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Prahalad and Hart suggest that investors should not adopt thoughts of the poor as victims of exploitation. Investors should not exploit low-income…
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Download file to see previous pages... The article focuses on a comprehensive discussion of the market at the bottom of the pyramid. Unique characteristics of this market form a significant part of the explanation. According to Prahalad and Hart, bottom of the pyramid market segment has an estimated 4 billion people who live in abject poverty. Notably, the population in this market segment represents a potential market for goods and services. Active involvement of private firms at the BOP is a significant factor in generating inclusive capitalism (6). Private firms’ engagement in the BOP segment of the market enhances completion of the market will redirect attention to the poor as consumers. Prahalad and Hart assert that each group that gives close attention on poverty eradication such as the World Bank, developed countries offering aid, charitable organizations, federal governments, and private firms – has its an overriding justification. Prahalad and Hart explain that MNCs suffer the effect of strongly established reason in relation to cost structure, consumers and BOP sector (12). As a result, donors view the private sector as malicious and exploitative of low-income society members. None of the well-known organizations perceive that market inclined solutions can result into poverty alleviation and economic growth.
Prahalad and Hart turn to a discussion of products and services for the BOP. They assert that it requires an innovation perspective of product development and creativity in accordance with the realities of the BOP market. Based on this assertion, the writer identifies a number of principles that should guide innovations for the BOP market segment (9). The aspect is price performance. It is essential for quantum jumps in the price performance. The second factor focuses on hybrid solutions: advanced and evolving technologies that innovatively merge with available and increasingly developing infrastructure. Another important aspect is focusing on conservation of resources ...Download file to see next pagesRead More
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