Karnani and Prahalad

IN YOUR OPINION, which arguments you prefer Karnanis or Prahalads? Why? The Fortune at the Bottom of the Pyramide (F. BOP Prahalads oblige) defend the idea that if MNCs can succeed in the BOP market their potential rewards, such as growth, profits and contri moreoverions to valet kind will be prodigious. This challenging opportunity is created due to the characteristics of an unsaturated market (e. g. ize) which required affordability, availability, knowingness and access. The Mirage at the Bottom of the Pyramid (M. BOP Karnanis article) defend a different perspective from Prahalads arguing mainly that the BOP market is composed by 2. 7 billion of poors instead of 4 billion that the fortune at BOP is a misleading notion due to high embody for MNCs, poors purchasing power, fallacy of affordability and the uncorrect exemplifications in Prahalads article (e. g. Casas Bahia).Moreover, the article defend that it is not only all-important(a) to raise poors income creating employment or tear downing prices decreasing quality that overly to create productivity, efficient markets, increase poors capabilities and freedom, make social and cultural changes and transform the fictitious character of disposal. Firstly, it is not possible to precise the size of the BOP market and and so authors can use the more(prenominal) convenient source of data. In my opinion, the dimension the BOP market (4 billion or 2. billion) is in both cases relevant for MNCs, comparing with saturated markets where they operate, which have the pressure to growth pipe bowl new markets or trough new products in order to survive. Also, the BOP opportunity has not only to do with profits but with gaining efficiency and innovation. Secondly, in my opinion, the poor consumer is not fooled to think that small size products are cheaper but they do not have another option. Therefore, give them the possibility of choosing others items (e. g smaller products) is a way to suffer them, at least, th e capacity for a daily consumption.Thirdly, all individuals have different consumption needs and therefore they can be prioritized differently. In my opinion, no interdiction or change can be do to avoid poors relatively bad consumption since it is more a matter of culture, habits and preferences than a want of information. In the long term run, with the development of the country, the poor consumer will naturally change its consumption. The lack of information, mentioned before, is used by Karnani to explain the vulnerability of the poor consumer.Nevertheless, when Karnani defend that the BOP market prefers cheaper but lower quality products (e. g. Nirma) even if it can cause blisters, he seems to disregard the fact that consumers are not intelligent and may not know about potential effects. How can the poor consumer not have bountiful knowledge to understand the trade-off surrounded by buying two different products or the trade-off between small-size and price but have enough education to understand about the price-quality/safety trade-off?In my opinion, in this explanation, Karnani demonstrate some inconsistency in his arguments. Furthermore, I agree with the notion of The poors as producers but in order to be achieving it is necessary to have financial and governmental support, a minimum of infrastructures available, and so on Both articles make a reference about the importance of the employment creation, the productivity and the role of government which is without doubt crucial for the development of the BOP market.Finally, I can conclude that I prefer Prahalads perspective because he takes into account both consumption and production in order to achieve leanness alleviation in which multiple players are involved (e. g. NGOs, governamental authorities and other companies) and not only MNCs. Also, in my opinion, creating the ability to consume is a way to create potential disposable income and original and lucrative markets. In that sense, F.BOP art icle, perceive and describe the development of the BOP market more as a complex and lucubrate process in which companies are close up beginners and therefore still learning, improving and innovating. In addition, Prahalads article makes reference to more deterministic arguments and solutions. Nevertheless, even if I prefer Prahalad arguments I am conscient that there is still much to be resolved and improved. (e. g. environmental concerns)