The Optimal Solution

The fact that Davos chose to meet this year on the theme of global
shifts
of economic and political power, they do indeed go hand in hand, is in and of itself significant of
the validity, the speed and the geographical spread of the shift.

An unexpected factor, imho, was the effect of the wealth flow that had been released
from the bottom of the pyramid, an always unconsidered or overlooked
segment for corporate global marketing strategy, and how this flow of
wealth in emerging markets like India’s or China’s was able to add its
not inconsiderable might in volumes to support the growth rates of
these two economies. The question here is not whether they are
overheating or not, as The Economist recently chose to do, but what
will be the subsequent impact in the global markets and how they are
managed by global companies in order to maximize their returns on
investments for their shareholders.

Technologyhypecycle

Lets take a moment at this time to take a look at the tool behind this flow of wealth. You’ll note that Gartner’s crucial hypecycle of technology two and some years
ago in 2004 from the new product design and development point of view.
They leave out the biggest generator of wealth in the world right now –
the mobile phone. In 2004, The Gartner Group had not seen the impact of
the mobile phone in the arena for consumer technologies in just two
years. They have the game consoles, home theatre, broadband all coded
as "to plateau of productivity" in 0-2 years. It can be argued that
these product lines have done so. However the mobile phone has not been
taken into consideration nor was it’s subsequent impact via its
exponential sales volumes in emerging markets. This is a crucial
missing link in the purchasing power calculations you make of your
intended target audiences particularly in emerging markets is to
seriously ignore the so called "poor".

If ever the words of CK Prahalad seemed prescient – in that he
exhorts business to look at the 4 billion of the world’s so called poor
not as victims but as consumers, with aspirations and values of their
own, that they hold – it is now. Why is the potential of the waiting
market of 4 billion new customers considered such an insurmountable challenge?

Once we are able to frame the design problem correctly, in order to
best solve the challenge of maximising our client’s return on
investments in an emerging market with the peculiarities of the bottom
of the pyramid segment, we can simply say the following.

We must design within the maximum constraints – that’s the optimal solution.

And once we invest in product development and design, supply chains
and assembly lines to create and distribute such products, it is but a
simple task to increase their attractiveness to more sophisticated and
more developed markets by repositioning their core values of
sustainable, minimal footprint design using the scarcest of resources
for the poor as "sound sustainable ecologically friendly green product
design".

What we have here is an opportunity to create a platform of
products, on a whole new platform of values, that of conserving mass
and energy. There’s a law somewhere that states the conservation of mass and energy
is a zero sum game. The question that has been raised is whether this
applies to economics, business, the market place or is it simply one of
the fundamental laws of nature? I mean have we ever let gravity stop us
from doing business online?

But in order for this to succeed, to truly make a difference to the
genuine, its for real environmental crisis that our world faces right
now, we cannot afford for global warming the concept to become the next
big thing, or hot fad or trend for 2007. I genuinely believe that it
would sap the movement towards healthier living in tune with our entire
ecosystem of its value.

~originally posted in full.

Advertisements
This entry was posted in Strategy. Bookmark the permalink.