Poverty = Profit
It’s December. Rick is laying in bed at his window looking out at the night sky as the cars go by. He can hear city lights and faint noises just off in the distance. Just then he sees tiny snow flakes fall from the sky. It’s beautiful. Rick pull the covers closer and snuggle in tight as he slowly drifts off to sleep.
It’s January. Rick is laying on a blanket just outside of the community library on the sidewalk. He looks up at the night sky as a car drives by and honks the horn loudly. As Rick tries to sleep he notice that it is beginning to snow. Now he needs to pack his things up and find a place that shields him from getting snowed on.
I just described a scenario that many people experiencing homeless have to deal with from day to day. My intention isn’t to make you, as the reader, feel pity for Rick but actually relate to him. Rick, like many people experiencing was not always homeless and he was not always poor. We often think of people like Rick as “Homeless People” as if they are different from us in some manner. We put them in a box and pretend that we know what is best for them. It is because of this thinking that we often fail to give these individuals the aid they actually need. This brings us to the main problem: many people currently are experiencing extreme poverty and homelessness, and it is because of this poverty they lack the ability to get themselves out of it. I am proposing a solution. We need to do two things. First, we start to see these people as potential customers and leaders rather than charity cases. Second, use the five lessons in building a social business that Muhammad Yunus states in his article,”Building Social Business Models: Lessons from the Grameen Experience,” to design with and empower these people to take charge of their situation and have them create a way out of their situation but in a way that suits them individually.
Challenging the Way We Think
So let’s talk about poverty. People experiencing homelessness are usually in the throes of extreme poverty. Many would view their situation as the result of bad decision making but Dean Spears would say the contrary. In three studies done in various context with several people both rich and poor Spears concludes that it is because of poverty that people make bad decision and not the other way around. In other words, poverty cause low cognitive control and bad decision making to those affected by it. After reading his findings and results I concur with his findings and agree that we need to take this into account when dealing with those experiencing homelessness.
No matter how you approach this issue you are still working with human beings and that means they have max potential and minimal potential just like the rest of us. In both their articles, C.K. Prahalad and Chris Le Dantec talk about this idea that there is more to these people that are experiencing hardship. Prahalad talks about how poor people have a place as customers with substantial buying power.
“Surveys show that poor households spend most of their income on housing, food, healthcare, education, finance charges, communications, and consumer goods. Multinational corporations have largely failed to tap this market, even though the rewards for doing so could be substantial…[and]… In some developing economies such as China and India, poor households control a significant portion of national income.”
and, his article “Designs on Dignity: Perceptions of Technology Among the Homeless,” Le Dantec does research into the social implications that technology has on those experiencing homelessness. Overall in his article it is clear that the people they speak with are just that, people. In both cases these people have been overlooked by the rest of society because of their situation. Whether it’s that companies aren’t creating products for them or that programs are designed FOR them and not WITH them.
Now Chris LeDantec does this is in his other article, “A Tale of Two Publics: Democratizing Design at the Margins.” He, along with his group of researchers set out to create a product designed to help the homeless. Instead of just interviewing and asking the people they get several of them to “co-design” the product with them. They ask their input and the result is a much more well designed product. The product is a program called Community Resource Messenger (CRM). It’s main function is to support, “…both those in need and those attempting to provide care in a challenging environment.” The goal of the program is to generate opportunities for participants, and action. But, given what we know now about poverty from Dean Spears we can assume that, for the majority of cases, the CRM will not be utilized in such a way that generates ample opportunities for these impoverished individuals. So what is next? How do we get these people to make good decisions in the face of such adversity?
Creating an Entrepreneur
If we look at Rick, this man who is experiencing homelessness and apply what we’ve learned so far about homelessness and poverty and the way he thinks given his state of poverty. We can then use the lessons Muhammad Yunus gives in his articles that illustrate how to build a business that is not engaged in contest or financial gain but rather social issues and serving society’s betterment. We use these five lessons because we are, in a way, investing in the social business that is Rick. We are empowering him in the hopes that he will embrace entrepreneurship and learn skills that allow him to create products or services that will help his community.
Lesson 1: Challenging conventional wisdom
Don’t assume every person experiencing homelessness is a loner, outside of a community. Le Dantec points out several instances in his article of people clinging to social status and having a community of peers and status in those communities. Take advantage of this empowerment and social status. It can be powerful.
In this lesson we need to also challenge the work of Le Dantec. If we look at his work, while it was great that he used co-design tactics, we need to take it a step further by focusing on the right questions.
Roger Martin talks about the Social Entrepreneur in his article “Social Entrepreneurship: The Case for Definition” and how they are people that are inspired, creative, courageous, who take direct action and have fortitude. They identify instances of injustice towards people or groups and work to create balance when those people have no means to do it for themselves.
We can ask Rick and other members of his community to talk about what makes them inspired? What makes them creative? When was a time that they took direct action or had fortitude? Then once we have those utterances and informations these people and we can synthesize design ideas to create together. This will take these people away from the state of poverty that, because of the desperation that come with poverty, causes bad decision making and low performance and gives them the tools to create something useful for them and their community. Overall it will give them a chance to make real money, if their product takes off, and it will give them purpose.
Lessons 2: Finding complementary partners
This is a process that requires the input from many people in the community. Rick’s idea may not work but if we get a lot of people working on ideas and a lot of people helping when an idea gets some traction then we will provide that community support that will help keep people engaged. Rick may fail but unlike what Roger Martin may view I believe that he is still an entrepreneur. Even if Rick never makes a successful product or service I still believe that as long as he is finding ways to help others and tries to be innovative then he is an entrepreneur.
Lesson 3: Undertaking continuous experimentation
Always be testing out ideas on other people and continue to be a source of help. The only way we can go from a good idea to a great idea is through many many drafts.
Lesson 4: Favoring social profit-oriented shareholders
If companies like Dell or Indeed.com had a hand in this program it would open up opportunities to present ideas to them, providing a mutually beneficial partnership. The people would be given the opportunity to present their ideas to these companies and could potentially get funding if an idea gets picked up. Dell and Indeed could become shareholders in the program and benefit off any profits the ideas that come out of the program generate.
Lesson 5: Specifying social profit objectives clearly
We want these people out of poverty and not to remain homeless but we are focusing on launching their ideas and making sure they take off. We are wanting to make money from that. It is important to distinguish between those two focuses because if we start to focus on getting people out of poverty then we fall back into the same trap that we are in at the present moment.