Book review: The Fortune at the Bottom of the Pyramid: Eradicating Poverty through Profits, by CK Prahalad.
“What are we doing about the poorest people around the world? Why is it that with all our technology, managerial know-how, and investment capacity, we are unable to make even a minor contribution to the problem of pervasive global poverty and disenfranchisement? Why can’t we create inclusive capitalism?”
With opening challenges like this, Mr Prahalad’s book really grabs one’s attention. “If we stop thinking of the poor as victims or as a burden and start recognizing them as resilient and creative entrepreneurs and value-conscious consumers, a whole new world of opportunity will open up,” Mr. Prahalad goes on to state.
Constant innovation
University of Michigan Business School professor CK Prahalad challenges the common beliefs held by business about the world’s poor and introduces us to the Bottom of the Pyramid (BOP), an underserved market of more than four billion people. This is the market companies should be paying attention to, he says.
According to Prahalad, the poor need to seen as a market, but one different from the conventional wisdom. When this happens traditional business concepts are applied to each situation from its distinct perspective. What results are practical, innovative solutions to unresolved problems.
Prahalad demonstrates that making products more affordable to the world’s poor can provide substantial returns to create real partnerships and innovations for established companies.
One may question the realism of Prahalad’s vision and goals. As Prahalad readily admits, “We have a long way to go before the social transformation of inequalities around the world will be accomplished.” But being a long way from reaching that goal should not be a deterrent to working towards it.
Slowing growth and financial crises in overserved markets may mean companies have no other option than to enter these Bottom of the Pyramid markets. When you do, you’ll find it a win:win.
In what way will you apply the efficiency and effectiveness benefits you’ve gained from Agile? What about using these benefits to innovate products for Bottom of the Pyramid markets?
