C.K. Prahalad is at it again. The University of Michigan professor (and - full disclosure - member of WRI's Board of Directors) has published his 14th article in the Harvard Business Review, out today. Cocreating Business's New Social Compact, co-authored with consultant Jeb Brugmann, is the latest installment of bottom of the pyramid work from C.K., which he first introduced with Stu Hart back in 2002.

Unfortunately, the Harvard Business Review is off-limits to all but those who subscribe. I've given the article a once-over already and will post a full review and analysis later today. Even better, I'll collaborate with Al Hammond - the third point on the BOP triangle - on this review. So stay tuned. In the meantime, a brief excerpt:

As more companies conduct business experiments in bottom-of-the-pyramid markets and NGO's business acumen evolves, they are realizing each other's limitations and strengths. This has laid the foundation for long-term partnerships between the two sectors based on 'cocreation.' Cocreation involves the development of an integrated business model in which the company becomes a key part of the NGO's capacity to deliver value and vice versa.

More later. In the meantime, brush up by reading the original article, Fortune at the Bottom of the Pyramid.

This is the second post on CGD’s event – check out yesterday’s post to read more.

At the Eyes Beyond the Prize event yesterday several major themes emerged: how to keep the spirit of microfinance present as it grows and incorporates external forces like governments, investors, and development agencies; how to promote efficiency, improve distribution channels, offer more diverse services, and increase transparency and regulation; which business models should be built upon and which are outdated; how to promote growth rather than just improving quality of life.

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C.K. Prahalad has done it again. He’s come up with an idea as radical as his and Stuart Hart's suggestion 5 years ago that there was significant value to be found in business engagement at the base of the pyramid. [Full disclosure: C.K. is a friend, a partner, and a WRI Board member.]

With apologies to the musical Oklahoma, what he and co-author Jeb Brugmann suggest is that the farmer and the cowman should be friends—indeed, even business partners.  That farmer (development NGOs and grassroots community groups) and the rancher (multinational companies) should be friends and partners goes against our preconceived notion of both groups.  Moreover, C.K. suggests that in such partnerships and co-created value chains we find the elements of a new social compact that will benefit both the bottom line and the BOP.

If C.K. is correct, this is a transformative vision. His article suggests how to harness market forces and the power of civil society to bring tangible benefits and full citizenship in the global economy to 4 billion people.  He points to lots of examples that show beneficial co-existence (stage 1), cooperation (stage 2) as corporate CSR and NGO enterprise development efforts overlap, and a few examples of full engagement (stage 3), where companies and NGOs create businesses together. And he argues that full engagement is the future.

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