BOP 3

Book Review: Chapter 3 (BOP: A Global Opportunity)

Book: The Fortune at the Bottom of the Pyramid

Library Reference: None

Amazon Reference:

Quote: “BOP markets can collapse the time frames taken for products, technologies,
and concepts to diffuse in the system. Many of the drivers of change and market
growth—deregulation, involvement of the private sector in BOP markets, digitization, ubiquitous connectivity and the attendant change in the aspirations of people,
favorable demographics (a young population), and access to credit—are
simultaneously present in BOP markets.”
-C.K. Prahalad

Learning Expectation:

For this chapter, I would like to learn about the BOP solutions for developed markets. I also want to learn about the concept of capital intensity and of course, I also expect to learn in this chapter how to live in a network of relationships.

Review:

The part of this chapter that caught my attention was the lessons for MNC from BOP Markets. These lessons are the capital intensity which according to the text is a critical element of success in the BOP markets.

The next lesson is sustainable development which means knowing how the said product or service would be affecting the BOP markets such as if they would be benefitting from it or not. Aside from that, sustainable development refers also to BOP markets being a great source of experimentation for this idea. A lot of things can be improved in the BOP markets and so, there are a lot of possibilities for sustainable growth and development. Another lesson is innovation because it forces new set of disciplines such as focusing on price performance instead of focusing on how you would earn a lot of money.
Basically, these lessons are related to the principles of innovation for BOP markets discussed earlier in chapter two of the same book. Anyway, another part of this chapter that caught my attention was the part about learning to live in a network of relationships. According to the author, MNCs working at the BOP must learn to live with a variety of relationships with large institutions. I agree with this very much because in order to be able to get to the BOP, you first have to truly understand its nature and the best way to understand this is by building a strong relationship with them.

What I Learned:

By the end of this chapter, I learned that there are lessons addressed to the multinational corporations or MNCs from the BOP markets which I did not really expect at the beginning to happen. Aside from that, I also learned that MNCs must learn to live in a network of relationships in order for them to be more effective.

Integrative Questions:

1. What are the BOP solutions for developed markets?
2. What are the lessons for MNCs from BOP markets?
3. What is capital intensity?
4. What are the costs of managing?
5. What is the basic unit of analysis?