Posts Tagged ‘Global Fellows’

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Reaching rural markets through effective distribution

Tuesday, February 28th, 2012

Editor’s note: This post and tomorrow’s post, also posted on the Villgro Fellows Blog, is the result of a collaboration–we asked one Villgro Fellow and one Acumen Fund Fellow the same prompt: What are the challenges in and the unique approach you take to distribution, marketing, and/or doing dealings with the Base of the Pyramid (BoP) at your social enterprise? Interestingly, this resulted in a contrasting look at distribution and marketing in rural versus urban India, and how two very different business models can serve the rural BoP market in India.

Andrea and part of the Orb distribution team in Bangalore.

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There is an enormous rural market for solar in India.  But the key is ‘reach’ through effective marketing and distribution and ensuring that systems continue to work as expected.

Orb Energy, a solar energy company, aims is to serve customers who are looking to adopt a better energy alternative that is safe, environmentally sound, and reliable. Orb is one of India’s leading providers of solar energy systems. To date, Orb has installed over 30,000 systems in 5 states (Karnataka, Tamil Nadu, Kerala, Maharashtra, and AP) and is interested in expanding its reach to regional and international markets.  Orb designs, engineers, and distributes its own products including a large range of AC and DC power systems for off and on-grid grid applications, solar water heaters, and solar street lights.

Effective distribution and ongoing service and maintenance are absolutely integral to the success or failure of a business model in the off-grid decentralized solar energy market.  In fact, many companies and markets have suffered/failed due to poor distribution and failure to effectively maintain and service systems once they are installed.  Regretfully, India has a long history of solar not being properly maintained after installation, therefore leading to system failure of a highly valued asset to the discounted customer.

Orb’s main innovation has been its distribution model of over 100 direct and franchised retail branches and direct sales methodology.  Many companies will sell solar products through dealers.  Dealers are essentially retail outlets accessible to the end-user that typically sell multiple brands of products and product types.  Orb on the other hand, sells Orb-designed and engineered products directly to the customer through its own direct sale branch network and sales team.  Orb branches also maintain a team of technicians who service and maintain the systems them after installation.  There are many reasons for the direct retail approach, but the most notable is that Orb is able to invest in the end-user customer relationship and oversee that maintenance of the systems after installation.  As said earlier, this after sales service is key to the firm’s sustainability in the long run.  Happy customers typically introduce new customers to Orb.

Orb’s approach to distribution has been a success made possible by the dedication, vision, and resourceful planning of its managing team and employees.  But managing more than 100 branches across 5 states and a distributed workforce of over 550 employees is cumbersome.  It’s especially cumbersome for a company like Orb that wants to scale its distribution network into new regions and states within India (not to mention into new countries as well).  Not only do you have to scale your network of branches and franchises, you also have to simultaneously maintain the health and performance of the existing branches.  Orb has more recently considered diversifying its distribution channels within India and outside, by signing on channel partners and franchisees where possible.

The key distribution and marketing challenges we face are the following:

1)      The branch network is expensive but integral to building trust:  To establish a direct retail branch, CAPEX (capital expenditure) can be high.  The company will typically incur a loss in the beginning because the local solar market is not developed and a fair amount of awareness building and deal pipeline needs to be established.

2)      Scale:  In order to scale, Orb needs significant capital to deploy to fund new branches.  Orb is building trust in the communities they operate in that couldn’t be done via a dealer.  The physical Orb office shows commitment of the brand to serving the community.

3)      Market Making: Each time Orb sets up a direct retail branch in a new area, solar technology (especially PV) is typically being introduced for the first time to the community.  Orb’s branch therefore has to create solar awareness among the community. End user finance is also key to a large group of our customers.    Orb works with local banks to familiarize them with the benefits of solar to the end user to create solar lending programs.  End-user finance enables more end users, particularly those in the lower income bracket, to purchase solar systems via loans. The presence of Orb branches also means that local employees need to be recruited and trained, both from a sales and technical standpoint.  In doing so, Orb is essentially building local market infrastructure from scratch each time it establishes a branch.

4)      Capacity:  Finding skilled and motivated employees on the ground with a shared vision can be a challenge.  Solar energy is a technical product and requires a combination of good sales skills, technical understanding and skills, and strong business acumen as well as an understanding of the customer/end users needs.  Many of Orb’s staff do not have a formal background in business, so Orb needs a strong emphasis on training and controls for sales, money collection, distribution, installation, and after-sales service to function smoothly.

5)      Retail Productivity: The ability for Orb to be in business is driven by the branch office’s productivity in generating sales and bringing in revenue.  Keeping productivity at the branch level growing is a constant challenge, particularly when Orb headquarters are not nearby.

Orb is well positioned to address these challenges to distribution in India but is constantly looking for ways innovate to push this model forward within in India and now particularly into new geographies around the world.

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Andrea is an Acumen Fund Fellow, working in Bangalore, India with Orb Energy, which is India’s largest direct provider of off-grid solar systems. Andrea is from the United States, and has worked as an analyst at Bear Stearns and subsequently J.P. Morgan. She has also worked with the UNDP in Senegal and as a Summer Associate with Acumen Fund in Pakistan. She holds a Master’s in International Energy Management and Policy from Columbia University’s School for International and Public Affairs, as well as a B.A. in Economics from the University of Vermont.

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Monday Morning Motivation – Leadership: The Art of Balance

Monday, December 12th, 2011

In the three weeks that I’ve spent in Patna, Bihar, I’ve witnessed many forms of leadership. I am struck by the patience demonstrated by Gyaneshji, Husk Power System’s CEO, as he repeats himself to make sure he is understood. He has the flexibility and willingness to explain how to hide a row in Excel, how to integrate the MIS system into every department – all while being cognizant of paying for diesel for the generator downstairs, so the ongoing meeting can run longer on the additional hour of electricity. He has to maintain a balance between creating high expectations that drive continuous momentum while encouraging individuals to spark creativity throughout the organization.

This encouragement drives Huskians, aka Husk employees, to innovate. In an area where electricity is a rare phenomenon, the team is experimenting with tablet PCs, mobile applications and remote monitoring systems to address their operational challenges. They are training locals to not only operate the plant equipment but use the latest technology with an interface designed specifically for them. Though in an initial phase, these developments demand a creative imagination; one that dares to dream big, believes in individual potential regardless of education or past experience, and digs deep to patiently innovate solutions for challenges that have existed for decades.

Patient resilience is a critical factor to being an effective leader on the ground. I recently met a bony young woman of 25 years who proved that not only is it possible to be successful despite the odds stacked against her, but rather that individuals can excel well beyond expectations. She conceivably has the toughest job in the organization: managing collections for the region in the remotest parts of Bihar. She can’t travel anywhere alone, day or night, because as a woman it isn’t safe for her to do so. Yet, she is managing over twenty men spread across several villages, a challenging task for a tiny lady amidst all the yelling and screaming I’ve observed here – in the market, at the rickshaw stand and even during seemingly professional conversations. In three short months, she has developed relationships that allow her to get things done, often over the phone. She doesn’t resort to yelling, but instead she encourages her team through unique incentives, like starting small competitions or buying presents for their girlfriends. I asked her what motivated her to keep trying despite the obvious obstacles. Without any hesitation she answered, “You have to have passion to succeed here. You have to build relationships because nothing else will work in Bihar.”

During the leadership training for the Acumen Fund Global Fellows Program, we were asked if it is better to lead with love or fear. I thought then, as I am confirming now, that one should lead with love, because fear just isn’t sustainable. It is love that patiently allows leaders to listen with an open mind to gain a real understanding. It creates trust that allows individuals to learn from each other as they willingly share their mistakes. What is most striking though is that leadership through love creates something that is sustainable beyond one person or one lifetime. The teachings of Mahatma Gandhi, Martin Luther King, Jr., or Nelson Mandela are a testament to the power of leadership through love. The inspiration they set forth transcends nationality, gender, race, culture and generations. Leading with love enables the creation of a shared vision that not only can survive, but can flourish in the leaders’ absence – something fear can’t create despite the leader’s presence.

In Bihar I’ve discovered that the art of balancing patience, creativity, resilience and love is essential to successful leadership. A few days ago, as I sat surrounded by my all-male co-workers, I listened to a Jay-Z song competing with an old Hindi classic on opposite speakers. This moment, like so many others in Patna, is indicative of modern India, a country that is being shaped by leaders in even the most remote areas, striking a balance.

Neha is an Acumen Fund Global Fellow, working in Bihar, India with Husk Power Systems, which uses innovative biomass technology to convert abundant rice husks into energy that provides power to Indian villages. Neha is from India and previously worked in international marketing for General Motors. She holds a B.S. in marketing and management from Purdue University and an MBA with a concentration in social entrepreneurship from the Kelley School of Business, Indiana University. Read her blog at http://nehasnewadventure.blogspot.com/ and follow her on Twitter @kale_neha

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Everyday barriers

Wednesday, October 19th, 2011

We believe empathy and listening are the foundation of leadership and are critical to developing solutions with the poor. As part of their empathy training, the Acumen Fund Global Fellows are stripped of their wallets and cell phones, and are given only a 2-ride Metrocard and a $5 bill, and are sent out into the city to experience for one day what it means to be poor in New York. Below is one Fellow’s reflections:

I have lived with hunger before, not knowing when or from where my next meal would come. I have lived with illness before, not knowing when or from where healing would come. But at least I had a place to rest my head at night, and in times like that, for me, that was enough. I had the opportunity to see what it would feel like to take away that one comfort I treasured most, a place to call home.

Reaching the homeless shelter in the late morning, I found the doors bolted shut. I stood there and contemplated my next move.  I imagined myself lugging around a small suitcase containing my earthly possessions. There was no notice on the door, but I had a fact sheet which told me the shelter would open at 4PM. May as well look for something to eat I thought to myself. Armed with my list of feeding facilities, I marched on to the closest one, feeling down but not out.

Getting to the facility I pulled on the door. Locked! I stood there, staring at the buzzer, wondering whether or not to press it. I must have looked pitiful because a street vendor came over to press the buzzer on my behalf and smiled kindly as he egged me on to speak into the intercom. A faint voice picked up on the other said. ‘I’d like to inquire about your meals’, I asked. ‘Come back at noon.’, the response. I was taken aback. I had not anticipated hitting a brick wall quite so soon. I felt the stares from the vendors selling their wares on the edge of the street but dared not raise my eyes to meet theirs. Two doors had remained shut when I needed them most. Unable to eat when my body craved nourishment, instead having to be told when I could eat. I felt like a child again, unable to make decisions for myself. With nowhere to rest and nothing to eat, feelings of despair and shame came over me. I had to move on. Still avoiding the vendors glares, I deliberately held my head high to counter the feelings I felt inside, and moved swiftly in the opposite direction. I just wanted to melt into the crowd and blend in. Looking at the throngs of people perusing through the latest fashions hanging in the stores as they bit into yummy looking treats, I wished just for a second, I could walk in their shoes.

My stomach was now grumbling and I was beginning to feel a little weak. I decided to go to the nearby hospital, I’d been suffering from a cough anyway and could use this as an excuse to camp there as I waited for the food shelter to open. Besides, I was guaranteed a place to sit and rest my legs and a bathroom which I so desperately needed now. I spent the next 4 hours in queues. A queue to give my reason for visiting. A queue to give my medical history. A queue to give my identity particulars. A queue to have my vitals taken. A queue to finally see the doctor. Armed with my prescription in hand, feeling victorious, I marched with renewed strength to the pharmacy. Another queue. My heart sank! I was hungry, and all around me people ate food they’d bought from the cafeteria in the next wing. An hour and a half later, I walked out of the hospital with my medicine packet feeling exhausted and on the verge of collapse from hunger. At least, I thought, something went right today. My body and stomach told me it was time to go home, the experiment was over. I paused to imagine where I’d go now if I truly had no home.

As we stop and think about what it would it feel like to walk in the shoes of the homeless, the hungry and the vulnerable, stop for a second and imagine how they wish they were walking in yours. At the end of the day, we all deserve the opportunity to live a life where we have the freedom to make basic choices about what we eat and when, and about where and when we lay our heads down to rest. This for me is dignity.

Rutendo Change is an Acumen Fund Global Fellow in the Class of 2012. She will be working with Juhudi Kilimo in Kenya.

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Moving On With Courage…

Monday, October 3rd, 2011

As we stood in front of the audience at the Acumen 2011 Fellows Graduation on Tuesday evening, each of the fellows had the chance to speak directly about their experience in the field. I felt the warm embrace from this global family that applauded and celebrated our year of service abroad.  I truly felt inspired by their admiration and acknowledged by their recognition.

As Jacqueline spoke to each of us, to our triumphs and hardships, to our challenges and resolve, she had a resounding theme…Have courage!  Have the courage in life to stand up for what you believe in, the courage to follow a dream, the courage to love unabashedly, the courage to seek truth, the courage to create change, the courage to embrace challenges, the courage to be different and unaccepted, and most importantly, the courage to fail.

To seek out acceptance, support and love is natural. But to have the courage to try something new, to go against the mainstream, to choose the path of most resistance and to fail openly, outwardly, and with no apology, is true success.  Jacqueline’s last words to us were those of true encouragement, to be fearless in whatever we do.

The memory of this last year with my cohort of fellows is one of tears and laughter, resolution and reflection, struggle and camaraderie. And I cannot think of a more fearless group of people to carry the torch, to be renegades of social responsibility, and to succeed in the face of failure. Thank you to the Acumen Family for the opportunity!

Brenda Williams is an Acumen Fund Global Fellow in the Class of 2011. Read her post on returning home after the Fellowship here.

Click here to read the graduation reflections of Acumen Fund Fellow, Mario Ferro.

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Generosity economy

Friday, September 30th, 2011

In the ultimate world-colliding evening, last night I attended the graduation for the Class of 2011 Acumen Fund Fellows.  These 10 Fellows, selected from 700 applicants from more than 60 countries, are a humbling and inspiring assembly of talent, commitment, grit, drive, and empathy, and they spend a year working with Acumen Fund investees in India, Pakistan and East Africa as a training ground for lives in social change.

Chris Anderson, curator of the TED conference and all-around deep thinker and mind-bender, gave the Fellows graduation speech, and he led it off saying, “Thanks to a nice talk featured on the TED.com website last week, I’ve been thinking a lot about generosity and the role it plays in our lives.”  I couldn’t feel more humbled, or more honored, that Chris took the time to reflect on generosity – he’s the one who helped us all understand that taking the most incredible, insightful, and (at the time) exclusive content in the world and giving it away for free was the right business strategy and the right thing for the world.  He’s the ultimate generosity inspiration.

Chris started off talking about the evolutionary and biological bases for generosity, and all the research that has been done on the value of reciprocity, especially amongst pairings of individuals and groups that have reason to believe that they will have multiple encounters over time.  But he went further and shared research from experiments in which one subject was given $100 and had the option to give away any amount of that money, with the knowledge that the amount given away would triple.  Many subjects gave away all $100, and, even better, many recipients then gave back $150 to their donor.

Generosity begets generosity.  Trust begets trust.

At the same time, it’s incredibly easy to break the cycle – all you need is one shirker and the whole things spirals into a “no trust” equilibrium.  But the cycle can be broken: someone can take a generosity risk and reset the system.

At any moment, we have the chance through our individual actions to transform others’ behaviors.

Going further still, Chris observed that the best way to create generous action is through transparency: tell people to behave however they want to behave, but add the caveat that how they acted will be publicly known, and people act much more generous.

Transparency transforms behaviors.

Chris’ final observation is that we can be generous in infinite ways, not just in sharing our money but in sharing our thoughts, our ideas, our wisdom, and that today the friction around sharing what we have to give has reduced dramatically.

It’s easier than ever to give (= spread ideas)

And suddenly we arrive at the big conclusion (not Chris’ exact words)

Increased transparency (e.g. living in a Facebook world) + frictionless idea-sharing (e.g. living in a blogging, YouTube, TED world) = We are living in a generosity economy

Discuss.

Sasha Dichter is Director of Business Development at Acumen Fund. This post originally appeared on his blog, where he writes on generosity, philanthropy and social change.

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