstrating how theory may be enacted and developed in the process.

Informal sellers and formal markets: a habitus gap

“…This approach is akin to other efforts to help BoPs join formal markets such as multinational firms’ efforts to include BoP suppliers (usually, farmers) in their value chain (Prahalad, 2004). For example, Hernandez-Cazares et al (2020), provide a detailed account of a Mexican agribusiness that was developed between Acuerdo Nacional por la Salud Alimentaria (ANSA) and local farmers and required the continuous intervention of the firms’ executives and managers.…”

Codesign in resource-limited societies: theoretical perspectives, inputs, outputs and influencing factors

“…Involvement of resource-constrained people in design and development of solutions has been defined or described in many ways and terms, offering various perspectives on the integration of knowledge and capabilities of relevant partners (Rosca and Bendul 2016). For example, whilst some studies use the term co-creation (Hernandez-Cazares et al 2019;Dalvit et al 2013;Funamizu 2017;Galafassi et al 2018), others employ terms such as codesign or participatory design (Zeb et al 2019;Nthane et al 2020;Mwanzia and Misati 2013), emphasising involvement of resourceconstrained people or a broad range of partners for sharing information or for offering suggestions in the design and development process to realise value for the involved stakeholders, including resource-constrained people (Bharti 2014, Rosca andBendul 2016;Jagtap and Larsson 2019). Nahi (2016), for instance, defines cocreation in the context of resource-constrained communities in developing countries as "iterative interaction that empowers resourceconstrained communities and integrates their knowledge and capabilities with those of a company and other actors" throughout the process of designing solutions.…”

Organizational unlearning and inclusive innovation: The moderating role of green control ambidexterity

“…With the continuous advancement of BoP strategy and resources investment, enterprises began to regard the poor as producers (Hernandez-Cazares et al, 2020;Roxas &Ungson, 2011) andentrepreneurs (Fitz-Koch et al, 2018;Musona et al, 2021) and create value by providing equal opportunities to participate in the market (Hart, 2015), which can be defined as substantive inclusive innovation.…”

“…With the continuous advancement of BoP strategy and resources investment, enterprises began to regard the poor as producers (Hernandez‐Cazares et al, 2020; Roxas & Ungson, 2011) and entrepreneurs (Fitz‐Koch et al, 2018; Musona et al, 2021) and create value by providing equal opportunities to participate in the market (Hart, 2015), which can be defined as substantive inclusive innovation. Given the particularity of production, consumption, and trading behaviors in the BoP groups (Dembek et al, 2020), the products and business models of enterprises in the top (top of the pyramid) market cannot be directly used in the BoP market.…”