< Prahalad and colleague Gary Hamel helped spark a management revolution in the 1990s with their idea of "core competence," which says that companies must identify and focus on their competitive strengths. Their 1994 book, Competing for the Future, is regarded as a classic. A decade later he co-wrote The Future of Competition, which argued that the traditional "company-centric" approach to product innovation is giving way to a world in which companies "co-create" products with consumers. That book gave Prahalad a reputation among designers. At the same time, he has been working to convince executives that today's needy masses, so often dismissed as subsisting largely outside of the global economy, are actually its future. >
It may not be really necessary to go ga-ga over the guru. CK's focus has for long been on diversification, the fourth quadrant of the strategy model in which the others are expansion/penetration, product development and market development. Contrary to popular wisdom, as exemplified by the Business Week article cited above, the idea of core competence is not primarily about "sticking to one's knitting". Its about 'diversification' based on what one is good at. Then it was about entering new businesses. With the appearance of the internet in a big way since then, the emphasis shifted to product development which tapped customer response directly. [I myself published an article in a leading Indian management journal in 2003 in which I have visualised the "next paradigm" in product development viz product development itself AND the development of a customer toolkit to enable 'customerisation' a sort of 'double loop' process but that need not detain us here]. The focus on the "needy" ( which CK calls the Bottom of the Pyramid or BOP market for short) can be seen as a dramatisation of the search for new markets and customers, a perpetual challenge for businesses especially in competitive conditions. This is not new. Henry Ford did it when he invented the assembly line to cut the cost/price of automobiles. Theodore Vail did the same in the service sector with his concept of "universal telephone service". What CK is emphasising is that product (and process) development has to be tailored to the attack on such BOP type markets. For example the Japanese led by Toyota ratcheted the Ford model further with their development of the just-in-time process of manufacture. For its part Matsushita (of Panasonic fame) contributed by emphasisng the human resources management aspect of large scale production in small lots. The problem in India is to get people to see that problems which are solved stay solved and do not recur whether it is on the production line or in service businesses. Because we dont seem to be able to keep the lid on things through internalised controls, problems keep recurring and progress is hampered. The other thing is we have to be willing to learn from others and not keep thinking that we are unique.
