Understanding the inclusive business landscape: A closer look at hubs, networks and programs established to support inclusive business initiatives

As a result of increased interest in inclusive business initiatives, a large number of hubs, networks and programs (HNP) have emerged to provide technical advice and support services to entrepreneurs, multinationals, impact investors and ventures at different stages of development. These HNP differ in terms of services offered, beneficiaries targeted, scope, thematic and geographical focus, maturity and size of supported initiatives.

The Inclusive Business Action Network (IBAN) recently commissioned a project with the aim of gaining an in-depth understanding of service offerings, gaps, measures of success, experiences and lessons learnt. The empowering people. Network Team was part of this project and shared valuable insights through the expert interview series. A blogpost about the overall findings was published by www.inclusivebusinesshub.org and highlighted five key areas:

There is need for more specialization and focus on core competences in the IB landscape
Numerous studies show that different groups of beneficiaries and enterprises at different stages of development have different needs and value different service offerings. The in-depth analysis reveals that most HNP lack specialization. The expert interviews reveal that while some HNP consider their specialization a key success factor, others admit to challenges because of lack of specialization and plan to focus as part of their strategic development. The specialization can refer to industries, groups of beneficiaries, stage of enterprise development or cohorts.

There is a need for more initiatives to raise awareness and engage MNCs, impact investors, foundations
and local stakeholders

The engagement of a range of stakeholders varies across key geographical regions. Insights from all project stages suggest that key groups of actors such as MNCs, impact investors, SMEs or foundations are not sufficiently engaged. On the one hand, it is important to especially raise awareness of opportunities at the BOP and the need for patient capital among MNCs and impact investors. On the other hand, there is a need to educate entrepreneurs about the role of MNCs and impact investors. The inclusion of local stakeholders such as local entrepreneurs, companies, investors and governments is a key success factor but it needs to be intensified, especially in Africa where most inclusive business initiatives are driven by foreigners.

Balancing global and local thinking is crucial for success
Most HNPs evaluated in this project operate on a global level and encounter challenges to balance global and local needs, requirements and expectations. Specific challenges include customization of service offerings, partner selection, organization of on-site trainings and keeping global networks vibrant. Several experts see a strong need for a global certification system in inclusive business which would facilitate finding/working with local entrepreneurs, consultants and trainers in developing countries.

Comparable impact measurement approaches are lacking
The inclusive business landscape comprises numerous service offerings in particular for entrepreneurs and small initiatives. Yet, there is little evidence in regards to impact and effectiveness of different types of service offerings. Comparisons of impact across industries and countries are difficult to conduct because of the wide diversity of approaches employed for impact measurement. Those approaches range from success stories to very detailed impact reports. Current best practices include the use of theory of change to guide impact measurement as well as the use of indicators at household, institutional and sector levels. Important initiatives for comparable data on impact measurement include the BEAM Evidence Map and GALI initiative for accelerators.

There is a need for more knowledge exchange between HNPs
The project findings show that all HNP have valuable lessons to share but very few publish these and make their lessons learnt available to others. For example, several HNP provide awards and support services to high-growth and impact enterprises. After a closer look at their selection criteria and as pointed out by several experts, it seems that many HNPs target the same type of enterprises and they ‘fight’ for a handful of high-potential initiatives. In order to provide support for more enterprises and help them grow, HNPs could benefit from exchanging venture selection practices, support services and follow-ups. Nevertheless, due to a large diversity of organizational models of HNPs providing support services to inclusive business initiatives (from independent for-profit to donor-based initiatives), it is still not clear whether (or who) could facilitate such knowledge exchange or provide support services to HNP.

This conclusions were drawn from the IBAN project that was conducted in four main stages as shown below:

About The Inclusive Business Action Network (IBAN)

Providing a pivotal point for the global inclusive business community, the Inclusive Business Action Network (IBAN) promotes inclusive business globally. To support the scale and replication of inclusive business they connect the dots between the vast number of businesses, existing initiatives, networks and other stakeholders around the world and trigger collective action.

Eugenia Rosca is a Research Associate and Ph.D. student in the Production & Logistics Networks Workgroup of Prof. Dr. oec. J. Bendul at Jacobs University in Bremen, Germany.

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