Bottom of the Pyramid organizations are the ones that develop a set of capabilities that contribute to create short- and long-term sustainability values inside and outside the boundaries of BoP ecosystems. Capabilities have an important role in BoP organizations’ strategies that aim to solve BoP issues. Notwithstanding its developments, BoP research still lacks theoretical contributions for the analysis of organizations. We suggest special attention to the need of advancing knowledge on capabilities of BoP organizations because this field is (...) scattered and fragmented, misinterpreted, and still underdeveloped in the literature. We oriented our research formulating and seeking answers to our main question on what are the capabilities needed to enable organizations to create sustainability values in BoP ecosystems? We conducted an integrative review of BoP research for the period from 1998 to 2019, and we found 22 key capabilities of BoP organizations. We organized the capabilities into four major categories including BoP Responsible Consumption, BoP Responsible Business Model, BoP Responsible Management, and BoP Responsible Innovation. We advanced propositions and discussions regarding the capabilities and major categories’ popularity, interdependence and combination, short- and long-term temporal functions, sustainability roles, and effectiveness to address BoP issues. Our article organizes the field of capabilities of BoP organizations; advances contributions and implications for management, organizations, and policymaking; and opens fruitful avenues for future research. (shrink)

In this article, we develop theoretical and empirical linkages between corporate social responsibility initiatives of business organizations and their market development efforts at the bottom of the pyramid. We use qualitative in-depth interviews of 21 CSR heads of business organizations and its CSR partner organizations in India to explore, develop, and explain plausible theoretical linkages between CSR initiatives of the organizations and its market development efforts at BOP using theory of market separations. Using theoretical frameworks from CSR literature (...) and sub-theory of market separations from marketing literature, the study suggests that market development at BOP is enhanced using the CSR route in several ways. These are, making the BOP market development less risky, mask the CSR initiative as a BOP pilot project to generate internal traction within the organization, integrating the BOP communities with the last mile of the supply chain of the organization, bringing government intervention to accelerate scale-up, and developing BOP as future markets for consumers and supply chain partners to make business more sustainable. Our study has several theoretical as well as managerial implications linking organizations’ market development efforts at BOP with its CSR initiatives. (shrink)

The bottom of the pyramid (BOP) concept suggests that business has a vital role to play in meeting the unmet needs of the 4 billion poorest people on the planet. Serious advances in research on bottom of the pyramid business will require effective evaluation of the social impacts these businesses are having on the people they are supposed to benefit. Evaluation will allow us to identify conditions in which specific business interventions can address unmet needs fairly (...) and effectively. Theory-driven evaluation offers an approach to assessing the successes and limitations of BOP businesses by exploring why a venture does or does not achieve its social objectives. The experience of AIG Uganda in the microinsurance business illustrates the insights possible from applying theory-driven evaluation. (shrink)

Many companies are now targeting the sizeable segment of consumers in Bottom-of-the-pyramid (BoP) markets with new products to specifically address their needs. As mainstream consumers become aware of these initiatives, their views on what products may be construed as appropriate for BoP marketplaces, may influence their attitudes towards the companies engaging in BoP activities. We propose that when the mainstream consumers are culturally distant from the BoP consumers, they have less favourable attitudes towards a company marketing a hedonic (...) product to BoP consumers, compared to a utilitarian one. However, when the mainstream consumers are culturally closer to the BoP consumers, they are less likely to react negatively to a company’s marketing of a hedonic product compared to a utilitarian one. We theorize that these differences in evaluation are based on the mainstream consumers’ expectations regarding the products a company would/should target towards BoP consumers. We also examine two company characteristics (country-of-origin and profit orientation) as contingency factors affecting the attitudes of culturally close mainstream consumers towards companies engaging in BoP practices. Across two studies, we find support for our hypotheses. This research adds to a new stream of scholarship that theorizes about the permissible consumption mindset of mainstream consumers. The research also provides guidance to marketing managers and communication experts to help build favourable company attitudes and minimize any mainstream negativity towards a company’s marketing initiatives in the BoP domain. (shrink)

Existing research posits that decision makers use specific cognitive frames to manage tensions in sustainability. However, we know less about how the cognitive frames of individuals at different levels in organization interact and what these interactions imply for managing sustainability tensions, such as in Bottom of the Pyramid projects. To address this omission, we ask do organizational and project leaders differ in their understanding of tensions in a BOP project, and if so, how? We answer this question by (...) drawing on a 5-year study of a BOP project of a global pharmaceutical company in India. In line with the existing research, we found three kinds of frames—paradoxical, business case, and business—held differently across organizational levels and over time. We also found that the shift in frames of both project and organizational leaders was mediated by the decision-making horizon. The initial divergence across organizational levels, seen in paradoxical and business frames, was mediated by long-term decision-making horizon. However, there was an eventual convergence toward business frames associated with the shift from long- to shorter-term decision-making horizons and one that led to the project’s closure. We contribute by proposing a dynamic model of cognitive frames in sustainability, where the research has either alluded to top-down or bottom-up understanding. (shrink)

This article examines the question: How do local organizations deal with competing temporal dynamics when building and implementing base/bottom of the pyramid initiatives? Time has been neglected in the BoP literature to date, yet, addressing poverty in a developing country requires a complex perspective of time. An analysis of 21 semi-structured interviews with locally based organizations implementing BoP initiatives in the Philippines revealed that the organizations had an ambitemporal perspective. In particular, we discover that they harmonize multiple temporal (...) pacers by making strategic decisions about the best mechanism of entrainment to utilize to move their community and any stakeholders to a long-term temporal horizon. We find that organizations manage this process by generating what we term a “third time” via a process of push-and-pull entrainment between the communities, the business, and the different temporal pacers. This article develops a conceptual framework for helping organizations to harmonize competing temporal dynamics to generate a bespoke “third time” for each community they work with. (shrink)

Sixteen years ago, Prahalad and Hart introduced the possibility of both profitably serving the poor and alleviating poverty. This first iteration of the Bottom/Base of the Pyramid approach focused on selling to the poor. In 2008, after ethical criticisms leveled at it, the field moved to BoP 2.0, instead emphasizing business co-venturing. Since 2015, we have witnessed some calls for a new iteration, with the focus broadening to a more sustainable development approach to poverty alleviation. In this paper, (...) we seek to answer the question: How has the BoP approach evolved over the past 16 years, and has it delivered on its early promise? We conducted a systematic review of 276 papers published in journals in this period, utilizing a rigorous correspondence analysis method to map key trends, and then further examined the 22 empirical studies conducted on the BoP approach. Our results suggest that the field has evolved, passing through a number of trends and coming full circle—with our analysis pointing to more recent BoP literature emphasizing similar themes to those espoused in the initial BoP iteration, rather than reflecting the principles espoused in either BoP 2.0 or BoP 3.0. Our analysis also points to a lack of clear evidence that the BoP concept has delivered on its promise either to businesses or to BoP participants. (shrink)

Almost two decades ago, Prahalad and Hammond [Harv Bus Rev, 80(9):48–59, 2002] introduced the base/bottom of the pyramid (BOP) approach to profitably serving the poor with business models adapted from developed markets while alleviating poverty. In response to disappointing results and ethical criticism, the BOP approach evolved from a just-for-profit approach with a passive role of the poor to an inclusive development approach that integrates the principles of the triple bottom line. A recent review of the BOP (...) literature [Dembek et al., J Bus Ethics 165(3):365–382, 2020], however, reveals a lack of empirical evidence to support the sustainable BOP approach. In this paper, we specify the assumptions underlying the sustainable BOP approach and test them using structural equation modeling with clustered robust standard errors on a unique dataset of 212 firms. Our findings show that BOP business model involvement and adaptive capacity are significant drivers of the triple bottom line at the BOP; however, business model adaptive capacity does not guarantee an ecologically sustainable performance at the BOP. We find that there is a need for further extension of the ethical foundations of the sustainable BOP approach. (shrink)

The early literature on base of the pyramid strategies argued that multinational enterprises can contribute significantly to poverty alleviation of the poorest population in the world. An emergent perspective suggests that the solution to poverty lies within the BOP itself. Here, entrepreneurship within the BOP population is seen as the more credible solution to poverty. In this Special Issue introduction, we briefly present how the literature has further shifted the discussion of BOP strategies toward issues such as innovation, networks, (...) business models, and sustainability at the BOP. This analysis signals a gap in our knowledge related to the success factors in business models of BOP entrepreneurs, with attention to economic, social, and environmental impacts. We present the five articles accepted for publication in this Special Issue, of which three contribute to our knowledge of BOP business models and two to our knowledge of sustainability at the BOP. In conclusion, we propose several avenues for future research. (shrink)

Writing in the Business and Politics, Santos and Laczniak 2012) formulated a normative, ethical approach to be followed when marketers e ngage impoverished market segments. It is labeled the integrative justice model. As noted below, that approach called for authentic engagement, co-creation, and customer interest representation, among other elements, when transacting with vulnerable market segments. Basically, the IJM derived certain operational virtues, implied by moral philosophy, to be used when marketing to the poor. But this well-intentioned approach raises a significant (...) “So what?” question. Are such sentiments anything but lofty aspirations for idealists or are there steps to be taken by society and business managers of goodwill to make the adaptation of the IJM by corporations more likely and pragmatic? This paper begins to layout a roadmap that shows “how and why” the IJM might more likely be vitalized. The crux, as described below, is found in the transformational justice dimensions that are embedded in institutions ; such external institutions provide a “power” impetus to assure the ethical rights claims that impoverished consumers have owed to them. In this way, the ideal exchange characteristics for bottom of the pyramid markets argued for in the IJM can become actively transformational. The main contribution of this paper is that it begins to chart out the institutional system elements that need to exercise power in order to deliver a “fairer” marketplace for BoP consumers. (shrink)

This paper builds on London and Hart’s critique that Prahalad’s best-selling book prompted a unilateral effort to find a fortune at the bottom of the pyramid. Prahalad’s instrumental, firm-centered construction suggests, perhaps unintentionally, a buccaneering style of business enterprise devoted to capturing markets rather than enabling new socially entrepreneurial ventures for those otherwise trapped in conditions of extreme poverty. London and Hart reframe Prahalad’s insight into direct global business enterprise toward “creating a fortune with the base of the (...) pyramid” rather than at the BoP. This shift in language requires a recalibration of strategic focus, we argue, and will necessitate implementation of “moral imagination” to formulate new mental models that can frame the possibility of local entrepreneurs working collaboratively and discursively with development partners drawn from civil society, corporate, and government sectors. Successful partnerships will arise from interactive processes of emergent, co-creative learning within a shared problem domain or “community of practice”. We call attention to three related pluralist framings of situated learning within such communities of practice: decentered stakeholder networks; global action networks; and a focus on “faces and places” as a cognitive lens to humanize and locally situate diverse inhabitants within base of the pyramid partnership projects. (shrink)

Bottom of the Pyramid (BOP) strategies recognize for the first time that global companies can contribute to the alleviation of worldwide poverty by adopting non-traditional and mostly non-Western models of business involvement. It is now widely accepted that poverty and hunger arise not because there are no goods or food, but because billions of people lack income to purchase them. It is also a common belief that the private sector can play a significant role in lifting the poor (...) from the margins of the market system. This would require strategic and mindset shifts in global companies leading to a very different path where their operations intersect with the greater good of communities, societies, and nations. Successful engagement in the untapped market space at the base of the global income pyramid calls for completely new capabilities, responsibilities, and values. Alliance building with local and non-traditional partners, promoting bottom-up solutions and understanding social sustainability are some of these new managerial challenges. This article reflects on some of the critical challenges of global companies and global managers in their strategic engagement at the BOP and explores how large firms can become involved in the pursuit of social capital acquisition and how new approaches of public–private partnerships in reformulating the profit-performance links, the downscaling of products or services without compromising their quality and integrity, the bridging of the information and infrastructure gap, educating, and empowering the poor, together with innovations through technological adaptations can be managed through the embracing of new mindsets. A number of frameworks are presented with a view to contributing to the debate and outlining new value objectives for global companies. (shrink)

Although a number of microfinance initiatives have improved financial inclusion in various regions of developing countries, the transferability of their foundations from one context to another is still a challenge. This study proposes an innovative process-based model targeting the initial stages of the transfer process that links three interconnected categories: local contextual conditions, transferring practices, and initial developmental consequences. The results were produced through a longitudinal study of the implementation of three community development banks on the periphery of Sao Paulo (...) based on a highly successful Brazilian model known as Banco Palmas. In addition to the process-based model, our findings contribute to the microfinance and bottom of the pyramid literatures, showing a cross-fertilization that has been insufficiently explored. (shrink)

Do foreign direct investment (FDI) and international business ventures promote positive social and economic development in emerging nations? This question will always prove contentious. First, the impacts differ according to context. Second, the social consequences and spillover effects of knowledge diffusion and technology-sharing may be limited and hard to measure. Third, contributions to enhancing social responsibility and improving living standards in host countries are delayed in effect, causally complex, and also hard to measure. Outcomes often critically depend on collaboration of (...) governments, international institutions, the business world, and non-governmental organizations (NGOs). Research in this area is challenging and requires interdisciplinary collaboration between economists, financial experts, sociologists, ethicists, and other specialists. This paper explores: (1) the evidence to support the proposition that FDI and international business improve social conditions in less-developed countries, and: (2) how these improvements are linked to strategies of corporate social responsibility (CSR) and ethical business practice. The paper draws insights from development, FDI, poverty alleviation, and bottom-of-the-pyramid (BOP) literature. Applications are demonstrated using examples from poverty-stricken areas of Sub-Saharan Africa. The paper attempts not only to argue theoretically but also to provide practical evidence. The approach is simultaneously descriptive, analytical, and prescriptive in order to address a wide audience. It also highlights issues and trends for further academic research and presents the viewpoint that some limitations lie in the nature of ethics frameworks widely referenced in business and that these often fail to consider the compatibility of ethical constructs with relevant incentives. In this vein, we explore the application of Homann’s framework for advantage and incentive-based ethics. (shrink)

Purpose This paper aims to focus on the role of information and communication technologies in preparation for and management of human and/or nature induced disasters. Design/methodology/approach Drawing from the phenomenal growth of ICTs, initiatives aimed at disaster management, stakeholder theory, prior research and the successful development and implementation of 9-1-1, this paper explores ICTs in the context of human and/or nature induced disasters. Findings This paper discusses a new ICT for mitigating disaster management, scans, using stakeholder theory, relevant initiatives and (...) prior research to identify the stakeholders relevant for successful preparation for and management of disasters, and draws from the 9-1-1 example to discuss how ICTs can be successfully developed and adopted. Research limitations/implications There are opportunities for researchers to develop ICTs that can make countries, developing and developed, more efficient and effective in their preparation for and management of nature and human induced disasters. In addition, researchers can investigate the role of stakeholders in facilitating the adoption of new ICTs developed for disaster management. Researchers could also help public policy in designing the most efficient and effective programs for the adoption of new ICTs. Practical/implications As an example of new ICTs that can potentially mitigate the effect of disasters, this paper discusses the E711 text-message mobile phone service and provides a description of how this protocol operates and can be implemented. There are tremendous opportunities to develop new ICTs in the context of disaster management. Social/implications This paper argues that ICTs such as E711 can have a major impact on all countries in general and poor and developing nations in particular. Specifically, in the bottom of the pyramid markets, developing ICTs for BOP market in the context of managing human and nature induced disasters and ensuring the diffusion of such ICT innovations is both critical and challenging. Originality/value This paper discusses the role and importance of ICTs in disaster management, identifies relevant stakeholders, discusses how ICTs can be diffused and implemented and calls on and hopes to provide an impetus to research on ICTs that can aid in the preparation for and the management of disasters. (shrink)

With over three billion people currently living below the poverty line, finding better ways to lift people out of poverty is a concern of scholars from a range of disciplines. Within Management Studies, the focus is on developing market-based solutions to poverty alleviation through Bottom/Base-of-the-Pyramid initiatives. To date, these have enjoyed limited success, sometimes even exacerbating the problems they attempt to solve. As a result, there is a growing academic and practitioner push for a third iteration—BoP 3.0—that moves (...) closer to a sustainable development model of poverty alleviation. Through a grounded theory study of 21 Philippines-based organizations implementing poverty alleviation initiatives at the community level, this paper seeks to add to the existing suite of tools and guidance in the BoP field. It does so by questioning how these organizations approach the development and implementation of market-based approaches to poverty alleviation. Our results suggest that these organizations adopt a more community-centric approach, focusing on the creation of a self-reliant community before all else. We find this to be the result of a deeper understanding of the drivers of poverty in the communities they work with. Through the extrapolation of key themes and issues in our data, we propose a new conceptual model for building BoP 3.0 initiatives. This model consists of three intertwined theoretical dimensions: understanding issues as matters of concern; identifying limitations; and navigating time. These elements are linked by three active phases that allowed the organizations to move from one dimension to the next: sensemaking; entrainment; and investment. (shrink)