Harvard Case - Naara Aaba: Expansion Dilemma of a Social Entrepreneurship
"Naara Aaba: Expansion Dilemma of a Social Entrepreneurship" Harvard business case study is written by Parijat Upadhyay, Sandeep Puri, Sanjeev Ningombam, Prabin Kumar Panigrahi. It deals with the challenges in the field of Entrepreneurship. The case study is 9 page(s) long and it was first published on : Jan 25, 2024
At Fern Fort University, we recommend Naara Aaba pursue a phased expansion strategy focused on strategic partnerships and leveraging technology to scale their impact. This approach prioritizes sustainable growth while ensuring the organization maintains its core values of social impact and environmental sustainability.
2. Background
Naara Aaba is a social enterprise based in India, dedicated to empowering rural women through sustainable agriculture practices. Founded by two passionate entrepreneurs, the organization provides training, resources, and access to markets for women farmers, enabling them to achieve financial independence and improve their livelihoods. Naara Aaba faces the challenge of expanding its reach while maintaining its social mission and financial stability.
The main protagonists of the case study are:
- Anjali and Raj: The founders of Naara Aaba, driven by a strong social mission and entrepreneurial spirit.
- The women farmers: The beneficiaries of Naara Aaba?s programs, seeking economic empowerment and sustainable livelihoods.
- Potential investors: Seeking to invest in a socially responsible venture with strong growth potential.
3. Analysis of the Case Study
This case study can be analyzed through the lens of Porter?s Five Forces, SWOT analysis, and Business Model Canvas.
Porter?s Five Forces:
- Threat of New Entrants: Moderate. The social enterprise sector is growing, but entry barriers exist due to the need for expertise in agriculture, rural development, and social impact measurement.
- Bargaining Power of Buyers: Low. Women farmers are highly dependent on Naara Aaba for training, resources, and market access.
- Bargaining Power of Suppliers: Moderate. Naara Aaba relies on suppliers for inputs like seeds, fertilizers, and technology. However, they can leverage their scale and social mission to negotiate favorable terms.
- Threat of Substitutes: Low. Naara Aaba?s unique combination of training, resources, and market access makes it difficult for substitutes to compete effectively.
- Competitive Rivalry: Moderate. Naara Aaba faces competition from other NGOs and social enterprises working in rural development. However, their focus on women empowerment and sustainable agriculture provides a distinct competitive advantage.
SWOT Analysis:
Strengths:
- Strong social mission and impact.
- Experienced and passionate founders.
- Proven track record of success.
- Strong relationships with rural communities.
- Commitment to environmental sustainability.
Weaknesses:
- Limited financial resources.
- Dependence on grants and donations.
- Lack of scalability in current operations.
- Limited marketing and outreach efforts.
Opportunities:
- Growing demand for sustainable agriculture practices.
- Increasing interest in social impact investing.
- Potential for technology adoption to scale operations.
- Expansion into new geographic markets.
Threats:
- Competition from other NGOs and social enterprises.
- Economic downturns impacting rural communities.
- Difficulty in attracting and retaining skilled staff.
- Regulatory changes affecting agricultural practices.
Business Model Canvas:
- Value Propositions: Empowerment of rural women, sustainable agriculture practices, improved livelihoods, access to markets.
- Customer Segments: Rural women farmers, potential investors, government agencies, corporate partners.
- Channels: Direct outreach, partnerships with NGOs, online platforms, social media.
- Customer Relationships: Personalized support, community building, ongoing training and mentorship.
- Revenue Streams: Grants, donations, product sales, partnerships, licensing fees.
- Key Activities: Training and education, resource provision, market access, advocacy, research and development.
- Key Resources: Skilled staff, partnerships, technology, infrastructure, financial resources.
- Key Partnerships: NGOs, government agencies, educational institutions, technology providers, corporate sponsors.
- Cost Structure: Staff salaries, program costs, technology investments, marketing and outreach, administrative expenses.
4. Recommendations
Naara Aaba should implement a phased expansion strategy focused on strategic partnerships and leveraging technology to achieve sustainable growth.
Phase 1: Strategic Partnerships and Technology Adoption:
- Partner with NGOs and government agencies: Leverage existing networks and resources to expand reach and access new markets.
- Develop a mobile application: Provide farmers with access to information, training materials, and market opportunities through a user-friendly mobile platform.
- Implement data analytics: Utilize data to track program impact, identify areas for improvement, and optimize resource allocation.
- Explore partnerships with corporations: Seek corporate sponsorships and partnerships to leverage their resources and expertise.
Phase 2: Geographic Expansion and Product Development:
- Expand into new geographic markets: Identify regions with similar agricultural challenges and potential for women empowerment.
- Develop new products and services: Explore value-added products like processed food or organic agricultural inputs to diversify revenue streams.
- Establish local partnerships: Build relationships with local communities, farmers? groups, and government agencies to ensure successful implementation.
Phase 3: Scaling Operations and Financial Sustainability:
- Seek investment from social impact investors: Attract capital to support expansion and develop new programs.
- Explore crowdfunding platforms: Utilize online platforms to raise funds from individual donors and build community support.
- Develop a sustainable business model: Diversify revenue streams and optimize operations to achieve financial independence.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core competencies and consistency with mission: The recommendations focus on leveraging Naara Aaba?s existing strengths in agriculture, rural development, and women empowerment.
- External customers and internal clients: The recommendations address the needs of women farmers, potential investors, and corporate partners.
- Competitors: The recommendations aim to differentiate Naara Aaba by leveraging technology and building strategic partnerships.
- Attractiveness: The recommendations are expected to increase Naara Aaba?s reach, impact, and financial sustainability.
Assumptions:
- Naara Aaba?s founders have the leadership and entrepreneurial skills to navigate the challenges of growth.
- The organization can attract and retain skilled staff to support expansion.
- The technology sector will continue to develop innovative solutions for agriculture and rural development.
- Social impact investing will continue to grow, providing access to capital for social enterprises.
6. Conclusion
Naara Aaba has the potential to become a leading social enterprise in the sustainable agriculture sector. By pursuing a phased expansion strategy focused on strategic partnerships and technology adoption, the organization can scale its impact, achieve financial sustainability, and empower rural women across India.
7. Discussion
Alternatives:
- Organic growth: Naara Aaba could focus on expanding its existing programs and operations without seeking external partnerships or investments. This approach would be slower and potentially limit the organization?s reach.
- Mergers and acquisitions: Naara Aaba could consider acquiring or merging with other social enterprises to gain access to new markets, resources, and expertise. This approach could be complex and require significant financial resources.
Risks:
- Technology adoption: The organization may face challenges in developing and implementing a mobile application or data analytics system.
- Partnering with corporations: Naara Aaba may need to navigate potential conflicts of interest or compromise its social mission.
- Financial sustainability: The organization may struggle to attract investment or achieve financial independence.
Key Assumptions:
- The Indian government will continue to support initiatives for rural development and women empowerment.
- The demand for sustainable agricultural practices will continue to grow.
- The technology sector will continue to develop innovative solutions for agriculture and rural development.
8. Next Steps
Timeline:
- Year 1: Develop a mobile application, secure partnerships with NGOs and government agencies, explore corporate sponsorships.
- Year 2: Expand into new geographic markets, develop new products and services, seek investment from social impact investors.
- Year 3: Scale operations, achieve financial sustainability, measure and report on social impact.
Key Milestones:
- Secure funding for mobile application development.
- Establish partnerships with key stakeholders.
- Launch pilot programs in new geographic markets.
- Develop a comprehensive social impact measurement framework.
By implementing these recommendations and navigating the challenges of growth, Naara Aaba can fulfill its mission of empowering rural women and creating a more sustainable future for India.
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Case Description
In April 2023, Tage Rita, the founder and chief executive officer of Lambu Subu Food and Beverages, contemplated the company's ambitious goal of achieving a revenue of ₹100 million by 2025. There was a positive trend in demand for the company's popular kiwi wine, Naara Aaba, particularly in key markets. However, Rita had concerns regarding supply chain issues that had impeded fulfilling significant orders in 2022 due to the remote location of the production unit. In addition, the company's product portfolio solely had wines in the lower-price segments (₹250-₹700), and Rita was considering the launch of a new range of wines in the mid-price segment (₹1,090-₹1,990). The question looming was whether this was the right moment to introduce a higher-priced product. Additionally, she pondered the ideal target audience for these new wines and how their positioning should be differentiated from existing offerings. Furthermore, Rita sought to explore alternative growth strategies for the company.
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