C.K Prahlad was an Indian management scholar who introduced the concept of core competence. He received several awards from the President of India for his contributions to management. Prahlad is known for developing the concept of bottom of the pyramid (BOP) marketing, which proposes that multinational corporations can develop business strategies to market affordable products and services to the billions of poor people living on less than $2 per day. Prahlad argued that there is significant untapped purchasing power and business opportunities at the BOP. He advocated for MNCs to play a leading role in developing products and distribution systems to serve the BOP market.
2. C.K Prahalad.
👉 Coimbatore Krishnarao Prahalad.(1941-2010)
👉 Hometown- Tamilnadu.India
He was the first recipient of the Lal Bahadur Shastri Award for
contributions to Management and Public Administration presented by
the President of India in 1999.
In 2009, he was awarded Pravasi Bharatiya Sammaan
3. CONTRIBUTION TO MANAGAMENT:
Sir made a name for himself by introducing the
concept of core competence to explain the
superior performance of Japanese organization
compared with the rest in the world.
This was acknowledged be a dramatically new
way of understanding competitiveness of
Organisation.
4. What is BOP ?
The bottom of the pyramid, bottom of the wealth
pyramid or the bottom of the income pyramid is
the largest, but poorest socio-economic group.
In economics, the bottom of the pyramid is the
4 billion people who live on less than $2 per
day.
7. Bottom Of Pyramid:-
“Bottom of the Pyramid” (BoP) was first used
by U.S. President Franklin D.Roosevelt in
1932.
The phrase “Bottom of the Pyramid” is used in
particular by people developing new models of
doing business that deliberately target the
poorest regions.
8. Many Companies are beginning to experiment
with the BOP?
(1) :-Nutristar, Nutridelight (nutritional
drink),Pur (Pure Water).
(2) :- Hindustan Lever (detergent for the poor
in India and Brazil), Annapurna (iodized-Salt
for the poor)
(3) :- Vodacom community services in South
Africa.
9. Companies beginning to experiment BOP:
(Hewlett-Packard)
Solar powered digital camera in India and
community information systems.
Program in South Africa to help entrepreneurs enter
the supply chain and profit from new business
ventures.
10. Roles Of MNCs:-
An important element of the BOP proposition is
that MNCs should take the lead role in the
BOP initiative to sell to the poor.
MNCs must provide their attention towards
growing of poor people of a particular
geographical location.
11. BOP From MNCs Prespective:-
BoP economic potential may be underestima-
ted because of four main misperceptions of
poverty.
👉 Income is too low, the poor can’t buy MNCs’
products.
👉 Goods sold in developing markets are so
cheap that MNCs can’t make reasonable profit
12. 👉 The poor don’t waste money on
luxury products, they only fulfill
basic needs.
👉 The poor don’t have the
required skills for the use of
advanced technology.
13. Startegies For the bottom of the pyramid:-
At a minimum, managers have to focus
on the following challenges.
👉 Create mechanisms that shift the poor from
unorganized to an organized sector.
👉 Transition from barter to transactions
primarily mediated by money.
14. 👉 Create access to credit on a
commercial basis.
👉 Create a low cost, high quality
distributionsystem.
15. The Furtune at the bottom of COP:-
Fortune or Mirage at the Bottom of the
Pyramid (BOP)?
Fortune at the BOP: Large multinational
companies can make a fortune by selling to
poor people at the bottom of the pyramid.
Mirage of a Fortune: The alleged large and
lucrative market at the bottom of the pyramid
is a mirage, and companies are much better
off targeting the growing middle class in
emerging economies.
16. 4 POINTS TO NOTICE:
There is much untapped purchasing power at the
bottom of the pyramid.
Private companies can make significant profits by
selling to the poor.
By selling to the poor, private companies can bring
prosperity to the poor, and thus can help eradicate
poverty.
Large multinational companies (MNCs) should play
the leading role in this process of selling to the poor.
