The Fairphone teaching case, written by Dr Onajomo Akemu, Prof. Gail Whiteman , and Tao Yue from the CDC, is taught to business and management students in institutions around the world and has already been recognised twice; in 2015 it won first prize in the oikos Case Writing Competition and in 2016 it was a bestselling case for The Case Centre.
The award-winning teaching case about Fairphone and put together by RSM’s CDC team illustrates how enterprises emerge in the wake of social movements and as a result of effectual decision-making by entrepreneurs. It also explores the complexity of start-up social enterprises that aim to achieve twin missions – social and commercial – in an industry dominated by large incumbents.
It details the remarkable story of the Dutch social enterprise company Fairphone, a supplier of ethical, modular smartphones, which originated during a social awareness campaign about the connection between smartphones and the conflict in the Democratic Republic of Congo (DRC). With no expertise in producing a commercial phone, no customer base, and no prototype, Fairphone founder Bas van Abel and his staff managed to produce and sell 25,000 smartphones in a year, financed through a successful public crowdfunding campaign. After these first crowd-funded steps, Van Abel thought Fairphone should scale-up its production – become a 'real' company – to fulfil its dual mission. His challenge was to allow Fairphone to reach a larger audience with its message and product, and how to structure the organisation to achieve this.
The Fairphone case was selected as a suitable subject for a teaching case as it was already undergoing an ethnographic study of its management practices. It became apparent that Fairphone’s founders had not formulated a business plan; if there was a business opportunity, it was not obvious to them. They started out as a social movement but almost inadvertently exploited contingencies with the support of influential industry actors, and Fairphone emerged. This challenges the predominant classical model for entrepreneurs founding successful businesses. It was also a very human story that might benefit MBA students and executives struggling with the same issues.
Students learn from the Fairphone business case how the environment plays a role in the creation of entrepreneurial opportunities, including social ones, and how ad-hoc decisions can be used to take advantage of events to create an entrepreneurial opportunity. This case also shows how messy it can be at the start-up phase of a company, and encourages students to think about the tensions involved in creating a social enterprise that aims to achieve both social and economic missions.
The CDC approach
RSM’s CDC brings first-hand knowledge of business practices to management education as well as to other businesses. Interviews with Fairphone’s founders, employees and stakeholders, and observation and use of published sources were carried out by Onajomo Akemu, who was a PhD candidate at RSM at the time. The CDC team then worked on the text Onajomo Akemu prepared to turn the exceptional story of Fairphone into a powerful teaching case which can be used by students at businesses and management schools worldwide.