July 11, 2024. Co-creation in vulnerable environments and taking advantage of existing resources in communities is related to the possibility of success of companies in rural, poor or informal environments, according to a study. This is the basis of the VIVA Idea workshop, “Co-creation in vulnerable environments”, of which an abbreviated demonstration was held to bring the methodology to invited companies and organizations.
A demonstration of a workshop proposed by VIVA Idea showed how communities can be strengthened through co-creation approaches and the use of existing resources. Jose Valverde, executive director of VIVA Idea, shared with more than thirty attendees what the co-creation approach in vulnerable environments and the five capitals is all about.
VIVA Idea has incorporated this methodology as a way of strengthening communities, transmitting a way of seeing their own environments and working with the population, whether in rural areas, poverty or informality, where it often seems that there is no way to build businesses or productive associations.
The co-creation approach and the idea of the five capitals come from the work of Urs Jäger and Ted London, who published an academic article in 2019 on co-creation with the base of the pyramid. This approach proposes that companies collaborate with low-income communities to identify and utilize the economic, knowledge, leadership, network and innovation assets that already exist in these markets, rather than transferring solutions from more developed markets.
Co-creation has become a powerful tool for entrepreneurship in low-income markets at the base of the pyramid. According to José Valverde, executive director of VIVA Idea, this approach not only promotes economic inclusion and sustainable development, but also generates significant change in the lives of people living in poverty. “It’s not about imposing solutions from above, but about working closely with the community to create innovative and sustainable solutions,” Valverde explained at the workshop demo.
The demo was a sneak peek of a larger workshop that conveys the working methodology for incorporating existing resources in the community and co-creating in your own environment.
The 5 Capitals Framework
The workshop facilitated by Valverde used the five capitals framework – knowledge, innovation, economic, connections and leadership – taken from the original article by London and Jäger, to guide the co-creation of initiatives. This approach uncovers and leverages valuable assets embedded in developing country markets.
Knowledge Capital
Communities often possess deep cultural and local knowledge that can be crucial to the success of projects. Valverde stressed that “this knowledge not only helps to make informed decisions, but also brings an element of uniqueness to products and services.”
Knowledge capital includes elements such as culture, traditions and local occupations. This knowledge helps to make informed decisions and brings an element of uniqueness to the products and services that are developed in these contexts.
Innovation Capital
Innovation is a catalyst for change, even in resource-constrained environments. “By leveraging local knowledge and expertise, fresh and creative ideas are generated that are tailored to the unique circumstances at the base of the pyramid,” commented Valverde.
Local assets and resources can generate significant change when properly managed. Innovation in these contexts is based on creativity and the ability to adapt to local circumstances.
Economic Capital
Although low-income markets may lack formal financial assets, they have other forms of economic capital, such as labor and local production. The identification and proper management of these resources can generate economic stability and sustainable growth.
This capital includes labor, production capacity, property and access to credit. By controlling more of the value chain, companies can offer local producers a better price and establish stable sourcing.
Connections Capital
Community relationships and local networks are critical in these environments. Valverde noted that “these connections provide platforms to connect individuals and communities, facilitating cooperation and resource sharing.”
Community, political, business and cultural connections play a crucial role in creating networks that facilitate cooperation and resource sharing between communities and formal markets.
Leadership Capital
Local leadership, both formal and informal, can significantly influence decision-making and project implementation. “Community and religious leaders, as well as women leaders, play a crucial role in social cohesion and resource mobilization,” Valverde commented.
Community, religious and women leaders have a significant influence on local decision making. Their role is key to generating support and mobilizing resources within the community.
Dialogue of knowledge and experience
Co-creation enables companies to establish a deep connection with the community at the base of the pyramid. By engaging community members as valued partners, a sense of belonging and mutual trust is created. “This not only helps to better understand their needs and wants, but also fosters a long-term relationship and a loyal customer base.”
By working side-by-side with this sector of the population, companies can accurately understand the real needs of the community. “This in-depth understanding enables the development of products and services that truly address the problems and provide effective solutions,” Valverde noted.
Active community participation in the creation of solutions ensures that they are culturally appropriate, accessible and aligned with local needs and preferences. “When people feel valued and participate in the creation process, there is a greater likelihood of acceptance and commercial success,” Valverde said.
Case Study: Hilandería Warmi
A concrete example presented at the workshop was Hilandería Warmi, an initiative that has transformed llama wool production in the Puna region of Argentina. This company has worked closely with indigenous communities to create a transparent and fair value chain, ensuring competitive prices for local producers. The combination of local capital has enabled not only high-quality production, but also cultural promotion and the strengthening of community identity.
Paradigm Change
The workshop demonstrates the necessary paradigm shift in the way companies relate to communities so that all parties can develop their potential and the social progress of the community can be elevated. The VIVA Idea approach, which José Valverde expressed in the workshop demo, points out that co-creation in environments of vulnerability is not only possible, but essential for sustainable development. “By connecting with the community, understanding needs, fostering community-driven innovation and generating positive social impact, businesses can achieve long-term, sustainable success in low-income markets,” Valverde concluded.
This approach not only promotes economic inclusion, but also contributes to economic and social transformation at the bottom of the pyramid, making a significant difference in the lives of people living in poverty.
The paradigm shift that the VIVA Idea workshop helps to develop involves a collaborative approach in which companies act not only as benefactors, but as active partners of communities. This model is based on some key aspects.
1.Active Participation: Companies should involve communities in all stages of project development, from planning to implementation. This ensures that solutions are relevant and sustainable.
2. Leveraging Local Resources: Instead of importing external solutions, companies identify and utilize local assets and knowledge. This not only empowers the community, but also creates more tailored and effective solutions.
3. Network Building: Fostering the creation of networks within the community and between the community and the formal market is crucial. These networks facilitate the sharing of resources and knowledge, and strengthen social cohesion.
4. Capacity Building: Companies should invest in local capacity building, providing training and support to enable the community to assume leadership and management roles in projects.
5. Long-term Sustainability: The goal is to create business models that are economically viable and socially beneficial in the long term. This implies a continuous engagement with the community and constant adaptation to their needs and circumstances.
This collaborative and sustainable approach not only promotes economic inclusion and social progress, but also contributes to the creation of an environment in which all stakeholders can thrive and grow together.