David Brand (GIZ) talks in an interview with Barbara Hofmann (GIZ) about an open innovation approach to solving development challenges as sustainable business opportunities together with the private sector.
David Brand is a consultant in the lab of tomorrow at the Gesellschaft für internationale Zusammenarbeit (GIZ). Since 2019, he has advised project teams around the world on implementing lab of tomorrow processes to create market-based solutions to development challenges. Another focus of his work is the methodological development of the lab of tomorrow. He is a certified design thinking expert and studied sociology and management in Mannheim, Mexico City and Istanbul.
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)
Mr. Brand today is the International Day of Awareness of Food Loss and Waste. You are currently working in an advisory position at the lab of tomorrow to establish a circular food system in Rwanda. Can you tell us more about that?
In Rwanda there is a rapidly growing population, and at the same time there is strong urbanization. Currently, the predominant linear approach to food production drives the exploitation of finite resources and damages human health through environmental pollution. In addition, there are aggravating factors such as limited access to food for the general population, low agricultural productivity, and post-harvest losses. A circular food system would regenerate natural systems and reuse waste.
This is the task we have taken on at the lab of tomorrow. In March of this year, together with the "Swiss Agency for Development and Cooperation (SDC)" and the "Competence Center for Social Innovation (CSI-HSG)" at the University of St. Gallen, we launched a so-called "Challenge" to address the need for a more sustainable food system. Together with local stakeholders and European partners, we were able to use design thinking methods to identify five specific challenges and develop new business models. These are currently in the incubation phase and are being tested for their viability on the market.
What makes the lab of tomorrow special? How does this approach work to solve development challenges and achieve the SDGs?
The lab of tomorrow is a holistic approach to engaging the private sector in creating sustainable solutions to SDG-related challenges. Still, many approaches to development cooperation are transactional and top-down, meaning that it is not the people or companies, but organizations in development cooperation that set the key parameters and formats. This often creates a dependence on donors and leaves little room for user-centered innovation. Limited and short-term impact are a possible risk.
Therefore, the lab of tomorrow takes a different approach. We inspire local and European businesses to actively participate in creating products and services that help solve specific challenges in developing and emerging countries. The resulting products and services are commercially viable and scalable. Moreover, they are established on the market by the companies themselves. In this way, we create especially sustainable solutions: Development challenges become business opportunities. We leverage the resources and capacities of the private sector in industrialized, emerging and developing countries to develop and implement effective, market-based solutions.
Earlier, you mentioned that there is an incubation phase and that the principles of design thinking are applied. How exactly does a lab of tomorrow work? Could you describe the process in a little more detail?
The lab of tomorrow is a three-stage process that runs for an average of nine months. For example, it can be initiated by an external organization approaching us with a country-specific challenge. If the challenge shows economic potential, the process starts with a detailed analysis of the development problem. For this, the initiators of the "Challenge" conduct user-centered research directly on site to get to know the target group better.
This is followed by an "ideation sprint". In this phase, representatives of local and European companies form interdisciplinary teams to develop innovative products and services that contribute to solving the Challenge. The participating companies are screened and selected for their suitability by the initiators in advance and are also supported by experts from politics, academia, and the civil society. The ideation sprint itself is usually implemented by a professional design thinking agency. There, the participating companies contribute their existing know-how and necessary resources. As a result, market-oriented business solutions can be developed jointly using innovative and creative methods.
In the subsequent incubation phase, the participants develop suitable business models for their products and services. They regularly test their new business models with potential customers and improve them until their viability is validated. This ultimately leads to the creation of investment-ready start-ups or joint ventures that no longer require further support from donors.
That sounds like a complex, but very exciting process, Mr. Brand. Do you have an example of such a business model?
A business model was developed that directly links fishermen in Kenya with restaurants and hotels in the cities. Previously, there was an oversupply of high-quality fish in rural areas and an unmet demand in the cities. Because supply and demand did not align, a lot of the fish spoiled on its way to the cities. Nowadays, the company "GoodFish" offers an online marketplace and a continuous cold chain in transit. As a result, customers in the cities receive quality fish, while local fishermen can sell more of their goods. It also effectively prevents food loss and waste.
Can you look back at other processes concerning food loss and waste? Are there any other success stories?
So far, we have already been able to launch three lab of tomorrow processes that have specifically addressed food loss and food waste: the circular food system process in Rwanda described earlier and two processes in Kenya. One process addressed refrigerated food transport chains, during which "GoodFish" was created, and the other was centered around the prevention of food loss in production. This one has been particularly successful. Unfortunately, 40 percent of the fruits and vegetables produced in Kenya for mainly the European market are thrown away due to visual characteristics or last-minute changes in order quantities. The company "Wheeling Fruits" has been able to establish itself on the market to solve this problem. Instead of discarding the overproduction of "ugly" mangos, mobile drying facilities are used to produce a safe and durable food product and to secure another income for the farmers.
However, we have been able to develop business models to reduce food losses in processes that did not originally address this challenge. Our sustainable energy process in Uganda resulted in the creation of Wamala Energy, a company that has used solar-powered refrigeration machines to make milk production more efficient and more profitable for local people. Hopefully, we can add many more success stories in the future.
Can you already give a little outlook? What can we expect from the lab of tomorrow in the future?
We can already be very proud of what we have achieved so far: 226 companies, including Bayer, Merck, SAP, Siemens and TUI, have already participated in eleven completed processes. Of 58 business models developed, twelve are currently on the market and have received investments of over €6.5 million.
Therefore, I believe we can look to the future with great optimism, because the lab of tomorrow is a scalable tool that allows development challenges to be solved economically and sustainably. As such, it can be applied by all institutions in development cooperation. At our start, it began with one or two processes per year, implemented one after the other. Today, six processes are implemented at the same time. It is no longer only the "Gesellschaft für Internationale Zusammenarbeit (GIZ)" that initiates the processes, but also the private sector and other development organizations. As already mentioned at the beginning, we are currently implementing a process with Switzerland and another one in Austria with the Austrian Development Agency (ADA) and the non-profit association for global development ICEP (Inspiring Cooperation Empowering People). Our goal for the future is to continue to carry out this open-innovation process together with other organizations.
In addition, we provide a handbook and a toolkit for our innovation process for initiators and interested parties and hope for a worldwide dissemination. At this point, we would like to give a shout out to all decision-makers in development cooperation and interested companies - please feel free to contact us with challenges such as the prevention of food waste and food loss. We look forward to supporting you on your way to innovative and flexible solutions.
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