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www.thesmartmanager.com 64 The Smart Manager Mar -Apr 2014
12% of the world’s population resides in India’s rural areas
1
—is that reason enough for your company to know who exactly rural Indians are?
tata consultancy services smart manager case contest
The Smart Manager Mar -Apr 2014 www.thesmartmanager.com 65
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A small data-related enterprise in Maharashtra that focuses on
research in rural India wants to achieve a pan-India presence.
The question is: how should it implement the existing business
model in other villages across the country, given their diverse
cultural and social environments.
connecting bharat
to india inc
SHEKAR PRABHAKAR
IS ASSOCIATE PROFESSOR,
AT MARKETING, PRIN. L N WELINGKAR
INSTITUTE OF MANAGEMENT
DEVELOPMENT AND
RESEARCH, BANGALORE.
DR MADHAVI LOKHANDE
IS PROFESSOR, FINANCE,
AT PRIN. L N WELINGKAR
INSTITUTE OF MANAGEMENT
DEVELOPMENT AND
RESEARCH, BANGALORE.
www.thesmartmanager.com 66 The Smart Manager Mar -Apr 2014
ne late evening, Sheela Shirodkar stood by her
office window, lost in thought. She reminisced
about her maiden efforts in gathering
information about rural India, specifically in
Maharashtra. What began as a simple initiative—sending
a postcard to opinion leaders in villages to collect basic
information about them—had grown into a huge business
opportunity today.
Sheela firmly believed that building a comprehensive
and constantly updated base of information on rural
India could be leveraged for both business and social
development, a goal dear to her. Running an organization
sustainably and being in the business of doing social good
excited her, and she had been successful so far. Her next
challenge was to become a force to reckon with in the rural
marketing sector with a pan-India presence.
Sheela wondered, “Can the model of building a rural
database for Maharashtra be adopted in other states as
well?” She had started her company, Pragati Aur Hum,
ten years ago—but few people envisioned rural India as
a ‘market’ back then. Today, no marketer could afford to
ignore rural India, which had changed the rules of the
game for all businesses. “How do I replicate this model in
other states, and add more strategic units to my business,
and yet not lose focus on doing social good? Should the
model be replicated as it is or will it need to be tinkered
with to suit the local context? she wondered.

a peep into the past
Sheela came from a modest background—she was the fourth
child of a family that lived in the small village of Pandeypur
in Maharashtra; and she had three brothers older than her.
She scraped through in school, but went on to complete
her graduation with decent scores. She was brought up
like a boy, and often drew no personal boundaries between
genders. She then moved to Pune to live with her uncle’s
family. She landed a job as a waitress at the Officers’ Club
with the help of her uncle, and was awed by the respect
people there commanded.
Sheela always knew that desire, dedication, and effort
were the three key ingredients for success; the stint at the
club made her realize the importance of education as the
fourth. She soon enrolled for a distance education program
specializing in marketing. To garner practical experience,
she convinced a friend’s father, who was in the business
of selling paper tissues, to allow her do the marketing. On
completing the diploma, she was selected by a reputed
MNC during campus placement, to market their products
in Madhya Pradesh.
It was her first stint at a corporate entity, and Sheela
wanted to do her best. She understood that practical
experience and understanding the working of markets were
most essential; she traveled extensively across Madhya
Pradesh for almost one-and-a-half years—through the
urban areas as well as the rural heartland. This helped
Sheela develop a deep understanding of the market
dynamics of rural areas. During the course of her stint, she
also managed to save R55,000.
business beckons
With this sum as capital, she decided to start a business.
She took up the distribution of bakery items in Pune with
a couple of friends. They would take turns to pick up
products from the manufacturers and sell their stock to
In a world of increasing complexity,
there is a way to be certain.
IT Services
Business Solutions
Consulting
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O
connecting bharat to india inc Lokhande and Prabhakar
The Smart Manager Mar -Apr 2014 www.thesmartmanager.com 67
In a world of increasing complexity,
there is a way to be certain.
IT Services
Business Solutions
Consulting
www.tcs.com
retailers. She worked hard each day and yet, by the end
of the month, the net return was R15,000. Unhappy with
such low returns, her friends and partners withdrew and
her first business attempt failed.
She then chanced upon a lecture by the director of
a foreign bank who opined that the future of business
lay in rural India, where the potential was almost
limitless. This set her thinking. What if she could run
a business with rural India as the research base and
simultaneously contribute to its development? She wasn’t
sure of the exact plan, but she definitely wanted to help
rural youth.
Thus began her journey to discover and understand
Indian villages. Experience had taught her that there was
more to understand about this entity [called ‘village’]
than what met the eye. She wanted to fully understand
the essence and core of village life: its customs, traditions,
cultures, and the mindset of the rural population.
Sheela visited 4,000 villages across Maharashtra and
tried to understand rural administration methods, local
markets, education infrastructure and other aspects. Sheela,
being the enterprising person she was, established direct
contact with the opinion leaders of the villages and started
recording obscure details of the local economy.
The fabric of the Indian rural landscape is extremely
intricate: scores of official languages are spoken in a few
hundred dialects, numerous festivals are celebrated in
different ways and each village has its own set of arts, crafts
and architecture. Sheela wondered who exactly the average
rural Indian man or woman is. How do they think? What
made them tick? Answers to these questions were what she
was looking for.
She exhausted her resources—both time and money—
rapidly in her pursuit to collect this exhaustive data from
rural areas, but she persisted. The first-hand experience
and data became the foundation of the organization she
started—Pragati Aur Hum. She set up base in Pune and
advertised her services to all market research agencies
and corporations planning to foray into rural Maharashtra.
collating data
Sheela started by targeting villages with a population
strength of 2,000-10,000 that held weekly village
fairs and bazaars. Data was collected on the basis of the
following questions:
n On which day is the bazaar held?
n How many people come to the bazaar?
n What kinds of shops does the village have?
n What are the products and brands sold?
n Who is the head of the village?
n Does the village have a school? Who are the teachers
and principal?
n What facilities are available in the village—electricity,
potable water, banks, etc.?
www.thesmartmanager.com 68 The Smart Manager Mar -Apr 2014
She started by sending questionnaire postcards to
the opinion leaders. The responses received were mostly
scanty, both in quantity and quality. This did not discourage
her. Soon, she was sending thousands of postcards to
various villages. Her husband and father-in-law would
help her prepare the postcards, and also collect and classify
the information. She received a few responses from 9,000
people; and repeated this exercise twice. She then sent
Diwali greetings to 10,000 villagers with a reply card.
These exercises got her almost 1,000 responses, thereby
confirming her belief that people in rural India built
lasting relationships.
This exercise drove home an important lesson: the
rural market has to be approached with the intention of
establishing relationships, and not just seen as a fertile
ground for business. Encouraged by the responses, she set
out to collect information on rural markets firsthand; her
family then helped enter the data on an old computer.

dual strategy
Sheela knew that in order to monetize the information
she was collecting, it had to be refreshed from time to
time. She developed a dual strategy of continuing to send
questionnaires on prepaid envelopes, and setting up
teams on the ground called the Scouts of the Village
(SoV). The leader of the team, the village developer, was
responsible for building relationships, comprehending
mindsets, traits, preferences and values of the villagers,
collating data and sending it to Sheela. He/she also
monitored and guided other members in the team.
These teams basically comprised youth from the
villages. Through this project, Sheela not only provided
them a job opportunity, but also leveraged their
knowledge of local language and culture. These teams
would interact with the villagers on a continuous basis
or as and when needed, collect latest information,
entertain queries, and generate answers to build
confidence and trust among the villagers. Pragati Aur
Hum soon had around 200 SoV teams, and this number
would increase when specific projects demanded more
coverage. This ensured that the villagers did not see it as a
one-way relationship.
monetizing the information
With the data collection and updation process in place,
Sheela started approaching more companies that sold
products in rural areas, and offered them this data to help
them make better marketing decisions. While companies
wanted to buy the information, the price they offered
was as low as `25,000. Though disappointed at the
unenthusiastic response of the companies, she agreed to
sell the data to start generating revenue.
Navigating a world of new rules and
new opportunities. There is a certain way.
IT Services
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The rural market
had to be
approached with
the intention
of establishing
relationships, and
not just seen as
a fertile ground
for business.
connecting bharat to india inc Lokhande and Prabhakar
The Smart Manager Mar -Apr 2014 www.thesmartmanager.com 69
Presumably, she
started getting
enquiries from
big companies for
data, analyses and
ideas to tap the
rural markets. And
they paid a good
price too.
Navigating a world of new rules and
new opportunities. There is a certain way.
IT Services
Business Solutions
Consulting
www.tcs.com
But Sheela knew the worth of the information she
had collected, and she was sure that companies would see it
eventually. The companies that were purchasing the
data would need her expertise to constantly update and
analyze information, and Sheela was hoping that this
would happen soon. Presumably, she started getting
enquiries from big companies for data, analyses and ideas
to tap the rural markets. And they paid a good price too.
From concept to implementation, from strategy to
developing communication that works in rural settings,
Pragati Aur Hum helped these companies achieve their
marketing objective. Companies could either buy targeted
information on a one-time-use basis or subscribe to her
continually updated research, which was live and dynamic,
and served as a regular source of information on
rural Maharashtra.
a greater common good
The concept of SoV served the dual purpose of refreshing
information, and providing a means of livelihood to the
rural youth, but Sheela wanted to do more; she launched
many initiatives leveraging the information she
had gathered.
Soch was one of them—its primary aim was to motivate
students to develop good reading habits. And the larger
goal was to open a library in every secondary school in
key villages across the state—a library for the students,
managed by the students.
Invitations were sent to individuals and corporations to
make donations directly to the publisher and Pragati Aur
Hum coordinated the delivery of books and setting up of
the library. They installed libraries in hundreds of schools
in Maharashtra. The SoV teams spent about two weeks
installing the library and supporting the school in
its operations.
In addition to this, Pragati Aur Hum also initiated
other projects to empower the rural population. They
introduced IT to the rural masses by installing used
computers in villages, especially in secondary schools,
where the interest and inquisitive levels were high. The
intention was not to make the children computer literates,
but at least get them to touch, feel, and try computers.
When she personally could not find the means and finance
to progress, she appealed to individuals, organizations, and
corporations to contribute used machines. This initiative
has been a success in numerous village secondary schools.
Sheela also started the Non-Resident Villager
Movement as an effort to connect such uprooted
Maharashtrian villagers back to their roots. Sheela believed
that every such Indian yearns to reach out and make a
difference to their country and village. Pragati Aur Hum
facilitated an exclusive tour of an individual’s native village
where they got a chance to visit the village, see their
www.thesmartmanager.com 70 The Smart Manager Mar -Apr 2014
ancestral home, and meet extended family and old friends,
visit their former school and so on. This opportunity
to connect with one’s roots came at a nominal fee of
$100. Individuals could also contribute to getting special
projects done in the area related to power, health, roads,
communication, water and sanitation; they could also
donate a computer by paying the manufacturer/distributor
directly with Pragati Aur Hum coordinating the logistics of
installation and use.
Sheela had also dappled with the Gujarat rural market
and tried to get an idea of how things work there. Though
this business moderately took off, it never did really well.
Despite being Maharashtra’s neighbor, Gujarat was a
different territory. It had become quite difficult to garner
youth to support her initiatives as the locals seemed most
inclined toward entrepreneurship. The cultural and
mindset difference opened Sheela’s eyes to the diverse
nature of India, but still she felt there were other ways to
do more.
the choppy future
Pragati Aur Hum believed that they were different because
they not only helped corporations build a sturdy rural
marketing model, but also because they contributed to
improving the lives of the rural population. They aim
at revolutionizing rural India and bringing sustainable
development to villagers. Today, they pride themselves in
their ability to mesh both the business and the community
profitably, managing both bottom lines sincerely and
professionally. The challenge now lay in how to scale in
terms of both reach and impact. That is what lay heavily on
Sheela Shirodkar’s mind.
your questions
How should Sheela expand her business to other states?
Identify the threats and opportunities and suggest ways to
tackle them. n
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Selected to present common managerial dilemmas, the
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specific company.
win fame!
Transforming your business while you’re
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The Smart Manager Mar -Apr 2014 www.thesmartmanager.com 71
smart insight
heela has indeed found a
valuable gap in an ‘emerging
economy’ market. Almost
all companies dealing with lifestyle
products and services are keen to
venture into the high-potential rural
India market, but they lack proper
consumer insight. But it is expensive
to build long-standing and deep
relationships with rural communities,
which could provide them with the
necessary information.
Sheela’s core business model
provides an innovative solution to
bridge this gap through:
01 Sustained collection of
information through surveys, and
Maharashtra. These are valuable
assets that create a strong platform for
further growth. I would recommend
that Sheela takes up the challenge
of expanding her business to other
states. To do this, Sheela and her team
will need to take a few transformative
steps. This is important because
scaling up puts tremendous pressure
on a team and the resources of an
organization, and hence the important
step is to ‘prepare for scale’—do it by
design, and not by default. Here are
three steps Sheela can explore:
structuring the organization
for scale: In order to scale, Sheela
may want to explore the potential
of a hybrid business model—a
non-profit Section 25 company that
leverages CSR funds to work with
rural communities, and implement
high-impact schemes such as Soch,
non-resident villager movement,
IT enablement, education, etc.
This entity could target CSR as its
‘buyer,’ charge a small service fee for
the design and implementation of
these activities and/or leverage grant
funding to continue these activities.
This will create deep bonds of trust in
the community, create social impact,
Parvathi Menon is Founder and
Managing Director of Innovation Alchemy
Private Limited.
with the help of scouts of the village
(SoV), and
02 Consistently building deep,
trusting relationships with the local
community through a range of
social initiatives and through the
employment opportunity created for
the SoVs. To be able to analyze what
the growth strategy for Pragati Aur
Hum could be, let’s first take stock of
Sheela’s current strengths:
n A deep and detailed understanding
of rural markets, consumer
preferences and changing trends
gained through several years of
research, which is available in the
form of a database
n A methodology with pertinent
questionnaires, and people on the
ground who can identify and do
research on trends and consumer
profiles on an ongoing basis,
thereby enabling Pragati Aur
Hum with a indepth network of
‘information points.’
n Operational readiness for scale
in the form of a network of SoVs,
and rural communities that can be
leveraged further and,
n A proven track record of substantial
work done in the gathering and use
of research data collected from rural
S
www.thesmartmanager.com 72 The Smart Manager Mar -Apr 2014
make Pragati Aur Hum a platform
for social change in the corporate
community, and create credibility
for Sheela’s team since they are
implementing visibly impactful work.
In addition, the existing private
limited company (Pragati Aur Hum)
will create better tools, technology
and methodology to gather insights
from the rural communities regarding
their preferences and choices, and
continue to make it available to
corporate buyers who wish to work
in these markets. This two-tiered
structure with independent teams will
create space for new momentum.
ecosystem mapping to create a
path for growth: Study broad market
and consumer dynamics across India
to identify which states should be
targeted in the short-term, mid-term
and long-term. For example, in the
short term, pick those states where
microfinance initiatives have already
created a deep impact on women, and
have created empowered consumers
within family households. These are
also the markets that are more ‘ready’
for better lifestyle products and
services that corporate organizations
wish to target. In the long term,
Sheela’s team perhaps will first need
to help create such empowerment
and then hope to create impact and
analyze consumer behavior.
step ahead with an anchor
business in every new region: In
order to stay successful, any business
organization needs to ensure enough
cash flow. This means that Pragati Aur
Hum needs to find buyers (corporate
clients) who have a requirement for
data and research in a new region.
This may require Sheela to meet with
her current clients and explore if
they already have plans to go to other
regions, and offer to do the service for
them with the methodology that has
been effective in Maharashtra. And
since she has already demonstrated
results, this discussion could help
her find more business with existing
clients. This will mean that Pragati
Aur Hum will have a paid project
to enter into a new region, and
the project fee could be treated as
working capital.
It’s important to also look at
some potential risks. One big risk
that Pragati Aur Hum faces is the
contradiction with regard to social
impact and the market insights
business. The bond of trust between
the villagers and Sheela (and her
team), based on the social impact and
several local initiatives, can be lost
quickly if a corporate organization
misuses research data to sell products
and services that harm the lives of the
community. Therefore, it's not just
enough that Sheela understands the
rural market. Her team also should
ensure that only ‘relevant’ products
and services use this data and insights,
and that too in a productive manner.
If the core trust is lost, then Pragati
Aur Hum will lose its biggest asset,
which is its connect with the
rural community.
Like any good consulting firm,
the other major challenge is that of
building a strong, commited and
aligned team that can help take the
business to new regions. Sheela
will need to explore the potential of
setting up new offices and creating a
strong layer of leadership that could
lead each region fairly independently,
but within the framework of the
methodology that has made Pragati
Aur Hum a success so far.
And finally, Sheela will have to
‘codify’ her intrinsic knowledge of
this space and domain, and try and
help her new leadership team to
imbibe those principles and depth
of experience.
All this seems like a lot of work,
but given that the market potential is
so large and that Sheela has already
created such a strong base of assets, it
would be the logical next step to scale
her business across India. n
Other major challenge is that of building a
strong, commited and aligned team that can
help take the business to new regions.