Panel Discussions

Bottom of the pyramid: A strategic decision or a Bandwagon effect?

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“These unhappy times call for the building of plans that rest upon the forgotten, the unorganized but the indispensable units of economic power...that build from the bottom up and not from the top down that put their faith once more in the forgotten man at the bottom of the economic pyramid.”

                                                                                                                                            -       Franklin D. Roosevelt, April 7, 1932

 

“Bottom of the pyramid” the phrase was first coined by U.S. president Franklin D. Roosevelt in his ground breaking speech, The Forgotten Man. The more contemporary usage of this term was popularized by Professors C.K. Prahalad and Stuart L. Hart. It refers to the billions of people around the world who live on less than $ 2 per day. A lot of companies have tried to harness the growth potential in the lower echelons of the economic strata ever since. The response however, has been mixed. Despite the extents of the market and volume of the hype only a few multinationals have been able to capitalize in this segment.

Apart from some successes in industry such as telecommunications, fast- moving consumer goods and pharmaceuticals, global multinationals have not captured the imagination of the poor. Moreover, micro-finance which took of well is now viewed as a mishap waiting to happen by imminent scholars. The bottom of the pyramid is clearly not every corporation’s cup of tea, even if it is highly receptive to the problems of the poor. At this point in time there is a far reaching issue whether bottom of the pyramid is a strategic decision or a bandwagon effect?