22 Sep 2003  Research & Ideas

How Businesses Can Respond to AIDS

Partnerships among business, government, and advocacy groups are crucial to halting AIDS. A report from an influential conference at Harvard Business School.

 

Much like how disruptive technologies can threaten established businesses, the growing epidemic of AIDS has the power to blindside and possibly topple companies who choose to ignore the threat, participants concluded at a Harvard Business School conference.

"HIV/AIDS and Business in Africa and Asia: Building Sustainable Partnerships," held September 4 and 5, brought together over seventy participants from business, government, non-governmental organizations, and activist groups to share experiences and offer a strong corporate response to HIV/AIDS. The conference was co-chaired by Diana Barrett, Senior Lecturer in Business Administration at Harvard Business School, and John Ruggie, Kirkpatrick Professor of International Affairs at Harvard University's John F. Kennedy School of Government.

HIV and AIDS devastate individuals, families, and communities, particularly in developing nations, but the diseases' effects and potential impact on businesses and organizations is only recently coming into stark relief, particularly in Africa and Asia.

Approximately 38 million adults and children in Africa and Asia (including Eastern Europe) were estimated to be living with HIV/AIDS in 2002, according to UNAIDS, the Joint United Nations Program on HIV/AIDS

Recognizing the threat

What should responsible organizations do to counter the epidemic for their employees and their business?

For a start, they must pool knowledge and build partnerships with other organizations fighting the same battle, participants said. While it is no simple matter to create collaborative relationships for treating disease among workforces, other partnership models unrelated to HIV/AIDS may provide ideas, inspiration, or red flags.

The warning signs for business are clear, agreed participants. HIV and AIDS exert such power to wreck communities and companies that they should almost be viewed as a metaphor for "disruptive technology" along the lines of the model proposed by HBS Professor Clayton Christensen in his book, The Innovator's Dilemma, said Buff Mackenzie, director in the Office of Education at USAID. Christensen's influential book was not about AIDS; it described companies that were well managed yet were blindsided by rapid advances from unexpected challengers. Yet HIV and AIDS also have that potential to blindside companies and put them out of business, Mackenzie warned.

"Business cannot sit this one out" and ignore reality, he said.

Yet the nature of any given industry today presents business with unique challenges. One session of the conference focused specifically on supply chains, led by Stacey Childress, Social Enterprise's executive director and senior researcher, and Daniel Curran, director of the Humanitarian Leadership Program at HBS. Participants drew up a long list of supply-chain characteristics that help determine the degree to which an HIV/AIDS treatment program can take hold. Supply chains are complex, they agreed. The chains arise out of efficiency, cost, and risk mitigation issues. The elements are interdependent, yet not all stakeholders face the same image and branding exposure. Supply chains also translate to attenuated control; that is, your company can exert less and less control the further away the supplier is from you in the chain.

Business cannot sit this one out.
— Buff Mackenzie, USAID

Take Coca-Cola, for example. According to Carol Martel, director of public affairs for the Coca-Cola Company, the secret-formula concentrate that is the essence of Coke is manufactured in only a limited number of plants. But the "large majority" of Coke's bottlers around the world—which add water, carbonization, and sweeteners, and take care of distribution—are independent bottlers. Bottlers are chosen because they work in local communities. Coke sees them as customers, she said, adding that while the Coca-Cola Company obviously has requirements, its relationship with the bottlers strives to be collaborative, not command-and-control.

Some bottlers, not all, are publicly traded; many do not only make Coke. To illustrate the limitations of oversight, she said, "They have suppliers"—of bottles and caps, for instance—"that we never see. Many bottlers are in a supply chain of their own."

Action steps

Despite these challenges, there are many ways that companies can take steps to battle HIV and AIDS, summarized Ruggie:

  1. Pay more attention to the people who should be the most important partners: the company's own employees. Figure out how to involve and motivate them. "That will vary depending upon the degree of unionization of the industry, of the company," he said. "One issue that has come up in our discussions is corporate culture and its relation to the employees: whether corporate culture might act as an impediment to greater uptake of the available programs. Working directly with employees in a systematic way would be one important step toward increasing the uptake."
  2. Manage the expectations of all partners, including the external ones but especially the immediate partners, the participants in the programs, their superiors, and others. It is a problem when expectations soar too high. "A hundred-percent participation rate in your [HIV/AIDS] program may be unrealistic, given the state of affairs in the environment in which you operate."
  3. Recognize that companies and many groups they partner with, especially NGOs, "are in over their heads. None of them have ever done anything like this before," Ruggie said. "And so an overly rational approach to this may have some really severe, built-in limitations. You have to allow for dynamism, for feedback loops, for lots of mid-course corrections. These have to be to some extent very fluid relationships, very agile; you've got to be able to shift and move around very quickly."
  4. Don't forget the importance of trust when exploring partnerships. "There are systematic factors that inhibit trust formation and those are easier to identify—but the ones that work may be a bit harder," he said. A corporate structure containing relatively few layers of authority is also more conducive to trust formation than a corporate structure that is too rigid.
  5. Understand the balance of power between partners and be flexible, because the balance of power may shift and change over time.
  6. Do a realistic appraisal of the external environment for your program. While an internal analysis of your company is important, equally crucial is understanding the community's capacity for making a program grow or not.

Larger than the workplace

When corporations tally up all the factors they need to take into account when they create programs for HIV and AIDS, "it's obvious that this can't be defined as a workplace issue," added Ruggie.

"You can get a start there. There's just no way to isolate the issue from the rest of the environment, the immediate family, the external environment, the prevailing cultural norms. We're talking here about a point of entry into an intervention, as it were—but you can't even define the problem in terms of workplace, let alone deal with it within those confines."

You have to allow for dynamism, for feedback loops, for lots of mid-course corrections.
— John Ruggie, Kennedy School

Ruggie said it's troubling when people in business, government or NGOs become overly ambitious in their expectations of "all the things" a company has to do to establish HIV and AIDS programs for its stakeholders. "There isn't a company in the world that can do all those things," he told the conference participants. "We have to be careful we don't do the same thing here. Because if we do, it could well turn into a deterrent for anybody else to get engaged."

Discussions and plans for partnerships, such as those at the conference, he added, should encourage others to grapple with the mounting problem of HIV and AIDS, not devolve into such thorny complexity that other people will simply throw up their hands and say, "Look, I'm just running a company. I'm here to produce widgets."

The conference was the third in a four-part series addressing HIV/AIDS and business. The series was organized by Harvard University's John F. Kennedy School of Government, Business School, School of Public Health and Harvard AIDS Institute. It was co-sponsored by UNAIDS and the World Economic Forum. The fourth conference in the series will be held in Beijing on November 5, 2003, to coincide with the World Economic Forum Asian regional summit. For more information, see the conference series' Web site.

About the author

Martha Lagace is the senior editor of HBS Working Knowledge.