FROM WHERE I SAT
Leveraging Shared
Value To Gain A
Competitive Advantage
A
fter a hiatus, call it a spring
break, and the urging of William
Kalombo, I am back with an
article that deviates from the norm. My
article is on Shared Value, a concept
that is rapidly gaining currency in the
Corporate, NGO and Public arena. I
came across this concept at the African
Shared Value Summit held in Kenya on
23rd and 24th May 2019.
As I sat through the presentations and
plenary sessions it occurred to me that
the concept, when understood and
implemented well, is a strategic tool that
business can leverage to have a positive
impact on their bottom line. Given that
marketers are constantly looking for ways
to build and strengthen their brands it
is important that we understand what
Shared Value is all about.
The article will look at the ‘what’ and the
‘how’: what is Shared Value and how does
it result in a competitive advantage. What
I am sharing has been drawn not just
By Robert Wamai
from what I learnt at the conference but
subsequent reading which has resulted in
a deeper understanding and consequently
the confidence to share it. attributed in part to off-shoring (shifting
production overseas), short term focus on
returns and the rise of venture capitalists
whose model is to invest, scale, and sell.
The Shared Value concept was birthed
by Prof Michael E. Porter and Michael
Kramer both of Harvard Business School.
They shared the concept in an article
published in a Harvard Business Review
January-February 2011 issue. The article
was titled - Creating Shared Value: How
to reinvent capitalism and unleash a wave
of innovation and Growth. According to the writers' people in many
quarters started questioning the very role
of capitalism and its benefits to society and
many were dissatisfied with the way things
were turning out. This resulted in what the
article describes as ‘capitalism being under
siege’ and it needed to ‘redeem itself and
earn the respect of society again’.
This academic concept was triggered by
the 2008 financial crises which many
attributed to capitalism gone rogue.
Many were of the opinion that businesses
were placing prosperity at the expense of
everyone else except their shareholders.
They were thus not just ignoring the
social, environmental, and economic
problems facing their communities but
were in many cases seen as the cause of
these problems. This development can be
As I sat through the presentations and
plenary sessions it occurred to me that
the concept, when understood and im-
plemented well, is a strategic tool that
business can leverage to have a positive
impact on their bottom line. Given that
marketers are constantly looking for ways
to build and strengthen their brands it
is important that we understand what
Shared Value is all about.
66 MAL35/20 ISSUE
The long and short of it is that there
has to be a new thinking and businesses
cannot just focus solely on fulfilling their
obligation to their shareholders. They can
no longer turn a blind eye to the larger
communities in which they exist. In their
quest to make profits they must look for
ways to simultaneously solve the social
and economic challenges facing society.
This is what the concept of Shared Value
is based on.
To quote Nicholas Nganga, Chairman
Safaricom PLC, in a recent Business Daily
article, ‘as businesses, we can no longer
ignore the fact that we do not operate in
isolation’. Noting the growing inequalities
in the World today; he further stated that
‘we have a critical role to play in reducing
or eliminating these inequities’. He
encouraged other businesses to confront
difficult truths of the challenges the world
is facing today including poverty, poor
governance and climate change which
call for a need to evolve the way they
approach business. The success of business
is intertwined with the growth of the
communities in which they operate in for
they cannot succeed if the communities
are struggling.