Behavioural Decision-Making in the Context of Sustainable Business Practices: The Case of Jaipur Rugs, India, 2011

Announcing the latest case study to be accepted for publication in my forthcoming book:

Behavioural Decision-Making in the Context of Sustainable Business Practices: The Case of Jaipur Rugs, India, 2011

Dr. R. K. Tyagi Head, School of Management, RGGI, Meerut

Abstract: Jaipur Rugs reaches more than 40,000 artisans —approximately 60 percent of who are women— in the most economically disadvantaged regions of India and is a handmade carpet manufacturer. As a part of its commitment to the Business Call to Action in January, 2012 it has announced that it will train some 10,000 people in Northern India in advanced carpet weaving techniques and provide them with access to global markets by 2015. This case focuses on the general concept of sustainability and the dynamics of underlying social and economic factors by outlining CSR practices in Jaipur Rugs and discussing its role in the business model. The issues involved were discussed with the company’s CEO, HR Manager, employees and staff. Telephone and personal interviews, together with company visits, were carried out to understand the business model, production processes and socially responsible practices employed in the company. It was found that Jaipur Rugs is using labour-intensive production processes, which boost employment and support economic growth through increased exports. The business model of the firm leads it to operate in a highly decentralized manufacturing and logistics system which, eventually, dramatically decreases its fixed cost. Medium-sized as well as small-scale productive ventures are human problems no less inimical to society than do large-scale ventures. It is further found that the model can be replicated by other firms willing to make CSR an integral part of a business model rather than just through paying lip service to it. This model is different from that of cooperatives and if replicated in other industries it can bring or add to self-employment. Keywords: Corporate Social Responsibility, Rural Employment.

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