Daily Archives: August 24, 2012

45 Million People Are Blind today!! Cheesecake Factory Might Be the Answer? (Part 1 of 2)

Today’s guest post is from Dalip Raheja, past contributor to Sourcing Innovation and CEO of The Mpower Group, Inc.

45 Million People Are Blind today … and 80% of them could be cured through surgery (36 million if you’re looking for your calculator). Oh, of course, most of these people cannot afford the surgery, don’t know about it, cannot physically be where eye care is available, and so on and so on. The answer? Reverse Innovation (RI) — a term coined by Jeffrey Immelt and Vijay Govindarajan. The basic premise of RI is that all innovation cannot flow from the developed to the developing world. There is a lot of innovation going on in the developing world that can and should be adopted here. According to Govindarajan, one can and should argue that the paradigm in the developed world is “spend more to come up with innovation,” while in the developing world the exact opposite is true, “spend less to come up with innovation.”

Let’s look at some comparative facts first:

  India US
Aravind surgeries 2,000 a year 125 a year
Average Cost $30 $1,000
Complications 1 / 2 Double

So, what’s the secret? It must be that they are performing a procedure that is not even accepted in the developed world. Not true. What they perform is called Phacoemulsification (considered the gold standard in cataract surgery).

What they have done is reimagined (not just reengineered) the entire conceptual framework with a different set of assumptions and come up with some innovations that are staggering. They have created an assembly line mentality that allows surgeons to focus on what they do best — perform the actual surgery. Not the prep, not the paperwork, not anything else but that which leverages their specialized skill set the most … allowing a surgeon to do 30 to 40 surgeries a day!! There is no time wasted between surgeries — the next patient is prepped, draped, and ready to go. With no degradation of quality! Oh by the way, Aravind performs about 300,000 of these procedures a year … WITH HALF OF THEM FREE!

Because they are offering the latest procedures with exceptional quality, half of their patients pay them full going market rates which then subsidizes the charity cases, which is what they are really about. They have used the combined volume leverage and scale to start making their own intraocular lenses and providing some lenses for $2, and they are now exporting these lenses to 120 other countries (Canada, Denmark, and Israel amongst them).

If all of this sounds like a classical supply chain/sourcing problem being solved — that’s because it is. They have applied a number of ideas from the business world to the non-profit world. So much so that they have also reimagined the traditional model of a charity organization always looking for a handout — they’ve planned half of their effort to be a commercial venture generating profits to pay for charity.

This is but one example amongst many:

  • GE’s portable EKG machine — developed in China
  • Boston’s PACT program — modeled after a program in Haiti
  • Kangaroo care — developed in Colombia
  • Pedialyte — developed in Bangladesh

And one of the biggest stories is Dr. Therdchai Jivacate (Thailand) who is providing artificial legs made out of plastic yogurt bottles for about $100 with a delivery time of 1-3 days compared to $10,000 and 7-10 days! Dude — don’t throw away that water bottle! And to lower the cost of labor involved in actually working with patients, he has trained local recipients of the artificial legs. He just broke the Guinness Book of World Records by serving 864 amputees in 13 days.

So before you pooh pooh those ideas from your colleagues from the developing world, you may want to keep an open mind and process them. You may want to actively seek innovations from your suppliers in the developing world. Remember — their context is different and context is very powerful and they are able to reimagine problems that we cannot because we cannot shake out of our context.

In the next post, we will continue this conversation about innovation and examine Atul Gawande’s suggestion of using the Cheesecake Factory (a place I’ve never been to) model to reimagine the healthcare system.