Introduction

This paper develops a business stakeholder perspective on inclusive innovation. We work

from established definitions of business stakeholders as individuals or groups of people
who seek both to influence the strategic decisions made by organisations while
simultaneously seeking to draw benefits from its business operations – operations that
might be designed strategically to generate both profit and ‘shared value’ among key
stakeholders (cf. Porter & Kramer, 2006). By attempting to develop a business
stakeholder perspective on inclusive innovation we explore the extent to which
innovation as conceptualised in the context of business organisations can be framed as
‘inclusive’ when external stakeholders are invited into processes of managed innovation
both as creative influences and as immediate beneficiaries. The external stakeholders
whose interests we emphasise in this paper are members of so-called ‘Bottom-/Base-of-
the-Pyramid’ (BoP) populations – a segment of the world’s population originally
conceptualised as offering business opportunities to multinational corporations (MNCs)
seeking to a identify and exploit previously ‘hidden’ business opportunities (cf. Bartlett
& Ghoshal, 1989). Increasingly, these BoP populations can be identified as potential
consumers and business partners who offer a dynamic opportunity for MNCs and other
organisations seeking to diversify their global strategies towards creating and
internalising business and market knowledge (cf. Bartlett, et. al., 2003; Rugman, et.al.,
2011). As we attempt to illustrate in this paper, ‘including’ members of BoP populations
as a stakeholders in the MNCs investments across global and regionally-defined markets
can serve to promote innovation of existing products, services and strategic management
thinking (cf. Prahalad, 2012).

Taking the example of Nestlé, a Swiss-based MNC, and its Business on Wheels (BoW)
initiative in The Philippines, we explore the extent which business innovation might be
perceived and – very importantly – experienced as ‘inclusive’ where the organisation
targets the training of skills and development of knowledge and competencies among
members of BoP populations as a supporting objective to its overall business strategy: in
this case, increasing sales of Nestlé foods and beverages among BoP communities while
simultaneously training the sales skills of selected members of these communities in The
Philippines. Correspondingly, the premise for the discussion developed in this paper
draws on definitions that emphasise ‘inclusive innovation’ as the creation of knowledge
along with the training of skills targeted directly at meeting the needs of low-income or
BoP populations in order that individual members of these populations might over time
improve the social, economic and physical welfare of themselves and their respective
families (Utz & Dahlman, 2007; Dahlman, et. al., 2014; UNCTAD, 2015).

In developing a business stakeholder perspective on inclusive innovation we examine the

extent to which the Nestlé BoW initiative might benefit individuals and families from the
1
BoP populations in terms of creating work and learning opportunities that might, over
time, allow the BoW workers to acquire skills and knowledge relevance towards
achieving social mobility, health and relative economic security. According to Tschang
et. al. (2011), key skill sets towards achieving these objectives include: time
management, bookkeeping, inventory management, general business communication
combined with product- or service-specific sales skills. Over time, acquiring these skill
sets and knowledge of how and when to apply them might subsequently enable these
workers to develop capabilities relevant towards achieving social entrepreneurship,
defined by Bornstein and Davis (2010) as a process whereby individual citizens gain
resources (knowledge, skills, financial security, etc.) such that they might contribute
towards building institutions that serve to alleviate social problems such as poverty,
illiteracy, ill health, and other manifestations of social and economic exclusion from the
benefits that members of non-BoP communities in the same region or country might
enjoy readier access to. From a more global perspective, gaining skills and knowledge
relevant towards achieving the status of social entrepreneurship might ensure some
sustained degree of self-employment or job security (Alvord, et. al. 2004; Davidsson &
Honing, 2003; Baron & Markman, 2000).

Consequently, the case study we detail in this paper of the Nestlé BoW initiative in The
Philippines is designed to offer both conceptually-farmed and practically-oriented
insights into practical and locally targeted interpretations of inclusive innovation from a
business stakeholder perspective. Simultaneously explore the extent to which BoP
members recruited onto this initiative might benefit from achieving some degree of
sustainable social and economic security for themselves and their respective families,
now and in future. In our conclusions we explore the extent to which the lessons learnt
from the Nestlé BoW case and other comparable case studies of inclusive innovation
from a business stakeholder perspective might be generalised to other contexts for MNC
investments, and specifically in locations where there appears to be a similar failure of
government or non-governmental agencies to provide vocational training and, by
extension, opportunities for economic and employment security among members of BoP
communities.

2
Research Methods
In order to connect directly and, from a business stakeholder perspective, critically with
current conceptualisation of ‘inclusive innovation’ as applied in practice to BoP
communities, we seek to address the following research questions:

1. To what extent might the Nestlé Business on Wheels (BoW) initiative in The
Philippines represent an example both of business innovation generally and of
‘inclusive innovation’ specifically?

2. What evidence is there to suggest that those BoP members who are recruited onto
the Nestlé BoW might experience inclusive innovation as a means towards
becoming social entrepreneurs and, thereby, enjoy a prospect of enhanced job or
employment security?

3. What evidence is there to suggest that those BoP members who are recruited onto
the Nestlé BoW might experience inclusive innovation as a means towards
becoming social entrepreneurs and, thereby, experience enhanced job or
employment security?

Towards addressing the first of these research questions we present a brief review of
relevant literature. Towards addressing the second question we adopt a case study
approach, whereby we make an ‘empirical investigation of a particular contemporary
phenomenon within a real-life context’ and drawing on ‘multiple sources of evidence’
(Saunders, et. al., 2012:666). The case study or ‘real-life phenomenon’ that each co-
author of this paper has observed and otherwise systematically researched in Japan and in
The Philippines: for example, in as series of structured conversations with senior
managers at Nestlé East Asia headquarters in Kobe (Jackson & Ruiz-Tafoya) and during
a period of intensive field research in The Philippines in 2014 (Ruiz-Tafoya)
supplemented by a follow-up visit in early 2015 (Jackson). We draw on these and other
primary and secondary observations in our discussion in response to the third research
question before finally outlining what we believe are vital implication for future research
and practice in respect to conceptualising and investing in inclusive innovation among
BoP populations in The Philippines and generally across communities defined by the
World Resource Institute as ‘The ‘Next 4 Billion’ (cf. Hammond, et.al. 2007) – a
tendentious view, we believe, implying that the ‘first’ four billion have already ‘made it’
in terms of social and economic security.

3
Literature review
The following brief survey of literature relevant to our theme develops within the
contextualisation outlined in our Introduction and explores the extent to which the Nestlé
Business on Wheels (BoW) initiative in The Philippines exemplifies business innovation
generally and, from a business stakeholder perspective, ‘inclusive innovation’
specifically.

1. Boundaries: describing organisational contexts for inclusive innovation

As with reference to ‘internal ‘ and / or ‘external’ business stakeholders, invoking

conceptualisations and practices of ‘inclusive’ innovation suggests there are processes of
innovation that might be interpreted as being more ‘exclusive’ than ‘inclusive’,
depending against which measure or scale the boundaries of relative inclusiveness and
exclusiveness are drawn. To illustrate, an internal stakeholder might have access to
information and thereby exert a level of direct influence on an organisation’s strategic
decision-making than an external stakeholder. It is for this reason we consider the notion
of ‘boundaries’ to be fundamental in developing a discussion that attempts to link
stakeholders with processes of inclusive innovation. These boundaries might be
interpreted as being ‘perceptual’: in other words, imagined, sensed or intangible. They
might also be sensed as ‘actual’: for example, having the status of an employee (internal
stakeholder) with a pass enabling physical access to a subsidiary of an MNC as opposed
to a customer or other external stakeholder of a business organisation who would need
special permission to enter a building or an organisation’s intranet system.

2. Organisations as boundaried entities for defining inclusive innovation

General theories of ‘organisations’ tend to emphasise these as boundaried social,

economic, legal and technological entities (cf. Daft, 1989; Mullins, 2005; Senior &
Swailes, 2010). Correspondingly, those individuals and groups offered inclusion within
organisational boundaries tend to be those whose social status, economic investment
and / or technological skills or knowledge suggest sources of competitive advantage to
one or other organisation: for example, in support of that organisation’s investment in
processes of innovation.

One business definition of ‘innovation’ describes a process of ‘bringing inventions to the

marketplace’ (Pass et.al, 2005:47): in other words, an ‘innovation’ might be perceived or
experienced by both internal and external stakeholders as a potential benefit or otherwise
relevant when a ‘marketplace’ for whatever has been ‘invented’ is deemed to exist and of
sufficient impact or scope to suggest that any investments in the innovation process might
sooner or later be returned with interest. As discussed previously, calculations of

4
potential returns of business investment in so-called ‘BoP’ markets are relatively new - in
academic circles, at least (cf. Prahalad & Hammond, 2002; Prahalad, 2010). This casual
observation reminds us of the etymological roots of the ‘innovation’ concept. Derived
from Latin novum meaning ‘new’, innovation can be conceptualized as a process (hence
the ‘-ation’ suffix) of creating (inventing, hence the ‘in-‘ prefix) and exploiting (bringing
to market) something that might be perceived or experienced by key stakeholders as
‘new’. Alternatively, and as with the BoP concept, the relative ‘newness’ of an invention
might more precisely express a (relatively) ‘new’ formulation, application or adaptation
of something ‘old’ and established in a ‘new’ or hitherto untried context – a theme we
develop subsequently in this paper.

To this general definition we can interpret innovation as ‘the management of all the
activities involved in the process of idea generation, technology development,
manufacturing and marketing of a new (or improved) product or manufacturing process
or equipment’ (Trott, 2012: 15). This much-cited definition reminds us of how far
conceptualizations of business innovation reflect the strategic interests of manufacturers
competing in (for example) the automotive, consumer electronics, information
technology, transport, and pharmaceuticals sectors. It also reminds us of how
‘innovation’ as a process might be managed more or less effectively in business
performance terms and, in the context of our current discussion, managed more or less
‘inclusively’. Against this background we can appreciate the enduring attraction of
conceptualising innovation as a linear and - from a business stakeholder perspective -
value-adding process. From an inclusive innovation perspective, we should question the
extent to which this value-added is shared.

Correspondingly, and echoing Trott (2012), the process of managing innovation in

organisations can be depicted as follows:

 Innovation = C + R + E

Visualised complete within the perceived boundaries of an organisation, the initial stage
of the innovation is conceptualisation (‘C’). This refers to a sub-process in innovation
management whereby ‘new’ ideas are created and shared for the purposes of attracting
the attention and - if adjudged sufficiently relevant and / or promising potential value
added – the investment of time and other resources from internal stakeholders. The
opportunity for investment is illustrated in this linear model as the first of the two ‘+’
symbols. This represents a vital linking point in the managed innovation process; for,
many ‘good’ ideas that might – in broad marketing terms – be identified within the
organisation as ‘new’ will fail at this stage of development unless sufficient numbers of
influential stakeholders choose to ‘buy into’ the idea. Given the routinely hierarchical
structure of organisations as social and legal entities (cf. Handy, 1993), decisions to

5
invest or not invest in a ‘new’ idea are likely to be enacted ‘top down’: in other words,
from the strategic to the operational level of the organisation’s activities. If decisions are
made to commit resources towards developing a idea then the there is the promise it will
be ‘realised’ (‘R’), meaning it will take some tangible or concrete form such as product
prototype or a market entry and development strategy or plan. In such cases, the
organisation as a legal entity might choose already to protect its initial investment in the
form of patent protection – an exercise that can be interpreted as overtly ‘exclusive’
innovation.

Finally in this linear model of managed innovation the ‘E’ stage denotes the
‘exploitation’ to market of the original idea (‘C’). In general terms, this is where a return
on previously committed investments might be generated to stakeholders through the
revenues and other benefits accrued through sales. Again, if sufficient numbers of
stakeholders with influence or other relevant resources are willing to invest in the idea at
the second ‘+’ link between ‘R’ and the ‘E’ or (market) ‘exploitation’ stage then the
realised product might be prove to be sufficiently ‘new’ by external stakeholders such
that it does begin to generate a return on previous investments. However, and as with all
business investments, allocating resources to the development of one idea rather than
another is an exercise in calculating and managing risk; for, if organisational stakeholders
chose to ‘bet’ on there being sufficient market demand for one ‘new’ product or service,
the value of their investment and – cumulatively, perhaps - the business survival of the
organisation is at risk. We return to theme of ‘inclusive innovation’ as a strategy towards
sharing business risk and associated issues of business ethics later in this discussion.

3. Innovation in Japan: examples of inclusive innovation?

Among the distinguishing features of innovation management in Japan is the emphasis

given to what in the terms of this current discussion might be interpreted as
‘inclusiveness’ relative to Western or other non-Japanese contexts for business
innovation (cf. Jackson & Debroux, 2008). To illustrate from an internal stakeholder
perspective, Takeuchi and Nonaka (2004) develop the concept of ba ( 場 ) specific to
project team leadership and innovation in Japanese manufacturing. They describe ba as a
physical and / or virtual ‘place’, designed by managers for creating and sharing
knowledge. It provides a defined yet informal network for ‘enhancing mutual trust among
participants’ (2004:56). Takeuchi and Nonaka cite the development of the Toyota Prius
as an example of how the idea product of ba. Unusually for a Japanese business
organisation, members of the Prius project team were instructed by project leaders to
‘evaluate the new technology’, regardless of professional background or ‘speciality’ and
to ‘think what is best for the product, instead of representing one’s department’s interests’
and, in doing this, ‘not care about one’s age or rank’ (2004:109). In 1997, this innovative
conceptualisation of project team location and working / management communication

6
style (‘C’) led to this pioneering hybrid engine car was developed from drawing board
(‘R’) to market launch (‘E’) during a period of time far in advance of the then norms for
product development cycles in the automotive manufacturing sector.

To this we can add a further ‘Made in Japan’ example of ‘inclusive’ innovation from an
external stakeholder perspective. During the 1950s, Japan’s nascent Honda Motor
Corporation was trying to adapt European (mainly German) models of private transport
vehicles to a Japanese market still suffering economic deprivation and military
occupation after the Second World War. Senior engineer (Soichiro Honda) and senior
business executive (Takeo Fujisawa) were looking for ways to adapt the light
motorcycles (‘mopeds’) increasingly popular in Europe to the Japan market. They invited
owners of restaurants that produced and delivered soba noodles into the ‘C’ stage of
innovation. These external stakeholders asked for a light motorcycle that could be ridden
one-handedly as with the ordinary bicycles used to deliver their products. During 1957
Honda worked towards developing a gearbox transmission that could be operated one-
handedly (‘R’). The C50 light motorcycle series was launched in 1958 and has since (‘E’)
become the most widely sold private vehicle in history with over 130 million sales
worldwide, far surpassing four-wheeled rivals such as Volkswagen’s ‘Beetle’ – the
originally conceived ‘people’s car’.

Given its relatively low retail price and ease of maintenance, the commercial success C50
can be regarded not only as an example of inclusive innovation from a business
stakeholder perspective, in technological terms it can be regarded as an opportunity
enabling BoP consumers to gains skills and knowledge relevant towards becoming social
entrepreneurs. To illustrate, our field observations in The Philippines generate data about
the popularity among BoP communities of light motorcycles such as the Honda C50
enhance social mobility: children can be brought to school; elderly relatives to hospital;
individuals can travel in search for work; small-scale farmers and traders can bring goods
to ‘wet’ street markets without costly and risky reliance on intermediaries. Whole
families can be transported on one vehicle - though not, it should be noted, using the
original product design and safety specifications of the manufacturer. Rather, local
mechanics create hable-hable versions (‘C’) where the carrying cradles and supporting
springs can be adapted (‘R’) at low cost and with limited technological knowledge. These
mechanics become internal stakeholders to a process of product and technological
innovation from which they were originally excluded. Given the size of the local BoP
market, enterprising individuals might repeatedly dissemble and re-assemble vehicles in
order to gain expert knowledge not only about the original design but also of potential
adaptations relevant to local market demand (‘E’).

7
Discussion
Re-connecting with examples of Japanese-style business innovation, to what extent might
the hable-hable adaptations of original business models and consumer products behind
light motorcycles such as the Honda C50 lead to individuals gaining the status and
influence as social entrepreneurs? To what extent might these adaptors of so-called ‘first-
World’ products perceive and experience an opportunity to become business innovation
stakeholders and thereby gain the skills and knowledge sufficient to become social
entrepreneurs and thereby over time potentially improve the social, economic and
physical welfare of themselves and their respective families, as proposed in the
aforementioned Dahlman et. al (2014) definition of ‘inclusive innovation’?
Consequently, we can further ask: to what extent is this opportunity for adding value to
individuals drawn from BoP communities mirrored in the Nestlé BoW example?

1. BoW as an example of inclusive innovation?

Referring back to the Dahlman et. al. (2014) definition of ‘inclusive innovation’, there is
sufficient evidence to suggest that the polices and practices informing the BoW initiative
are relevant towards promoting and facilitating the creation of knowledge along with the
training of skills that might enable young bowers to become social entrepreneurs.
Specifically, the BoW initiative is designed to train young BoP Filipinos in skills of
inventory management, cash flow management, sales and business communication skills
– each skill set vital towards achieving the status as social entrepreneurs in each
individual trainee's immediate socio-economic context. Applying the C+R+E model of
managed innovation, bowers are trained towards effective inclusion in Nestlé attempts to
manage the ‘E’ stage of innovation: they are trained to drive sales, form and maintain
highly localized B2C product and brand relationships, through their individual
performance they feed back into the ‘C+R’ processes much as the soba noodle producers
did towards developing the innovative Honda C50. Such processes of inclusion are
transferable across BoP contexts. For comparison we can invoke the observed outcomes
of (for example) the promotion of ‘bed-and-breakfast’ start-ups in Cuba (cf. Henken,
2002; Sachetti, 2006). These comparable examples of inclusive innovation suggest that
our observations from the BoW initiative might be generalizable across BoP communities
and thus a potential source of isomorphic dynamism worldwide.

Correspondingly, further reference to the Dahlman et.al. (2014) conceptualization of

‘inclusive innovation’ suggests that MNCs such as Nestlé gain by appropriating and
benefitting from their local knowledge, their culture and tradition of using bicycles as a
way of transport, now used for business purposes that might benefit MNCs and other
investing organizations by generally increasing sales by volume and specifically in BoP
markets populations. The aforementioned mode of exploitation also serves to reduce risks
8
and direct costs of distribution in BoP communities in The Philippines and elsewhere.
Thus the business argument towards recognizing BoW and similar initiatives as
sustainable modes of corporate FDI appear investment appears compelling. However,
there remain justifiable concerns about environmental (as opposed to purely business-
serving) sustainability (Adams, 2006): for example, future research in this field should
examine the environmental impact of the packaging as (probably) un-recycled waste
along with the nutritional ‘vale added’ accrued by BoP consumers of BoW products,
including the bowers and their families.

As ever when assessing the impact of FDI from so-called 'developed' to so-called
emerging economies, ethical considerations should not be ignored (cf. Simanis, et.al,
2008; Davidson, 2009). From a global human development perspective, the BoW
initiative appears remarkable in that it targets the young low-skilled, male members of a
defined BoP community: the bias in development projects worldwide has in recent years
tended towards targeting young women – justifiably, in our view, given the legacy of
negative discrimination that women worldwide continue to suffer: for example, in terms
of access to basic or vocational education. Such pressing environmental and ethical
concerns extend beyond the current ‘business stakeholder perspective’ adopted for the
purposes of coherence in this current discussion – a perspective, we believe, that serves to
challenge both current bias in international business thinking as it does in the paradigms
commonly adopted by developmental economists and social anthropologists.

2. Towards a conceptualisation of ‘inclusive adaptation’?

We referred in our introduction to the types of skill sets that would-be social
entrepreneurs should aspire to, or might require targeted training in – skills sets that we
argue appear both targeted and (potentially) available to individuals participating in the
Nestlé BoW initiative. At a more elevated level of individual expression, Amabile (1998)
identified the key competencies for effective innovators to include: playfulness, passion,
persistence, and positivity Here, ‘competencies’ can be understood as ‘skills’ combined
with attitudes relevant towards applying these skills flexibly and effectively. However,
we might argue that the so-called ‘4Ps model’ proposed by Amabile along with the linear
and (at first glance) overtly simplistic C+R+E model of business innovation developed by
Trott become through iteration across contexts for human development further evidence
of the path-dependency and bias that obtains across ‘international’ management research
and practice (cf. Jackson, 2011). Consequently perhaps the premise of our current
discussion is misplaced: perhaps our invocation of inclusive ‘innovation’ reflects more an
academic and practitioner conceit rather the experiences and needs of members of BoP
communities who aspire towards social, economic and business independence: for
‘inclusion’ in what the World Bank (WRI, 2007) heralds as the ‘next Four Billion’ but, as

9
result of their immediate relevant social, economic and technological empowerment, on
their own more locally-relevant terms.

For, one of the consequences of social inclusion, including ill health and relative poverty
is that individuals might struggle consistently and with conviction the ‘4Ps’ highlighted
by Amabile and other Harvard-based experts in processes of managed innovation. Given
the failure of many regional and national governments to provide access to vocational
(skills-based) training, would-be BoP social entrepreneurs able to express sufficient
positivity, persistence, playfulness and passion for a business idea might lack the basic
skill sets to fulfil their ambitions. Correspondingly, in BoP contexts for business
innovation we should perhaps work more consistently with concepts such as ‘inclusive
adaptation’ rather than the potentially more ambitious ‘innovation’.

To put this proposition in broader context, there are many business terms originating in
Japan and now commonly adopted and adapted by organisations across the world: for
example, the Just-in-Time’ (JIT) inventory management approach towards efficiency and
controlled waste management refined by developing the now global ‘Toyota Production
System’ (TPS): as we have seen, efficient and effective inventory management represents
one of the key skills required by would-be social entrepreneurs (Tschang, et. al., 2011).
One original Japanese term is kaizen, commonly translated into English as ‘continuous
improvement’, became associated with the approach taken to product and (about)
production process and systems innovation developed and subsequently exported by
MNCs such as Toyota (cf. Liker, 2004). It would be no exaggeration to suggest that the
re-interpretation and re-application of these terms across non-Japanese business contexts
has caused an innovation in terms of strategic management thinking and management
behaviours or styles across the world (cf. Jackson, 2013; Jackson, forthcoming).
However, the example of kaizen causes to question whether ‘innovation’ genuinely refers
only to the conceptualisation, realisation and exploitation to market of what is ‘new’. The
hable-hable adaptation of light motorcycles in The Philippines suggests already that
emphasising ‘innovation’ as a distinct and perhaps (perceptibly) elevated process above
‘adaptation’ might be essentially something of an academic and Western business
conceit: in terms of BoP market impact, perhaps we should instead be referring here more
modestly and pragmatically to ‘inclusive adaptation’ – a re-conceptualisation with
implications for future practice and research.

10
Conclusions
Based on our brief review of literature, on evidence from the case studies we have
presented and compared, and triangulating further with reference to our own critical
observations and experiences as researchers and practitioners in international
management, education and human development, we draw the following interim
conclusions:

i) If the conceptualisation process (‘C’) is perceived by key stakeholders as

powerful as timely enough, BoP members can benefit from managed
processes of business innovation.

ii) If the realisation process (‘R’) is recognised by key stakeholders as

technologically accessible and adaptable enough, BoP members can benefit
from managed processes of business innovation.

iii) If the exploitation process (‘E’) is experienced by key stakeholders as

inclusive enough, BoP members can benefit from managed processes of
business innovation.

Our intention is to conduct further research on the Nestlé BoW and other comparable
schemes in order to ascertain whether the speculative ‘can’ in the above propositions
might be re-formulated as ‘will’. More immediately, we consider now some implications
for future research and practice in the field of inclusive innovation.

Applying the C + R + E leitmotif that has given structure to our discussion hitherto, we
can identify a number of implications for future research in the field of ‘inclusive
innovation’ relevant to BoP contexts. Specific to the case study discussed in this paper
we recommend that any replication of research into the Nestlé BoW initiative should give
critical attention (‘C’) to the qualitative methods for observing, listening and interacting
with key stakeholders, particularly members of BoP populations in The Philippines in
their role as consumers and as productive actors in extended global value chains.
Correspondingly, the design of future research in the context of BoW should be aligned
to the complexity of the local business system that includes motor-drivers, their relatives
and friends; Nestlé’s local distribution partners; micro-retail stores and market vendors –
all central figures of the local business system and, by extension, embedded in Nestlé’s
global supply and value chain networks. In the case of BoW, the sophistication of the
local technology is low, however the adaptation of the social capital and communication
skills of the bower as putative stakeholders in Nestlé’s distribution network requires
adequate research frameworks and methods to map them and understand difference
among neighbourhoods, regions or even countries where Nestlé or other MNCs apply

11
BoP distribution strategies. Finally, the exploitation process (‘E’) is in our view the most
complicated for do research due to the boundaries of inclusion/exclusion are subjective
for several key stakeholders, particularly BoP members. There is not a permanent
conscientious or reflexive attitude from BoP to analyse their perceptions of
inclusion/exclusion: in other words, future research into the BoW and similar schemes
needs to re-examine the assumptions and biases that generate both actual and (above all)
perceived boundaries drawn between ‘inclusive’ and ‘exclusive’ and question whether
these boundaries are or should be fixed and / or should be considered dynamic and
variable for purposes of gathering and analysing research data.

As researchers attempting to generalise from these field-specific observations and

reflections, we are encouraged by increasingly persuasive presence of South-North or
East-West re-interpretations of ‘innovation’ are challenging the established Western
business paradigms about what business innovation and stakeholder analysis to these
processes might mean. To illustrate, the term jugaad innovation is inspired by Indian
scholars observing practices of ‘innovation’ in South Asian BoP contexts (cf. Radjou
et.al., 2012). Consequently, there are opportunities for business researchers worldwide to
re-conceptualise established definitions of ‘innovation’ and ‘innovation management’ and
explore whether re-conceptualising these processes more pragmatically as ‘inclusive
adaptation’ might offer more valid pathway towards researching ‘inclusive innovation’
among BoP communities where, by definition, the resources to appear ‘innovative’ in
elevated academic terms are limited. In the design of research projects (‘R’) more
systematic attention can be given towards framing inclusiveness as a methodological
choice: for example, by developing more emic (‘insider-looking-in’) research
partnerships and / or dyadic research relationships in the design of ethnographic,
verstehend and other field research approaches. In terms of ‘exploitation’ or
dissemination of research findings, it could become standard practice to verify research
findings with representatives of local BoP communities before disseminating to more
removed audiences exclusive to conferences and research seminars held by resource-rich
universities and other institutions.

On this basis, researchers of inclusive innovation are able to offer parallel and potentially
more critically observed feedback to the MNCs and other organisations seeking to invest
in BoP communities. In terms of conceptualising BoP communities, MNCs might be
guided towards identifying markets towards which MNCs have opportunities during
which to reflect critically and – with relatively low business risk - adapt their current
marketing and investment strategies: in other words, recognising BoP markets as more
than an opportunity to extend their current approaches. From a position of global power
and influence, MNCs and their markets might choose to internalise lessons more directly
from local conditions and feed this knowledge back into other (perhaps) more
mainstream strategic marketing thinking. To illustrate, Nestlé might recruit bowers for

12
 inclusion into the ‘exploitation’ loop of the BoW initiative, employing them not only as
providers of sales revenue and local knowledge but also as stakeholders in processes of
strategic marketing decision-making beyond their home BoP market. In this way MNCs
might employ the social entrepreneurs they help to form in The Philippines as ‘intra-
preneurs’ in the parent organisation and, eliciting their expert local business insight and
knowledge, invest more substantially towards realising policies and practices for (for
example) international business ethics, environmental accountability and sustainability
reporting.

Paraphrasing from John Lennon’s ‘Imagine’, our recommendations for future MNC
policies and practices towards promoting inclusive innovation – or, as we latterly suggest,
adaptation - might appear rather ‘dreamy’ in the ‘hard world’ of global business.
However, for those who invest sincerely in the research and business of inclusive
innovation we believe that working with such combinations of research and business
objectives can generate learning and a sustainable value-adding experience for all
stakeholders involved.

Figures and Tables.

Figure 1. Population by segment income as percentage of the national population,

0.5%
4.5

31 .55%

BOP
6 3 .9%

2010
Own elaboration based on World Bank data base, 2013
Note: Lowest—below $2.97 per capita a day; Low—between $2.97 and $8.44 per capita
a day; Middle—between $8.44 and $23.03 per capita a day; Higher—above $23.03 per
capita a day. Source:

Figure 2. Annual household consumption in Philippines (percentage of total expenses 2010)

Low income Lowest income

13
 Food and Beverages 44.1 Food and Beverages 60.3
Clothing and Footwear 2.6 Clothing and Footwear 2.3
Housing 15.5 Housing 10.5
Energy 7.6 Energy 7.1
Transport 8.2 Transport 4.9
Water Utility 1.3 Water Utility 0.8
Education 4.1 Education 1.7
Health 1.8 Health 1.5
Personal Care 3.2 Personal Care 3.4
ICT 3.1 ICT 1.4
Financial Services 2.5 Financial Services 0.8
Others 6.0 Others 5.3
% %
0 10 20 30 40 50 0 20 40 60 80

Note: Lowest—below $2.97 per capita a day; Low—between $2.97 and $8.44 per capita a day
Source: Own elaboration based on World Bank data base, 2013.

Table 1. Nestlé-GLOBAL Organic growth

Year Expected Obtained

2005 5 to 6% 6.20%
2006 5 to 6% 6.20%
2007 5 to 6% 7.24%
2008 5 to 6% 8.30%
2009 at least 5% 4.10%
2010 5 to 6% 6.20%
2011 5 to 6% 7.50%
2012 5 to 6% 5.90%
2013 5 to 6% 4.60%
2014 5 to 6% ---
Source: Own elaboration based on Nestlé Annual Reports 2005 to 2013

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