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«DOI: 10.1016/j.destud.2014.02.007 Published: 01/01/2014 Link to publication Citation for published version (APA): Jagtap, S., Larsson, A., Hiort, V., ...»

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How design process for the Base of the Pyramid differs from that for the Top of the

Pyramid

Jagtap, Santosh; Larsson, Andreas; Hiort, Viktor; Olander, Elin; Warell, Anders; Khadilkar,

Pramod

Published in:

Design Studies

DOI:

10.1016/j.destud.2014.02.007

Published: 01/01/2014

Link to publication

Citation for published version (APA):

Jagtap, S., Larsson, A., Hiort, V., Olander, E., Warell, A., & Khadilkar, P. (2014). How design process for the

Base of the Pyramid differs from that for the Top of the Pyramid. Design Studies, 35(5), 527-558. DOI:

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Download date: 26. Nov. 2016 Author's Post-print To cite this article: Jagtap, S., Larsson, A., Hiort, V., Olander, E., Warell, A. & Khadilkar, P.

(2014). How design process for the Base of the Pyramid differs from that for the Top of the Pyramid. Design Studies, 35 (5): p. 527-558.

How Design Process for the Base of the Pyramid Differs from that for the Top of the Pyramid Santosh Jagtap and Andreas Larsson, Department of Design Sciences, Faculty of Engineering, Lund University, P.O. Box 118, SE-221 00 Lund, Sweden Viktor Hiort, Product and Production Development, Chalmers University of Technology, SE- 412 96 Gothenburg, Sweden Elin Olander and Anders Warell, Department of Design Sciences, Faculty of Engineering, Lund University, Sweden Pramod Khadilkar, Centre for Product Design and Manufacturing, Indian Institute of Science, Bangalore, India Abstract The base (BOP) and the top (TOP) of the world income pyramid represent the poor people and the people from developed countries, respectively. The design of products for the BOP is an important ingredient of the poverty reduction approach that combines business development with poverty alleviation. However, the current understanding of the design for the BOP is limited. This study, using a protocol analysis, compared design processes for the BOP and TOP markets. The results indicate the difference between the design processes for these markets in terms of the design strategy employed by the designers (i.e. problem driven, solution driven strategy), their requirements handling behaviour, and their information behaviour.

Keywords: base of the pyramid; design process; design activity; design behaviour; protocol analysis The world income pyramid can be divided into three segments (see Figure 1). The top of this pyramid, called the Top of the Pyramid (TOP), includes people from developed countries (Prahalad and Hart, 2002). The middle segment consists of the rising middle class from developing countries. The base of this pyramid, generally called the ‘Base of the Pyramid’ (BOP), consists of poor people. About two-fifths of the world population can be categorized as poor. Their income is less than 2 dollars per day (Karnani, 2011). About a fifth of the world population is classified as extremely poor with income of less than 1.25 dollars per day.

Figure 1 The world income pyramid (Prahalad and Hart, 2002)

Poverty is a trap because children born to poor parents are likely to grow up to be poor adults.

Mahatma Gandhi often said - poverty is the worst form of violence. It is important to alleviate poverty. There are ways (i.e. approaches) to alleviate poverty (e.g. microcredit, granting formal property rights to the poor, etc.). In recent years, a poverty reduction approach that combines business development with poverty alleviation has received attention (Prahalad, 2004). Private sector firms continually search for new business opportunities. Saturated markets and a highly competitive business landscape motivate companies to search for new markets to increase profits.

This has led companies to pay greater attention to opportunities at the BOP (Nakata, 2012; London and Hart, 2010). While companies are beginning to address the product needs of the BOP, there is limited practical and theoretical knowledge to support them (Nakata, 2012).

Page 1 of 29Author's Post-print

In the approach of combining business development and poverty alleviation, the poor at the BOP are considered as producers and consumers of products. Design of products is an important ingredient of this market-based approach. Furthermore, some universities have begun to offer courses and/or design projects in the area of the design for the BOP1.

The research in the BOP domain has been carried out by several authors from different disciplines (Prahalad, 2004; UNDP, 2008; Whitney and Kelkar, 2004). While design research is important in understanding and improving design practice and education (Blessing and Chakrabarti, 2009), design researchers have given little attention to the field of the design for the BOP. Most of the design research has been carried out in the context of developed countries and relatively affluent markets (Viswanathan and Sridharan, 2012; Jagtap and Larsson, 2013;





Jagtap et al., 2013). There has been little empirical examination of the design for the BOP, and this limits our ability to develop tools and methods for improving current practice and education of design for the BOP. It is therefore important to develop an understanding of design for the BOP.

This study aims at exploring the differences between the design processes for the BOP and TOP markets, where designing for the TOP is a baseline. The sharp contrast between the BOP and the TOP makes the distinctions clear. The intent of the study was not to determine the differences between the outcomes of these design processes. Rather, it was to empirically explore the differences between these design processes. The design processes are compared using the widely employed technique of verbal protocol analysis in the area of design research.

In a laboratory setting, four designers individually solved a design problem for the BOP, and four other designers individually solved the same problem for the TOP. The collected data was encoded and analysed. Encoded results of the protocol analysis show the differences between the design processes for the BOP and TOP markets.

1 Background literature

1.1 BOP Markets and Product Design The BoP includes poor people. About two-fifths of the world population can be categorized as poor. Their income is less than 2 dollars per day. Their income is irregular and unpredictable, and these people live in rural villages, urban slums, or shantytowns. Usually, these people have little or no formal education, and they are hard to reach via the conventional means of communication and distribution channels. The World Bank conducted a study called ‘Voices of the Poor’ involving 20000 poor women and men from 23 countries to explore their perspective regarding poverty, wellbeing, and illbeing (Narayan et al. 2000). This study identified that the poor face different problems such as: hunger, violation of dignity, powerlessness, insecurity, state corruption, unemployment, poor health, gender inequality, etc.

Poverty is multifaceted, and has three intertwined characteristics as follows (Karnani 2011): (1) lack of income and resources required to satisfy basic necessities such as food, shelter, clothing, and fuel, (2) lack of access to basic services such as public health, education, safe drinking water, sanitation, infrastructure, and security; and (3) social, cultural, and political exclusion.

It is important to alleviate poverty. The United Nations Millennium Development project (2005) notes, “Poor and hungry societies are much more likely than high-income societies to fall into conflict over scarce vital resources, such as watering holes and arable land…Many world leaders in recent years have rightly stressed the powerful relationship between poverty reduction and global security”. Poverty is a trap - children born to poor parents are likely to grow up to be poor adults.

Page 2 of 29Author's Post-print

In recent years, a poverty reduction approach, popularised by the late C.K. Prahalad, has received attention (Prahalad 2004). This approach proposes solutions involving business development combined with poverty alleviation. According to Prahalad and Hart (2002), the most visible and prolific writers in the area of the BoP, this business strategy is important in, “…lifting billions of people out of poverty and desperation, averting the social decay, political chaos, terrorism, and environmental meltdown that is certain to continue if the gap between rich and poor countries continues to widen”. Furthermore, saturated markets and a highly competitive business landscape motivate companies to pay greater attention to opportunities at the BOP (Nakata, 2012; London and Hart, 2010).

The International Finance Corporation together with the World Resources Institute measured the size of BOP markets (IFC, 2007). The potential purchasing power of the BOP is five trillion US dollars. Furthermore, the products originally developed for the BOP can be adapted for the markets in developed countries, and this is called ‘reverse innovation’ (Immelt et al, 2009). For example, GE developed an ECG device for rural India and an ultrasound machine for rural China. These products are now being sold in the United States.

In the market-based approach of combining business development and poverty alleviation, the poor at the BOP are considered as producers and consumers of products. Design of products is an important ingredient of this approach. Designing and developing products for the BOP require addressing constraints in the BOP. These constraints are significantly different from those in developed country markets. Regardless of the location of a BOP market, the constraints in the design and development of products for the BOP are the following (UNDP, 2008).

(1) Market information: In the design of products for the BOP, there is an important role of information regarding the BOP, for example, what the poor need, what capabilities the poor can offer, etc. In the product design for the BOP, businesses often lack detailed information about the BOP markets.

(2) Regulatory environment: The regulatory frameworks are under- or un-developed in the BOP. In addition, enforcement of the existing rules is inadequate. Complying with the bureaucracy in developing countries can be time consuming and monetarily expensive.

(3) Physical infrastructure: This constraint considers the inadequate infrastructure (e.g. roads, electricity, water and sanitation, hospitals, etc.) in the BOP. In developed countries, the logistics system that is necessary for accessing consumers, selling to them, and servicing products exists, and only minor changes may be required for specific products. In the BOP, the existence of a logistics infrastructure cannot be assumed.

(4) Knowledge and skills: The poor, generally, are illiterate and do not possess knowledge and skills regarding the availability of products, usage of products, etc. In the design of products for the BOP, the skill levels of the poor must be taken into account.

(5) Access to financial services: The poor lack access to credits, insurance products, and banking services. This puts limits to the purchases made by them. In addition, they cannot protect their meagre assets from events such as illness, drought, etc. In the design for the BOP, the designers must take into account the price-performance relationship.

Companies need to change their business assumptions, models, and practices in order to address these constraints (Viswanathan and Sridharan, 2012). While companies are beginning to address the product needs of the BOP, there is limited practical and theoretical knowledge to support them (Nakata, 2012). There has been little empirical examination of the design for the BOP, and there is an urgent need to develop an understanding of this area. This study aims at exploring the differences between the design processes for the BOP and TOP markets.

Page 3 of 29Author's Post-print

1.2 Design problem solving There is a plethora of design process models (Cross, 1994; Pahl and Beitz, 1996). At a high level of abstraction, these models share common characteristics such as: progression from

Abstract

to concrete, presence of feedback and iteration, presence of decision and evaluation points, etc. (McMahon, 2012). Chakrabarti et al. (2004) found that the main ingredients of the design process are: requirements (i.e. problems), solutions, information, and strategy (i.e. plan of action to progress through the design process).

Research in design has been undertaken by using a variety of methods such as verbal protocol analysis, questionnaires, ethnographic studies, observation, etc. Some characteristics of the design process have been widely observed. It is commonly accepted that the design process is iterative in nature. In the design process, the requirements and solutions co-evolve (Suwa et al.

2000). Designers develop both requirements and solutions in parallel (Dorst and Cross, 2001).

Suwa et al. (2000) investigated the process of how different requirements are generated through unexpected discoveries during the design process. In their study, they found that sketches help in the identification of requirements. They call this requirements identification as ‘invention’ of design issues or design requirements. Chakrabarti et al. (2004) observed that the process of requirement identification is closely related to solution generation. Designers tend to use solutions to develop their understanding of the problem because a problem cannot be fully understood in isolation from solutions (Cross, 2006).



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