Does inclusive business require different skills than ‘mainstream’ business? In part, yes (my view). So, if there is already a shortage of business management talent in developing and emerging economies, just how big is the talent gap needed for inclusive business to thrive?
I have no way of measuring the gap, but it is big enough to be a cause for concern—and action—among several players. Our theme this month explores what kind of skills are needed and what is being done about it.
My assertion that inclusive business needs different skills can certainly be challenged. Of course, it needs the best of ‘conventional’ business skills—the best in product design, marketing, logistics, financial management and more. These skills will be put to the test in the most difficult circumstances: design and marketing must be the best if customers are cash poor and risk averse and possibly illiterate. Logistics must be creative to deal with the ‘off-tarmac’ economy. Financial management must be best in class to manage cash flow in businesses that can take 4-5 years to scale, often require consumer finance, and can deter risk-averse investors and banks. So, the first set of skills needed for inclusive business is, said simply, ‘the best’ of conventional commercial talent.
But secondly, I would assert that inclusive business needs something more: an ability to conceive and shape social impact as well as commercial return. Most importantly, it needs the skill of seeing how the two intertwine—how a market mechanism can tackle a social problem. That requires creative flair.
This ability to bridge commercial and social strategy in turn needs greater:
Agility: successful inclusive businesses of the future are being created now—entrepreneurs cannot depend on ready-to-copy solutions;
Humility and the ability to listen to low-income consumers, suppliers or workers, to understand their actual (not assumed) needs. And willingness to adapt.
Ability to work with different expertise. We should not expect one person to have the full suite of business and social skills, even if they are comfortable on the interface. So, another talent is simply knowing when you need someone to bring in expertise—perhaps in tools for consumer voice, analysis of smallholder household economics, or accounting tools used by people who are illiterate. Knowing when to ask and who to ask is a skill in itself.
Diversity. A lot of inclusive business practitioners are white and western. I am too, so I think I’m allowed to say, I know that is not the answer. We all have our value to add, but business models that create viable solutions to the huge diversity of social challenges will need a huge diversity of people with different lived experiences.
The third type of talent needed is ‘second generation.’ Many inspirational individuals have created inclusive businesses. Their vision and drive broke through boundaries. So, there is preponderance of strong founders in inclusive business. But scale and replication need much more and different—the second generation of managers and leaders.
Over a decade ago we were talking about the policy ecosystem for inclusive business, but only a few years ago did we start to focus on the ‘talent gap’ in inclusive business, impact investing, and the ‘small and growing business’ (SGB) sector, as ANDE calls it. That said, a wealth of initiatives is already in place, as you will learn in this issue: better entrepreneurial training techniques, developed by the African Management Institute. Boardroom Africa developing a generation of board-ready African women, supported by CDC. A host of local incubators and hubs developing talent of young men and women in southern cities. The rise and rise of online courses that help any of us stretch beyond our comfort zone via +Acumen and others. And even the start of a shift in MBA programmes where the future business elite can now take not only individual classes, but entire full-time coursework in social entrepreneurship.
But there is no doubt that this issue has risen quickly up the priority list. For the inclusive business sector to truly scale, more will need to be done to invest in talent, by way of new and innovative ideas or by focusing on the ones that are well underway.
