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November 06, 2005
Google, Yahoo and the bottom of the pyramid.
We all go to conferences and most are pretty good but the IDSA/HP Design About on BOP--the bottom of the pyramid--was especially intense and productive. Thanks to Sam Lucente, director, Brand Design and Experience for HP and Kristina Goodrich who runs the IDSA, and the folks from Jump, especially Udaya Patnaik who MC'd the two days and all the breakouts, we had nearly 48 hours of great talk and thought. There were about 60-70 participants and that number seems optimum for maximizing discussion, networking and ideation.
And the really biggest idea to come out of the talk was CK Prahald's Co-Creation. Funny, because it was CK's book on the Bottom of the Pyramid that was the initial glue holding the conference together. But it became clear early on in the discussions that corporations cannot simply walk into villages in India and elsewhere and sell off-the-shelf computers and shampoo to people making $2 a day or less (and who are probably very suspicious of outsiders). The solution? Provide the capability of designing products and services together with the people on the ground. Craig Vogel, who heads up innovation at the University of Cincinnati, called it "our capability and your need."
Now stop a moment and think about all this. Are we not speaking about the very same thing when we talk about The Power of Us? Are we not talking about the great shift of power to consumers from producers and in fact, the rise of consumers AS producers? And are we not talking about the process of social networking, collaborative intelligence, mass cooperation and all the Google, Yahoo and web stuff?
The answer is yes. Odd as it sounds, at a conference on poverty and the Third World, in a discussion of marketing to people so poor they make $1 to $2 a day, we conclude that only through collaboration can we best create the things people want. Gary Elliot, the really smart vice president of brand marketing for HP, talked about "Me-ism" in the US, the idea that form follows me today, that "me" is the center of the universe and companies have to work within that cultural context to success. Companies therefore have to partner with millions of "me-customers" to co-create products and services.
But the conference showed that companies must do the same thing in the "we-cultures" of India and the bottom of the pyramid countries. For political, economic and cultural reasons, they have to partner up with their customers to generate new products and services to sell to and with them. In fact, Patrick Whitney of the Institute of Design discussed how in Indian villages, consumers are invariably producers, that every household is invariably an entrepreneur, how consumer goods are used to produce things for sale. Sound like American teenagers using computers and mixing and remixing video and music, creating their own blogs, sharing them?
Folks, I haven't connected all the dots, but we may have a new, singular model of capitalism developing here. At the very least, a new business model. Perhaps a new economic model as well. The high tech world of the web and the low-tech world of the village are somehow coming together to offer up a new vision for innovation, design and society in general. Whew, what a conference! More on specific ideas for innovation and design later.
bottom of the pyramid
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Bruce Nussbaum on businesses co-creating products and services with consumers in developing countries from Putting people first
Bruce Nussbaum, who writes a column on innovation and design for Business Week, reflects today on the IDSA/HP Design About on BOP--the bottom of the pyramid. Gary Elliot, the vice president of brand marketing for HP, talked about Me-ism in the US, the ... [Read More]
Tracked on November 6, 2005 08:11 PM
I've always been fascinated by co-creation. Particularly business models at the so-called bottom of the pyramid showcase this art of integrating customers into designing and creating value. I tried to illustrate this in a recent post on my business design blog (http://business-model-design.blogspot.com/2005/11/business-model-innovation-at-bottom-of.html ). I've always been impressed by the innovativeness of businesses in developing countries and I think the bottom of the pyramid is a huge resource pool of creative thinking for design. Greetings from Chiang Mai, Thailand, Alex
Posted by: Alex Osterwalder at December 9, 2005 09:10 AM
I am going to write my thesis in India, its about "New form of partnership between NPO and For-Profit-Organizations: The hybrid value chain model".
It was developed by Ashoka, based on Prahald's book.
I would be glad if you can give me some tips or if we can colobarate in one way or another.
Posted by: Tobias at July 23, 2006 05:48 PM
Interesting article. As soon as we see people who make $2 dollars a day we skip the BOP idea. It's only when you know there's 4 billion of them and according to CK 13 trillion dollars PPE. The focus is on how you can help more than one - the multiplier and not on the individual $2.
The idea that I also like in the book is the, "doing good by doing well", and "charity makes you feel good" but it doesn't include the doing well bit. And why charity is ok and nothing more.
So we need to redesign capitalism to include the 4 billion, who wants technology and know how and not food and charity.
I am busy with a PowerPoint video on BOP and how to unleash a BOP idea using Seth Goldin's free ebook "Unleashing the IdeaVirus" anyone who like to collaborate is welcome.
Posted by: Mozambique Bio Fuel Industries at November 1, 2006 01:14 PM