Innovative Strategy Research On Multinational Enterprises Entering The Bop Market

With the development of economic globalization and the aggravation of market competition,the poverty gap is increasingly broadened all over the world.It is reflected in the fact that the low-income groups who are at the bottom of the economic pyramid now suffered from the increasingly severe social and environmental pressure such as inflation increasing,the price level soaring,the deteriorating environment,and revenue instability.These problems have been aroused highly attention by governments,NGOs and corporations around the world.How to improve the living conditions of BOP population and to alleviate the poverty gap become the key to raise the level of social welfare.Prahalad&Hart believes that the BOP market is a potential market which owns full of development possibilities.Companies may use innovative business strategies to stimulate the potential of BOP markets as well as emphasis on market characteristics and needs of the community by means of providing them with products and services that they are desire for.Meanwhile,companies can absorb BOP groups into their production chain through the business operation for the reason of making full use of its resources and enhancing their productivity and income.The members of BOP groups are not only consumers or producers but also including those who have important impact on the business interests of the stakeholders,the enterprise wealth creation and achievement of incorporations.The most significant strategy is that BOP market of low-income groups does not passively accept the ready-made product or service anymore.On the contrary,enterprises provide low-income groups a platform for innovation and opportunities and share their own resources and labor in order to create a common goal and mutual assistance and build the same cultural identity.(In other words,corporations and groups under pyramid shall cooperate with dependence on their special resources and skills to create social value and market value.They work together as a solid foundation that try to improve the legal system,rules and culture for furthering integration of resources through innovative business strategies of enterprises,optimizing the allocation and utilization,and promoting economic,social and environmental sustainability and healthy development.Enterprises can make use of this opportunity to create new markets and increase business benefits.Meanwhile,they shall take the social responsibilities to eliminate the phenomenon of poverty and promote the sustainable development of enterprises and society.This dissertation mainly uses the method of literature research and case analysis.Firstly,by collecting and sorting through the relevant literature research paper at the first stage,it defines the concepts involved in the review of the BOP theory.Secondly,on the basis of the existing literature,multinational companies to enter the BOP market are summarized.Then come up with an analysis of framework for multinational business innovation in BOP market,combined with the case study,the theoretical analysis of framework is extended to the analysis of specific indicators have model,support the decisions of enterprises.Finally,it makes a summary and prospect of innovative strategies from the five aspects such as marketing,value chain and organizations and etc.This paper deepens understandings of businesses,government agencies and non-profit organizations and business strategy for cognitive innovation BOP market and affirms the important position of low-income people in the enterprise market strategy and business initiative and innovation in solving poverty problems,which can provide researchers,business managers and decision-makers with a clear theoretical framework for multinationals for innovative business practices and gives a vital guidance for the development of business.