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SC Johnson in Keny a

Base of the Pyramid Protocol™ in Action:

SC Johns on
AFNE
John Langdell

Cambr idge Nove mber 2006

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SC Johnson Core Values
• Commitment to Family
• Innovation is fundamental
• Environmental leaders
• Superior Partners
• Global Brands that win
• Spirit of Leadership and Adventure

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Five generations of Family Leadership

• Dr. H. Fisk Johnson


is Chairman and CEO

“One of the greatest benefits of


being a family company is the ability
to make decisions for the long term,
rather than for quarterly gains. The
progress SC Johnson continues to
make against our goals shows the
power of this long term focus. ”
Fisk Johnson, Chairman and CEO,
SC Johnson
3
Strategic Vulnerability
MAJORITY OF SCJ BUSINESS

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Strategic Opportunity

• Using Earth-Responsible Raw Materials


• Preventing Insect-Borne Diseases
• Reducing Energy Consumption and
Greenhouse Gas Emissions
• Advancing Social Progress and
Public Health

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Advancing Social Progress and
Public Health

Core Values
+
Sustainability Platforms
+
Products that Make Lives Cleaner, Easier,
Healthier =
Strong Foundation for Work at the
BoP

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SCJ in AFNE

MENA (20% AR)


• Saudi (JV & factory)
• Egypt (JV & factory)
NWA (17%)
• Gulf (Sub)
• Nigeria (JV & factory)
• Levant & Other
• Ghana (Sub) (Distributor)
• FWA (Distributor) SEA (28% AR)

• Morocco (Sub) • South Africa (Sub &


factory)
• North Africa (Distributor)
• East Africa (KUT) (sub)
• Israel (JV)

Approximately 200mm sales 7


The MNC: Traditional Customer Base

“Top” of the
Income Pyramid
> $10,000/yr Cost structures, business
models, & research
methods based on a
“Western infrastructure”
The
“Base” of the “ToP”
Resource
Pyramid Customer
85% of Global Resources

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We Needed to Move On

Business Corporate Strategy/Philosophy Personal

The Growth Challenge + Sustainable Business + Motivation

= Challenge (2 – 5 years)

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Opening Up: The Business Concept
Incremental business opportunity between existing ToP
model and BoP model, BoP Service model delivering
product benefits direct to home instead of delivering
products through traditional channels

BoP Consumers
Incremental
ToP/MoP
Consumers
Local
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Retailers
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Regional
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Regional
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Regional
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Wholesal
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Whole- Wholesal
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Whole- Wholesal
Wholesal
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Whole-
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salers ers
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salers ers
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salers
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SCJ
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SCJ SCJ
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SCJ SCJ
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SCJ unity
Distribut
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Distrib- Partners
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utors ors
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SCJ SCJ SCJ
Regional Regional Regional
Office Office Office

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Opening Up: The Business Concept
“Community-Based Cleaning & Waste
Management Company”
• Offer a diverse set of cleaning and pest control services that provide
product benefits direct to homes and businesses in Nairobi’s slums
• Provide suites of services that bundle SCJ products like Pledge®, Glade®,
Toilet Duck® and Baygon® along with existing youth services (e.g., garbage
collection and carpet cleaning)
• Generate income for the youth groups while improving the communities they
live in

SCJ Business Model Innovation


“ToP” Business “BoP” Business
SELL: Cases of Product Service
ENABLE: Distribution Micro-Enterprise
MANAGE: Retail Trade Community Partners
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Challenges

• PEOPLE, PEOPLE, PEOPLE


• Small numbers, slow “burn”
Do we have patience?
• “Firewalls”. Advantageous in early days
• Fully integrate into annual performance
targets

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Finances

• Six students x three months in Kenya


• One full time MBA graduate (BoP I & II)
• One full time local co-ordinator (BoP I & II)
• Numerous air fares
• Percentage of management time

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What will Give it a Chance of Success?

• Relate to mainstream business


• Results:
– Sales/profit
– distribution
– awareness
• Make it part of the plan:
– Strategic
– Annual

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Achievements

• Kibera pilot project still growing/developing


• Incremental distribution effort winning in Kenya,
Nigeria
• Anti-malaria effort in RSA positively perceived
• Roll anti malarial effort to other geographies in
07/08
• Linkage established with other SCJ Developing
Markets efforts. Learning/co-ordination will
follow

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Fitting Into the Current Strategy

BoP CONSUMERS

VECTOR CONTROL
DEEP
DISTRIBUTION BoP PROTOCOL
• Malaria education
and marketing
• Motorcycle Sales • Kibera BoP
(South Africa)
and Distribution (SE Business Pilot
• Dengue marketing
Asia, Nigeria) • Continued BoP
and “Men in Baygon”
• KasKazi: Third Party Learning Lab
(SE Asia)
Bicycle Sales and Sponsorship
• Asthma program in
Distribution (Kenya)
the United States

INCREMENTAL EVOLUTIONARY INNOVATIVE

“Skate to where the puck will be, not where the puck is”
-- Wayne Gretzky

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Use Incremental and BoP Efforts
to Re-balance the Business – End in Mind
MAJORITY OF SCJ BUSINESS

DEEP DISTRIBUTION VECTOR CONTROL BoP PROTOCOL

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SC Johnson in Keny a
Base of the Pyramid Protocol™ in Action:

SC Johns on
AFNE
John Langdell

Cambr idge Nove mber 2006

18