What is a social enterprise? With multiple forms of incorporation, complex objectives and firms claiming to be or perceived as social enterprises, we have used the Sankara philosophy of Neti Neti (not this, not that) to describe a social enterprise. In Aravind Eyecare, we found the answer — Idam Ittham (this is it).
Much has been written about Aravind — a slightly dated Harvard Business School case; a book chapter by C K Prahalad; two cases by the Indian Institute of Management, Ahmedabad and other writings that put the organisation in perspective. The book under review provides a comprehensive picture. Pavithra Mehta is a part of the Aravind system and issues of succession, inter-generational leadership and growth were expected be difficult for her to handle. Not so.
The Aravind model provides payment choices to patients. Nobody verifies affordability. Patients choose free treatment or payment: “Zero can be a legitimate price point… price points are built around a culture that respects patient’s right to selection.” The problem of mis-targeting in cross subsidisation is addressed by offering the same services (doctors, technology), but differing facilities (beds on the floor for free patients). In earlier days, technology (providing intra-ocular lenses for paying cataract patients and spectacles for non-paying patients) made the difference sharper. But it was not about keeping the differences; it was about removing even these differences by investing in research, bringing down price points but maintaining viability.
Unlike many not-for-profit organisations that have an us-versus-them attitude towards corporations, Dr Govindappa Venkataswamy (Dr V, the founder) and his team had never-ending curiosity. How does standardisation of McDonalds apply to cataract? How to use human resources and physical infrastructure optimally? How to cut idle time to increase capacity utilisation? “An average practitioner uses his surgical microscope 20 times a month… at Aravind our utilisation is actually 20 or 30 times higher. So our average cost per case is drastically lower than his,” Mehta and and her co-author Shenoy write. This increased the headroom for pricing. Doctors should be used for their specialisation. Others, who are trained, should provide support services.
Having a large number of interns and trainees brought enthusiasm, youthfulness and curiosity — and cut costs. Large numbers provided diversity and learning opportunities. There was a big problem of avoidable blindness — in India, Africa and across the world. “If somebody is blind, that’s our problem,” the authors write. In this articulation, the business model blindly chased the blind and not the bottom line. This problem needed to be solved in Dr V’s lifetime. The race could be won only with dedication, tirelessness and the perseverance of summiting Everest.
The task could not be measured by pay-packets, bonuses and stock options. At one end was a well-knit (almost joint) family supporting each other and living for a common cause, led by the patriarch Dr V. Nobody questioned him. At the other end was his spiritualism that ensured moral suasion. That was motivation. Dr V easily and seamlessly switched between the writings of Aurobindo and Burger King which provided an operational framework. It was a “we need to do what we need to do attitude. No cheesy, frou-frou notions of ‘doing well by doing good’. It was.. just — doing.” It was not a charitable operation running on external grants because “the founders did not want the eyesight of the community held ransom by external resources.” Resources were generated internally and accruals used for operations and growth.
How does one ensure that the patient’s experience is non-discriminatory irrespective of payment? The systems are designed to operationalise core principles. “To ensure equity of care ... the organisation intensively monitors clinical outcomes across paid and free services, all its surgeons are rotated between free and paying patients,” the authors explain.
The ruthlessness in being self-critical on operations, on tasks not achieved is the stuff that dream enterprises are made of. Do work, money follows. The story of how one family could produce so many eye surgeons, get them all to work in difficult conditions, rope in their spouses and grow at a pace that would make a private equity investor salivate is the stuff that Aravind is made of. It has the ingredients of an ideal enterprise. Dynamic leadership, audacious vision, dedicated team, clinically precise operations and superb implementation. Decisions are driven by sound business sense (and spirituality).
But what happens when leadership passes to the next generation and decisions move from convictions to systems, when a social enterprise faces growth and inter-generational shift?
The cracks set in. Inevitable hierarchies, make it complex. It needs funding just to see the support systems in place. The next generation does not own the intensity and passion of purpose; it is handed down. The external environment has changed and begs a response. Would it help if others embraced spirituality or would it sound hollow?
The passing of Dr V raises these questions. The decisions must be made by gen-next; they do not have the counsel of the old man. The frustration shows. As the authors write, “This large scale model just isn’t sustainable… A lot of people don’t want to deal with the heat, the wait and the crowd. We’re turning into a hospital for the masses; The bottom of the pyramid itself is moving up; Specialised eyecare hospitals are taking away the paying patients. How does the changed environment, changed leadership and aspirations of the ‘poor’ patients to have quality eyecare — (even in facilities) dictate the future? Is the traditional stance on self-reliance pointlessly restrictive?”
The book asks the right questions, deals with the complexity of inter-generational shift in social enterprises when the visionary is no longer around. When the seemingly unreasonable and convoluted logic of business and spirituality fails, the purpose is to be articulated differently. Aravind has effectively served the cause since 1976, but the challenges of re-definition have to be faced. Irrespective of how it responds, it faces a task of living up to the image and the vision of Dr V. An impossible and frustrating task that runs the risk of “mission drift”. That phase of Aravind has started. Mehta and Chenoy tell a wonderful tale. If one needs to understand the unreasonableness and complexity of a social enterprise, this is the book to read.
The reviewer is an independent researcher and consultant
Editor’s note: The version reviewed here is the overseas edition. The Indian edition of the book is due end-February/March
INFINITE VISION
How Aravind Became the World’s Greatest Business Case for Compassion
Author: Pavithra K Mehta and Suchitra Shenoy
Publisher: Collins Business
Price: Rs 499
