From outsider to insider: A Western SME’s journey to inclusive innovation in a base-of-the-pyramid market

Abstract

• Western SMEs can enter a BoP market by providing inclusive innovation. • Inclusive innovation contributes to the livelihood improvement of a BoP community. • Challenges include lack of trust and market knowledge. • Different environment requires financial and operational adaptation. • Partnership with an NGO facilitates the operations on a BoP market. This study provides an in-depth look at how small- and medium-sized enterprises (SMEs) in the healthcare sector can enter a Base-of-the-Pyramid (BoP) market and foster inclusive innovation (ININ), an innovation meant to offer growth in BoP communities. The study stems from the intersection of internationalization and BoP literature by exploring how companies can internationalise and gain insidership in a BoP market through ININ. This qualitative case study uses primary and secondary data from a Finnish SME and non-governmental organization (NGO) to understand how this partnership led to inclusive expansion into Kenya. This study resulted in a conceptual framework for SME internationalisation through ININ. The findings identify challenges, including a lack of trust and market knowledge, the need for operational and financial adaptation, and antecedents, such as market exploration, partnership, and community inclusion. The study highlights the importance of collaboration with NGOs and suggests five propositions for further research.

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