Bridging the Digital Divide - (A) HP's e-Inclusion, (B) HP's First i-Community in Kuppam

In terms of information technology, the digital divide between the extremes of the world's haves and have-nots is simply mind-blowing. Visiting Professor of Economics Daniel Traça examines the efforts of one of the world's biggest and highest-profile IT firms to work towards bridging this yawning divide. The (B) case focuses on Hewlett-Packard's first i-community in Kuppam, India where H-P hopes to use information and communication technology as a catalyst for improving the standards of living of the poor in certain countries, thereby developing what could be very promising markets for the company in the longer term.

by Sara Foryt,Daniel Traça
Last Updated: 23 Jul 2013

(A) Case: H-P's e-Inclusion

In terms of information technology, the digital divide between the extremes of the world's haves and have-nots is simply mind-blowing. Dire poverty has created two major constraints for the poor being able to access the information and communication technology (ICT) that - quite arguably - could do much to better their lives. The most obvious may be that almost any IT products are completely beyond their financial reach. But the world's poor are disenfranchised from the most basic benefits of technology in countless other ways. Try opening an account with a traditional telephone company in the developing world, for example, when account managers have no confidence in your ability to pay.

Visiting Professor of Economics Daniel Traça examines the efforts of one of the world's biggest and highest-profile IT firms to work towards bridging this yawning divide. Hewlett-Packard had already launched digital divide-focused grassroots initiatives in several developing nations, paying particular attention to those that showed promise in furthering H-P's philosophy of "doing well by doing good", i.e., in this instance, using ICT as a catalyst for improving the standards of living of the poor in certain countries, thereby developing what could be very promising markets for the company in the longer term. With this in mind, H-P's e-inclusion programme was launched in 2000.

Since its foundation, Hewlett-Packard has presented itself as firmly committed to an ethos of corporate social responsibility. Its track record of commitment to responsible business practices may well have been admirable, but H-P's approach does have its detractors, who see the more life-and-death problems burdening the world's poor as clearly having higher moral priority.

As Traça illustrates, however, supporters of e-inclusion-type initiatives argue that greater ICT access is absolutely vital in, for example, allowing inclusion into programmes like the types of healthcare or educational advantages enhanced by ICT application in many underdeveloped countries, and are seen by many as integral to such states' attempts to raise standards of living.

The author details how H-P followed on earlier experiments by trying to develop new IT solutions tailored to the expressed needs and desires of the poor themselves. At the same time, the corporation has been developing business models it hopes are appropriate for emerging markets. Rather than adopting the traditional approach of jockeying for "first-mover" advantage in a market with clear growth potential, H-P actually views the poor themselves as bona fide clients, regardless of their currently quite limited spending power.

But Hewlett-Packard still felt that it needed to make direct contributions to foster long-term business growth if it was to develop the products and network solutions that could be readily marketed in the developing world. i-communities were viewed as integral to the corporation's sustainable competitive advantage. Many other ancillary industries also had to be involved for H-P to succeed in bringing products to ICT have-nots, and Traça describes the efforts made to involve state and local governments

(B) Case: H-P's first i-community in Kuppam, India

The (B) case focuses on H-P's establishment of its first "i-community" in India, a nation of over a billion people and a land of phenomenal contrasts in terms of IT application. The city of Kuppam, over two hours from the nation's computer capital, Bangalore, may have seemed a bizarre choice. But the support from the state government for digital divide-related initiatives and the presence of many important local networks and a respected NGO were significant incentives.

Traça relates the considerations behind H-P's Kuppam operations, including how it undertook both quantitative and qualitative studies of the area's population and its shorter- and longer-term needs. Naturally, obstacles were numerous, including the generally passive and fatalistic attitude of most local people, and (fortunately, limited) government corruption. But most officials were willing to acknowledge structural limitations, and were eager to make improvements wherever necessary.

INSEAD 2004

Sara Foryt,Daniel Traça recommends

Click here to read the full article on INSEAD Knowledge

Read more

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Mike Ashley: Does it matter if the public hates you right now?

The Sports Direct founder’s response to the COVID-19 pandemic has drawn criticism, but in the...

4 films to keep you sane during the coronavirus lockdown

Cirrus CEO Simon Hayward shares some choices to put things in perspective.

Pandemic ends public love affair with Richard Branson et al

Opinion: The larger-than-life corporate mavericks who rose to prominence in the 80s and 90s suddenly...

The Squiggly Career: How to be a chief strengths spotter

When leading remotely, it's more important than ever to make sure your people spend their...

"Blind CVs don't improve your access to talent"

Opinion: If you want to hire socially mobile go-getters, you need to know the context...

The highs and lows of being a super-achiever

Pay it Forward podcast: techUK boss Jacqueline de Rojas and Google UK's marketing strategy and...