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Harvard Case - Dharavi Redevelopment Project: Strategy for Project Implementation

"Dharavi Redevelopment Project: Strategy for Project Implementation" Harvard business case study is written by N. Ravichandran, Nikunjkumar Patel, Russel Lawrence. It deals with the challenges in the field of Strategy. The case study is 16 page(s) long and it was first published on : Apr 8, 2023

At Fern Fort University, we recommend a phased approach to the Dharavi redevelopment project, prioritizing community engagement, sustainable development, and economic empowerment. This strategy leverages a public-private partnership (PPP) model, incorporating innovative business models and technology to create a thriving, inclusive, and environmentally conscious community.

2. Background

The Dharavi Redevelopment Project aims to transform Dharavi, Mumbai's largest slum, into a modern, sustainable, and economically vibrant area. The project faces challenges related to land ownership, community resistance, and the need to balance economic development with social equity.

The main protagonists are the Maharashtra Housing and Area Development Authority (MHADA), the government agency responsible for the project, and the residents of Dharavi, who are stakeholders with diverse needs and aspirations.

3. Analysis of the Case Study

SWOT Analysis:

Strengths:

  • Large, skilled workforce: Dharavi boasts a significant pool of skilled labor, particularly in manufacturing and small-scale industries.
  • Strong entrepreneurial spirit: The community exhibits a high level of entrepreneurial drive, with a thriving informal economy.
  • Potential for economic growth: The redevelopment offers significant potential for economic growth and job creation.

Weaknesses:

  • Lack of infrastructure: Dharavi suffers from inadequate infrastructure, including sanitation, water, and electricity.
  • Complex land ownership: The intricate land ownership patterns pose a significant challenge to project implementation.
  • Limited access to formal financial institutions: The informal nature of the economy limits access to formal financial resources.

Opportunities:

  • Government support: The government's commitment to the project provides a strong foundation for its success.
  • Technological advancements: The project can leverage technology to improve infrastructure, enhance sanitation, and facilitate access to services.
  • Private sector investment: The project can attract private sector investment in infrastructure development and economic activities.

Threats:

  • Community resistance: The project faces potential resistance from residents concerned about displacement and loss of livelihoods.
  • Environmental concerns: The redevelopment needs to address environmental concerns related to waste management and pollution.
  • Competition from other urban development projects: The project faces competition from other urban development projects in the region.

Porter's Five Forces:

  • Threat of new entrants: High due to the potential for new businesses to enter the revitalized area.
  • Bargaining power of buyers: Moderate, as residents will have more choices for housing and services.
  • Bargaining power of suppliers: Moderate, as the project can leverage its scale to negotiate favorable terms with suppliers.
  • Threat of substitutes: Low, as Dharavi's unique character and location offer limited substitutes.
  • Rivalry among existing competitors: High, as the project will attract existing businesses and new entrants.

Value Chain:

The project's value chain involves multiple stakeholders, including:

  • Government: Responsible for policy, regulation, and infrastructure development.
  • Private sector: Involved in infrastructure development, real estate development, and business operations.
  • Residents: Contribute to the project through their skills, labor, and participation in community development.

Business Model Innovation:

The project requires innovative business models to address the unique challenges and opportunities presented by Dharavi. These models should focus on:

  • Social entrepreneurship: Creating businesses that address social needs while generating economic returns.
  • Microfinance and financial inclusion: Providing access to financial services for residents and small businesses.
  • Community-based development: Empowering residents to participate in the planning and implementation of the project.

Corporate Governance:

Strong corporate governance is essential for transparency, accountability, and stakeholder engagement. This includes:

  • Independent oversight: Establishing independent oversight mechanisms to ensure the project's ethical and transparent implementation.
  • Community participation: Providing residents with meaningful opportunities to participate in decision-making processes.
  • Financial transparency: Ensuring transparent financial management and reporting.

4. Recommendations

Phase 1: Community Engagement and Planning (2 years):

  1. Establish a Community Advisory Board: Create a representative board composed of residents, community leaders, and experts to guide the project's development.
  2. Conduct comprehensive stakeholder analysis: Identify and understand the needs, concerns, and aspirations of all stakeholders, including residents, businesses, and government agencies.
  3. Develop a participatory planning process: Involve residents in the planning process through workshops, surveys, and public forums to ensure their voices are heard.
  4. Pilot innovative housing models: Experiment with different housing models, including mixed-income housing, co-operative housing, and community-owned housing, to address diverse needs.
  5. Develop a sustainable infrastructure plan: Focus on improving sanitation, water, electricity, and transportation infrastructure, prioritizing environmentally friendly solutions.

Phase 2: Infrastructure Development and Economic Empowerment (5 years):

  1. Launch a public-private partnership (PPP) program: Partner with private sector companies to develop infrastructure, housing, and commercial spaces.
  2. Develop a skills training program: Provide residents with training in construction, manufacturing, and other relevant skills to prepare them for new job opportunities.
  3. Establish a microfinance institution: Provide access to microloans and financial services to residents and small businesses.
  4. Create a business incubation center: Provide support for entrepreneurship and business development, including mentorship, networking, and access to funding.
  5. Promote tourism and cultural development: Leverage Dharavi's unique cultural heritage to attract tourists and create new economic opportunities.

Phase 3: Long-Term Sustainability and Growth (ongoing):

  1. Implement a comprehensive environmental management plan: Address environmental concerns related to waste management, pollution, and resource conservation.
  2. Develop a sustainable transportation system: Promote public transportation, cycling, and walking to reduce traffic congestion and air pollution.
  3. Foster a vibrant community spirit: Create public spaces and community centers to promote social interaction and community building.
  4. Monitor and evaluate the project's impact: Regularly assess the project's progress and make adjustments based on feedback and data.
  5. Continuously innovate and adapt: Stay abreast of emerging technologies and trends to ensure the project's long-term sustainability and competitiveness.

5. Basis of Recommendations

These recommendations are based on:

  1. Core competencies and consistency with mission: The project aligns with the government's mission to improve living conditions and create economic opportunities for all citizens. The recommendations focus on leveraging existing community strengths, such as the skilled workforce and entrepreneurial spirit.
  2. External customers and internal clients: The recommendations prioritize the needs of residents, businesses, and government agencies, ensuring their voices are heard and their interests are addressed.
  3. Competitors: The recommendations aim to create a competitive advantage by leveraging Dharavi's unique character and fostering a thriving business ecosystem.
  4. Attractiveness ' quantitative measures if applicable (e.g., NPV, ROI, break-even, payback): While specific financial metrics are not provided in the case study, the recommendations focus on creating a sustainable and economically viable project that can generate positive returns on investment.
  5. Assumptions: The recommendations are based on the assumption that the government is committed to the project's success and that residents are willing to participate in the planning and implementation process.

6. Conclusion

By adopting a phased approach that prioritizes community engagement, sustainable development, and economic empowerment, the Dharavi Redevelopment Project can transform Dharavi into a model of urban renewal. The project can serve as a blueprint for other urban development projects in India and around the world, demonstrating the power of public-private partnerships, community participation, and innovative business models to create thriving, inclusive, and sustainable communities.

7. Discussion

Alternatives not selected:

  • Complete demolition and rebuilding: This approach would be disruptive and could lead to displacement and social unrest.
  • Minimal intervention: This approach would fail to address the critical infrastructure and social needs of the community.

Risks and key assumptions:

  • Community resistance: The project faces the risk of community resistance, which could delay or derail the project.
  • Financial feasibility: The project's success depends on securing sufficient funding from both the government and private sector.
  • Political instability: Political instability could impact the project's implementation and funding.

Options Grid:

OptionAdvantagesDisadvantagesRisks
Phased approachCommunity engagement, sustainable development, economic empowermentLonger implementation timelineCommunity resistance, funding challenges
Complete demolition and rebuildingFaster implementation, modern infrastructureDisruptive, potential for displacementSocial unrest, environmental concerns
Minimal interventionPreserves existing communityFails to address critical needsContinued poverty, lack of infrastructure

8. Next Steps

Timeline with key milestones:

  • Year 1: Establish the Community Advisory Board, conduct stakeholder analysis, and develop a participatory planning process.
  • Year 2: Pilot innovative housing models, develop a sustainable infrastructure plan, and launch the PPP program.
  • Year 3-7: Implement infrastructure development, skills training, microfinance, and business incubation programs.
  • Year 8 onwards: Focus on long-term sustainability, environmental management, and community building.

The success of the Dharavi Redevelopment Project depends on effective collaboration between the government, private sector, and residents. By embracing a phased approach, leveraging innovative business models, and prioritizing community engagement, the project can create a thriving, inclusive, and sustainable future for Dharavi.

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Case Description

The case presents the complexities involved in implementing a social project with specific reference to the Dharavi Redevelopment Project (DRP) in Mumbai, India. This project was awarded to the Adani Group, a large business conglomerate in India. Started in 2022, the project is envisaged to be completed over a period of seven years with a return on investment capped at 193%. Its multiple stakeholders include politicians, bureaucrats, Dharavi residents, manufacturing companies which outsource their production to Dharavi, committed non-governmental agencies and motivated press. These agencies with varied interest have been a drag in transforming Dharavi from a slum to a reasonable living place.

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