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Corporate Social Responsibility
News
8.24.2004 ET
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CSR News from:
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Wharton School Publishing
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News Category:
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The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits
A Radical Approach that Delivers on Two Bottom Lines: Financial and Social
(CSRwire) To read a pdf excerpt from The Fortune at the Bottom of the
Pyramid: Eradicating Poverty through Profits, click here.
The lead book of Wharton School Publishing/Pearson's new business
imprint
"C.K. Prahalad argues that companies must revolutionize how they do
business in developing countries if both sides of that economic equation
are to prosper. Drawing on a wealth of case studies, his compelling new
book offers an intriguing blueprint for how to fight poverty with
profitability." - Bill Gates
Globally, 1.8 billion people lack access to electricity, keeping
them from the fuel and connectivity necessary for modern life. How
does low cost, clean and fast sustainable energy - solar-power - now reach
into the hinterlands of Nicaragua through local entrepreneurship where the
average per capita income is less than $300? And, can this example be
copied?
The world's leading cause of mental disorders and retardation is
Iodine Deficiency Disorder (IDD). In India alone there are 70 million
people who have IDD and another 200 million are at risk. This rampant
disease can be found in Kenya, the Ivory Coast, and Nigeria. How did
Hindustan Lever Ltd, a branch of a multinational company, solve the
problem and make a profit at the same time?
Because 24 million poor Mexicans earn less than $5 a day, they have
been unable to get access to credit. How did this change so that the
Mexicans could build affordable housing for themselves while the third
largest cement manufacturer in the world, Cemex, continues to reap the
financial rewards?
Blindness affects 12 million people in India. Since 80% of
blindness would be avoided with medical treatment, could a clinic serve
more than a million patients and do it mostly for free, yet continue to be
highly profitable? Can this local
solution be replicated elsewhere?
These are four examples of the provocative 12 in-depth case stories from
India, Peru, Mexico, Brazil and Nicaragua that illustrate the world's most
exciting, fastest growing and perhaps most lucrative market -the bottom of
the pyramid (BOP). First discussed in a Harvard Business Review
article and then in Foreign Affairs, this transformative business
idea is the mission of C.K. Prahalad, who has been called one of the top
20 business thinkers today. He brings this radical concept to life in his
book that launches Wharton School Publishing/Pearson new business imprint,
THE FORTUNE AT THE BOTTOM OF THE PYRAMID: Eradicating Poverty Through
Profits (Publication Date: August 25, 2004; $27.95 hardcover). The
25-minute CD (included with every book) shows the results of companies and
organizations creating sustainable win-win scenarios -- the lives of real
people at the BPO are dramatically improved in many ways.
The market for goods and services at the bottom of the pyramid is enormous
and under utilized. Prahalad shows that the 18 largest emerging countries
have 680 million households with an annual income of about $6,000 or less
per household. Those numbers translate into a huge, untapped market of
approximately $1.7 billion - waiting to be recognized and served.
Largely ignored by most traditional companies because they only have a
small, often fixed amount of money, the poor are an invisible market, but
only because we've been socialized to think that way. Prahalad believes
the business community has had blinders on. They haven't been able to
imagine how to sell something when money isn't readily available. Growth
has been misguidedly focused on ownership rather than access, on the
luxury market or on copying "best practices." These strategies can only
account for a portion of revenue and efficiency over time. On the other
hand, the BOP is enormous with almost limitless growth potential. C.K.
Prahalad says serving the bottom of the pyramid is the "next practice,"
the challenge that will lead to a radical leap forward.
THE FORTUNE AT THE BOTTOM OF THE PYRAMID proves that the future will
develop from serving the poor, because the innovations that are developed
are superior-- top quality, low price, high volume and world-scale. Only
the best innovations will work for both sides of the equation, those in
poverty and those in the "developed" countries. New products and
services that improve the lives of poor people aspiring to the middle
class make the world a safer place, while protecting and conserving the
earth's resources.
The case studies, based on research done by Mr. Prahalad and his graduate
students whose biographies appear at the back of the book, cover a wide
variety of industries: retail, housing, food, agriculture, healthcare,
financial services, wireless technology, renewable energy, e-governance,
and infectious diseases. The new solutions come from diverse types of
business, multinational corporations, local businesses, and newly
developed local entrepreneurs. They include such unusual examples as
groups of women selling time on their cellphones.
The ramifications of this book are just beginning. Globally, this is a
movement in the making that will affect everyone and the life of the
planet. After all, what company or individual entrepreneur wouldn't want
to make money, create successful products and services that no one else
has thought of, and save lives and our earth at the same time?
About the Author
CK Prahalad is a professor, researcher, speaker, author and prominent
consultant. Business Week has called him "a brilliant teacher at
the University of Michigan" and also described him as "maybe the most
influential thinker on business strategy today."
In addition to serving as the Harvey C. Freuhauf Professor of Business
Administration at the University of Michigan Business School, Prahalad
specializes in corporate strategy and the role of top management in large,
diversified, multinational corporations.
He is a prolific author. In 1994 he co-authored the bestseller,
Competing for the Future, with Gary Hamel. Translated into 14
languages, it was named the Best Selling Business Book of the Year in
1994. Other books he has authored or co-authored include Multinational
Mission: Balancing Local Demands and Global Vision (1987) and The
Future of Competition: Co-creating Unique Value with Customers,
published earlier in 2004.
He has won numerous awards (please see notes to editors below). The most
recent include the McKinsey Prize three times, the SMR-PWC award, and the
ANBAR Electronic Citation of Excellence.
A prominent world-class guru, Professor Prahalad has consulted with the
top world companies (see bio for list) and services on the Board of
Directors of NCR Corporation, Hindustan Lever Limited and the World
Resources Institute.
THE FORTUNE AT THE BOTTOM OF THE PYRAMID
Eradicating Poverty Though Profits
Enabling Dignity and Choice Through Markets
By C.K. Prahalad
Published by Wharton School Publishing/Pearson
Publication Date: August 25, 2004
Price: $27.95 hardcover U.S.
ISBN: 0131467506
CD-ROM included
* * *
Notes to Editors: ABOUT THE AUTHOR, C.K. PRAHALAD
If you google C.K. Prahalad, you will find that over the past ten
years, he has been included in every survey of top ten management thinkers
in the world. He is the Harvey C. Fruehauf Professor of Business
Administration at the University of Michigan Business School, in Ann
Arbor, specializing in corporate strategy and the value added by top
management in large, diversified, multinational corporations.
Business Week said: "...a brilliant teacher at the University of
Michigan, he may well be the most influential thinker on business strategy
today."
In addition to his other achievements, Mr. Prahalad is a prolific author.
His books include the international bestseller Competing for the Future
(1994) that he co-authored with Gary Hamel. It was published in fourteen
languages and was named the Best Selling Business Book of the Year in
1994. Business Week described his most recent book The Future of
Competition: Co-creating Unique Value with Customers (2004) coauthored
with Venkat Ramaswamy; "provocative", "an important book full of
disruptive ideas," and "what the authors contemplate is nothing less than
the democratization of commerce." Although the book was recently
published, it is already being translated into nine languages.
He is also the author of numerous award-winning articles. Harvard
Business Review awarded the McKinsey Prize to him three times for:
"The End of Corporate Imperialism", co-authored with Kenneth Lieberthal
(1998); "The Core Competence of the Corporation", co-authored with Gary
Hamel (1990), and "Strategic Intent", also co-authored with Gary Hamel
(1989). "The New Frontier of Experience Innovation" published in Sloan
Management Review won the SMR-PWC award for the best paper published in
2003. "Weak Signals vs. Strong Paradigms", published in the Journal of
Marketing Research (1995), was awarded the 1997 ANBAR Electronic Citation
of Excellence. "The Dominant Logic: A New Linkage between Diversity and
Performance" (1986), co-authored with Richard Bettis, was selected the
Best Article published in the Strategic Management Journal for the period
1980-88. "The Role of Core Competencies in the Corporation" (1993)
received the 1994 Maurice Holland Award as the Best Paper published in
Research Technology Management in 1993. "A Strategy for Growth: The Role
of Core Competence in the Corporation" won the European Foundation for
Management Award in 1993.
A member of the blue ribbon commission of the United Nations on Private
Sector and Development, he is the first recipient of the Lal Bahadur
Shastri Award for contributions to Management and Public Administration
presented by the President of India in 2000.
A prominent world-class figure, Professor Prahalad has consulted with the
top management of many of the world's foremost companies, such as
Ahlstrom, AT&T, Cargill, Citicorp, Eastman Chemical, Kodak, Oracle,
Philips, Quantum, Revlon, Steelcase, and Unilever. In addition, he serves
on the Board of Directors of NCR Corporation, Hindustan Lever Limited and
the World Resources Institute.
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