leveraging ict for the bop: innovative business models in education, health, agriculture and...
DESCRIPTION
Hystra, a consulting firm specializing in hybrid (social and business) strategies, presents the opportunity to find out “what works” in terms of full projects - as opposed to technologies - combining both an economically viable model and socio-economic impacts on their end-users, in the field of ICT for development (ICT4D).TRANSCRIPT
Jimena BetancourtCoordinación TIS [email protected]@jimebeta
Sustainability Models
Trends & Opportunities
TIS Talks Phase 1.
Product Development oriented• Syrian Telecentre
Project• BIID N Bangladesh
Partnership oriented• ATN Brasil• Colnodo Colombia
• Social Innovation
• Social Enterprise
• ICT Business models leveraging ICT for the Base of the Pyramid
1. 2.
LucieKlarsfeld PresentationProject Manager – Hystra
At Hystra since 2009: Developing hybrid strategies for housing, education, ICT and energy sectorsPrevious work experience: Bain & Company Paris, French Embassy Bucharest, UNEP New York and UNDP Mali.Master in International Affairs from Columbia University Master of Engineering from Ecole Centrale Paris
TIS Talks, September 13, 2012
Leveraging ICT for the BOPInnovative business models in education, health, agriculture and financial services
In collaboration with
A word about Hystra
Our methodology: learning from what works to scale up proven solutions
3 types of business models emerge, each with their key challenges
In financial and agro-services, viable models serve the BoP…
… whereas only a few exist in healthcare and education
Entrepreneurship is key to starting successful services, while cross-actor and cross-sector collaboration is key to scaling
Agenda
We work with business, social and public sector pioneers to design and implement hybrid strategies, i.e. innovative business approaches that:
• are profitable, scalable and eradicate social and environmental problems
• combine insights and resources of business, public and citizen sectors.
Hystra mission
Hystra is a hybrid organization, a for-profit tool for social change
Advisory Board vets our choice of clients/ projects based on the expected social impact
Board members: Rodrigo Baggio, Valeria Budinich, Bill Drayton, Emmanuel Faber, Jay Naidoo, Muthu Velayutham
Support to leading social entrepreneurs with 5% of our man days
Open source policy: we publish all our knowledge, except confidential information developed for specific clients
Hystra vision: “Be the change we want to see in the world”
A word about Hystra
Our methodology: learning from what works to scale up proven solutions
3 types of business models emerge, each with their key challenges
In financial and agro-services, viable models serve the BoP…
… whereas only a few exist in healthcare and education
Entrepreneurship is key to starting successful services, while cross-actor and cross-sector collaboration is key to scaling
Agenda
11
Initial scan
280projects
15 case studies with minscale
<140 projects
1st selection: On-going projects with market-based
mechanisms
Project classification
We learn from solutions that work to craft scale-up strategies
Note: No implied hierarchy of projects, but good examples representative
of best models
Analysis on 3 criteria
Effectiveness (in solving the problem)
Financial sustainability
Scalabity and replicability
Obstacles to scale
Strategies to overcome these obstacles
Lessons learnt and recommendations
Number of projects screened:
Many projects do not have an economically viable model, limiting their lifespan and impact
Tested market-based mechanisms
Fully grant-based, “dead pilots” older than 2 years or feasibility studies
57
103
64
21
11
97
122
30
22
Case studies span 3 continentsIndia - Bangalore• Narayana
Hospital
Nigeria •
mPedigree
Uganda• CKW
Kenya• Txteagle• Mpesa
Bangladesh•
Healthline
• BBC Janala
East India• Drishtee• Ekutir
Ghana• mPedigree
• •
Esoko
MYC4
Brazil• Bradesco
India - Mumbai • FINO• Reuters Mobile
LightIndia - Nagpur• Echoupal
13
14
A word about Hystra
Our methodology: learning from what works to scale up proven solutions
At this early stage, 3 types of business models emerge, each with their key challenges
In financial and agro-services, viable models serve the BoP…
… whereas only a few exist in healthcare and education
Entrepreneurship is key to starting successful services, while cross-actor and cross-sector collaboration is key to scaling
Agenda
Key take-away: the potential of market-based ICT approaches for the BoP is still largely untapped
*Maximum estimates from Hystra database of 280 projects
Caveat: It is still early days!
ICT may transform your business (… or not?)
Most successful programs use ICT as an enabler, not as a driver
Users of ICT services worldwide in 2011*
(in million)
Users of ICT worldwide(in million)
… yet limited reach of ICT-based social services
Unprecedented growth of connectivity worldwide…
Sources: ITU World Telecommunication /ICT Indicators database, Hystra analysis
There are three different business models,
with different barriers to scale
Technology front-end
Technology back-end: source of information and service
Technology at local agent’s
Client organization gathering data
“Direct access”: 1-way, accessed by end-users
“Local agents”: 1-way, accessed via local agents
“Crowdsourcing”: 2-way on 2 sides of techno platform
Client /end-user
Key challenge: Creating and marketing relevant local services
Key challenge: Recruiting and training enough local agents
Key challenge: Ensuring crowdsourced data accuracy
Our study analyses the various cases by sector and by business model
Learnings for:
Analysis of sectorial outcomeAnalysis of potential of ICT to fill current value chain gaps
Identification of obstacles to scale
Cost efficiency analysis
Cross sector opportunitiesLe
arni
ngs
for:1-way
in direct access
1-way via local agents
2-way on 2 sides of techno platform
CKW txteagle
Education
Health Financial services
Agriculture and support to economic activities
Insurance via mobile
M-PESA
MYC4
mPedigreeHealthLine
BBC Janala
Reuters RMLEsoko
Drishtee (education)
eChoupaleKutirDrishtee (FMCG)
Sectors
Narayana Hrudayalaya Hospital
Business model
FINOBradesco
21
A word about Hystra
Our methodology: learning from what works to scale up proven solutions
At this early stage, 3 types of business models emerge, each with their key challenges
In financial and agro-services, viable models serve the BoP…
… whereas only a few exist in healthcare and education
Entrepreneurship is key to starting successful services, while cross-actor and cross-sector collaboration is key to scaling
Agenda
ICT viably brings financial services to previously unbanked people, lowering risks of carrying cash and transaction costs
. See FINO case study for more details
Largest project seen: FINO
37 million users
After
Money transfers, remittances, payments
SavingsLoansInsurance
24/7 service, cheap, safe and fast
✗
Banks
MFIs
Before
Money transfers, remittances, payments
SavingsLoansInsurance
Limited availability, high costs,
long wait lines and delays
FIs
In rural development, farmers and the agro-ecosystem are ready to pay for local services with direct financial benefits
Sourcing Culti-vation
SalesChoice of
crop
Local and integrated services
Info and expert advice on weather, best agro-practices and plant health
Info on local market prices, demand and availability for inputs and outputs
Aggregation of farmers for purchase and grouped sale and direct order/sales
Data on farmers’ income and harvests, construction of credit history
Before ICT service
AfterICT service
+5 to +400% of farmers’ income
increase*
*Anecdotal evidence from cases studied for this work: CKW, eChoupal, eKutir, Esoko, RML
Largest project seen: eChoupal:
4 million users
A word about Hystra
Our methodology: learning from what works to scale up proven solutions
At this early stage, 3 types of business models emerge, each with their key challenges
In financial and agro-services, viable models serve the BoP…
… whereas only a few exist in healthcare and education
Entrepreneurship is key to starting successful services, while cross-actor and cross-sector collaboration is key to scaling
Agenda
Market-based models in health leverage the financial interests of diverse stakeholders
ICT service Examples Payers
Consultation End-users: 3-min phone consultation ($0.2)
Integrated, optimized
management
Hospitals generating productivity gains, i.e. first screening of patients by teleconsultations free to end-users
Drug authentificatio
n
Pharma companies avoiding sales of competing fakes, i.e. drug verification message free to end-users
Largest project seen: Healthline:
3.5 million users
ICT is yet to fulfill its potential to transform education systems, with very few market-based projects to date
Attending classes
Monitoring of perfor-
mance
Training teachers
Designing curriculum and
contentLearning
Practi-cing
Classes via video-conferences (including for vocational training)
Mobile phone based courses
Pedagogy training via ICT
Designing classes on ICT
Finding class content on the web
Sharing class content
Using ICT as learning tools
Interactions with teachers through ICT
Quizzes on mobile
Accessing classes archives
Online forums
Reporting grades
Reaching students
Reporting attendance of teachers and students
Before school At school After school
LegendService provided by ICT
Not market-based
Largest project seen: BBC Janala:
6 million users
A word about Hystra
Our methodology: learning from what works to scale up proven solutions
At this early stage, 3 types of business models emerge, each with their key challenges
In financial and agro-services, viable models serve the BoP…
… whereas only a few exist in healthcare and education
Entrepreneurship is key to starting successful services, while cross-actor and cross-sector collaboration is key to scaling
Agenda
A long trial-and-error phase has proved necessaryto start successful services
“We did lots of pilots, spending a year and a half developing just the technology.”
“This is a truly new field, no one has the answers, we can only succeed through trials and errors.”
“It requires a significant time and money investment to design an effective service for specific cultures and language speakers.”
Sources: Interviews
“We did a pilot for two years before launching RML. An entrepreneurial spirit is fundamental.”
Sara Chamberlain, BBC Janala
Amit Mehra, RML
Nathan Eagle, txteagle
Tim Vang, MYC4
Entrepreneurs on their own need time…
…as do intrapreneurs within larger organizations
Collaboration is key to scaling
Policy
Recruitment and training
Partnerships
Funding
Technology
Connectivity
Literacy
Challenges to scale faced by entrepreneurs Collaboration required
Governments, local authorities, international agencies
CSOs, aid agencies, universities
Telcos, providers of complementary products and services
Telcos, software and infrastructure companies
Governments, telcos
Sources: Entrepreneurs’ interviews, Hystra analysis
Regulations: Legislators have an important role as buyers of services enabled by ICT
Policy
Recruitment and training
Partnerships
Funding
Technology
Connectivity
Literacy
Challenges to scale quoted by entrepreneurs
Sources: Entrepreneurs’ interviews, Hystra analysis
Drivers for success: Legislators as promoters, first movers and buyers
Monitoring of successful programs to shape regulations helping their scale-up
Purchase of efficient systems for public health or education initiatives
Financial inclusion or national health programs ensuring minimum revenues to companies in that space
Barriers to success: Legislators as prescribers✘Regulations that limit entrepreneurs’ solutions or do not allow to import best practices from other countries
Regional initiativesCreating regional incubators for cross learnings
Harmonizing regulations
Financing, though not the main challenge, is required for both entrepreneurs and technology purchasers
Policy
Recruitment and training
Partnerships
Funding
Technology
Connectivity
Literacy
Challenges to scale quoted by entrepreneurs
Sources: Entrepreneurs’ interviews, Hystra analysis
1) Entrepreneurs’ needsSeed funding to develop adequate offerEquity funding (patient capital)
•To sustain operational expenses•To finance the set up of new kiosks
Shared advertising and marketing costsGrants
•To raise digital and financial literacy•To reach the very poorest
2a) Local agents’ needs“Meso loans” to finance the set up of new kiosks (in models with intermediaries)
2b) End-users’ needsMicro finance to pay for the technology (in models where end-users access technology directly)
Financing required
The full report is available on the sponsors’ websites and at www.hystra.com
Report structure:Sponsor’s ForewordHystra and Ashoka IntroductionAcknowledgements1. About this project: Methodology2. Executive summary3. The basis for ICT4D: Connectivity4. The “Direct access” model5. The “Local agent” model6. The “Crowd” model7. ICT4Financial services8. ICT4Agriculture9. ICT4Health10.ICT4Education11.Socio-economic impact of ICT4D projects12.Environmental impact of ICT4D projects13.Conclusion on findings and recommendationsAppendix
Key questions: what does it mean for you?
Do you have capabilities that could contribute to the success of some of these entrepreneurs?
Could you leverage the capabilities of some of these entrepreneurs?
Could ICT enable productivity gains for you and your stakeholders (remote access, automation of processes), to reach underserved populations?
Could you use ICT to fundamentally re-engineer your business processes (like Narayana Hrudayalaya Hospital)?
Could ICT allow you to create an entirely new business model in your industry?
Easy wins
High risk, high return
opportunities
Thanks for your attention!
TIS Talks Phase 2. • Identify potential partners to develop
distribution channels of products and services (E-health, distance education, telecomunications solutions, and others)
• .Identify solutions for network’s management based in open software applications
• .Identify solutions to lower hardware cost• .Identify partners to develop applications for
greater impact in the communities served by telecentre networks
Schedule and information:http://www.telecentre.org/sustainability/
http://community.telecentre.org/group/tis-talkshttp://www.facebook.com/telecentre.org@telecentreorg@telecentrosLAC@MiguelRaimilla@jimebeta
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