SC JOHNSON- CSR Initiatives’

Testing the Base of the Pyramid

Protocol
INTRODUCTION
 SC Johnson is an leading manufacturer of household cleaning
supplies and other consumer chemical in US.
 It is known for its practices in sustainable development.
 Company based in Racine, Wisconsin focused on 4 areas of
sustainable development:
-advancing social progress and public health
-using earth responsible raw material
-preventing insect-borne diseases
-reducing energy consumption and green house gas
emission.
 Johnson Family Enterprises includes:
-Johnson Financial Group
-Johnson Diversey Inc.
-Johnson Outdoors

 Its well known product includes:

-Ziploc bags
-Glade air freshener
-Raid insect controller
-Vanish toilet cleaner
-Scrubbing bubbles automatic shower cleaner
Corporate Goals

 SC Johnson had two important corporate goals:

-growing its brand across the world
-achieving the company’s environmental and social
responsibilities
BOP PROTOCOL
 It was a part of the company’s attempts to
advance social and public health objectives.
 Through this protocol company aimed:
-to reach underdeveloped market and
consumers
-to encourage the use of the
environmentally friendly materials
GREENLIST

 It was a part of the company’s effort to be earth

responsible.
 It classified the raw material according to the
impact they had on the environment and human
health.
 It helped SC Johnson to phase out environment ally-
unfriendly raw materials and substitute them with
environmentally-friendly ones.
 In June 2006, SC Johnson was conferred with the US
Presidential Green Chemistry Challenge Award.
OBJECTIVES
 SC Johnson aimed to :
-prevent insect borne diseases across the world.
-lessen energy consumption and green house gas emission.
-reduced use of fossil fuels.
 Background Note
•In 1886, Samuel Curtis Johnson (Racine Hardware

Company’s sales representative) purchased the

company’s parquet flooring business.
•Company renamed as Johnson’s Prepared Paste

Wax Company (Beeswax-based polish was

developed)
•In 1900, he introduced paid holidays for its employees

•1906, business was renamed as SC Johnson and Son.

•Introduced Group Life Insurance

Expansion
 First International Venture established in
Britain in 1914
 A subsidiary was opened in Australia in 1917
 By 1919, firm had more than 200 employees
 Johnson’s wax became a popular brand in the
US and Britain
 Herbert Fisk became the president in 1919
 Opened a subsidiary in Canada in 1920
 By 1928, the company had grown in a $ 5mn business
 During 1930s, Herbert Fisk Jr. managed to steer the company
through the rough times without any lay-offs
 He introduced new products including Glo-coat, a self-shining
polish, Glade Air Freshners, and pledge, the first sprayable polish
for furniture, raid insecticide and off-bug repellant
 In 1955, SC Johnson water based aerosols that minimized the
adverse impact on the environment
 By 1975, they completely removed CFCs from its aerosol products
 In 1979, announced a policy to donate 5% of pre-tax profits to charity
 In 1985, introduced childcare centers for children of the employees
 In 1990, SC Johnson introduced a centralized environment and safety
policy
 Developing safer and cleaner products
Recognition
 In 1991, it received Presidential Citations for environmental quality
management
 Its environmental practices were recognized in many other countries;
 Japan, Canada, Argentina, Mexico, Australia
 The other Awards it received were:
 World Environment Center’s Gold medal
 The Business Ethics Award for best practices in social responsibility
 Lifetime Atmospheric Achievement Award from US EPA
 In 1984, Cornell University’s Graduate School of
Management was renamed SC Johnson
Graduate School of management
 Professor Stuart L Hart joined this center as a
professor
 His association with the center led SC Johnson
to actively participate in the creation and
testing of the BOP Protocol.
BASE OF PYRAMID PROTOCOL
 Pyramid Protocol-Structure
 Base of Pyramid: Hart and Prof CK Prahalad
 BOP Protocol- launched in 2004
 BOP: people who earned
less than US$1500 per annum.
 BOP: comprises 4 billion people
 Out of 4 billion, 1 billion earned-less than US$1 a day.
 Top of the pyramid: Earnings above US$15,000 a year on an average.
 75-100 million ‘top of the pyramid’ consumers.
 Middle of the pyramid: Earnings US$1500-15000 with 1.4 billion people.
 Financial support by SC Johnson, DuPont, Hewlett-Packard and Tetra Pak as
a collaborative effort of Cornell University from Michigan, The world
Resources Institute, and The Johnson Foundation.
Objective
 Identify and develop sustainable new products and business
models in association with BOP communities
 Business co-creation: Marriage
 A formal business process which consisted of 3 phases.
 Interdependent phases
 Specific business outcomes

 Generating value for the company and the local communities.

BOP Protocol- 3 PHASES
1st Phase-Opening Up
 Facilitating idea generation
 Learning process-2 way
 4 processes
 Team formation & preparation
 Immersion & engagement
 Needs & asset identification
 Idea generation & evaluation
 Cross-functional team
 Carried out at selected locations
 Community activities
1st Phase contd……..
 Community needs identified
 Assets and resources possessed by community were also found
 Identify own assets to apply to community activities.
 Gaps with the resources were identified
 Final step was idea generation where ideas to build sustainable
partnerships and businesses were worked on.
2nd Phase-Building the ecosystem
 Relationship between the company and the community was establishes.
 1st process-
 Resource and capability assessment
 2nd process(Partner selection and Network formation)-
 Network partners were identified.
 Location of operation of company to be identified.
 Resources and capabilities provided for the venture.
 3rd process(Business plan development)
 Plan and model developed for proposed venture, team formed to
garner support from community for the venture.
 Feedback also collected from the community.
3rd Phase-Enterprise Creation
 Venture formalized through- pilot design and testing .
 Pilots designed to cover the community.
 Tested in stages.
 Feedback obtained while testing.
 Promising pilots were retained after testing.
 Business model evolved
 Business & Governance structure established.
 Learning from venture to generate a new value proposition.
 To expand its opportunities and find out new businesses for
existing BOP customers.
 Also expanding into other BOP markets .
S C Johnson and
BOP protocol
BOP in S C Johnson
 S C Johnson involved in BOP even before this
term was coined
 Herbert Fisk Jr went on 15000 mile expedition
from Wiscosin to Brazil searching for Carnauba
wax
 BOP protocol was also tested in Kenya for the
usage of S C Johnson’s products
Pyrethrum Farmers in Kenya

 Pyrethrium an active ingredient

 Insect control products like
Raid and Baygon
 Found in Chrysanthemum plant
 200,000 farmers were involved in cultivating
chrysanthemum in Kenya
Pyrethrum Market Share in Kenya

 Market share went on reducing due to

decrease in production and inadequate
processing facilities
 Coupled with increased competition from
synthetic pyrethrum producing and poor
marketing
S C and Pyrethrum

 S C Johnson purchased 70 percent of

pyrethrum in Kenya
 Only 12 percent of farmers irrigated their land
which led to low yields of the crop
 Natural chemical degraded on exposing to
sunlight and by the time it was transported to
sourcing center quality of crop deteriorated
S C and Pyrethrum

 In July 2004 SC Johnson approached a NGO named

KickStart for pyrethrum
 Project aimed to provide micro irrigation
 Reduced the usage of pyrethrum and more of
cultivating other crops
 Contests on pump challenge were involved
 Pumps gave higher yields than pyrethrum
Testing BOP
Protocol in Kenya
 JAN 2005:6 students from different universities in the US ,went to
Kenya to field test the BOP protocol.
 Divided into 2 teams.
 Tested in slums of Kiberia in Nairobi and Nyota in Nakura.(1 million
people lived).
 Identifying business opportunities for the company in partnership with
local communities.
 The Action Undertaken
 Started with the task of immersion and engagement .
 Voluntary Team: Community clean up in Kiberia-to know the community
better.
 Helped in building rapport and also showed the team’s commitment to
the BOP program.
 Volunteers stayed in the homes of the poor for a month ,living like
them ,carrying out tasks like them: milking the cows and making
“Mandazi”, a Kenyan bread.
 Methods to improve the tasks were suggested.
 ..continued the Action
 An appraisal meeting after the home tasks –idea generation.
 SWOT was done and the resources available and potential income
generating activities were found.
 Meeting attended by 250 people in Nyota: including community
members, NGOs and employees from SC Johnson to create mutual
value for company and community and create businesses that were
sustainable.
Taka Ni Pato
 Group members of Carolina for Kiberia involved in the waste
management program “ Taka ni Pato(Trash in Cash)”.
 Under this program, the volunteers collected waste from slum and
segregated it into recyclable and compostable waste.
 Use the existing resources of “Trash in Cash” groups. These groups
became SC Johnson’s partners in developing a new channel to market
insect control and home care products to BOP consumers in Kenya.
Building the Ecosystem

 Next phase called for establishing a permanent

relationship among the NGOs,the groups, and the
company.
 3 partners: Carolina for Kiberia, Trash in Cash groups and
SC Johnson, Kenya.
 The company provided the groups with training and
marketing support which led to pest control, air
freshening and cleaning services too.
Success of the Ecosystem
 Nairobi-community based cleaning companies.
 BOP customers were receptive to the idea: Used Windex to clean
their houses while others used Baygon.
 Even Premium products like Pledge furniture cleanser also found
many takers.
 So services extended to 2 more slums in Mathare and Mitumba –
home maintenance services were also provided.
Workshops
 In Nyota- organized workshops with the
farmers where farmers came out with ideas to
convert manure into dried fertilizer.
 NGOs financed the venture.
 Proposal for community level organic farm
that would train locals and also provide them
with seeds of good quality.
 Through these initiatives employment level
raised and income level too increased.
 Win-Win Proposition
 Cleaner ,pest free and healthy homes.
 For SC Johnson this was launch of a new Business model and the
company found a new market for its products.
 Relationships between the company and the people in that area helped
in targeting new consumers and develop cost effective products.
 BOP Protocol team expanded their contacts- Egerton University,
Ministry of Agriculture, CARE..
 Several other programs launched-Healthy Children Healthy Homes
Benefits of BOP Protocol

 SC Johnson introduced new low cost items with

customized designing and packaging for BOP
consumers.
 For example: In Mexico it was found that use of
electric mosquito repellant was not high, though
it provided more protection as compared to coils
because of high initial cost of plug-in heater.
 So as a sampling program SC Johnson provided plug-in
heater and four refillable mat free of cost.
 After the program people started buying refillable mats
which priced affordably.
 The BOP brought together communities, NGOs, and the
companies.
 Protocol team ensured that the local communities derived value
from their efforts by conducting workshops, training programs and
developing relationships with MNCs and NGOs.
 People came up with several ideas like starting an organic fertilizer
company, community level organic farming and fruit processing.
 After successfully establishing the BOP model in one market, it
planned to replicate in other markets across the world.
 Company did not derive instant business but demand for its
products expected to grow as BOP consumers began earning
higher incomes.
According to Scott

“We always take the long view in our decisions. We’re very patient. And I
can see that the working base of the pyramid is going to test our patience .”
GREENLIST
 Introduced by SC Johnson’s in year 2001.
 To evaluate adverse effect of chemical on environment and
human health.
 Several criteria were used to evaluate chemical.

Effect on aquatic and

Biodegradability
human life

EU classification of
Vapor pressure
chemical

Water coefficient Other

RATING SYSTEM OF GREENLIST
Th
ree
Company targeted to
,
be achieve rating of 1.41
st
Two, by end of 2007, but
significant achieved mile stone in
better 2005.

One, acceptable

Zero rating, only when no substitute is

available
 To attain rating of 1.41 company phased out production of
chlorine based external packing material
 Company also phased out production of bottles made of PVC
and bleached paperboard that uses chlorine as bleaching
agent.
 Greenlist program received a patent.
 SC Johnson planned to license program to other companies
without any royalty.
 Companies getting license must set goals to improve
environmental footprint & publish report of the progress made
against set goals.
SC Johnson – Other BOP Incentives
 In 2004 company launched Malaria prevention program
known as “Healthy Children, Healthy Homes” in S.A..
 Program was initiated in three provinces in the country with
high incidence of malaria.
 Children from 300 schools in each province were taught about
preventing from malaria.
 Interactive material was distributed in six different languages
 Company sponsored mosquito trap in Ghana from 2003-2005
 Trap was put in Tafo, village near Ghana.
 Result showed that incidence of malaria reduced after trap
was introduced.
THANK YOU
 SAMTA WADHERA

 RIDDHI PAREKH

 PANKTI SHAH

 RAMKUMAR VENKITESWARAN

 PRAKASH KRISHNAMOORTHY

 RICHA MAHAJAN

 SAHIL SALEEM

 SADAF