Offshoring BoP and Tandoori Nights in Texas
A few years ago, I had the pleasure of hearing the management guru Prof. C.K Prahlad talk eloquently about his idea of Bottom-of-pyramid (BoP)and how organizations and individuals around the globe are benefiting by skimming margins at the BoP of larger organizations and trends. For those of us in the business of offshoring, BoP seems to be everywhere. Case in point, I was in the Plano, at the Texas office of Infosys last week interacting with fellow architects and academics participating in the Infosys Certified CTO “Enterprise Architect” workshop. For the two-week long session, I stayed at a nearby hotel [Let’s call it XYZ suites]
I have been traveling on business regularly ever since I started my career in IT in the early nineties, more so in my current avatar of a consulting architect. So what made me reflect on BoP during this trip?
Well, the management of the suites, like many catering to business travelers, has a practice of organizing themed social-evenings with drinks and O'dourves for business travelers and guests. While checking in the desk-clerk asked if I liked Indian curry (Here-you-go, I thought, my mustache, brown skin and accent had not failed me yet again). However, he surprised me with his next remark: we have organized a tandoorie-special night on Tuesday for our guests, and we hope you would join us.
Even a few years ago, I would be taking pains of explaining to the restaurant waiter or Maître de – especially in the Mid-west in Anytown-America - that I was vegetarian: meaning no-meat please; and here I was, the heart of Texas-ribs being indulged in a Tandoorie night.
The reason was not hard to find: The Plano area is home to a number of hi-tech companies and also happens to be the world-headquarters of the tech giant EDS, which incidentally has a number of its staff moving between here and the offices in India. Hotels and restaurants in the area have realized that they are a part of the offshoring value-chain… however indirect: and what better way to nurture and retain clients than to cater to some of their tastes?
The illustration here is just tip of the iceberg. If you look around, businesses and entrepreneurs of all stripes seem to be benefiting from the business of global sourcing at the bottom-of-pyramid. Just a few random examples that come to mind:
- Writers and Columnists: The list begins with New York Times' Tom Friedman (of the Flat World fame), BusinessWeek's Steve Hamm, who also authors the Bangalore Tigers blog among others. [My book and blog is somewhere in the long tail of offshoring]
- Travel and hospitality industry: Travel agents, airlines, hotels, taxi cab companies etc etc…both in western and eastern countries.
- Builders and developers: developing ‘world class’ offshoring centers in India, Phillipines, China, Mexico and elsewhere is a big business that includes many local BoP players
- Communication service providers. Several examples here too if you look around.
- Other service providers
- Micro-level BoPs: I find it interesting that several individual technology managers also seem to moonlight as real-estate brokers. Some invest in flats and apartments to be rented out to fellow employees from offshoring firms….
Do feel free to add to the list
Comments
Interesting, however what I understand is:
The BOP paradigm is to offer goods and services to the people who are in the lower strata. The wikipedia link you quote defines it as: "In economics, the bottom of the pyramid is the largest, but *poorest* socio-economic group." (emphasis on poorest mine)
I would not put a company like Infosys as serving BoP clients, or having BoP employees. Most (if not all) of the clients are big comapnies with turnovers exceeding a few million $s. I would say a one rupee ice cream cone would be a BoP offering, not a high end service.
Additions/corrections welcome.
Posted by: Nitin | November 6, 2007 07:41 PM
Nitin
You are right about the definition of BOP. However, in my mind, it is not just about not about serving ‘BoP clients.’ The argument I was making was not about Services of Service-Providers (e.g Infosys) but about the BOP impact from being in the fringes.
Will be glad to continue the debate.
Posted by: Mohan | November 6, 2007 09:52 PM
Love this post Mohan!
Posted by: michael | November 12, 2007 05:30 PM
Thanks Michael,
What can I say? I just blog what I observe. :-)
Posted by: Mohan | November 13, 2007 01:56 AM
Good observation Mohan, I have also experienced the same in some places in Europe where restaurants and suites are getting guests from India.
Posted by: Gowrish Bhaskar | December 18, 2007 02:11 PM