Category winner: Fairphone:
Organising for Sustained Social Impact

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This case won the Entrepreneurship category at The Case Centre Awards and Competitions 2018
 
The case
Bas van Abel

Who – the protagonists

Bas van Abel, Fairphone CEO.

What?

mobiles

Fairphone is a smartphone that uses ethically sourced materials and manufacturing in an effort to improve the social welfare of underrepresented mine and factory workers along the mobile phone industry’s supply chain.

Why?

With no previous experience in the mobile industry, Van Abel, an industrial designer, did not intend to produce a functional, commercial smartphone; his goal was simply to raise the Dutch public’s awareness of the link between mobile phones and minerals mined in the context of a bitter civil conflict in the Democratic Republic of Congo (DRC).

The campaign soon went beyond a collaborative prototype design between Van Abel and the public, however, as within six months of Fairphone’s founding, a large media following and socially conscious consumers led to 25,000 units being pre-ordered (priced at €325 a piece) through a crowdfunding initiative.

When?

It was September 2009 when Van Abel first became aware of the connection between consumer electronics and the conflict in the DRC.

Van Abel’s friend, Peter van der Mark, a PR expert with communication company Schrijf-Schrijf, was working on an awareness campaign for their client – NGO Niza.

Not happy with his progress, Van Der Mark asked Van Abel to design a more creative awareness campaign.

Abel was soon spearheading the project, as Van Der Mark had to concentrate on his day job, and on Christmas Eve in 2013 the first batch of Fairphones were dispatched to customers, with the rest delivered in February 2014.

Where?

Fairphone’s office is based in central Amsterdam, Holland, with 50+ employees, speaking 17 different languages, working there.

congoKey quote

“This area depends on quarries and mining. If there is no mining, there is no money. No money, no life.” – a miner in the east of the DRC reflecting on US companies avoiding sourcing from the region after Congress passed the Dodd-Frank Act in 2010.

What next?

After the first Fairphone had generated millions of euros in revenue in 2013, Van Abel knew the company faced significant challenges ahead.

How would they improve the welfare of underrepresented miners? What would the future organisational design of the company look like, as the current structure was very much informal with no codified processes for making decisions?

 
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The authors

authorsOnajomo Akemu, Gail Whiteman and Tao Yue

Onajomo Akemu and Tao Yue discuss how students can relate to Fairphone’s dilemmas.

The case for Fairphone

“At the time the teaching case was written, I was performing an ethnographic study of management practices within Fairphone,” Onajomo explained.

fairphone

“The Fairphone case was interesting for at least two reasons.

“First, the emergence of the company would not have been predicted from dominant theories in the field of management. As I asked questions about how the enterprise emerged, I noticed that the founders of the company had not started Fairphone with a clearly-formulated business plan; they began as social movement campaigners. They seemed to be receiving unsolicited help from governments, industry and social movement actors. If there was a business opportunity, it was not obvious to them at the onset.

“Second, there is a rich story in the emergence of Fairphone. Being a social enterprise, the company has a dual mission: to improve conditions in the mobile phone supply chain and to be commercial viable. These two goals can be exceedingly tough to achieve in a competitive industry. As I witnessed first-hand the struggles within Fairphone to run a successful commercial enterprise that remained true to the founders’ values, I felt that there was a human story that could benefit students and managers who also struggled with similar challenges.”

Appealing to students

Onajomo added: “In our experience, students can relate to the struggles of the principal actors in the case. Questions such as, ‘How do you stay true to your values while running a commercial enterprise?’ and ‘How do you make decisions under uncertainty?’ are central to the discipline of management. Furthermore, our students often want to work for companies that allow them to do meaningful work. We think the Fairphone case provokes students to wrestle with these questions.

“Also, the case is easy to relate to. The smartphone, the product at the heart of the case, is an artifact that is ubiquitous in our society. So students can relate to the product in a way that connects it to problems like conflict minerals half a world away.”

Remaining impartialPerforming good case study research

Tao commented: “In order to write a good teaching case, it is essential to have a company that is open to sharing information. But students and researchers need to be aware that companies often have promotional interests; they want to portray a desirable image of themselves.”

Onajomo agreed: “Case study research can be emotionally and politically challenging for the researcher. So case study researchers should carefully follow guidelines to ensure objectivity and reliability in their research.

“For instance, they should seek evidence to independently corroborate their interviews. They should also be ready to challenge the viewpoints of their interviewees and also be self-critical.”

The realities of business

Onajomo concluded: “Most students are taught that businesses are started by identifying an opportunity, writing a business plan, setting up a team, looking for funding, and accessing the market. This classical model of entrepreneurship, which is based on decades of sound economic theory, is valuable and must be learned.

“However, real life does not always unfold as the classical model suggests. Successful business emerges in a chaotic, often open-ended manner; it involves a lot of trial and error. Success depends on serendipitous events along the way. We think that this is what the Fairphone case demonstrates. It is fascinating to see students arrive at this conclusion themselves by teaching this case.”

About the authors

Onajomo Akemu was a PhD candidate at Rotterdam School of Management (RSM) when the case was written. He is now Assistant Professor of Strategy and Entrepreneurship at Nazarbayev University Graduate School of Business.
onajomo.akemu@nu.edu.kz
tw @onajomo_akemu

Gail Whiteman was a Professor at RSM when the case was written. She is now Professor and Director of the Pentland Centre for Sustainability in Business at Lancaster University Management School.
e g.whiteman@lancaster.ac.uk
tw @GenerationCO2

Tao Yue is the Managing Editor and Senior Case Writer at RSM's Case Development Centre.
tyue@rsm.nl
tw @yue_tao

 

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