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Open Village Marketplace

Open Village Marketplace

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Open Village Marketplace

Project report

Ace Institute of Management, EMBA Spring 2010 Kathmandu, Nepal December, 2011

Nama Raj Budhathoki As a fulfillment of individual assignment on Organizational Development Submitted by Siddhi Lal Kayestha [skayestha@veriskhealth. Mohan Das Manandhar Dr. Nepal December 2011 .Open Village Marketplace Project report Submitted to Mr. Kathmandu. EMBA Spring 2010 New Baneshwor.com] Ace Institute of Management.

........................................................................................................... 8 Anticipated Outcome ....................................................................... 7 The Intermediary ..........................................Table of Contents About Open Village Marketplace Project ..........................................................................10 ................................................................................................................................................................................................................................................................................................................................................................................ 1 OVM as an Organization .................................... 5 Motivational Area of Crowdsourcing..... 9 Personal reflection ...................................... 9 The Producers .. 7 Findings ........................................................................................ 7 The resellers ........... 5 Crowdsourcing and Communication ............................................... 7 The Producers ............................................................................................................................................ 2 Why Open Village Marketplace? ............................................................................. 8 Proposed intervention ............................ 5 Analysis and Discussion of Process .................................................................................................................................................................................................................................................................................. 3 Literature Review ......................................................................................................... 9 The resellers ............. 3 Limitations of intervention ............................... 4 Conceptual framework of Crowdsourcing ..................................................................................................................................................................................

Different theories of social science and management. Nama Raj Budhathoki for guidance and providing opportunity to work and complete this paper entitled ³Open Village Marketplace´ as a partial fulfillment of individual assignment in Organization Development and Change. It has provided an opportunity to enhance our knowledge in broader aspects of Organization Development. Siddhi Lal Kayestha . both in traditional as well as emerging approaches.i Acknowledgements I would like to acknowledge and extend my heartfelt gratitude and sincerity towards faculty members. Mr. linkage between them and their practical implications and analysis has really helped to understand many organizational change activities around us in real life to greater details. Mohan Das Manandhar and Dr. Thank you and Regards.

Many entrepreneurs started organic farming as a prospective venture. These helped to cater fresh food and vegetables at local store but are not healthier one. and meat produced at Chitwan are few examples. Many of these products have a huge potential market. But the products get expensive as it involves high cost in compare to ordinary farming which uses chemicals for higher productivity. Trying to meet this demand of customers. oranges and fresh vegetables from Dhading. implementing crowdsourcing. And consumers will loss an opportunity to consume it. It . in fulfilling needs of both parties to make successful transaction happen. Either producer is not aware of the marketplace or a person who buys it has less or no information about the product and its availability. milk produced at different places like Panouti. Hetauda and the like. It creates a huge economical loss at seller¶s end. Open Village Marketplace (OVM). The organic farmers have a difficulty in selling their product at local market because of high cost and need to search for one who likes to consume organic products for quality health. Need of healthier food has given rise to a high demand of organic food & vegetables. There might be many more which are even not in our knowledge. apples produced at Jumla. People want to have fresh and healthy food and vegetables at their neighborhood store. tries to assist in bridging a gap between two parties ± producers (sellers) and buyers (here it is reseller).Open Village Marketplace 1 About Open Village Marketplace Project People living in urban area are getting very much health conscious and trend of healthy eating is growing. sellers or producers started using preservatives (basically chemicals which are hazardous to health) to preserve food and vegetables for longer time. Niche market of people who are health conscious and at the same time willing to pay high and few start hotels which serves quality food to its customers are existing clients of organic vegetables. But a huge mass of consumers could not get benefit from this. To take an example in our context. It is possible because of nature. or skill sets of people living there or may be because of some other reasons. But specialized local products are produced at different parts of the country. But these products hardly get exposure to big markets.

Goods are supplied. Logistics (Intermediaries which can again be a community to perform logistic activities or separate entity providing service) . Buyer (or reseller) will make these goods available to end users through stores. Matching Buyers and Sellers a. OVM basically will be a virtual marketplace based on web technology. they communicate either online or offline to make real business transaction. location. where sellers can provide details of their supplies (product details. Determination of product offerings (product details will be filled in by sellers) b. Registered suppliers post details of products that they would like to sell. Interested buyers can surf the website. OVM as an Organization OVM is a conception of a web portal. Major chunk of primary marketplace functions will be hence crowd sourced. Price is paid to seller. or search product of their choice and other criteria via advance search options. The functions are: 1. Customers enjoys quality product and suppliers gets return to his investment and hard work. Price discovery (interaction between sellers and buyers) 2.Open Village Marketplace 2 will ultimately help end users (real consumers) to get product at reasonable price. contact details etc) and buyers can find them as per their requirement (product. If the buyers feel that they have found what they are searing for and want to use the features of website to connect with supplier. These products will be listed in a portal. price. Once buyers and sellers are able to meet each other (virtually in web). It will be a free registration. place and price basically). Searching product (buyer will search products via web tool) c. Customers can get quality product at their neighborhood in reasonable price via these stores. And the product that was never exposed to end market gets sold to earn money. they get registered (if had not registered before). Facilitation of Transaction a. The website will be a virtual marketplace to registered buyers and suppliers.

efficient and cost effective trade between buyers and sellers for local products including food and vegetables y y y Provide local suppliers an exposure to a larger market Boost economic activities by facilitating trade between rural and urban areas Create a knowledgebase of locally available products Limitations of intervention y This project will only focus on marketplace for all kinds of goods (not services) that are produced by local communities (like locally produced tea. dry food. It is collaboration among communities and trust exists) A lean team will be working in an organized way to maintain and administer OVM portal. Settlement (OVM process assists this function for transfer of fund or parties involved in transaction can mutually agree to do it) c. Why Open Village Marketplace? Open Village Marketplace has certain objectives. meat products. . fruits. Anticipated objectives of OVM are mentioned as follows: y Help establish easy. Big community of buyers and supplies will be providing and exchanging major sources of information required to themselves and others who are interested. handmade local products made of raw materials found locally etc). y It will try to establish direct contact between producers and buyers by marginalizing mediators who plays to gain maximum benefit creating infliction to producers and customers by paying low to producers and charging high from customers.Open Village Marketplace 3 b. vegetables. fisheries. Trust (information is with communities and shared by them for themselves.

And we can find that they are mostly from villages. It is crowdsourcing. fruits. They either have to take their products and sell in a local market or need to depend on mediator who buys goods from them at low price. Many parties get involved in this activity of distribution ± supply chain management. Mediators come into picture as a separate entity to manage this problem. But the cost of providing solution is very high as they are also not organized. But there exists a philosophy which can provide a solution to this kind of problem but is not utilized to solve. For instance. But with traditional business model. . Traditional supply chain management in this scenario cannot be implemented as no organization exists there. The more tall structure of supply chain. still there exists other entity in a society ± individuals or small group of people who works together to produce goods like organization do for their living. other may have kept some cows to sell milk for living. organization uses different distribution channels to take its goods up to its end customers. And the difference between price that customer pay and producer receives is significantly very high in case of unorganized entity like this.Open Village Marketplace 4 Literature Review In an existing business model. which will ultimately. or other cash crops. More is the number of mediator. more costly will be a product of organization. gets added to product price. there is no solution in trading goods without them especially when it is not organized. Besides organization. Many organizations tries to reduce cost incurred in supply chain by working out different models of supply and distribution management. Producers and customers feel this act of mediator an infliction. It will help to create cost advantage. higher will be a price of goods in the market that customer has to pay. But this is only possible in case of traditional organization. These individuals or group of people are focused on producing goods. Similarly. And some skillful person may try to craft useful goods and plan for living by selling them. a farmer with his own piece land may grow vegetables. Less intermediate means less cost in supply and distribution. take it to marketplace. sell it at high price and enjoy maximum profit.

where it tries to bring together a community of buyers and sellers. there will be a cost benefit. in search of best solution. which is crowd sourced. It will help to decrease transaction cost of communication. This is because of unmatched preferences of individuals with in a group. motivated crowd of individuals capable of providing solutions which is superior in quality. which is commonly known as organization chart to cope with problem related to communication. Motivational Area of Crowdsourcing Motivational factors of contributing members (e. But in case of OVM. First. it will pay comparatively low cost to the solution provider. and social production of knowledge) describe why people participate in crowdsourcing. a hierarchy system is created. Next. Scale of complexity grows faster and higher than that of people in a group.g. such things like hierarchy cannot exist. Crowdsourcing has two primary benefits. collectively called the volunteer functions inventory (VFI): (a) Value. Wise use of crowd wisdom is helpful to bring positive change for the betterment of society by bringing down cost and time and providing service to customers at low cost. (b) Understanding. Complexity of communication or disseminating information grows with the increase in number of people in a group. Volunteerism. Basically it is made available to a large network of potential people in the form of open call. A web portal plays vital role to establish communication. (c) . it can get solution by attracting an interested. In an organization. Crowdsourcing and Communication Crowdsourcing also helps to reduce complexity of communication.Open Village Marketplace 5 Conceptual framework of Crowdsourcing Crowdsourcing is about disseminating specific task (especially problem) of an organization to crowd preferably via web as a distributed problem-solving and production model. And each one cannot interact with other in person directly. Individuals engage in volunteerism to serve the following six functions. Leisure. Instead of recruiting highly paid experts to solve problems.

(e) Social and. .Open Village Marketplace 6 Enhancement. and social production of knowledge. are further broken down into intrinsic and extrinsic factors of motivation and is summarized to know how they contribute to crowdsourcing. (d) Career. (f) Protective. leisure. Different motivational factors which have evolved as volunteerism.

there is no solution in trading goods without them especially when it is not organized. They basically belong to remote areas and lives in villages. But the cost of providing solution is very high as they are also not organized. But with traditional business model. Besides regular work needed to produce goods. In a community level. But this is obvious for distribution channel. i. purchase goods from these resellers as required which are located at convenient neighborhood. mediators come into picture as a separate entity to manage this problem. The retailers buy goods from wholesalers. most of the product are similar thus results low consumption The Intermediary To overcome the problem of marketplace and selling local products.e. They are involved in farming. Marketplace at local is not big and has less value to the product they sell 2. They cannot sell product regularly 3. Most of the times goods are transferred from one mediator to another in many folds till the goods reach in the hand of end user. animal husbandry.Open Village Marketplace 7 Analysis and Discussion of Process The Producers Local communities produce goods. crafting and the like using materials available locally in a community. Producers and customers feel this act of mediator an infliction. . End users of goods. Significant amount of cost get added because of this transactions among intermediary. These resellers can be wholesalers. The resellers Finally these intermediaries delivers product to resellers. consumers. it is very hard for them to market the product because of following reasons. One level of transaction again happens at this point. 1. These communities are scattered around the country. and big stores.

They are scattered. Availability of information is lagging. And this gradually moves one level up in a same manner till one reach to producer. . price and so on. its market. Primary stakeholders (i. Proposed intervention It is identified that in the process of successful transaction in supplying locally produced goods to urban market. transactions happens in many folds. buyers and resellers) do not have clear information about availability of goods. every level of transactions seems necessary. In a traditionally structured supply chain management. Resellers only have access to mediators at the lower level of supply chain. communication is not smooth. place where it is available or where it needs delivery. The proposed intervention to improve this supply chain process is to introduce collaborative model of crowdsourcing as a new business model. y Producers do not have direct contact with reseller and don¶t know where (or in which market) their product will get sold and at what price. Each transaction adds cost to goods. telecentre (if any) can be used to facilitate communication. and contact details. Individual at one level has to depend on other level to make transaction happen. Individual at each level tries not to furnish with necessary information or create barrier in communication and the existing supply process. price. It will bring buyers and sellers closer and make direct interaction possible by sidelining mediator. This model will use web technology to cut down transaction cost of communication and furnishing information to the community at a same time. as it is not organized too.Open Village Marketplace 8 Findings y y Buyers and resellers are not organized. y Because of this lagging information. These group of people have lots of information about demand and supply of goods. But this is just because of lack of information. y Mediators play games in this series of transaction and takes maximum benefit for low effort that they have contributed. In case of villages.e.

. will form a virtual community via web portal of OVM. they can utilize it to ease communication and to provide collaborative input. They can get detail information of producers and analyze them before making transaction. sell goods at higher price 3. They will furnish detail information of product they want to sell with all other necessary details. which are scattered. consumers.Open Village Marketplace 9 Anticipated Outcome The Producers Local communities producing goods. will have idea of market and current market price of goods In idle case there will be no mediators. Significant amount of cost get reduced because of this transactions among two directly concerned parties. purchase goods from these resellers as required which are located at convenient neighborhood. This will help them to 1. In case of villages. and big stores. They can purchase goods at relatively low price as the deal will takes place directly with producer. The resellers Resellers search for required product and communicate with producer via web portal of OVM. End users of goods. These resellers can be wholesalers. i. Producers and reseller feels satisfied and build a trusted relationship. Only the extra cost that has to be incurred is for logistic. This makes them feel satisfied as they get goods that are value to money they spend. But now the end users can get products at relatively low price.e. can communicate directly with reseller and 4. get exposure to big market 2. Goods are transferred from producers to reseller directly in most cases. if there lacks computer literacy and has access to telecentre.

Know how of web technology still lacks though it has became cheap and easily available even at remote places. Philosophy behind this is not mature and clear though. There can be many solutions that organizational development process can suggest for the betterment of organization or system. The rate of successful implementation of crowdsourcing is very low. Crowdsourcing largely depends on this new technology. But one has to carefully follow it and in a correct way. Not only an existing organization but systems which exist in our society can get better and cost effective if we try to enhance its operation process. But a new concept of organizing organization or systems is rapidly growing with an introduction and development of web technology. But it has really challenged the way traditional organization operates. It is not sure that if philosophy of crowdsourcing can entirely replace traditional organization. It is crowdsourcing. But it is sure and is proven that partial implementation to solve problems works fantastic for traditional organization. .Open Village Marketplace 10 Personal reflection It is not true that organizational development and change can only be implemented in a typical organization that really exists.

They furnish product information. and big stores. No intermediary required. Producer too gets high value for product. They need to communicate with Intermediary. animal husbandry. Poultry Farm Agricultural Animal Husbandry Product Local Manufacturing Existing System The producers depend up on other people to sell their products at local level or sell products at local market in cheap price. This will save cost and can sell at cheaper price. OVM Host server ± a web portal helps to link producers and resellers. This will add cost and can NOT sell at cheaper price in the market. crafting and the like using materials available locally in a community. These resellers can be wholesalers. Resellers can search for required product. Logistics (Intermediaries which can again be a community to perform logistic activities or separate entity providing service) The Resellers These resellers can be wholesalers. mediators come into picture as a separate entity to manage this problem. System with OVM The producers will try to sell their products on their own via using OVM portal. and big stores. Significant amount of cost get added because of this transaction among intermediary. Customer need to pay high price. . communicate and can purchase goods at fairly good price. contact details and other required info.Open Village Marketplace 11 Comparative System flow and benefits of OVM The Producers The producers are basically from remote areas and lives in villages. The Intermediary To overcome the problem of marketplace and selling local products. NO transaction cost will incur as there will not be an intermediary. They can visit OVM site and communicate with the producers. They are involved in farming. contact producer.

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