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Executive Interviews: Interview with Miguel Angel Gardetti on Bottom of the Pyramid
November 2008
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By Dr. Nagendra V Chowdary
What are BOP Markets? What are
their unique characteristics?
Over the past years the base of the
pyramid term has been widely yet
inconsistently used. For this reason, a
key discussion topic at the BoP
Learning Labs Global Network
Director Summit (Tilburg University
The Netherlands held on June 3
and 4, 2008) was to determine the
distinctive features of the BoP
strategies and undertakings. The
identified critical factors typical of
BoP strategies are:
First of all, the BoP undertakings are
based on transformational "business"
models at a local level.
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That is, they
promote and develop local
capabilities and socioeconomic
systems in order to create value for
the parties. This also means that the
business, as a proactive partner,
needs to leverage the local players
potential for developing successoriented
alliances. Based on the
above, will it be possible to develop
perfectly tailored solutions to real
problems in ways which respect the
local culture and natural diversity.
Second of all, the triple bottom line
needs to be integrated into the
strategy. A better future will depend
on the new paradigm of marrying
business with development, fostering
social, environmental and economic
stability. Third, there should be aspiration and
potential for scale and replication
(inability to help a business grow and
expand does not meet the goal of
transforming the local society and
economy). Two other critical factors under
review were: Great leap innovation or
the theory of disruptive innovation
that suggests that the existingmarkets
are the wrong place to search for
further opportunities for
development; and to consider the
people living at the base of the
pyramid as partners and peers (rather
than consumers/producers).
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Why sudden interest in BOP
markets? Is it another fad or is this
the new big marketing opportunity?
The question is much more complex:
The decade of globalized economy,
privatizations, and free trade has
produced, at the very best, mixed
results. While the richer countries
have grown richer, most nations all
over the world cannot refer to the
benefits of capitalism. In the
developing world, all this contributes
to challenging globalizations
potential as a precursor of prosperity
to a great extent. The antiglobalizationmovement
resulted from
a combination of considerations such
as environmental degradation,
inequity, human rights, cultural
diversity, and loss of local autonomy.
Moreover, many authors assert that
the globalization process led by
multinational companies over the
past decade has a dark side. For
instance, they argue that the corporate
sector promotes a new commercial
monoculture based on the values of
Western consumerism, which
brings about the impairment of both
local cultures and traditions. As a result of these and other factors,
the gap between rich and poor
countries has widened over the past
40 years. Of course, multinational
companies are not solely responsible
for all this: multilateral agencies have
played a leading role which added to
these consequences, while
corruption has also proved to be a
contributing factor. If this dangerous
trend persists, development fails to be
accelerated, and benefits of economic
progress and technology fail to reach
people who are currently living in
poor conditions, the future will look
bleak. Due to the above reasons,
capitalism must change. With a new
and more inclusive capitalism, the
private sector can become a catalyst
for sustainable development. -
Can you please share with our
readers what the Base of the
Pyramid Learning Lab is all about?
What was its origination and what
has been its growth so far? Why
were these labs set up? What were
the objectives?
The lab that was developed in
Argentina in September 2005
consists of a set of companies, NGOs,
and members of both the government
and academics, that taking into
account the huge existing inequality,
work jointly to analyze the best way
in which the private sector can
eradicate poverty as a proactive
partner, betting on the potential of
local players to cooperate in fostering
and jointly promoting local
development. Each lab participant was selected
based on the nature of their
relationship with the BoP. Thus the
lab has companies that, at a local
level, have implemented business
strategies in the BoP, others that are
developing said strategies, and some
others that, while they have not
developed said strategies yet, their
foreign parent companies have
initiatives in such market. The NGOs
selected to participate in the lab, are
those that, due to their work, are
closely connected with poverty. The
guest social entrepreneurs belong to
Fundación AVINA and Ashoka
Emprendedores, which are two
organizations that support this
concept worldwide. The Members of
Government belong to departments
whose work mainly focuses on the
BoP (Ministry of Work, Ministry of
Social Development, and Secretariat
of Environment and Sustainable
Development). The academia has
been defined based on the postgraduate
level in private as well as
public Universities. Please note that
both NGOs and social entrepreneurs
are taking part as the first step
towards the integration of poor
people into the Lab.
1.
Bottom of the Pyramid Case Study
2. ICMR
Case Collection
3.
Case Study Volumes
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