Alexis Bonnell (@alexisbonnell) from USAID’s Global Development Lab (@GlobalDevLab) talks about how innovation is changing the way development work is done around the world, harnessing 21st century technology to create more development impact, and how some of the most effective innovation tools can be both simple and inexpensive. Bonnell also talks about what it takes to have a successful career in international development today. Learn more at www.globalinnovationexchange.org.
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Many say that we are in the midst of a Fourth Industrial Revolution, characterized by rapid and transformative technological advancement on a scale the world has never seen before. This Fourth Industrial Revolution has already radically and fundamentally altered the way we live, work, and interact with one another, and, unlike the ones that preceded it, is evolving at an exponential, rather than a linear, pace. Its possibilities are nearly endless.
And while previous industrial revolutions were slow to spread to certain areas of the world—thus engendering spheres of “industrialized” and “non-industrialized”—the technological nature of the Fourth Industrial Revolution has meant that the playing field has evened somewhat; industry in virtually every country has been disrupted, and transformation of entire systems of production, management, and governance is all but inevitable, if it hasn’t already started.
From cell phones to self-driving cars and artificial intelligence, the Fourth Industrial Revolution is shaking up what we know—or think we know—about almost everything. This presents an opportunity to recalibrate the lens through which we view and approach critical development issues, and provides a challenge to traditional mechanisms for delivering key goods and services.
Pat Agbakwu-Ajegwu in front of her store.
“As a business owner, you either choose to survive or die. And surviving in this state of economic crisis in Nigeria requires creative thinking.”
On my recent trip to Lagos, Nigeria, I spoke with Patricia (Pat) Agbakwu -Ajegwu, the owner of Xklusive Patsie and the former president of the Fashion Designers Association of Nigeria. She shared with me some challenges that women entrepreneurs in Nigeria are facing in midst of economic turmoil.
Since the peak in 2014, the global price of oil has decreased by over 70 percent. As a result, petrostates like Nigeria, which relies on oil sales for 75 percent of government revenue and 95 percent of its export earnings, are hurting. This is especially felt by small business owners in Nigeria.
As part of the American Enterprise Institute’s Philanthropic Freedom Project, AEI President Arthur Brooks recently interviewed Microsoft co-founder and philanthropist Bill Gates about the intersection between the exceptional entrepreneurial success of Microsoft and the extensive charitable contributions of the Bill and Melinda Gates Foundation.
When asked about how a free market supports philanthropy, Gates explained that effective governments have the capacity to implement social services and deliver necessary support to citizens, but lack the resources to improve upon goods and delivery mechanisms. Taking on the expensive risk of such innovation therefore falls to the private sector, which has a financial incentive to invest in what would otherwise become a market failure.
However, sometimes needed goods are not lucrative for private enterprise to invest in, either. Gates offered the example of anti-malarial medicine research, which proves to be an undesirable field for pharmaceutical companies to invest in due to the inability of most people in malaria-affected countries to afford these medicines at the costs required to support such an expensive research effort. This is the space in a free market where philanthropic efforts, such as those of the Bill and Melinda Gates Foundation, step in to provide research and development assistance that will hopefully produce a cheaper and more effective product.
Trying to explain the connection between democracy and market-driven growth can be like trying to solve the puzzle of the chicken and the egg: which came first? Our panelists in the free enterprise and democracy webinar on September 12 did a commendable job of sorting through the linkages and debunking several myths.
One of the starting premises for discussion was that economic growth flourishes when private property rights are protected in a market-oriented system under rule of law. While autocrats can provide a level of protection for property and a legal order, without democratization there cannot be universal protection of property rights, as Boris Begovic, Senior Fellow at the Center for Liberal Democratic Studies, pointed out. In the long run, democracy brings greater certainty to the rule of law. Businesses require certainty for long-term investment, and this is lessened when the whim of an autocratic ruler prevails.
Aurelio Concheso, Director of Aspen Consulting, further stated that autocratic decisionmaking discourages innovation. As an economy becomes increasingly complex, feedback becomes essential to the decision process and feedback is facilitated by democratic governance. By contrast, oligarchic societies raise huge barriers to entry and innovation in order to protect incumbent political and business elites.
Selima Ahmad, Founder and President of the Bangladesh Women Chamber of Commerce and Industry, and John D. Sullivan, Executive Director at CIPE, spoke about how the private sector can act to level the playing field, for example by advocating universal property rights as guaranteed in the UN Declaration on Human Rights. Businesses ranging from small and medium enterprises to those engaged in international commerce have an interest in regulatory reform, which they can pursue collectively through voluntary associations and policy agendas.
In recent decades, technology has opened the door for many young entrepreneurs in Latin America. Not only has it offered an open space to develop projects and ideas new to their region, but it also offers them the possibility of adapting the technologies they create to the specific needs in their environment. In turn, this accommodation to different environments potentially leads to the creation of original ideas that can be duplicated and transferred to other countries with similar environments.
In view of this potential, many multinational companies, such as Intel, 3M, Cisco, and Microsoft, have held numerous technology and innovation contests for university students and recent graduates throughout the region in order to gather talent into one single space in search of the next big idea.
On April 15, Intel held its Intel Challenge Latin America 2013 in coordination with YouNoodle, a company based in California that provides a technology platform for entrepreneurs worldwide to help organizations innovate at a quicker pace. During the first round of the Intel Challenge Latin America 2013, 221 projects from Peru, Argentina, Chile, Colombia, Costa Rica, and Mexico entered the competition and only 45 passed on to the next round.
Within the last five years, crowdsourcing has risen as new phenomena both in the business world and in international development. Coined by Jeff Howe in WIRED magazine, the term crowdsourcing traditionally refers to using free or low-cost information or labor from a “crowd” to accomplish a task.
The innovative potential of this tool is impressive. Around the world crowdsourcing technologies have facilitated new ways to connect services with clients, track protests, fund businesses, map disasters, and more.