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C.K.Prahalad
Paul and Ruth McCracken Distinguished University Professor The University of Michigan
C.K. Prahalad
C.K. Prahalad
C.K. Prahalad
Principle Number # 1:
The Essence of Entrepreneurial Transformation
Situation A Resources Low Situation B High
Aspirations
High
Low
C.K. Prahalad
Principle Number # 1
Aspiration > Resources
Aspiration
Leverage Resources
2007
Fold the Future in Innovation Orientation
2017/22
C.K. Prahalad
2017/22
*Clarity to Direction *Willingness to Discover *Clear Milestones *Speed and Stamina: 400 meters at a time but a Marathon
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Best Practices
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All three principles are based on developing a Distinct Point of View about Opportunities
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Measures of Inequality:
Gini coefficient:
USA 1985- 1986 1989- 1991 1995 -1996 1999 -2001 2006 41.6 42.7 45.0 46.3 46.9 China 22.4 34.1 39.0 42.0 47.0 India 32.0 32.1 33.8 36.0 39.5 Brazil S Africa 59.3 64.0 60.2 59.6 57.2
59.0+
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Measures of Inequality:
Gini coefficient:
USA 1985- 1986 1989- 1991 1995 -1996 1999 -2001 2006 41.6 42.7 45.0 46.3 46.9 China 22.4 34.1 39.0 42.0 47.0 India 32.0 32.1 33.8 36.0 39.5 Brazil S Africa 59.3 64.0 60.2 59.6 57.2
59.0+
GDP/capita PPP
2005 Rank in HD Index (177)
$ 43,555
8
7,600
81
3,700
121
8,600 13,000
69 126
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2. Income Inequality:
National Rural- Urban Within a State/ Region Ethnic backgrounds
3. Income Mobility
Opportunities for Moving up Hope
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Redistribution of Wealth Vs. Wealth Creation ? Public Policy Focus Vs. Entrepreneurship/Market Focus ?
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The Critical Question: Is Globalization Good or Bad for the Poor? vs. How to Make Globalization Work for the Benefit of All? (e.g. India: Inclusive Growth ; China: Harmonious Society)
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Visualizing LSMs
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Dense Urban Dwellings (Slums) will become the Dominant habitat for Humanity
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3. Rapid Increases in Income and Aspirations Demand for a higher quality of life at lower costs Dramatic changes in Price-Performance Levels
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Price
Middle Class
3. 4. 5.
6.
1011 1
10 104
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Rich ?
Environmental Demands
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Emergence of a New Social Compact for Business: Collaboration with CSO; Private Public Partnerships
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H D I vs. C P I
10 9
H D I v s . C PI e q u a tio n
8 7 6 5 4 3 2 1 0
Dishonest
20
40
60
80
100
120
140
160
Hum a n De v. Inde x , 2 0 0 3
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C P I vs. P P P
USA C PI v s
USA
PPI e q u a t io n
P urchasing P ow er P arity,2002
India
10
Dishonest
Honest
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$35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 20 40 60 80 100 120 140 160
Focus on Individual
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My Takeaways:
1. Human Development is not about More Resources but less Corruption in the Deployment of Resources
2. Good Governance (less corruption) leads to High Levels of GDP/Capita; not the other way around 3. Focus on Human Development (Focus on Individuals) and not Groups Rights Leads to Rapid Economic Development (GDP/Capita)
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2020
GDP/Capita $ 25,000 (PPP)
CPI Rank
2.7/10.0
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?
2007 1947
Low Low High Commitment to Rights of the Individual, National Character, Universal Principles
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Deaths from global warming will double in just 25 years -- to 300,000 people a year. Global sea levels could rise by more than 20 feet with the loss of shelf ice in Greenland and Antarctica, devastating coastal areas worldwide.
The number of Category 4 and 5 hurricanes has almost doubled in the last 30 years. Malaria has spread to higher altitudes in places like the Colombian Andes, 7,000 feet above sea level. The flow of ice from glaciers in Greenland has more than doubled over the past decade. At least 279 species of plants and animals are already responding to global warming, moving closer to the poles.
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Sustainability is multi-dimensional:
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C.K. Prahalad
Millennium Assessment Findings How ecosystems have changed Types of ecosystem services
Provisioning
Goods produced or provided by ecosystems
Purdue University
Regulating
Benefits obtained from regulation of natural processes
NASA
Cultural
Non-material benefits from ecosystems
WomenAid.org
LSUP
CEH Wallingford
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Degraded
Capture fisheries Wild foods Wood fuel Genetic resources Biochemicals Fresh water
Air quality regulation Climate regulation Erosion regulation Water purification Pest regulation Pollination Natural hazard regulation Spiritual & religious Aesthetic values
Mixed
Timber Fiber
Regulating
Carbon sequestration
Cultural
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2. Energy
Fossil Fuels and Substitutes Regressive to progressive Fuels 3. Health
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Our Current Developmental Models Energy, Water, Packaging, and Waste/capita- are Inappropriate
New Breakthrough Innovations is not an Option The Emerging Markets must become a Source of Innovations
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Market Based
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Global Firms
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The Poor of India are Ready for this Journey: Are The Leaders Ready?
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.
T ough fate s tan ds in th e w ay, s tren uous effort yields ready fru it. h Labor recom pen s es w h at fate den ies .
Thirukkural 619
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Transformation Requires:
Imagination Passion Courage Humanity Humility Intellect Luck !
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