Scaling the Rural Enterprise

Lead Research Organisation: University of Nottingham
Department Name: Horizon Digital Economy Research

Abstract

Rural contexts do not naturally nurture large scale, sustainable enterprises. Rural enterprises wanting to grow, struggle without the honed infrastructures for collaboration, communication and distribution found in urban-industrial areas. The difficulties in achieving sufficient scale create barriers to entrepreneurial activity and prohibit rural business ecologies thriving, in particular the transaction costs associated with dealing with many micro-level organisations. This project addresses the fundamental challenge of scaling up rural enterprises within the UK and India and how we might exploit digital technologies to achieve this.
Economies of scale and scope have enabled the creation of large-scale multinational corporations that sit atop the 'apex' of large supply chains. In order to provide the cheapest product possible companies place enormous price pressure on their suppliers, often exploiting digital technologies to manage their supply chains and co-ordinate supply and demand worldwide. Rural enterprises involved in supply chains are often disadvantaged and there are a significant number of examples where local producers participating in supply chains of national or global conglomerates are squeezed in the 'race to the bottom'. In the UK this has pushed many farming communities to the point of bankruptcy. Furthermore, since many value chains worldwide are now oligopolies, there are few other customers for these rural communities to sell their products, making it very difficult for them to change their role in the supply chain - they are beholden to sell their products to those companies that agree to buy. The need for enterprise innovation in this domain is recognised, not least as a means to combat poverty, the issue is how rural communities might achieve this scaling up and support it.
Rural communities are currently uncertain of the appropriate forms of enterprise needed to scale up their endeavours and lack access to the appropriate IT enterprise capabilities to support these. Scaling up is essential if these communities are to obtain higher than subsistence income levels for the materials they produce. For example, many rural enterprises and their associated communities of practice cannot ensure the ability to deliver according to schedule a certain amount of product at a certain quality level. Without achieving sustainable economies of scale and of scope, rural enterprises will not be able to participate fully in the global economy. We need to innovate both in terms of the enterprise and the technologies uses to support these enterprises.
Within this project we wish to understand the next generation of rural enterprises that may be enabled by mobile devices in rural settings. First generations rural enterprises have emerged that exploit the timely delivery of information and expertise using mobile devices with considerable success in rural areas. Our focus in this proposal is the establishment of the next generation of enterprise where these mobile devices are used to scale up the activities of a rural enterprise by support the definition and management of enterprise wide processes between distributed members of these emergent rural enterprises.

Planned Impact

We aim to create direct economic impact by developing and deploying socio-technical solutions to enable communities in the UK and India to achieve sustainable economies of scale and scope that will facilitate their long-term participation in a global digital economy. Our emphasis is on focused concept demonstrators with local communities that provide direct initial benefit and with appropriate follow on investment will yield major socio-economic benefits.
Our community-based solutions will inform the development of an Extensible Rural Enterprise Toolkit that will be made accessible to others beyond our initial communities. Our solution will also provide empirical evidence to inform policy initiatives as well as creating market presence and demonstrating the capability of rural enterprises within local and global business ecologies.
The project necessitates an approach that is both interdisciplinary and cross-cultural in nature, not least because of the potential for participation in a global digital economy. The programme further aims to significantly document new interdisciplinary knowledge transfer techniques that involve academia, industry and the NGOs in the UK and India.
Finally, it aims to build a new research community and nurture links between the industrial, NGO and academic researchers in the UK and India.
This project targets a broad set of beneficiaries. Identified beneficiaries in India include: the non-edible oil community members themselves; governmental Ministries and Departments, Development Agencies working in rural development; R&D institutions with a special interest in the application of Science and Technology (S&T) for rural development; NGOs and other "intermediary agencies" engaged with rural enterprises; financial institutions with a mandate for the promotion of rural enterprises; and Self-Help Groups (SHGs) and other community-based organisations in the project region as well as elsewhere. These are mirrored in the UK where beneficiaries include the Ceredigion Region community members involved in the producing high quality food products. Governmental and NGO organisations involved in promoting enterprise in the region and beyond.
We will directly engage with these beneficiaries from the outset and then at key stages as we refine the Extensible Rural Enterprise Toolkit. This will ensure that their concerns are addressed in the course of inquiry and that findings will meet their needs and interests. Impact is embedded into the programme of research, which includes workshops to disseminate the findings and catalyse follow-up activities among Development Agencies, R&D Institutions, Financial Institutions and S&T NGOs.
All project partners are experienced in managing projects involving Intellectual Property (IP) considerations and industrial and international collaborations. The team will adopt an open approach to innovation and development, with generated IP being subject to collaboration agreements as appropriate.

Publications

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Valchovska S (2016) Interpreting Community-Based Enterprise: A Case Study from Rural Wales in Journal of Social Entrepreneurship

Related Projects

Project Reference Relationship Related To Start End Award Value
EP/J000604/1 01/10/2011 22/07/2012 £1,263,925
EP/J000604/2 Transfer EP/J000604/1 23/07/2012 30/06/2015 £1,053,173
 
Description Please see: EP/J000604/2
Exploitation Route please see EP/J000604/2
Sectors Agriculture, Food and Drink