Woman Getting Water from Naandi Plant

Yesterday was World Water day and my recent visits to the field made me pause and think about the tremendous strides that have been made in parts of India to bring clean water to every village. Just last week, the Villgro fellows were in Hyderabad, visiting the rural water plants of Naandi and Byrraju Foundations. Both organizations have similar operations of establishing water filtration plants in rural villages, which provide clean water for consumption at a price of ~Rs. 2 per day for each family (assuming a consumption of 12L).

How it works:

1. Villages demonstrate that they want and can support a water plant by collecting a portion of the funds to contribute to the building costs, which also creates a sense of ownership

2. Naandi and Byrraju Foundations conduct due diligence on the village including a feasibility study and evaluation of need

3. Local panchayats (village heads) allocate land or a building for the installation of the water plant; Naandi and Byrraju work with the community to plan the building to make sure that the community’s needs are incorporated

4. Naandi and Byrraju raise the additional funds for the cost of building and installation of the water filtration system

5. Local people are trained and employed to be the plant supervisors and managers (Naandi’s model has 2 employees per plant vs. 4 employees per Byrraju plant)

6. One employee serves as a sales and awareness building representative, who encourages village households to use the facility

7. Each household pays an initial ~Rs.100 – 150 for a 12L or 20L water jug as a membership fee and then pays a monthly ~Rs. 60 for daily water usage; purchases are tracked with a membership card

8. Operational costs of employee salaries and filtration system maintenance are covered by the pay-per-use model

Best Practices

Visiting both facilities, there were also a few best practices which I think are worth sharing:

1. Instill practices to encourage usage of clean water – Naandi’s membership card has 30 slots for each day of the month. When households come to collect their water each day, the appropriate slot is marked off. Households pay Rs.60 for the monthly card of 30 days and cannot roll over any missed days. According to health studies, 12L is the amount that an average household needs to consume daily, so the objective here is to encourage households to consumer only clean water by forcing them to collect 12L per day or losing that option value.

Byrraju Water Plant

Byrraju Water Plant

2. Make it a water party - the water plant in Nellutla that we visited was a community center as much as it was a clean water source. The multiple taps and self-service model encouraged villagers to come in the mornings and evenings around the same time to commune as well as to collect their water. The plant was also located right by the village temple. The village also hosted parties around the water plant, since it was centrally located and was a natural gathering place.

IMG_4609 3. Increase transparency and accountability of the NGO – at the Nellutla water plant, there was a prominent plaque on the building displaying the donors who contributed to the building. But what was more remarkable was the display of the responsible parties and their contact information. The manager of Naandi’s water project was clearly listed along with his mobile number. Any time that the villagers had a problem with the plant, they knew who to call.

It may sound simple, but it is truly impressive what Naandi and Byrraju have done in just the last few years. Naandi aims to be in 400 villages by the end of the year, which at an estimated 2,000 people per village could potentially impact 800K people! Both Naandi and Byrraju currently operate in Andhra Pradesh, which has one of the country’s greatest needs for clean water. The lessons learned there will certainly need to be brought to other states in India – there are still millions of people waiting for access to clean water.

Last week, the 2010 Villgro fellows took a trip out to Gobichettipalayam, site of Villgro’s pilot project of 10 retail agricultural supplies stores. Located in the Erode district of Tamil Nadu, Gobichettipalayam is the heart of paddy (rice) country. According to Wikipedia, the fertile paddies of Gobi are the cause of the perpetual influx of Tamil dancers and singers who like to film amidst all the lush greenery. The same lush fertile paddies were also the same reason that Villgro decided to pilot its retail store model in Gobi – the local farmers had steady enough crops year round to be willing to try out new agricultural products. Gobi was just ripe for retail agriculture.

The Model

Villgro’s retail model revisits an old-fashioned salesman model that has since gone out of fashion in the West – the Avon model (see model in photo).

Villgro Store ModelIn order to address the challenge of reaching small rural farmers, Villgro has come up with the concept of a Village Level Entrepreneur (VLE), who are local farmers and act as the direct sales representatives for Villgro. Each VLE is responsible for 4 villages, and each Villgro store has 5 VLEs, thus each store can reach 20 villages in an are. Like the Avon ladies who go door-to-door to sell cosmetics, the VLEs reach out to each individual farmer in their village to demonstrate and sell crop fertilizers and animal feeds. VLEs help to increase the credibility of the products by providing local endorsements. In addition, each Villgro store conducts pilot tests locally of each product before they are sold. The pilot tests serve to both demonstrate to farmers the value of the fertlizers / feeds, as well as increase the brand visibility. All of these labor and cost intensive measures are necessary in order to overcome the difficulties of building the trust and distribution channels for sales penetration of the rural market.

We visited with several VLEs and farmers who were conducting pilot tests for Villgro products around the Gobi area. They weren’t the most sophisticated business people, but they were financially savvy and understood the cost-benefit analysis behind the fertilizers and feeds that they used. They said that they saw dramatic benefits in terms of their crop yields and dairy production when they used the organic products distributed by Villgro. The farmer pictured below is a woman with 5 acres of land on which she grows 2 seasons of sugarcane and 1 season of rice. She stands amidst a health strong sugarcane crop that is fertilized using one of the organic products tested by Villgro. Even though she had little knowledge of the Villgro brand, she trusts the VLE who sells products to her and above all, she trusts the results that she sees from usage.

Villgro Farmer

Sustainability

It’s undeniable that sustainability is a key issue in this model. Not only are there great risks in the VLE model, the same ones that have led to the negative perceptions of Avon and other pyramid schemes in the US, but there are also risks with the cost-heavy structure of the sales process. However, there are great benefits to be considered as well, which is why Villgro is hoping to roll out 20 more stores within the next year. The benefits are that farmers are finally aware of the products that are available to help them increase their income generation. The other benefit is also the development of a whole new level of entrepreneurs within the villages. VLEs, who undergo significant training and who develop these businesses, may just lead to the next generation of rural innovations. So even though the risks are high, it is a worthy undertaking and if Villgro can succeed to create a rural distribution channel to take it to that last mile, then we all profit.

I’m fascinated by learning languages, not only because they allow you communicate with people, but also because of how much cultural value is embedded within. Native speakers of languages often miss the implicit meanings within the sentences they say; but for the language student laboring over every grammatical construction, these cultural gems can make it all worth the effort.

One such curiosity of the Hindi language is in showing possession. In English, we use the verb “to have” for everything. In Hindi, the construction is different depending on the situation:

1. “Ko” indicating a state of being as in “I have a cold”

2. “Ke paas” is used for possession of portable, tangible objects (and time)

3. “Ka/Ki/Ke” are used to indicate relationships with people and ownership of large immovable structures (e.g., I own a house or I have a brother)

What is curious though is that “ke paas”, which is used for portable objects, also encompasses servants! For example, if I wanted to say that she has a driver, I would say, “Vah ke paas driver hai”. This would be the same construction applied to all portable possessions, from books to furniture. The implication of this particular grammar rule is that servants are considered portable possessions.

Of course, this rule is dated and certainly not necessarily an accurate reflection of how servants are treated today in India. However, it still shocks many of the Hindi speakers with whom I’ve discussed this point. They never realized that they were making an implicit value statement when they spoke. The fact is that servants are still very much a part of Indian society – my roommate and I have a live-in housekeeper who takes care of us. And while many maids and housekeepers are treated very well and are seen as part of the family, a class division still exists within the society which is greatly explained by the cultural values hidden within Hindi. Perhaps awareness of this issue is the first step towards bridging the spoken divide. Or perhaps it’s all just semantics.

This article was originally published by the Wall Street Journal on February 24, 2010, “Budget 2010: Will Rural India Get a Fair Deal”. Within the article, Ms. K. Seeta Prabhu of the UNDP in New Delhi raises a number of extremely relevant concerns about the rural poor of India:

  • 42% of rural farmers live under the poverty line
  • Small acreage farmers compose 84% of total farmers
  • Low agricultural productivity
  • Lack of permanent shelter
  • Lack of electricity and highly inefficient energy usage
  • Lack of employment opportunities outside of agriculture

The situation described demands attention. In response, Ms. Prabhu recommends that the government should take action by injecting massive amounts of stimulus money into large public work projects to build crop warehouses and public toilets, to usher in another “Green Revolution”, to incentivize the installation of bio-plant stoves, etc. The litany of public projects that Ms. Prabhu wants the local governments to undertake is daunting. I find no fault with the problems identified and the end objectives cited, but I do doubt the realistic feasibility of the list of public projects. These proposed solutions are in fact not new; they have been discussed by the development community for some time. The problem doesn’t lie in the solution ideas themselves, but in the implementation – what has been coined as the “last mile challenge”. It’s agreed that these solutions need to happen, but how?

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Paul Basil, the founder and CEO of Villgro, started off my induction meeting like this:

Villgro was started in 2001 during a time when the concept of supporting rural innovations and providing products and services to the rural poor was unheard of. It was a good time to start. C.K. Prahalad wrote about the Bottom of the Pyramid in 2004 and brought a lot of attention to the sector. Acumen Fund and others also started proving themselves around that time. We started and grew at a good time.

My interpretation of the above set of facts is less positive than that of Paul’s. To me, the fact that Villgro predates much of the BoP movement means that it was in a prime position to take advantage of the recent focus on social enterprises to be installed as a top-of-mind organization. Yet, this is not the case. Even though Villgro has developed strong relationships with key grantmakers and foundations (e.g., Rockefeller, Lemelson, Ashoka), its presence within the greater social entrepreneurship community is still understated. Prior to accepting my fellowship, I asked friends in microfinance and social investing space in India for their opinion on Villgro. Aside from the one who worked with one of Villgro’s partner organizations, the others at well connected organizations were all unfamiliar with Villgro’s work. And so it was a surprise to me after becoming familiar with all the entrepreneur incubation programs and supporting services that Villgro has, to realize that it’s a still so unknown. Why is such an established organization so understated?

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