THE BENEFIT OF
CLOUT:
HOW CONNECTIONS
SHAPE PROSPERITY
DEEPA PRAHALAD
James Allen, a customer of Jaipur Rugs in Rajasthan, Indien, can hardly contain
his excitement as he explains why he chose the Mandir rug created by Soniya
Devi, an artisan working in this rural community. He enthusiastically shares mi-
nute details of how the design evolved and points to an area where disagreement
arose between Soniya and another weaver who assisted her. As he points to So-
niya’s signature at the top of the design, his pride of ownership and connection
to the story is palpable.
In remote villages across India,
weavers of Jaipur rugs are working dili-
gently at looms set up outside their homes.
Many of these homes are referred to by the
names of the female artisans, even in areas
where patriarchy and tradition run deep.
Lively debates about designs and color
choices take place among the artisans. Rajo
Devi, who was trained in rug weaving,
commented while on a visit to the Jaipur
Rugs headquarters: “If we do good quality
arbeiten, we can evolve from a mere laborer
to a responsible artisan…Buyer needs are
simple: he wants good quality, timely de-
livery, and good designs, and I am ready to
give him that!”
Nurturing connections between cre-
ators and customers is an important yet
often overlooked aspect of addressing the
persistent global problems of poverty and
inequality. Efforts made by government,
business, and philanthropy to address
these issues often focus on gaps in skills or
on increasing income through jobs pro-
Gramm. Most innovation occurs on the pro-
duct and service side as a way to promote
consumption, such as creating access to
cell phones, microfinance, and other con-
sumer products. Heute, cell phones are in
the hands of rich and poor alike, a global
payment infrastructure is firmly in place,
and access to consumer goods has im-
proved significantly. Jedoch, inequality
persists and is increasing in many parts of
die Welt.
The ongoing emphasis on fostering
entrepreneurship is in part an acknowledg-
ment of the limits of top-down approaches.
As Peter Drucker once prophetically ob-
serviert, “We are moving toward a society of
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Netzwerke. Don’t ask me to explain it. ICH
don’t understand it, I just see it.” This in-
sight may help to explain why so many ef-
forts to address poverty and inequality fall
short. While skill gaps can be addressed by
individual efforts and targeted interven-
increasingly
tionen, opportunities are
created and accessed through networks.
Creating new networks among diverse
stakeholders is especially important in
light of the challenges business and gov-
ernments are grappling with worldwide,
such as climate change, Armut, and secu-
rity.
Creating new networks requires inter-
Aktionen, which in turn are needed to build
trust and expand innovative capacity. Der
entrepreneurial path is precisely where
networks matter the most. daher,
today’s innovative organizations must give
explicit attention to enabling connections
that are focused not just on new products
but on new processes. Making visible the
aspirations and skills of marginalized com-
munities is an important first step. I refer
to this conscious effort to create new net-
works while imparting new skills as “the
benefit of clout.”
Tapping into the wisdom of social en-
trepreneurs can be a valuable aid in deter-
mining how to balance the need for
performance with the desire to make the
world a better place. Despite their knowl-
edge, they often do not have the luxury of
selecting the best and brightest and must
focus instead on uplifting the neediest. Ef-
forts to have a positive social impact must
be explicit and visible in order to build
trust and attract talented collaborators. In
dieser Artikel, I share the story of Jaipur Rugs,
a for-profit organization that has a social
mission at its core. The company’s longev-
ität, global reach, and system of fostering
connection make it a timely and relevant
case study for a range of industries.
THE JAIPUR RUGS MODEL
Leadership is the art of having
heart-to-heart conversations.
—N. K. Chaudhary,
founder, Jaipur Rugs
In a time when organizations of all sizes
grapple with the question of how to bal-
ance profit and impact, the successful
model of Jaipur Rugs stands out. The heart
of this model is the vision of founder N. K.
Chaudhary, often referred to as the Gan-
dhi of the carpet industry. After a brief
stint in his father’s shoe shop, Chaudhary
turned down a job in a bank and decided
to embark on an entrepreneurial path. An
the advice of his friend Ilay Cooper, WHO
ABOUT THE AUTHOR
Deepa Prahalad is an author, innovation consultant, and Visiting Faculty at the Indian Institute
of Management, Ahmedabad. She co-authored Predictable Magic, a book Fast Company selected
as one of the “Best Design Books of the Year.” A frequent contributor to the Harvard Business Review,
strategy+business, and other magazines, Prahalad studies design as a way to improve profit and
social impact. She serves on several nonprofit and advisory boards and mentors leading social
entrepreneurs.
© 2023 Deepa Prahalad
Innovationen / Volumen 13, number 3/4
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Deepa Prahalad
JAIPUR RUGS AT A GLANCE
Jaipur Rugs has an artisan network of 40,000 weavers in 600 villages in five of India’s
Staaten. It exports to more than 65 Länder; the US and Europe are its biggest markets. Es
operates five retail showrooms in India and also has stores in Italy, Russland, and China.
The company produces approximately six million square feet of handmade rugs per year.
Facts about hand-knotted rugs
•
•
•
•
•
A hand-knotted rug has over two million asymmetric knots.
It takes 45 kilometers of yarn to make one rug.
It takes 37 days to spin 45 kilometers of yarn by hand.
Each rug passes through 180 hands and goes through 18 finishing steps.
Each rug gives employment to 90 artisans, every one of whom matters in creating the
final product.
noted that export demand was strong,
Chaudhary opted to start a carpet business.
With a small loan from his father, he began
with just two looms and nine weavers.
Heute, Jaipur Rugs is one of India’s largest
exporters of handwoven carpets and a
trusted, profitable global brand. Chaud-
hary’s social mission is woven into every
level of operations, and he often shares his
ambition for Jaipur Rugs to be “the world’s
most admired company.” Chaudhary’s five
children manage different aspects of the
business, which includes Jaipur Living, A
large distribution center in Atlanta. Der
family also created the Jaipur Rugs Foun-
dation, a service arm that looks after the
Gesundheit, literacy, and other aspects of their
weavers’ wellbeing.
The social impact made by Jaipur
Rugs is particularly noteworthy in light of
the fact that the carpet industry has for
centuries been rife with child labor and
other exploitative practices. Founders of
firms in new industries generally have
more freedom than those in longstanding
industries to challenge existing power
structures. Since its founding, Jaipur Rugs
has challenged many prevailing practices
through its unique corporate structure.
Most notably, the company has cut out the
Zwischenhändler, which has doubled some
weavers’ wages, provided extensive train-
ing, and vertically integrated its extensive
Operationen (the carpet-weaving process in-
volves 60 Schritte). The Jaipur brand fosters
connections between the poorest of the
poor—it employs 40,000 weavers in re-
mote villages in six Indian states—global
consumers, Und
luxury brands. Der
weavers, who are 80 percent female, arbeiten
independently at home. Many of them live
in Rajasthan, one of India’s poorest states.
They produce rugs for contract orders and
sometimes weave their own designs, manche
of which have won global awards (see Text
Kasten). Jaipur Rug carpets are exported to
mehr als 65 Länder.
The success of Jaipur Rugs is largely
the result of good management rather than
technological innovation; many of the rugs
are still woven by hand using centuries-old
Techniken. The management puts great
emphasis on building connections inside
the organization and with the outside
Welt, and the firm’s focus on social impact
is clearly stated in its mission statement:
“The core purpose of Jaipur Rugs is to nur-
ture the creative capacities of the artisans
and empower them to fulfill their aspira-
tions so that they can live a dignified life.”
Many of the company’s management prac-
tices are usually seen in firms with highly
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The Benefit of Clout: How Connections Shape Prosperity
credentialed knowledge workers, nicht
among the underprivileged. The actual de-
signing of the rugs encourages engage-
ment, trust, and innovation, which bolsters
the brand and attracts global collaborators.
THE KEY MANAGERIAL
ELEMENTS JAIPUR RUGS
USES TO BUILD
CONNECTION
Jaipur Rugs is focused on continuous
learning for its artisans and for those in
management. The underlying principles of
the company model can be applied widely
and adapted to the nuances of different in-
dustries. Below I describe some of the key
managerial elements Jaipur Rugs uses to
build connection.
Peer Management
As Jaipur Rugs grew, it became impossible
to oversee each artisan directly. Frauen
with leadership potential who took initia-
tive and performed well were given leader-
ship training and put on a path to become
bunkar sakhi—supervisors, or weavers’
companions. This peer management sys-
tem serves several important purposes: Es
helps develop a pipeline of women leaders;
it allows troubleshooting and training to
take place in real time; and it enables the
company to discover talent and identify
skill gaps. The bunkar sakhi also serve as
role models for the younger generation.
This enables Jaipur Rugs to depend in-
creasingly on its business model to main-
tain its position as the industry leader, Zu
capture new ideas, and to draw from a
deep skill base when working with celeb-
rities and luxury brands.
Capturing and Sharing Narratives
N. K. Chaudhary is fond of saying, “We sell
the blessings, we sell experiences, we sell
the stories, and the carpet is free.” The Jai-
pur Rugs model emphasizes sharing the
mission and values both within the organ-
ization and in the public domain. When he
was new to the carpet industry, Chaudhary
spent much of his time learning how to
weave himself, which allowed him to min-
gle informally and get to know the
weavers. He has maintained his close inter-
action with the artisans since founding the
company, and much of the technology that
has been adopted was designed to main-
tain this connection. When the firm began
working in the remote villages of Gujarat,
Jaipur Rugs designed a walkie-talkie sys-
tem to keep in touch with the weavers and
get daily updates. A simple app was de-
signed recently to ensure that continuous
communication can take place even where
power and internet coverage are unreliable.
This enables the customers and the head-
quarters to receive daily updates on the
status of their rugs. The Chaudhary family
and company managers make frequent
visits to the villages and know many of the
weavers by name. This deep friendship and
respect enables Jaipur Rugs to have early
access to new ideas, and to troubleshoot
where necessary. It also makes it possible
to recognize the clear strengths and pref-
erences of individual artisans, welche sind
factored into the design of their work. Der
staff today includes people hired specifi-
cally to capture and share the individual
weavers’ learnings and aspirations.
This focus on individual narratives is
important to the mission of uplifting the
artisans, which is an ever-evolving task. In
addition to upgrading the weavers’ skills,
Jaipur Rugs has had to challenge existing
belief systems in the villages, as well as
among consumers and the management
ranks. Chaudhary was advised early on not
to venture into the tribal areas of Gujarat.
He nevertheless began his early operations
Dort, and he was able to successfully train
thousands of weavers because he first
forged friendships within the community.
Chaudhary took a similarly novel ap-
proach to gaining the trust of women,
whom he feels have innate management
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Deepa Prahalad
talent. Recognizing that they continually
have to balance the needs of family and
arbeiten, he created a way for them to do so.
Chaudhary openly shares his journey—the
origins of the company, the challenges he
has faced, and the rationale for his deci-
sions with artisans and outside audiences.
By sharing his narratives, he has increased
his ability to engage with the artisans, sein
managers, Und, Natürlich, the customers.
Manchaha: Creative Freedom
Manchaha—roughly “expression of my
heart” in Hindi—is one of Jaipur Rugs’
boldest initiatives. Kavita, Chaudhary’s
daughter, is an award-winning designer.
She had an inkling that, if given the right
opportunity, many of the women weavers
could become designers and artists in their
own right. To test this idea, the weavers
were given raw materials and the freedom
to create and name a rug of their own de-
sign, without direction from management.
The wisdom of this leap of faith be-
came clear with an early Manchaha rug
called Anthar, meaning “differences,”
which won a German design award. Nach
agreeing to a design concept, the three
weavers had different approaches to its ex-
ecution, but over the months they worked
together the pattern evolved into a har-
monious and unified design. This rug de-
sign featured the weavers as creators in
their own right, which was an important
step in bringing global recognition to the
Jaipur Rug’s brand and a critical advantage
in this design-driven industry.
Manchaha rugs have so far won nine
global design awards, and in the years
since its creation, the Manchaha project
has expanded and evolved. In its latest in-
carnation, the Chaudhary family is train-
ing prisoners to weave rugs as a form of
therapy and rehabilitation. More than 200
prisoner-weavers have taken part in this
“Freedom Manchaha” program. In order to
capture inspiration and improve their de-
sign processes, a regular exercise is done
with the professional weavers, während
which they share and write down their
dreams.
Enabling Direct Connections with
the Outside World
Women in villages face social and trans-
portation challenges when seeking em-
ployment outside the home. The work with
Jaipur Rugs enables women to fulfill their
traditional roles of caring for the home and
children while also earning a salary. More
importantly, the looms being set up out-
side enables others to observe the talent
and productivity of each weaver. Viele
tech platforms allow people to work re-
motely, but that often can be isolating. Der
Jaipur Rug artisans work together on the
rugs, which helps them to build com-
munity and increase their income. Hus-
band and wife teams sometimes weave
together, each having distinct roles. Diese
arrangements, which have formed organi-
cally, have nurtured gender equality.
Another bonus is that the weavers and
buyers often exchange postcards, provid-
ing a personal connection.
Many people not employed by Jaipur
Rugs still benefit indirectly from their pres-
ence in the villages. Through a collabo-
ration with Airbnb, travelers can arrange
village visits, during which they spend a
day visiting the weavers, sharing a meal,
and engaging in other traditional crafts,
such as leatherwork. Jaipur Rugs also hosts
what it calls exposure visits at its head-
quarters, during which it shares elements
of its model with workers from other states
and disciplines. These interactions help to
build the villagers’ soft skills, and their
confidence, and many families’ aspirations
have risen as a result of this exposure.
Some have enrolled their daughters in col-
lege or begun new careers. Customers, zu,
value the feeling of connection they ex-
perience with the community through
their rugs’ creation and are willing to pay
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The Benefit of Clout: How Connections Shape Prosperity
dafür. This sense of connection has led to
other unique offerings, such as a custom-
designed program in which artisans and
consumers create a rug together. This has
led to numerous collaborations and train-
ing programs with noted designers and
luxury brands.
The Jaipur Rugs model of co-created
purpose highlights the value and impor-
tance of an inclusive approach. Too often,
those seeking to help the underprivileged
begin with a long list of what skills and re-
sources people lack, rather than focusing
on what skills they have to build on. Em-
pathy is widely understood as a critical
part of innovation, but it is difficult to nur-
ture without having direct exposure.
Chaudhary understands the aspirations of
the poor and has focused on providing op-
portunity and support. He is known to say
that “thinkers must be doers and doers
must become thinkers.” His immersive
work model addresses the knowledge gaps
among both artisans and the management
ranks, and it includes interactions that en-
able managers to understand the skills and
capacities of each workforce and to seek
out connections that will benefit the firm
and the community.
An important aspect of addressing in-
equality is to create the benefit of clout
through enabling networks. This provides
an opportunity for individual transfor-
mation and learning among workers and
managers alike without requiring anyone
to migrate or take on additional risks. Es
also allows people to acquire new skills and
earn money without leaving inexperienced
individuals alone to navigate the entire en-
trepreneurial journey, as many platforms
do. The work environment design also en-
ables people to develop empathy and es-
tablish friendships.
The Jaipur Rugs model allows individ-
uals to be appreciated for their unique
skills, which in turn creates value for the
company by attracting collaborators and
making it feasible to increase prices. In
light of the COVID-19 pandemic and its
aftereffects, the model of working from
heim, building community, and enabling
new networks provides an interesting blue-
print for a wide variety of organizations.
CREATING A MODEL: SOME
BUILDING BLOCKS OF
CONNECTION
Creating new networks is vital if an inno-
vation is to scale. Doing this is especially
challenging among the poor, because their
access to new technologies often is lagging
and is compounded by social isolation. In
many cases, the community among the
poor provides a safety net, but for innova-
tion and entrepreneurship to succeed, Die
community also must function as a
launching pad for individuals with prom-
ise—a task they can rarely take on them-
sich selbst. Many technology platforms have
attempted to create this dynamic and have
made important contributions. Jedoch,
without anyone to vouch for or certify an
individual’s skills or talent, they often re-
main undiscovered. The unique skills and
stories of talented creators must be intro-
duced to an audience that values them and
can help to create the benefit of clout.
A one-size-fits-all model is not suit-
able for the range of challenges social in-
novators contend with. Jedoch, having
studied many organizations with a social
mission, I can identify some key elements
of a successful model. Many impactful ap-
proaches amplify what I like to call the new
CSR—choices, support, and recourse.
Choices
While the causes of poverty and inequality
vary around the world, the implications for
individuals are very similar—persistent
opportunity gaps. Much of the poverty and
inequality seen today is not about a lack of
information but about a lack of choices. Von
creating more choices, an organization can
dramatically improve its impact. Der
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Deepa Prahalad
orientation to creating choices for a com-
munity as opposed to providing “solu-
tions” is also more respectful and more
likely to inspire action and experimenta-
tion.
Support
Information alone rarely makes change
möglich. To get people to take risks, es ist
critical to first identify the type of support
they need. Early microfinance models did
exactly this by lending to groups of women
rather than to individuals. Support in cre-
ating new networks, sharing stories, Und
mentoring/coaching are currently gaining
importance.
Recourse
Since a system cannot be perfect, having a
plan to provide recourse is critical. Despite
our best efforts to design products and
services that are inclusive, most systems
fall short at some point. Having a process
in place to provide feedback, resolve dis-
putes, and offer compensation where ap-
propriate is a critical step in building scale.
N. K. Chaudhary sum4s up his vision
for Jaipur Rugs: “I see Jaipur Rugs as a plat-
form of connecting the end consumer with
the artisan so that they can emotionally
connect with each other. This shall lead to
the utmost level of dignity for our artisans.”
There is an increasing body of research to
validate this emphasis on connection. In
their book Firms of Endearment, Raj Siso-
dia, Jag Sheth, and David Wolfe identified
a number of companies that focused in-
tensely on the consumer and thus won
their trust and affection. They found that
these firms—which include well-known
brands such as Starbucks and Costco—had
a steady performance over a three-year
period and outperformed their competi-
tors by a wide margin over a ten-year
Zeitraum. Emotional connection is also im-
portant within firms, where it does not
necessarily prevent conflict but can pro-
vide a powerful incentive to resolve chal-
Längen. Most importantly, in an era of con-
tinual disruption,
connecting with
consumers is one of the few advantages
that grows over time. When customers can
share their ideas and concerns with the
firms they love and trust, it increases the
odds that innovations will succeed.
levels have greater access
Jedoch, skills do not automatically
translate into opportunity, even in devel-
oped markets. While individuals at all in-
Zu
kommen
information than ever before, the ability to
create networks remains elusive, especially
for marginalized populations. A great deal
of progress has been made in enabling
transactions, but less attention has been
paid to fostering human connections and
conversation. Paying explicit attention to
creating new networks is an important as-
pect of fostering innovation and opportu-
nity, especially in places where deep
divisions exist. As the issues that organiza-
tions must address grow in complexity,
making connections will become increas-
ingly critical in moving from paralysis to
discovering new possibilities.
DANKSAGUNGEN
The author conducted two long interviews
with N. K. Chaudhary and his children,
Yogesh Chaudhary and Kavita Chaudhary.
They also shared ideas on their business
with the author during a session in the
Global Peter Drucker Forum and during
case discussions with her at the Indian In-
stitute of Management in Ahmedabad.
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