Translator: Theresa Ranft Reviewer: Peter van de Ven
What an exciting place, huh?
The energy - I mean, if we could channel it,
somehow or another, we probably would save the electrical company
a few million dollars.
What an amazing place.
I want to thank the artists for making me look like Burt Reynolds.
(Laughter)
Really, I'm taking this home to my wife.
(Laughter)
Okay, so I'm here to tell you a little bit about hope and innovation
among the 4 billion -
the other 4 billion, the next 4 billion -
because we have an awful lot to learn from them.
First, I'll talk about the next 4 billion. Some of you know what I'm talking about.
The next 4 billion,
a huge number of people that actually live on less than $2 a day.
They're called the "bottom of the pyramid,"
they're called "base of the pyramid,"
"subsistence consumers" - whatever is politically correct.
Their reality
and why I am actually thinking of and studying these people:
I'm a business professor,
and businesses have all of a sudden realized
that these folks are important.
They don't make a lot of money individually,
but they're going to make a whole bunch of money over the next several years
because globalization is increasing their discretionary income substantially.
This is the next major source of growth.
And this is people saying, "We really should know something about them."
The amazing thing is we don't know that much.
We think we know,
then we start getting in there, and we realize we know nothing.
So a group of eggheads, like me, decided that we were going to do this
and do this right,
and so we started living among them, going out and shopping with them,
staying in their homes, seeing where they work.
This was the genesis of this research,
and, of course, we've extended it beyond that.
But the idea is we decided
that we were going to learn something about these folks.
Along the way - because I'm an innovation researcher -
I became fascinated by how innovative they are,
but the interesting ways in which they innovate.
One of the things I've always liked to do is study innovation
and how getting our body into it
somehow changes for the ideas that we can develop.
You guys can all figure that out.
Get your hands dirty, all of a sudden, the idea pops.
And among the poor, that happens a lot.
It dawned on me that studying innovation among the poor
was probably one of the purest places
where you can study innovation, human innovation.
If you go into [inaudible] or into Hewlett Packard
or some of these companies,
you study innovation.
These guys are surrounded by technology - guys and women, great innovators.
The idea is they're surrounded by technology;
the poor have nothing.
So, when they innovate, it is really the human innovation that is coming out.
And so I decided that this is what I was going to delve into.
So I spent the last couple of years studying innovation among the poor.
Where do we start?
The first place we have to start out is where they get their stuff.
Now most of you or, hopefully, some of you at least
know that the poor do a lot of scavenging.
Scavenging is very important because this is where you get your stuff.
And "Waste Land" and some of these other documentaries
have talked about how some of them make a living,
getting stuff from the dump, recycling it - that's cool.
That's only part of what they scavenge; in fact, it's less than half.
What do they do with the other stuff?
Well, most of them scavenge
so they can go home and make something that they can sell
or make something they could use at home.
You see, the solutions for the market are solutions for the home.
Let me tell you about a couple of them, just to put things in perspective.
They innovate across a whole bunch of different product categories.
There's a bell,
there's the alcohol stove you see up there.
There's watering troughs.
They innovate across a lot of things.
What dictates what they innovate?
Whatever their need happens to be.
Here's my friend Lisa.
Lisa makes soaps for resale in a marketplace.
She recycles animal fat,
and then she goes around and she buys some herbs,
but she picks a lot of them by the side of the road,
buys a few emulsifiers and things like this if she has to
that she needs in order to make the soap.
But she makes soap with her mother, and they sell them.
What's innovative about that?
For one, she only reads at a 4th-grade level,
and she's had to teach herself how to use a computer.
But probably the most innovative is how she's incorporated
modern market practices into the way she runs her business.
She'll tell you, "I run a very responsible business.
I test every product that we sell,
just like Procter & Gamble does."
"So, really Lisa? How do you do that?"
"Well, we test it on ourselves."
She has her own little mechanism for testing products.
She does it on herself, her mother and her sisters;
they are her guinea pigs.
And they do this, they document it.
In a broken way, they do it, they document everything.
They never put a product out there ...
at least they never put out a product that would make one of them break out.
(Laughter)
Once in a while, there's a disaster,
but she pays very close attention.
And then there's Rick.
I can't show you a picture of Rick, I'm sorry,
because this is being streamed all over the world
and it will be ensconced on the Internet forever.
I didn't want to show Rick's picture.
Rick is a man on the run.
He lost his wife and his daughter to narcotraffic in Colombia.
He ran away, he lost his land.
He's living, he's surviving,
but he doesn't want to know
where the people that are still after him will find him.
So he's off the grid, so to speak.
But he is very creative.
And so he's scavenged bicycle parts, he's scavenged methodologies,
and he's come up with a very innovative support for his hammocks.
He's also very innovative in his business model.
That support that you see right there will not break.
So he scavenges a material that he weaves a hammock from,
and he'll offer you a deal.
He says, "You buy a hammock from me, you pay me a premium,
but, oh, by the way, if it ever breaks,
I will repair it for half price if you bring me back the supports."
Why? Because he knows the supports won't fail.
And they never do, they never fail.
Again, a very innovative type of guy
across a whole bunch of different categories.
Okay, so the poor are innovative. Big deal, right?
Bring it home, Rosa.
Okay, let's bring it home.
What did we learn?
We've interviewed hundreds of these folks,
we've been out there in the field.
What have we learned that we can bring home here?
And one of the interesting things
has to do with what Steve was talking about that his mother gave him.
He didn't call it this, but I'm going to call it this,
and that's hope.
I'm a psychologist by training,
so I can tell you that I look at hope in a somewhat detached manner.
Hope is an emotion, but it is a very powerful emotion.
And hope is critically important to the innovation of the poor.
And in that laboratory of pure human innovation,
I've learned that hope is important here and now.
Why?
Well, one of the things that research has shown is hope gives us energy.
Now, the poor are just as focused on having and retaining hope
as they are on getting stuff.
Why? Because they understand the role of hope.
You see, you need just enough.
If you have too much hope, you go a little hog wild.
You'll see that in a minute.
But if you don't have any hope, that becomes the focus.
When people lose hope
because something bad happens in their lives,
I can promise you, they'll go out there
and they'll do things to restore their hope
because they understand hope is critical.
Hope provides us energy to scavenge, to experiment,
to try new things,
to see possibilities in the junk by the side of the road.
We need hope, and they understand that,
and so they pursue it, and they manage it very effectively.
We all need hope.
We should be about the business of building hope in one another
because it gives us that energy.
Now, another thing that hope does, which is very cool,
is that it allows us to engage in what we call "healthy delusion."
The psychologists like to call that "motivated reasoning" -
whatever that means.
You know, we had to invent words.
Healthy delusion, what does that mean?
That means - that's the ability to look at the argument
or the countervailing evidence,
the things that says you can't do it, and to ignore it
in favor of the belief that yes, you can.
Healthy delusion comes from hope.
Healthy delusion, in turn, leads to creative deviance.
It leads to trying things, trying things outside the norm,
bending the rules.
Now this is where too much hope can get you in trouble.
If your hope is so high
that your healthy delusion really starts getting delusional,
you're probably going to bend the rules too much,
you're going to engage in criminality.
And there's plenty of evidence to suggest that some of the most creative people
also are engaged in criminality:
terrorists, narcotraffickers.
That's Pablo Escobar, by the way.
You all recognize Che Guevara, but the other guy is Pablo Escobar.
The people who worked for Pablo and the people who worked with Che
were all very creative people.
Healthy delusion leading to aggressive, creative deviance.
So the poor also recognize
that too much hope can get you into trouble,
and they're always trying to maintain that balance.
We need to engage in healthy delusion a little bit
and help our neighbors to engage in healthy delusion.
Not to the criminal level, please.
But then again, once in a while,
a little criminality may not be bad in our day and age.
But don't, don't ...
Actually, I just said that on the Internet.
The CIA and FBI will not put me on their list.
I'm already at TSA's watch list, what the heck, you know!
(Laughter)
Okay, the third thing that we learn about hope
is the importance of conversation.
Now, I'm going to go to this.
Hope and innovation are fueled by conversation,
and lonely people are less innovative.
And to illustrate that, I'm going to tell you a story about a mine.
Mine in Chile - biggest mine in the world.
We have a problem,
a problem with loading those big barrels that you see there.
And the engineer comes up with a solution.
It fails miserably. He blames the workers.
What a surprise.
The workers are illiterate folks that work there.
They don't really have a lot,
but they have community.
These guys talk to each other, they're together all the time.
So what do they do?
Overnight, they work, they come together
and come up with a very creative solution to the problem,
which they implement overnight.
So the engineer who had blamed them comes back in the morning
and finds a system that works.
Now, it wasn't because these guys were geniuses.
They did it because they were talking.
They had hope and that led to their innovativeness.
So hope - three things.
We need the energy, we need the healthy delusion,
and we fuel it through conversation.
Last thing - my takeaway.
We can learn much more from the next 4 billion.
We can learn about their hope, about their innovativeness.
We can learn about the solutions that they come up with.
And we can bring it home.
So as you're thinking about poor people around the world,
don't see them as a liability,
see them as an asset.
Thank you.
(Applause)