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By Edward H. Baker  |  Posted 10-01-2004 Print Email
.S. Companies"> What do you think this portends for companies in the U.S.

If I were give advice to a U.S. company, it would be to move rapidly to exploit the opportunity and to learn how to do it. Because if you don't, European and Japanese companies will get there ahead of you. Just because you don't want to do it, doesn't mean others are going to stop. It's like saying there's water up there—you can contort the pipes as much as you want, but the water will finally come down.

Ten years ago, we didn't know the benefits of moving manufacturing to China. Now we get a $39 DVD. And we also sell more Boeing aircraft. A China that is not prosperous will not buy Dell computers, or Caterpillar tractors for construction, or Guardian glass, or Boeing aircraft.

And the BOP [bottom of the pyramid] markets well actually make companies stronger. You cannot sell into those markets without innovating. So in order to sell those markets, American companies will have to innovate, and those innovations can come back here as well.

If you read through this book, creating that for poor people is what it is. It's access and transparency through technology and dialogue mediated by technology, but not only by technology. But in the village they can have a dialogue without the technology. But across villages they need the technology, and, therefore, they can make their own risk-benefit assessment. It's exactly the same.

You just need the access.

That's right, access and transparency are crucial.

Are any of the hardware companies trying to make technology available?

A lot. AMD's in a massive project to build a simple computer for them, $200 or something like that. There's a company called Simputer—simple computer—in India, and they're trying to do it for a hundred bucks.

Sounds like a huge opportunity.

Tremendous. I'm so excited because I think the opportunity is real and big, and none of us know how big it is. And after all, creating the capacity to consume is our job as managers. Selling to the rich is a no-brainer. They have the money and they can afford to spend it. But selling to the poor, and making sure they will be able to buy what you're selling—that's tougher.


At a Glance

Background: C.K. Prahalad's motives in writing The Fortune at the Bottom of the Pyramid were complex. "As I was doing this work, it became obvious that this is the most untapped and interesting opportunity in the world—not only because it's a growth opportunity but because it's also an opportunity to change the way inequality in the world exists. By helping poor people become active participants in the global marketplace, we can change the levels of inequality in the world."

Career Highlights: C.K. Prahalad is the Harvey C. Fruehauf Professor of Business Administration at the University of Michigan Ross School of Business. He specializes in corporate strategy and the role of top management in diversified multinational corporations. He received a B.Sc. from the University of Madras in 1960.



 

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