BOOK REVIEW: The Fortune at the Bottom of the Pyramid

Author:
C.K. Prahalad

Recommended Retail Price:
R255.95 (Available from leading book stores from November 2009)

Publisher:
Pearson Education Inc publishing as Wharton School Publishing (2009), 407 pages

Following the spectacular success of the first edition of The Fortune at the Bottom of the Pyramid, a revised and updated fifth anniversary edition of this important book will be launched in November 2009.

In the first edition of this book (the complete original text of which is reproduced in this new edition) Prahalad highlighted the reasons for the failure of traditional approaches to poverty alleviation – and explored some tremendously successful innovations in this area driven by the efforts of large established enterprises to create and tap into the market potential of the poorest sectors of developing societies, the people living at “the bottom of the pyramid”.

In this revised edition of the book, the author takes stock of the extent of the progress made by companies serving the “bottom of the pyramid” consumers. Using the comments of 10 CEOs of companies operating in these markets, as well as updates on the case studies presented in the first edition of the book and one new case study, Prahalad again examines the role and successes particularly of the (commercial) private sector in efforts aimed at market development and the accompanying effects on poverty alleviation.

While he admits that “five years is not a long time to evaluate the diffusion of an idea; much less its impact on the ground,” he concludes that there are encouraging signs indicating the emergence of conditions that would enable substantial and sustainable change. Large commercial enterprises are rapidly learning that there are sizeable and potentially profitable markets that can be established at the bottom of the pyramid – for the benefit of both the companies operating in these markets and the consumers. As companies start developing new products and distribution systems, they need to engage with the communities they operate in as they create and organise new markets; which in turn offers entrepreneurs from those communities the opportunity to tap directly into what, at times, are no less than global networks and vast repositories of knowledge and expertise.

Any book dealing with new ideas and approaches to the eradication of poverty is important – particularly given the state in which South Africa finds itself at present. The fact that the initiatives outlined in the first edition of this book continue to show tangible successes, are a tribute to their importance and sustainability.

The revised edition of The Fortune at the Bottom of the Pyramid is an essential read for any company operating in South Africa that is looking for new markets and the opportunity to create long-term, sustainable change in this country.