Prahalad met Gary Hamel when they were in Ann Arbor. Hamel was a young international business student at that time. Their encounter was a blessing in the field of management thought. The culmination of Prahalad's cooperation with Hamel was Competing for the Future published in 1995, which was once published by Business Week As the best management book of the year, this book describes how the situation of business management has evolved. It has developed from the old control and command model. Later, managers must take the initiative to find new market opportunities. The success of business depends largely on the market situation and customer satisfaction.
Prahalad's latest book is The Future of Competition: Co Creating Unique Value With Customers, 2004, co written with Van Cate Ramoswami. Prahalad pointed out in the book that enterprises have not yet made full use of the opportunities brought by globalization, and people are still unable to realize that not only the rules of the game have changed, Everyone's role in the game has also been changed. Today's consumer is a more dynamic and active image, rather than an abstract body passively waiting to be satisfied. Thanks to the Internet, consumers can create and participate in commercial transactions. The concept of value has also changed. It is no longer an inherent characteristic of products or services. Value cannot be instilled by product producers or service providers. It must be co created by consumers and realized through their own experience. The only way for enterprises to win is to establish new strategic capital.
Prahalad has always been looking forward to a more intimate experience of business. In 1997, he co founded Praja in Santiago (Praja means ordinary people in Sanskrit). This fledgling network company is trying to change the focus of the Internet from a pure information industry to more substantive content. However, with the bursting of the Internet bubble, the company also suffered a fatal blow. For this, Prahalad has a common heart: he learned a lot from it.
Prahalad has always been deeply concerned about the poor groups in the world, for which he wrote The Fortune at the Bottom of the Pyramid:. Prahalad turned the traditional thinking of the world economy upside down. He pointed out that the 4 billion people living under the poverty line of $2 a day add up to a huge but neglected market. "Four billion poor people can become the engine of the next round of world trade and prosperity," Prahalad stressed. He calculated the purchasing power of the world's nine largest developing countries, China, India, Brazil, Mexico, Russia, Indonesia, Turkey, South Africa and Thailand, equivalent to 12.5 trillion US dollars. "This is a market that cannot be ignored," he said. "The real source of market potential is not the rich class in developed countries, nor the emerging middle class consumers, but hundreds of millions of eager poor people who have joined the flood of market economy for the first time."
The market at the bottom of the pyramid can be jointly built by transnational or domestic industries, non-governmental organizations and - most importantly - the poor groups themselves, so they have the right to choose life and goods. Prahalad praised the sales strategy of Unilever India Co., Ltd., which transformed washing powder and detergent into small packages with low unit price. This new distribution mechanism has created new wealth. Prahalad's interest is not related to benevolent humanitarianism. He believes that it is not good for charities to give too much to the poor. The poor should have real power in the market. In May 2005, Prahalad attended the Fortune Global Forum held in Beijing. He pointed out that the poor did not enjoy full rights in society. If their rights could not be fully guaranteed, there would be a crisis. This crisis is possible, and conflict is also possible. He said that it is not only developing countries like China and India that have poor people. There are 45 million people in the United States who have no savings. To achieve the goal of poverty eradication, more and more civil society and the private sector must be integrated. If the private sector and civil society view each other as rivals rather than cooperators, they cannot resolve this difference. Therefore, the problem we face is not just to provide charitable funding, but to further establish equality.
The business world is changing rapidly. It is necessary to constantly seek new ideas for survival. Prahalad has opened a new situation for us and brought us the most valuable business ideas. It can be said that whoever wins the wealth at the bottom of the pyramid first is the future business master.
