Carlos Rufín

Reviewing a Decade of Research on the 'Base/Bottom of the Pyramid' (BOP) Concept

In 1998-1999, Prahalad and colleagues introduced the base/bottom of the pyramid (BOP) concept in an article and a working paper. This article’s goal is to answer the following question: What has become of the concept over the decade following its first systematic exposition in 1999? To answer this question, the authors conducted a systematic review of articles on the BOP, identifying 104 articles published in journals or proceedings over a 10-year period (2000-2009). This count excludes books, chapters, and teaching cases. The review shows that the BOP concept evolved dramatically following Prahalad’s original call to multinational enterprises (MNEs). Deemphasizing the role of MNEs over time, published BOP articles portray a more complex picture, with wide variations in terms of BOP contexts, of BOP initiatives, and of impacts of the BOP approach. A simple framework for organizing the reviewed articles helps discuss findings, identify the gaps that still exist in the literature, and suggest directions for future research.

Global Village vs. Small Town: Understanding Networks at the Base of the Pyramid

We compare and contrast business networks at the Base of the Pyramid (BOP) and at the Top of the Pyramid (TOP), and analyze their implications for multinational enterprises (MNEs). We first identify the specificities of BOP environments in terms of competitive environment and institutions. Building on this analysis, we develop a series of propositions regarding the impact of these specificities on the structural characteristics of BOP networks, their boundaries, the characteristics of their ties, the diversity of their partners, and their evolution over time, as compared to TOP networks. Our analysis suggests that major differences exist between both types of networks along all dimensions and that these differences have important implications for MNEs active in BOP environments.

Between Commonweal and Competition: Understanding the Governance of Public–Private Partnerships

The authors leverage insights and theories from the extensive interfirm (business-to-business, or B2B) alliance literature to explore the effect of the sectors of the partners on the governance of infrastructure public–private partnerships (PPPs) as compared with B2B alliances. Their analysis suggests that the sectors of the partners have an important impact on PPP governance, not only because the sector constrains the availability of some governance mechanisms but also because it makes alternative mechanisms available or relevant to the partners. Specifically, the authors predict that PPPs will avoid equity structures and will rely, instead, on less complete and more complex alliance contracts; a restricted scope of activities; and nonequity hostages, such as metagovernance mechanisms or stakeholder involvement. Contrasting with B2B alliances, their analysis also suggests that trust-based governance mechanisms will play a minimal role in the governance of PPPs.

Bridging Institutional Voids at the Urban Base of the Pyramid

Much of the BoP literature has focused on rural settings, yet urban poverty is rapidly growing in scale and importance. The urban poor in developing countries inhabit informal settlements characterized by significant institutional voids. This paper examines the strategies used to address these voids by companies that operate in such settings, through in-depth comparisons of the approaches used by three companies providing basic services in a major emerging-country metropolis. The paper shows that institutional voids at the urban BoP are characterized by their instability, diversity, and incompleteness. In this context, companies have no choice but to engage in institutional entrepreneurship to bridge the unfilled voids and to bring some stability and uniformity. In Rio de Janeiro, some utilities are attempting to do so through a combination of technology, which offers a stable and uniform basis of operation, and the engagement of multiple stakeholders along the lines of the collaborative governance concept. In order to implement these actions, however, the companies first have to gain a measure of legitimacy at the local level, overcoming the liability associated with their outsider status.

Leaving a Social Venture: Social Entrepreneurial Exit among the Maasai in Northern Tanzania

Arguing that the exit of social ventures is likely to follow specific patterns, due the uniqueness of a social entrepreneur’s goals, the social venture’s emphasis on the provision of public goods, and its relationship to stakeholders, we conduct a qualitative analysis of the entrepreneurial exit of a Dutch social venture in Northern Tanzania. Our analysis suggests that the choice of exit and the potential exit routes are indeed specific to social ventures, as the original social goals of the venture influence the decision to exit and its implementation. Specifically, we find that the goal of leaving a sustainable venture after the exit and the preference for the transfer of ownership to local community members was paramount for the social entrepreneur. Our results also highlight the difficulties associated with the unique role of stakeholders in social ventures, due to different perceptions and interests about the meaning and implementation of entrepreneurial exit.

Bottom-of-the-pyramid strategies and networks

The Handbook provides an impressive state-of-the-art overview of the international strategic management field as an area of scholarly inquiry. The great strength of the work is the thoughtfulness of the messages conveyed by the expert team of authors.