C.K.Prahalad’s ‘co-creation of value’ and India
Posted : August 20, 2004 at 10:15 pm [IST]
C.K.Prahalad is a management guru with a difference. He does not only preach. He helps in getting his ideas implemented in actual business model. He collaborated recently with Tata hotel business group to create a budget hotel that provides five-star comfort to customers at affordable price for business class professionals.
Prahalad has a special affinity for India. Like many other, he does not go on criticizing all that is Indian or Indian government and its people. Prahalad conceives India as an incubator, not just for best but “next” practices. He shows confidence in India rewriting business rules by building supply chains around consumer aspirations. He appreciates the role of the handful of IT firms that irrespective of size are MNCs today. In same way, he gives a lot of credit to Indian pharma companies that have become active players in the global pharma scenario, even though none of them have the kind of muscle to spend a billion dollars for the development of a single molecule. India’s biggest strength is its heterogeneity, and here customers always co-created their value. His message is clear: Don’t smother these differences, ride them.
Many Indian companies are on the job in one way or the other. The ITC e-choupals are unique. The model seeks to address the issues relating to last mile connectivity by leveraging IT to build capability at the grassroots through empowerment of the small farmers. The model seeks to enhance farm productivity and income by aligning output with market demand through connectivity. Its primary focus revolves around creating markets by helping raise incomes before servicing such markets commercially. Both the processes happen almost simultaneously.
Prahalad considers- ITC e-choupal, ICICI self-help groups, the adult literacy programme by TCS, the Shakti initiative of HLL- as steps in co-creation process. The companies are trying to work their supply chain backwards starting with consumer expectations.
ITC’s initiative presently has reached over 4100 installations covering nearly 25,000 villages. The company is committed to cover 100,000 in a 10 year plan. How can we cut short the period of bringing all the villages in the reach of some installation such as e-choupal? How do we cover 6.38 lakh villages? Some 50 or more foundations, institutions as well as some more private and public companies must come forward to bring the total country in a single network by building digital bridges or creating a national grid. The rural farmers must get the information on the weather, must be in position to get away with the exploitation by middlemen, get the best price of their produce. Today the producers of perishable get only 20% of what consumers pay. Why can’t the initiative of M.S.Foundation that every day provides the information on wave patterns and location of fish to the fishermen be provided for all those who want similar inputs for their livelihood?
It is quite a feasible proposition, but we must appreciate its necessity.
- Indra
Category: Rural development |
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