Reflecting on Strategy as a Discipline: An Interview with C.K.

Prahalad
Raveendra Chittoor
C.K. Prahalad is the Paul and Ruth McCracken Distinguished University Professor of Strategy at the
Ross School of Business, University of Michigan. Prof. Prahalad is a globally renowned management
guru and according to Business Week, he “may be the most influential thinker on business strategy
today.” He has consulted with the top management of many of the world’s foremost companies. His
research focuses primarily on corporate strategy and the role and value added of top management in
large, diversified, multinational corporations. His recent work addresses the world’s poor as a complex
emerging market and outlines innovative business models that will alleviate world poverty. Prof.
Prahalad is the author of several award-winning articles and books. He has won the McKinsey Prize
four times. His books include: The Multinational Mission: Balancing Local Demands and Global
Vision (1987) co-authored with Yves Doz, Competing for the Future (1994), co-authored with G. Hamel;
The Future of Competition: Co-Creating Unique Value with Customers (2004) co-authored with Venkat
Ramaswamy, The Fortune at the Bottom of the Pyramid: Eradicating Poverty through Profits (2004),
and the recent book New Age of Innovation: Driving Co-Created Value through Global Networks
(2008), co-authored with M.S. Krishnan.
Despite his busy schedule, Prof. Prahalad graciously spent over an hour with me at the Strategic
Management Society (SMS) India Special Conference in Hyderabad for a free wheeling discussion on
the evolution of Strategy as a discipline and offered valuable advice for aspiring scholars in management.
Interview with C.K. Prahalad
Chittoor: Thank you so much for agreeing to talk to us. The primary aim of this discussion
is to get a historical overview on the discipline of strategy from you, someone who has spent
so long and contributed so significantly to this field. Could you describe how the field has
evolved, your work specifically and offer your views on the opportunity areas for aspiring
scholars like me, trying to do serious research based in India?
Prahalad: If you think about strategy as a field, we started with a simple view that strategy
is what general managers do. So the only way we could teach strategy was through cases
and only experienced people could teach it - experienced managers, retired CEOs, or very
senior faculty. The first step in developing the field was the book called the Concept of
Corporate Strategy by Ken (Kenneth R.) Andrews. As with many seminal works, the work
of Andrews is not as widely read by young scholars. It is like everybody cites Coase1 but
few have read the original.
Chittoor: Yes, that’s right!
Prahalad: Andrews systematized the knowledge of strategy at that point in time. The second
important work was Chandler’s Strategy and Structure. And then you had Cyert and March
(A Behavioral Theory of the Firm) and others. These works gave some substance to strategy
making as a conceptual process and in need of a methodology, rather than the depending on
the intuition of top managements.

Raveendra Chittoor is Assistant Professor, Indian School of Business, Hyderabad, Email: raveendra_chittoor@isb.edu
1Author of the seminal paper, The Nature of the Firm (1937)
Reflecting on Strategy as a Discipline: An Interview with C.K. Prahalad 4

Let us understand what Strategy meant at this stage. What were the broad underlying
philosophical assertions? First, aspirations must equal resources (for a firm). Aspirations (A)
= Resources (R). This is the whole notion of ‘fit’ between objectives (goals) and resources
(means) in strategy. The second fundamental assertion was that strategy is the work and the
responsibility of top management; so the top decides, others do. It is a very hierarchical view,
of course coming from the heritage of the military, the church and so on. And the third –
industry structure is a given and strategy for a firm is a positioning game within a given
industry structure. Few asked the question: How does an industry structure evolve? How is
it created? Sustained?
Chittoor: The structure-conduct-performance (S-C-P) paradigm...
Prahalad: Yes, basically SWOT analysis. And the last aspect is that resource allocation is the
job of senior management. So if you go back and look at strategy, from 1975 to almost 1990,
this was the paradigm. Dan Schendel’s work, and Michael Porter’s work added to this
perspective, but did not fundamentally change the underlying philosophical assertions. I think
it is important sometimes to understand the historical roots of our discipline, when we, as
young researchers, want to move forward. Unfortunately most of the young people gravitate
to the latest research paper in SMJ (Strategic Management Journal), rather than understanding
the historical roots of the discipline. It’s like being a great physicist today without understanding
Newton and Einstein.
Chittoor: Correct.
Prahalad: The first break from this perspective started from asking a simple question: “if this
is true then small firms cannot take on big companies”. Canon should have no chance against
Xerox, Toyota no chance against General Motors and you can go down the list. Therefore,
there must be something else going on here other than current resource endowments. We
need to know how smaller firms compete with established firms. That is how we got into
stage two of strategy as a discipline – at least I am giving you my view of the world. This
answer to the simple question was the core argument of the book Competing for the Future.
Chittoor: Which is ‘Stretch’?….
Prahalad: The core philosophical assertion is that aspirations (A) should be greater than
resources (R). That is AR. This is a significant departure from the view of strategy as fit
(A=R). This is “misfit” by design. You can call it stretch, you can call it strategic intent, you
can call it entrepreneurship or you can call it innovation. Every entrepreneur starts with an
aspiration that is beyond the means within his control. That is true of Bill Gates, Narayana
Murthy or Branson. This is universal. This is a fundamental philosophical shift. Second,
resources are not (pertaining to) just finance, but include intellectual capital. This is called
core competence. (It is) accumulated intellectual capital - not what one person knows, but
what the system knows. (It is) what the organization or the sub-sets of the organization knows.
This shifted the idea of resources from physical (e.g. plant and equipment), and access to
cash to add accumulated intellectual capital as new currency. Thirdly, this approach suggested
that individual firms can shape their future (e.g. Apple). So in other words, industry structure

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is not a given, it can be shaped. For example, if you listen to all the discussions today (on the
strategies of successful Indian companies such as Airtel), they are all about shaping the
industry structure; not working within a given industry structure.
Chittoor: Listening to your examples of Canon and Toyota emerging against industry majors
in the past, it feels like déjà vu when you consider the so-called emerging multinationals of
today from developing economies such as India and China. They too are resource deficient
and you would think that they never have a chance in this globalized world, but still they are
now emerging as multinational companies and might beat probably even the global majors.
Prahalad: Yes. You are right. Competing for the Future represented the first big shift. The
resource-based view partially captures this view. However, the resource based view does not
explicitly deal with questions of entrepreneurship (condition A R) that is required to convert
these intellectual resources into products and services. Unfortunately, the resource based
view does not tell us what a resource is. On the other hand if you look at the core competence
view, core competence was precisely defined. How to convert it into new businesses was also
defined.
Chittoor: Are you referring to the three tests you outlined to identify core competencies? (in
the article, The Core Competence of the Corporation)
Prahalad: Exactly. Yes. It is important that we should be precise in research; not just in data
collection and applying statistical methods but in the core assumptions behind our research.
For example, take research in transaction cost economics. When you talk about transaction
costs, are you looking at self–interest at the level of an individual transaction or self–interest
over a series of transactions? Is the ability to continue to transact a value by itself? Ask this
question when you read a paper using the transaction cost perspective. In real life, institutions
constantly ask: how do I build this relationship (multiple transactions), over time. This is
true in our personal life as well as transactions between husband and wife! Right?
Chittoor: (Laughs) Right.
Prahalad: In other words, what I wanted to see is the ability in young scholars to be rooted
in the evolution of the field. What were the philosophical underpinnings? What constraints
did it impose on our ability to explain new phenomena? What are, therefore, the critical
research questions? And how to take it forward. Few do it systematically.
Then, sometime around 2002, I asked myself a simple question. I saw five (new) developments
taking place, since my work Competing for the Future was published. One is globalization;
the second is connectivity (over 4 billion people are connected today); the third is convergence
of industries and technology and blurring of their boundaries.For example, (showing a mobile
phone) this is a cell phone, a computer, a map, camera, watch, calendar, TV and radio. Fourth
is steep reduction in the cost of technology. And the fifth key development has been the rise
of social networks. This led to my work, Future of Competition: Co-creating Unique value
with Customers. This fundamentally shifts the idea of who creates value? The primary view
till then, including in Competing for the Future, was primarily a ‘firm-centric’ view. Future

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Reflecting on Strategy as a Discipline: An Interview with C.K. Prahalad 6

of Competition presents four key ideas. One is co-creation. It is not customer focus, as you
know. The process of co-creation assumes that consumers are equally important joint problem
solvers. Second is that the deliverable is a personalized experience, not products. Third is the
notion of a nodal company and an eco-system. Resources will be accessed, not necessarily
owned, from a global eco-system. And finally you asked the question how do you co–evolve,
as an institution? All of these are fundamental issues of strategy and the theory of the firm.
For example, what does a value chain mean in the context of personalized co-creation of
value?
Chittoor: And as per the traditional view.
Prahalad: That’s right. Value chain was traditionally perceived as a sequential cost build.
Value is created by the firm and exchanged with the consumer. All activities prior to meeting
the consumer are just a “cost build” not value creation. The assertion in that book was that
value is created only by the joint interaction of the consumer and the firm; not just by the
firm. This implies that we move away from a firm and product centric view of value to a co-
created view of value.
Then lastly, you ask: Why are 5 billion people, 80% of humanity, poor - a subject that organized
private sector and strategy scholars have ignored? You know about my Bottom of the Pyramid
(BoP) work. You have heard enough stories - how fundamentally the cost structures would
change, innovation would take place and so on.
Chittoor: Correct.
Prahalad: I am primarily taking my own work to describe because I feel more comfortable
and easy to talk about it. If you look at BoP, some people were already doing it like Amul
(Anand Milk Union Limited, the highly successful dairy co-operative movement in India).
But now it is integrated into the framework of thinking about strategy. How do you create
inclusive growth? What are the issues and so on.
Therefore, combining the two big threads, you say, how do you break away from the notion
of a firm (firm-centric view) to the idea of a global eco system for competition (formulated
as Resources = Global, or R=G). How do you walk away from a firm with standardized
products and services and highly standardized ways of approaching the market to extreme
levels of variation which is co-created experience (formulated as N=1).
So now you can ask where does someone like you position yourself? The interesting question
for me is, what is the next one? Now, as a young faculty member in a country like India, you
can go back and do (another study of) the resource based view of the firm. That does not give
you a differentiated advantage. Neither does it allow youto exploit the unique opportunities
that India provides for research.
Chittoor: It may not cut any ice nor might it make an interesting contribution.
Prahalad: Contribution can be made, but it is very hard to publish and few are going to take
notice. So in my view, the strategy for a young faculty member has to be - how do I create

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Reflecting on Strategy as a Discipline: An Interview with C.K. Prahalad 7

a field where I will be the first one and therefore irrespective of whoever talks about that field
later, I will have to be cited. In other words, how do I create a new field? May be a sub-field,
but a new field. Then you can ask, is India is the right place to do it? I will say today that
India is indeed the right place to do it.
Chittoor: If you look at the young strategy researcher located here in India, he/she wants to
contribute something new and at the same time, naturally, wants to leverage on the context,
which is India. I am of the view that there are lots of interesting phenomena rooted in India
– institutional changes, emerging multinationals, this whole set of business model innovations
– which could be leveraged for research. Is that something that you recommend?
Prahalad: We need to deeply understand this at four levels - philosophy, operationalization,
tools and methodology. So you need to ask the question, whether you want to do the bottom
of the pyramid, as soon you will hear people saying that we need to move beyond anecdotal
evidence. What is the implication of it? Large sample studies. But if you are looking for the
next practices, where is the large sample? Right?
Chittoor: I am just coming to that. If we find a new field or a new sub-field that you were
describing, we need to publish in a good journal to gain legitimacy. But journals seem to
prefer large sample, quantitative models...
Prahalad: You can publish in Management Science. You can go to EMRI (Emergency
Management and Research Institute, an innovative emergency services firm based in Hyderabad,
India), look at their logistics problem and build a mathematical model. They have all the data.
You can publish in Management Science (and there is no need for large sample of firms). Or
go to ITC (another large firm in India, which is a cigarette major, but now has a substantial
agri-business operation).You can ask what are the problems in rural logistics.
So, I think the assumption that you have to do regression to publish in the Academy of
Management is not quite right. Why can’t you publish in Management Science? In other
words, there are some journals that emphasize large sample studies. There are also journals
which are rigorous and which publish conceptual, theoretical papers.
Chittoor: I agree. And thankfully the trend is growing in a majority of the journals.
Prahalad: That is right. We have consciously or sub-consciously, told all young Indian faculty
members that their holy grail is the Academy of Management or SMJ. We have not opened
up and told them that they can publish in Management Science, or American Economic Review,
or practitioner journals like Harvard Business Review (HBR). All of them are fine. So if you
start with the publication (in mind), then you will narrow your research problem methodologically
because there are only certain kinds that can be published in a specific journal.
Chittoor: Absolutely, I agree. Do you see the need for creation of some journals that accept
studies using innovative methodologies?
Prahalad: No. I am sure SMJ will also change. Why do you think I brought all these people
(editors of major journals) here? To say, what you are publishing is not very useful to people
building new business models. Just tell me in the last five issues of SMJ, which one article
could have helped any of these 15 CEOs who are here?

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Reflecting on Strategy as a Discipline: An Interview with C.K. Prahalad 8

(See Box for excerpts from inaugural address to young researchers in which he said, “the
original idea of Strategic management Society (SMS) conference was what we (usually) call
A-B-C; Academicians, Business people and Consultants coming together for a discourse. Over
a period of time, it has degenerated into primarily ‘A’, purely academic stuff for academicians.
The goal of this (SMS India) conference is to break it. We have business people, we have
CEOs and we hope to have some consultants as well and certainly researchers from around
the world. We need to build a type of bridge that informs our research as well as informs
management.”)
Chittoor: Talking of conceptual papers, among all your papers, the one that fascinates me
the most is one of your earliest papers, which is on the concept of dominant logic. It has no
number crunching…
Prahalad: The only numbers it has are page numbers…
Chittoor: (Laughs) True. Still it is a favourite among many scholars. I particularly liked it
because I could see it playing a significant role in organizations in my ten years of experience
in the corporate world.
Prahalad: In short, all change management in companies starts with changing the mindset.
Chittoor: Exactly. My question is that despite the huge impact it had – it won the SMJ Best
Paper award and so on – it still has not had an influence on researchers in terms of
methodological preferences…
Prahalad: But what I am saying is that it is your advantage. You are below the radar, you can
do it. We teach competitive strategy, I ask you what is your competitive strategy personally?
Chittoor: Yes, that is one way of putting it. But on the other hand, probably even a four of
such publications have not had an impact equivalent to one of your papers.
Prahalad: The question is this, what do you want? You want one paper. Coase wrote one
paper. All of us are not Coase, of course. For example, Corn Wet Milling study on signaling
won the Noble Prize for (Michael) Spence2 Was it a large sample regression paper? Did
Chandler’s core insight come from regression?
Chittoor: I agree, but if you see, one of the possible outcomes of the Deans’ conclave today
could be to give more priority to research in the Indian context and institutionalize the tenure
system. There is no problem with that, but if the Indian schools usher in thesame model of
the West, then we too need to have five or six ‘A’ publications in the first 5-6 years to get
tenure.
Prahalad: May be it may happen. Indian Deans may decide to follow the western model as
well. Why should it bother you? But I tell you this. Nobody can stop you from making an
impact though a HBR paper. How many from India have published in HBR?

2
Who shared the Nobel Prize in economics for 2001 with George Akerlof and Joseph Stiglitz for their analyses
of markets with asymmetric information

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Chittoor: As I told you, we are seeing some people from India publishing in ‘A’ journals, but
the numbers are limited.
Prahalad: You do not want to be just a regular faculty member, who is interested in a job; you
want to make a contribution, right? Contribution is not about ‘A’ journal publication,
contribution is about new content; new perspectives. The people who write a lot of papers
do not (necessarily) win a Nobel Prize. People who write papers which usher in a new way
of thinking, they win the Nobel Prize. Nobel Prize is not given merely for the number of
papers.
Chittoor: So even institutionally what you are suggesting is not direct aping of the Western
system?
Prahalad: I want you to think competitively, about what your bragging rights are. Competition
is about market share, what is the (equivalent of) market share for academics, tell me
Chittoor: Mind share.
Prahalad: And citation share. Look around. Look at young scholars with great impact. How
many papers did Pankaj Ghemawat write? How many did Tarun (Khanna) write? Ask yourself
why do Tarun (Khanna) and Pankaj (Ghemawat) enjoy the kind of mind share that they have?
In other words, I want you to just look around and think this through. It is fine to say, ‘Oh,
I have to publish in ‘A’ journals’. That is just what we have been taught. The need for a
paradigm shift in the mindset is more for the faculty than for the deans. Does it make sense?
Chittoor: I agree. But I am sure you will agree that to get qualitative research published too,
you need high rigor. I don’t think there can be any compromise on training or rigor?
Prahalad: I agree. We need training and rigor. But rigor does not mean regression.
Chittoor: Sure, I mean qualitative methodological rigor…
Prahalad: There are these huge disciplines of anthropology and sociology, which do not
depend only on statistics
I also want you to recognize that research need not always start with where a field is. You
can start with the problem; a fresh start. People ask me why in my BOP book I did not
mention development economics. I recognize that as a very well developed field. But I wanted
to start with a philosophically new approach; not aid, subsidies, and large government inspired
projects; but from the role of the private sector. I wanted to show an opportunitythat traditional
developmental economists had underestimated. What happened? Nothing. All the institutions
involved in Development - the World Bank, UNDP, IMF - everybody recognizes the importance
of the private sector in development. You do not always have to start with the current
literature. It is not arrogance; it is thinking through carefully (as to) how does one differentiate.
The first piece of research (that) you have to do is on knowing how to differentiate. But if
you start by saying, ‘I have to get three ‘A’ journal articles in the next three years’, then you
have totally eliminated all the new opportunities. Then you will be a mediocre, also-ran

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Reflecting on Strategy as a Discipline: An Interview with C.K. Prahalad 10

researcher sitting in Calcutta, which does not even give you the platform that sitting in the
US might give.
Chittoor: Well, naturally, that is not what we would like to do. But in your opinion, are there
any areas where India offers an advantage?
Prahalad: Total freedom. None of the management schools in India, including the IIMs (Indian
Institutes of Management, the premier business schools in India) have built a strong tradition
of good research. So, you have to find your own. You can define your own. I would love to
have this freedom. I have a limited and dated view of IIMs. Since all are hungry for good
research you can start and do what you want to do. Who stops faculty from writing Indian
cases? Why don’t they do it? It is a lot easier. I am having seven teams writing cases in India,
right now. In three years, we will have over 20 cases from India
Chittoor: Do you think this, your emphasis on primary data collection and being on the field,
is another means of differentiation for Indian researchers? A few of my colleagues are exploring
some interesting issues in villages near Varanasi…
Prahalad: If you are sitting in Hyderabad, why does it take a long time to go to EMRI
(Emergency Management and Research Institute, an emergency services firm based in
Hyderabad)? I have come all the way from Ann Arbor to be here
I want to be clear. I am not asking you to go to villages. There is enough research to be done
on (so-called) high level stuff. I can very easily do research on pharmaceutical patents and
its impact. How are the pharmaceutical companies in India breaking the global industry
structure? I will show you a lot of data, which I collect from here in India. The innovations
that our friend Kiran (Majumdar Shaw, of Biocon Limited) is doing or (D.S.) Brar (of GVK
Biosciences) is doing. So you have to have a totally different view of the industry.
Chittoor: I agree with you. When you talk about magnifying weak signals and next practices,
this is your preferred methodology. The question is can it be done in a way that satisfies some
of the rigorous ‘A’ journals?
Prahalad: Research must be done because you want to understand something. Never start a
research career saying you want to satisfy somebody else’s standards, be it their questions
or their methodological standards. I refuse to accept that. You study the bottom of the pyramid
because you are intellectually curious. You ask why this problem has persisted for two thousand
years. That is a more interesting starting point than how to collect enough data so you can
run one more regression on poverty. Ten thousand people can do regression, only few can
pose new questions. Right? Do you want to be (one among the) five or a thousand?
Chittoor: I see your point.
Prahalad: In India, we have to just step out of our campus door to see poverty. (Do) you mean
(to say), none of us can think of some solutions to this issue? Amul is sitting right there. So
is ITC, Jaipur Rugs, and so on. It is all to do with blinders and dominant logic. I do not want
our young faculty falling for the same trap. I can see it happening in India. Everyone says

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we have to do rigorous research. But this rigorous research does not seem to leverage the
unique Indian opportunity.
Chittoor: What were your objectives behind this Deans’ conclave? The opportunity for us
in India, as you said, is that we are starting with a clean slate. What do you think should be
the ideal research model for Indian business schools?
Prahalad: From the Deans’ conclave, you can see that (University of) Chicago has a clear
model, which they presented. (University of) Michigan has a model, clear? Harvard (Business
School) has a model that is very clear to everybody. What is the model for the Indian institutes?
We need to think about it.
Chittoor: What are your suggestions? I am only asking you because there is a need for
institutional structures to motivate the faculty towards research...
Prahalad: Don’t externalise it. Forget the leader for a moment. I want you to ask yourself,
what do you want to become. What is the motivation do you want other than (See Box) what
I told on the first day in my inaugural speech to all of you young researchers. Do you
remember, in your own house, even if you are an idiot you are worshipped; in your village,
it is the landlord and in a kingdom, it is the King. However, Vidwaan Sarvatra Poojyate (a
scholar is worshipped all over the world. See Box for excerpts). What else do you want?
Would you like to be the next Amartya Sen? He did not follow traditional economics, he
created his own economics. Look at our own people. Profs. Bhagawati, TN Srinivasan,
Raghuram Rajan and the list goes on. It is not that Indians have not done this.
Chittoor: Of course Indians have done it. They have done it more from outside (India) and
we want it to happen right here as well.
Prahalad: No. Amartya Sen’s work for which he won the Nobel Prize was done in Delhi.
Seminal work was done in Delhi. Sir C.V. Raman did his work in Calcutta. Jagadish Chandra
Bose, Meghnad Saha, again the list goes on.
Chittoor: Sure. Even in the domain of Strategy, Indians made a name, led by you.
Prahalad: From the day one when I started my research, I set myself some basic principles.
First, look at big problems, get focused for a couple of years, do small pieces first and build
the thinking in a big way. Number two, find a place where there is no competition and be
the first one to do it.
Chittoor: And in terms of outlets, you do not think that the type of journal matters that much.
Prahalad: I never worry about journals. I decide what I want to write and that has been so
from day one. I am not a good networker. I am not saying don’t network. I am saying: Think.
Networks will happen around you if you are a thinker. If you cannot think for yourself, your
dependence on networking increases.
Do you want to be the spider which weaves a web, or do you want to be an insect which gets
caught in a web. Both are a part of the web.

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Chittoor: I see the point in differentiating oneself especially when the dominant section of
scholars is going one way.
Prahalad: When everybody goes there, that is a not a good place. There is too much competition.
You should go in a different direction. (For this) you need a little bit of courage and you need
a little bit of entrepreneurship. So you have to become an academic entrepreneur. Does this
make sense?
Chittoor: It sure does! Thank you, I guess you would have to go. But one last thing I want
to ask you is this. How do you answer critics who say that some of your concepts such as the
BOP are not really new. Some firms indulging in rural marketing have probably been doing
it.
Prahalad: I don’t say anything. What am I supposed to say? If somebody says there is nothing
new in what you are doing, it is okay. There is a market in the world for ideas and let the
markets decide. That is what we teach, right? Let the market decide. So far the market test
has shown otherwise.
Chittoor: Thanks again so much for your time and patience.
Prahalad: Make a difference. Do not write articles for its own sake. Writing an article is just
a way of making a difference. The goal should be to make a difference. Writing an article is
not the end, just a means. As long as the goals and the means are kept separate, life is simple.
Thank you and good luck.

Some excerpts from Prof. Prahalad’s address to the participants of junior faculty and doctoral
consortia at the Strategic Management Society (SMS) India Special Conference held in Hyderabad,
India.
On the Importance of Focus on Next Practices
Our research should focus on unraveling the next practices. Many of us focus on best practices, but
that is historic. Next practice is about thought leadership. So focus on next practices. Look for weak
signals. I know all of us do regressions and we love it. But I also think there is a lot to be learnt by
looking at outliers. Very few people have any interest in how a system of 5000 companies operates.
I want to know how to win. I also want to know what would make me a failure. So understanding
outlier behaviour and outlier perspective is very important. So when you hear all these presentations
from CEOs and when you hear the presentations from senior faculty colleagues, just ask a simple
question, Is this a next practice or the best practice? Or more importantly is it a “fad” practice?
You cannot drive a car looking at the rear view mirror. As a researcher I want you to look ahead.
Once in a while, looking at the rear view mirror for perspective is healthy, but you cannot drive
looking at the rear view mirror. So I say, look at the outliers.

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On How Contradictions Offer Research Opportunities

I also want you to think about contradictions. If you have come from abroad (to India) you see it
here all the time. India is full of contradictions. Look at ISB (Indian School of Business, Hyderabad,
where the conference was hosted); look at Infosys (one of the largest IT services companies from
India), where many of you are staying. It could be anywhere else in the world. (But) just step
outside and you see poverty, disorder, chaos and poor infrastructure. (This is) just one contradiction.
You find companies doing world-class work, creating the next practice. You also see companies
which cannot perform even at a minimum level.
So, India and China are full of contradictions. Contradictions allow us to understand very clearly
a new perspective on how to manage. So look for them (contradictions), and be intellectually
curious.
On His Methodological Preferences
(Being) rigorous does not mean that you don’t have to be relevant, and certainly relevance does
not mean that you cannot be rigorous. You can take single cases, build conceptual models, and they
are perfectly publishable. In fact, those of you who are doing strategy research, please go back and
(take) a look at the paper on ‘signaling’ (theory). It is based on one case study. (With such research)
you could also go on to win the Nobel Prize! So the idea is how much of a break from tradition
you create and not how big a database that you have. So you need to have a deep understanding
and look at all the breakthroughs in strategic management, and ask yourself how much of it came
from looking at large data bases, how much of these conceptual breakthroughs came from looking
at single cases or a set of cases and making comparisons and having a strong conceptual underpinning.
I also think you need to build your research connections and we have already talked about a global
ecosystem.
On The Future Direction of Strategy Research
I also want you to think about strategy not as positioning the company in an existing industry space,
but as a way of creating fundamentally new sources of advantage. The good news about strategy
and management is that there are no sustainable advantages, somebody will duplicate them. So the
question is how do I continuously create new sources (of advantages) and therefore how you build
a cultural innovation. So I am going to look at strategy as a source of innovation or (in other words)
innovation, strategy and value creation are the three sides of the same coin. I certainly think that
the reason for bringing SMS (to India is this). Initially, the original idea of SMS was what we
(usually) call A-B-C; Academicians, Business people and Consultants coming together for a
discourse. Over a period of time, it has degenerated into primarily ‘A’, purely academic stuff for
academicians. The goal of this (SMS India) conference is to break it. We have business people,
we have CEOs and we hope to have some consultants as well and certainly researchers from around
the world. We need to build a type of bridge that informs our research as well as informs management.
On Future Scholarship
But the most fundamental question for me (and) for those of us who are old, is to be concerned
about building our succession. In other words the reason for all of you being here and for us to
make this (Junior Faculty and Doctoral Consortia) the centre piece of the conference is because
succession of scholarship in this area is of paramount importance. So you represent the future of
research, you represent the future of this field, therefore you must regain that position. You must
take charge; but taking charge would require that you put enough energy into creating thought
leadership.
So it is yours to lose. Everybody is trying to give it to you on a silver platter. Take it and run with
it. So I hope you will be the young researchers who will provide thought leadership.
On Management Research in India
And lastly, the expectations from my side and the organizers’ side and all the people who so
painfully went through all the papers, sorted them out is very simple, how do we build human

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Reflecting on Strategy as a Discipline: An Interview with C.K. Prahalad 14

capital in India that is connected and world class. And I think (being) connected and world class is
critical. Of course we have to build human capital in India. Human capital is not training good MBAs
and training good executives, critical as they may be.
It is also producing a seed corn that is research. So if you look at what has been a singular failure
in India, it has been extraordinarily good in building good educational institutions but not good
research institutions.
And therefore the expectation is that we would change it, may be marginally, but we would change
it directionally by saying how do we build this research culture in India. How to enable young
research scholars to build research based careers. I can tell you from the little experience that I have
that research based careers can be extraordinarily interesting. One it is fun; if work is exciting, you
are never tired. More importantly it can be more lucrative than just teaching. So even if you are
mostly motivated by money, be a good researcher because then the world is yours, not just your
school. In other words, good teaching gives you a field of opportunity that may be constrained by
your school or may be by the set of business schools wanting to get a good teacher. But if you are
a researcher and a world class researcher at that, then the world is your oyster.
In fact in India we should know this. When I was very young I was taught a single Sanskrit verse
by my parents. (Swagruhe pujyate murkhah, Swagrame pujyate prabhuh, Swadeshe pujyate raja,
Vidwan sarvatra pujyate.) Essentially it says - if you are a fool you are worshipped at home; if you
are a local lord you are worshipped in your village; if you are a king you are worshipped in your
own country; but if you are a scholar you are worshipped around the world. So if nothing else, if
you just want to be recognized around the world, scholarship is the only way.
Therefore I urge you to look at what you can do as a young scholar. Some of you might have seen
my work on looking at India at 75, which is a very different perspective of India than what India
may have been. The essential element of ‘India at 75’ is fundamentally changing the composition
of the talent and the work force in India. That means you have an extraordinarily important obligation
to provide the basis of research, the ways (in which) the country can change, and the ability to impart
knowledge. So go back to the old Sanskrit dictum “Vidwan Sarvatra Poojyate”, so everywhere
the “vidwan” will be respected. That should be your goal.

Decision, Vol. 36, No.1, April, 2009