Wednesday, April 27, 2016

How EasyPaisa in Pakistan was able to Create Shared Value

After reading through the article 'Creating Shared Value', I tried to identify a company which has been able to create a shared value. I recognized that the Telenor my previous employer has been able to do so by providing first of its kind digital mobile payments to its customers. 

Interestingly, the idea came from the basic pain of the consumers to line up for several hours at a bank or an authorized place where the monthly utility bills could be paid. This societal problem or an issue as discussed by Michael and Mark in the article 'Creating Shared Value' is very well explained. As the authors discuss, the shared value is created in three ways i.e. reconceiving products, productivity in value chain or employee productivity. 

Telenor was able to create value in terms of product as well as value chain productivity. For product, Telenor was the first company to introduce mobile payments and money transfer. The mobile payment first product was bill payment which reduced the basic pain in society enabling people to become self-sufficient and pay their bills at their convenience. Secondly, in terms of money transfer digitally allowed business avenues at different levels. One such new business opportunity was created for small shop owners or retail stores especially in far flung areas where banks were not available. The model that Telenor used for mobile money transfer was that, a person in one city can go to a e.g. retailer and do a transfer of money to someone in a village. But this transfer happened from retailer to retailer and the money sender and collector simply had to exchange money via a digital platform and sending and receiving money at their respective retailers. This complete model and business lifecycle excluded the need for any bank. The transfer was secured via identity card verification system.

The key learning is that shared value created in society and at economic level as well as increased business revenue opportunity for Telenor as well. The new jobs were created in the same process for the retailers who could now earn commission on top of each transaction they conducted for money transfer. This model was ideal for people whose bread earner lived someplace else but they had to send money back home. Hence, the overall goal achieved to support and grow society by addressing an issue in the society and by effectively enabling the sustainable model to help both company and society benefit from this new opportunity.

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