Value for Money and for Many

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Reliance also pioneered some groundbreaking marketing strategies including free text messages, free phones, free incoming calls, and more. The results were phenomenal. With Reliance’ entry, outgoing call rates were dropped exponentially thus creating a revolution in the Indian telecom industry. Reliance’s deal with equipment suppliers set the benchmark for the lowest equipment prices in the world. And this initial movement of providing value for money plummeted the prices and costs to the ultra-low levels mentioned earlier.

COST EFFECTIVE INNOVATION

A brilliant example of value for money and for many that stands out is the Aravind Eye Care System (AECS). Started on a modest footing by G. Venkataswamy, AECS now treats around 300,000 cataract patients in a year. Venkataswamy strongly believed that blindness is a curse that deprives humans of their independence, livelihood, and dignity. Venkataswamy’s mission was to “eradicate needless blindness.”

He started AECS with no money and mortgaged his house for a bank loan. The inspiration apparently came from McDonalds - delivery of same quality of products in diverse regions through highly trained staff. The model that AECS employs uses unique work flow and fee systems to achieve the objectives of providing value for money and for many. The innovative model allows AECS to treat poor patients at the lowest costs without compromising on high quality. The company is self-sustaining and profitable even after treating 60 percent of the patients for free.

Let us compare the relative costs of such surgeries around the world. The cost of delivering eye care in UK is around 100 times more than that charged by Aravind Eye Care. The surgeon productivity of AECS is significantly higher than some countries such as Indonesia, Thailand, and Bangladesh. The cost of a typical cataract surgery in the U.S. is around $3,000. AECS has managed to bring down the cost between $30 and $300.

AECS has a dual health care delivery system. One, where patients are brought to the hospital through a highly optimized logistical system and the other where the health care goes to the patients. This is done by organizing outreach camps and conducting surgeries for thousands of patients. Ownership is created in the community and they are integrated as partners during these camps. The high cost of imported ophthalmic supplies is countered by setting up AECS’ own manufacturing unit. The costs of lenses were reduced from $100 to $2, thus making cataract surgery highly affordable. AECS is now spreading its “value for money and for many model” in the rest of the developing nations by partnering with hundreds of hospitals.

This is an example from the health delivery system. However, such examples abound in the case of design and development of drugs and therapeutics also, where ultra low cost alternatives have been created by using completely novel and alternative paths.

THINK BIG

The process for getting value for money and for many can be institutionalized around the world just as it has been done in India. The challenge and the opportunity is to get the best minds in the world to direct their efforts towards the “value for many” approach.

A good start is through global foundations such as Bill and Melinda Gates Foundation (BMGF) which encourages unconventional thinking to solve the problems of the poor. For instance, BMGF has partly funded the Whitesides Group at Harvard which has developed ultra low cost paper-based diagnostics that can be used in the most rural parts of the world. These products do not require electronics, and hence power, and can withstand the harsh, dusty, humid, and hot conditions very well. This opens up a new world for the poor as the main problem many a times is access to diagnostics limited by unavailability of expertise, equipment, and distance to be traveled.

Disposable “lab on chip” devices promise rapid diagnostics at diverse and remote locations. This helps effective disease management, for example, management of HIV, where delayed diagnostics becomes detrimental to the treatment of the patient. Innovative concepts such as “crowdsourcing” allow a large group of experts to take on challenges and provide solutions to pressing problems. This also brings down the costs as most of these people are outside the organization who respond to an open call.

Innovative developing countries such as India, China, and Brazil are gearing up their health innovation programs. Sustained and clever utilization of their health innovation networks will help in achieving health for many.

One such network is Council of Scientific and Industrial Research’s (CSIR), Open Source Drug Discovery (OSDD) consortium. The OSDD collaboratively aggregates the biological and genetic information available to scientists for discovery of drugs. The backbone is a Web-based platform which allows scientists and students from all over the world to share research and knowledge and collaborate on drug discovery for diseases of the poor such as tuberculosis, malaria, and others. The current OSDD program of CSIR now has 2,566 members from 70 countries collaborating to help each other address the needs of neglected diseases, in this case that of tuberculosis.

The above examples have some common threads: First, the “value for many” vision in most cases seems impossible with very ambitious goals and targets. Second, the leaders who practice “value for many” together with “value for money” put people first before profits. A certain unmet need of a human being is identified and then the business models, technology, talent, systems, and processes are built around this. Third, the process to achieve value for many has to be fundamentally innovative and at most times disruptive. Standard solutions do not go far.