Business Gurus Explore Opportunity in Poverty
Friday, December 19, 2008
Bangalore 😕 A major market research company was recently tasked by a French NGO to explore mobile phone usage patterns in slums in Kolkata, including the kind of information they like to receive on their phones and the price they were willing to pay, as part of an effort to scope out business opportunities entwined in social development.
A start-up technology company in Bangalore is exploring ways to make low-end mobile phone experiences as entertaining as high-end ones with the understanding that low income groups are a large untapped market base.
A British Petroleum venture to create efficient smokeless stoves for rural India has so far sold 375,000 stoves and hopes to hit the one million mark by the end of next year.
The bottom of the pyramid is increasingly seen in the business world as opportunities and at the opening of the The Indus Entrepreneurs (TiE) summit on ?Inclusive Entrepreneurship? in Bangalore on Tuesday, business guru C K Prahalad called it opportunity in poverty.
With the poor living in largely unorganised circumstances, they pay more for loans, for housing and other needs. Organisation and competition in the servicing of needs of the poor can create successful businesses, he said. ?There is money to be made,? he said.
Citing an example, he said India had redefined the way telecom businesses are run because of a focus on the poor.
Traditional adversarial relations between companies and social activists are set to change as companies fulfil obligations to society resulting in greater democratisation of entrepreneurship, C K Prahalad said.
Wipro Chairman Azim Premji who also spoke at the opening of the three-day summit said the current economic recession would be a period of ?spring cleaning? where the good companies will emerge stronger.
?We are coming into a very interesting time. We are coming into restructuring of global economies. It?s not just a recession of global economies. I think we are seeing it happening also in India. You will see it intensifying as we go forward,? he said.
?Less successful companies will keep crying and crying and throw up their hands, blaming external people and ask government for aid,? he said.
The period however offers opportunities and will remove complacency from successful companies, he said.