Buzz and the business model: Creating impact from IT to agriculture

Having a positive buzz around a business model makes it easier to engage with partners and inspire change, writes Andrew Wilson.

The central role of improved business models in private sector development is nothing new. Market system development projects, in particular, invest substantial time and energy on analysis to recognise sustainable and scalable business models when they are proposed by private sector partners and/or to develop business models themselves. However, a great needs to stimulate a series of self-perpetuating changes throughout a market system, or in marketing terms 'go viral'. If the goal is for our business model to go viral, it needs to create a buzz.

A truly innovative, compelling business model that creates buzz or excitement, amplifies how much attention it receives. Having a positive buzz around a business model makes it easier to engage with business partners and creates a cascade of effects that continue to stimulate and inspire change in ways that a standard, everyday sustainable business model could not. Considering whether a business model creates (or will create) buzz can also show the difference between interventions that analysis tells us should work and interventions that really do work.

In Bosnia and Herzegovina (BiH), the introduction of an IT hub business model has succeeded in large part because of the buzz it created with businesses, current and future IT workers, media and the government. In this model, established IT companies, internship programmes, a start-up accelerator and an IT academy came together under one roof, to create a self-contained, dynamic IT ecosystem – HUB 387. While the concept has existed in more mature IT markets for years, it was completely new for BiH and it is dramatically changing the IT sector.

The benefits

Two common challenges with private sector development projects are how to engage well with private sector partners and how to achieve scale. With IT hubs in Bosnia and Herzegovina, a business model with buzz has been useful at three different points in the process of systemic change. From the beginning, when the model was conceived and initially adopted, the excitement the concept generated encouraged IT companies to take a risk by joining the hub. Shared enthusiasm also made it easier for the projects which supported HUB 387 and Edin Saracevic, the entrepreneur behind the concept, to work together through multiple challenges. 

The second effect of having a buzz was to ease and speed up the expansion of the business model. Excitement about the IT hub attracted substantial and continuous media attention, both in BiH and in international media such as Forbes (see here for the article). This attention attracted additional investors and institutions to try similar initiatives in other cities in BiH and in neighbouring countries, all within less than one year of the hub opening but with little external support needed to promote and sustain replication of the business model.

Perhaps most interesting, however, is how the buzz generated by the business model is stimulating the government to respond to opportunities for employment growth in the IT sector. In Bosnia and Herzegovina legal and regulatory change can be slow and difficult. However, partly because of the excitement, media coverage and positive stories around HUB 387, the government of Sarajevo Canton recently selected ICT as a strategic sector. They are creating an ICT sector development strategy in cooperation with a number of leading individuals from HUB 387 and its member companies to help lead the process. While the full results of the planned reforms will not be seen for some time, this may eventually be the most important impact of the buzz created by the IT hub business model.

Is this only relevant for IT? 

The IT sector, with its rapid innovation and unconventional work places may seem like a special case. But a business model that creates buzz is just as valuable in sectors from agriculture to healthcare. The starting point is to have ideas that make sense according to the analysis and which are truly innovative in the local context.

When you decide which business models to promote ask three questions about their ability to create buzz: When the business model is being discussed with the partner(s) and adopted, the first question to ask is, 'are my business partner(s) and I genuinely excited about this?' If not, think seriously why one or both parties are unenthusiastic and do something about it, or drop it and try something completely different.

The second question, which anticipates the expansion phase, asks, 'If this works in the pilot phase, will it create buzz in the sector and the media that will influence others to crowd-in?' If the answer is 'not really', think about how to make the business model more exciting. You may still go ahead with the business model, but it will be important to use unconventional and unexpected ways of telling the story of the innovative business model. 

Finally ask 'If this works as we hope, will it cause such a sensation that the government and other stakeholders will change what they do in order to be part of it?' If you can confidently answer 'Yes' to all three questions, you have a business model that will create a buzz!

Andrew Wilson is the Project Manager for MarketMakers, a programme supported by the Swiss Agency for Development and Cooperation (SDC). The programme is part of the Swiss contribution to the transition of BiH towards a socially inclusive market economy and a decentralised, democratic political system, with the longer-term perspective of European integration.

To hear more about this project listen to the recent BEAM webinar with Andrew.