Reducing socioeconomic inequalities is a crucial element in reducing poverty and creating an equitable economy. Mobilizing the productivity of rural population by empowering them to be rural entrepreneurs, is indispensable to achieve the resilient economic growth that will pull them above the poverty line and make them aspirational.
BoP communities can be positively impacted in two ways – One, by solving their problems through innovative products and services and other by empowering them through livelihood opportunities that focus on them becoming Producers.
Creating mass employment opportunities for BoP communities certainly helps them rise above status quo. However, to foster micro-entrepreneurship, training, promising individuals on managerial skills can help build more professional impact organizations and accelerate grassroots change.
Rural Entrepreneurship Over Income Generation
Business opportunities are not created by external intervention—they arise from markets and entrepreneurial capabilities. The issue is to enable rural and women entrepreneurs to take advantage of market opportunities. – United Nations Industrial Development Organisation
Rural micro-entrepreneurship based models that exploit the economies of scale help the BoP communities to not only be self-reliant but also help them in contributing to the national economy. Aneel Karnani in his paper illustrates this with an example.
Rather than lending $200 to 500 women so that each can buy a sewing machine and set up a microenterprise manufacturing garments, it might be much better to lend $100,000 to an entrepreneur with managerial capabilities and business acumen and help her to set up a garment manufacturing business employing 500 people.
Now the business can exploit economies of scale, deploy specialized assets, and use modern business processes to generate value for both its owners and employees.” – Fortune at the Bottom of the Pyramid: A Mirage. How the private sector can help alleviate poverty by Aneel Karnani
As pointed out by Aneel, the BoP community needs a level playing field, a conducive environment and a supportive ecosystem to grow. This can be achieved with collaborative efforts by the government, social entrepreneurs and financial institutions specialising in microfinance.
Developing Rural Managers
Rural entrepreneurship is the way to improve the living standards of rural people. It is necessary to train rural people for reducing rural migration rate, poverty alleviation and unemployment eradication. – Promoting Rural Entrepreneurship Through Skill Development for Decent Livelihood: A Review
Any organization that operates at a reasonable scale- medium size with 50-249 employees and large size with beyond 250 employees needs a pool of trained managers to supervise various aspects of business operations. This cadre of managers forms a layer above the core workers. Providing opportunities to workers to rise to managerial positions creates a strong workforce and leads to inclusive socio-economic development.
Capacity Building In Rural Enterprises
Skill development or imparting vocational training contribute in the capacity building of an organisation. Similarly, in case of rural enterprises, in addition to technical skill based training, individuals with the ability and persona to lead, should be handpicked and trained to be organization leaders.
Social enterprises and impact organizations can play a crucial role here. They can work hand in hand with various governmental and community-based organizations in building managerial capacities within the rural workforce. They can identify, encourage and upskill most enterprising members of their field staff to take up more roles of increasing responsibility.
For instance, Swades Foundation provides microfinance and knowhow to rural entrepreneurs. This is focused around developing community farming enterprises, agribusiness and poultry farming enterprises. Most of their rural entrepreneurship initiatives are focused around helping women to emerge as leaders.
Datahalli, the famous IT enabled services impact enterprise employs rural women in their workforce and trains them to grow and emerge as managers.
Jimani Collections provides entrepreneurship training and mentoring to rural women through business management education, mentoring, networking, ongoing work opportunities and access to markets. Jimani believes that through their Entrepreneurship Program, they’re able to provide a driven group of women with educational and mentoring opportunities that will help them to start their own businesses.
Through structured training programs and consistent oversight, they make sure that the women enrolled in their program are able to succeed in their community for years to come.
Development of BoP needs creating a level playing field through entrepreneurship. This means training rural enterprises in leadership and managerial skills.
In the end, why get a white collared professional to handle the rural enterprises when an indigenous entrepreneur can be shaped into a leader?
Cover Image: Jimani Collections