Whose in it for some incentives – Part II?

6 May

Sometimes I wish I were R. Daneel Olivaw, able to adjust anyone’s emotions for the greater good of mankind (Of course following the Zeroth Law). However until then, I have to rely on its poorer ancestor – behavioral economics. I have been a fan of the field ever since I heard Dan Ariely’s talk ‘predictably irrational’.

Since the last time we spoke of incentives, we have tried a few experiments- one successful, one marginal and have recently introduced some new ideas. As one who loves listening to his own voice, let me talk about the success.

Framing
Professor John List at the University of Chicago has conducted some pioneering field experiments using behavioral economics. We borrowed from his field experiment, “The Behavioralist Visits the Factory: Increasing Productivity Using Simple Framing Manipulations” in which he raised the productivity of workers in a Chinese factory by simply ‘framing’ the incentives differently.

In his study, List has used the risk averse nature of humans, i.e., we try to avoid losing much more than trying to gain something. Instead of earning an incentive as the month progresses, he provided the same incentives at the beginning of the month. He then deducted these incentives if required performance standards were not met during the month. In the former case, workers would just not earn something they could have if they didn’t hit required standards. In the latter, they now lost something they had already earned. Here, their innate risk aversion came into play and they worked harder to protect what they had already earned and hence there was a small but significant increase in productivity with no cost to the company.

Using the same principle we started giving all incentives in advance at the beginning of the month. Their instructions were simple – they would receive all their incentives in advance. However, every time they missed a supply notification,  points would be deducted from his account. At the end of the month, we would provide them a paper receipt that would show them how many points they lost out of the total they had received in advance that month.

I’ll be honest. I couldn’t contain my excitement the day we introduced this new initiative. Even before we started receiving any results, I was in self congratulatory mode. I thought how amazing I was, to apply state of the art research that would surely accomplish miracles.

So, what would you expect? Like all predictable twists, after the end of the first month – it achieved nothing. What’s more, the valvemen didn’t even notice. I’d ask my colleague, Aseem, did you explain the “Points Lost” receipt to them and he’d say yes. What was the response – they said. “Meh! Ok.”

If the initiative didn’t improve anything, may be I would have understood, but to not even create a stir amid our test group, that was inexcusable. I started to hunt for reasons. Why? Why don’t they care? It made me question the entire program itself. What was the point if they just didn’t care at all!

The next month was marginally better in that the valvemen only asked if they could spend all these newly minted advanced points, well, in advance! A tiny flicker of hope – I allowed it. But now, they used all the points at the beginning of the month so they had nothing to lose during the month. So we introduced a requirement of a minimal account balance to be able to use points in advance.
Finally, one day, by chance, I told Aseem to create the “points lost” receipt in Kannada and told him that we should keep that standard practice from now on.

The reaction was immediate. No sooner that the first of these Kannada receipts were distributed, valvemen started inquiring why they had so many points deducted. When we would show them each instance of a missed notification in the performance reports they would resort to haggling and bargaining. Eventually, they started to comprehend their cost of each missed notification. Talk about importance of using local language!

Even so, this framing of incentives has not been the raging success I had hoped it to be. However, it has certainly played a part in improving valvemen performance. One of the major gains from the initiative has been establishing the action and consequence loop for performance. If you miss notifications you will lose points. This simple rule has been established in their minds and no one now tries to question or bargain for points.

The program commenced in February and we started receiving reactions from the valvemen in March. At the beginning of March we had 28 consistent valvemen providing correct notifications to 115 areas o the city. This number increased to 35 and 158 respectively at the beginning of May (See chart).

blogpart2

During this period the only other new incentive introduced was a “Valveman of the Quarter” contest which rewarded the best 2 valvemen from each tank with a one time cash award. Significantly, the winners of the contest were performing well since January. While I have not done any rigorous testing yet (I intend to write a paper with David Argente, who suggested using List’s research ) the program seems to have been successful in raising the threshold of performance across all tanks.

Finally, it has primed the valvemen for my next ace ‘in the hole’. We have just introduced what we like to call the “Smiley System”. But I am not going to reveal what it is just yet. For that you will have to “watch this space”. (Hint: SMS, emoticons and behavioral econ).

Dream World

9 Apr

What’s been going on since my last broadcast?

The monsoon season has long past and the dry season is upon us. The reservoir is low and water supply timings have changed from once every 3 days to once every 4 days. Scheduled power outages and the number of tankers on the street have increased.

Our team has been tinkering away developing minor innovation improvements and executing them as soon as we can.

A few weeks ago there were local city elections. A large flux of people. An opportunity for us to market. We had recently developed some new tech to allow text messages to update our database. It gave us more control and visibility over our operations. And it was cool, this hack was updating our database so Melwyn didn’t have to do data entry anymore, this was in real time. The format was something like this:

“nd bill 9095242885 30″

Three days before the election we sat down and were interested to know how many people would reach out and tell us they want the NextDrop service. Initially, our experiment was to see how many people would text into our number something like, “nd new”. At this point we believed that people would tell us they wanted the service. They were telling us in other ways, referrals from other NextDrop users, catching our representatives while they were billing in their neighborhood. They just didn’t have an easy way to communicate with us.

The day before the election, I remember getting a call from Nishesh.

     “Hey man, so we were discussing what’s going on tomorrow. Instead of the customers sending a text message, Anjana suggests we give a missed call.”

     “That sounds great, let’s do it.”

     “Do you want to talk to Devin about the tech?”

     “No, he can handle it.”

Within 24 hours we had a missed call number and if you’ve never called the number before it would log you into our system and then send you a demo SMS immediately. The demo looks something like this:

“Demo: Water will arrive in your area in 30 to 60 minutes.”

We pushed marketing hard for those two days. Fliers, people on the field, and we were persistent when they told us we couldn’t be on the streets. The first positive feedbacks were people taking the fliers home and calling from their landlines. On those two days we had 14 people on the field pushing out this phone number and 80 people called in. Over the weekend, we had no one on the field. Five people called into our missed call number.

Major Innovation.

With additional marketing, this number has grown. Around 8 to 10 people call into the number daily, and we see spikes over the weekend, around 30 to 40. It completely changed how we acquire customers. Not everyone who calls in signs up for the service, they’ll say things like “What, I didn’t give a missed call? My children must have.” Some will not be interested after they find out it costs 10 Rs per month, but almost half provide their address information without hesitation.

This actually helped us out a lot, we were able to focus all of our time on delivery good content to people that would pay for the service.

As more and more people called in, some of them were calling from areas we didn’t provide service to. For the first time in Hubli, there was one single phone number residents could call into and consistently find out when they would receive clean drinking water. Each phone call questioned how well do we understand water in this specific area. We can tell you this this and this or we can’t tell you that. The market has spoken and we need to know water so well that we can tell you an hour before it’ll arrive and we need to know every time it comes. This is the future.

It’s an interesting exercise to think about if there was one phone number in the world to call if you needed to know when you’d get water. It’d be revealing to find out where people would call from. Now imagine a place where no one needs to call into this number. This is easy. Most suburbs and major cities in the United States, no one would call into this number. But for every place else, you’d probably get at least a few phone calls.

How did this all happen? How do you manage innovation? If its a process, then can it be observed, studied, stimulated and replicated? I don’t have a concise answer to these questions, I wish I did, and there isn’t a whole lot of documentation on the topic. But here is what we’ve found helpful so far.

  • Focus on the largest opportunity at hand.
  • Develop a culture engaged in knowledge work.
  • Use the Customer Development Methodology.
  • Learn Python.
  • Read a lot.
  • Exchange problems and solutions with other people doing similar work.
  • Share your knowledge.

NextDrop In Bangalore

7 Apr

It’s a bit difficult to keep this blog updated on everything interesting we’re doing, but we’re trying our best!  Today we have our newest employee, Bindu, who is running operations in Bangalore (yes, we’re actually working in Bangalore now), writing about her experiences/our progress thus far.

Where do I start?
For someone who had spent 9 years enjoying the centralized AC, freq cafeteria visits, chit-chats (most frequently discussed were traffic jams, where is our country heading? kind of interesting topics..;))
The pilot in bangalore has made me go through ‘A hell of an experience’ (of course in good sense ;))
Right from searching for the water tank in the area we first visited (I remember how me and Anu were asking every other person on the street if he knows where the water tank is.. no one seems to know and they gave strange expressions.. like why are these two girls so desperately looking for a water tank after all!) to sitting across the table with top BWSSB (Bangalore Water Supply and Sewerage Board) officials explaining the outcomes of our pilot and astonishing them

We got the necessary permissions from BWSSB to carry out the pilot in Bandappa Garden NE1 sub-division and Bhoopasandra NE3 sub-division (Of course it was as simple as that! :D).  We trained the valveman, enrolled people for our service and started monitoring the notifications.  4 weeks down the line, taking feedback from customers was so much fun – they totally loved us! :))

Our observations in Bandappa Garden after 3 months pilot – 2 Skipped supply, 6 Unscheduled supply timings.  Not trying to point out any inefficiencies here but, the goal is to make sure people know about it so that they plan their tasks accordingly.  The delays in the supply or the skips may be genuine (lot of times) due to shortage of water supply to the reservoirs or power cuts/pipe damages etc.  If they are made aware of it in advance, I am sure most of them would understand and co-operate.  Thats exactly where we are pitching in.
This is how the supply graph looks like.. Do you see the streamlined supply timings?  Don’t want to take away all the credit.. But yes, our monitoring has definitely made a difference (I see a steady trend continuing since)
Graph

Bhoopasandra was even more interesting.  To bring in a seriousness in the valveman to notify us of every supply was a challenge (he thought it was OK if he forgot to let us know?!)  Other than 11 Unscheduled supplies, it was fascinating to see that he was supplying water to the area every day continuously for 15 days!!  And no one seem to know about it.  When our reports reached the Engineers, initially they denied that was true and when we confirmed it was actually true, they gave us a ‘oh’ look. I know for sure that they have inquired into it, the valveman got back on track following supply schedules (took so much to convince them that a lot happens under their nose!)

Then the question came up.. why did he give water to a specific area for 15 days at a stretch???
We have not been able to arrive at a conclusion but here are some speculations at a high level..
a. Could be political pressure.. since the elections are round the corner?
b. Someone from the area pays him to open the valves for them?
c. He lives there? (actually No, he doesn’t)
d. He might simply be trying to impress us? Wants to show he is doing a good job?Well end of this luxurious supply period, on one end we have the Engineers with surprised expressions and on the other hand residents complaining that the supply was great and now its gone bad (No no! trust me! they mean that its only alternate days now!)Summarizing the study:  The board faces a challenge in coordinating within its various levels and effectively communicating with its consumers.  This gives us a great opportunity to make a difference.  With due respect to the enormous task the board has, to supply water to the monstrously growing city, we think that slightest of the change in the way the supplies are currently administered can bring in a drastic improvement in the system.  And we want to help them and be the instrument for change and move india forward!

Throughout the pilot the experiences I have had dealing with super-fast auto-rickshaw drivers, amazingly slow BTS buses, naive valve men, surprised looks on arrogant officials, encouragement from knowledgeable officers, long waits before the meetings, walking down lanes of North Bangalore which I never had, friendly slum residents, curious people who are amused to hear their phone ring a while before the supply was simply amazing and I thoroughly enjoyed it.
Do you want to see what the residents of the pilot areas has to say about us?  Do watch this video
My sincere thanks to the officials of the water board especially Mr. Amruthesh, Executive Engineer North East division for being so supportive and letting us into his fort.  Also, MSSS for helping us choose these areas and introduce us to the pilot area residents.

Who Is In It For Some Incentives – Part I

6 Mar

Today, we have our Vice President of Product Development, Nishesh Mehta, talking about what he’s learned about Incentives since he’s been here thus far.  Really fascinating topic, with implications across many sectors.  Why do people do what they do? Why do valvemen give us information?  I’ll let Nishesh take it from here

NextDrop was featured as one of the practioners at the ACM Dev 2013. At the conference, we witnessed some of the most innovative ideas in action that married crowd-sourcing, ICT with the mobile platform. One of the questions I was asked most often was, “So why do the valvemen work with you? How have you crafted your incentive program to get them to give you accurate information?”

To answer the question, we have to go back to September 2012. I had recently moved back to India to join NextDrop. My charge was to set up an incentive program that would convert each valvemen into human sensors – accurate, timely and most importantly consistent. Over the last 6 months, we have been able to devise a program that has achieved good results. About 70% of the valvemen working with NextDrop in Hubli report water supply timings accurately.

The incentive program that we designed works like a frequent flier program. For each correct notification, valvemen accrue a certain number of points which can be redeemed at the end of the month in the form of rewards such as jackets, T-shirts, petrol, ration etc. Essentially, they can get anything except cash.

What have I learnt in the process of designing this incentive program? I am going to summarize these in a multi-part series. Here goes Part I.

1)     The signalling effect is much stronger than actual incentives – When valvemen can see the rewards being given to other valvemen for good performance while they are left out, it creates a huge “I also want it” effect. In economics, it is called the signalling. What we learnt is this signalling effect has a disproportionately larger impact on valvemen performance than the actual incentive. It is also a powerful attraction to get new valvemen into the fold. Consequently, all incentives are given in a group setting. It not only enables the signalling effect but also gives you credibility that you will deliver on your promise of the incentives.

2)     They must decide on the methodology to score points – This is crucial for any system to work. If they perceive the points system to be biased, they will never buy into the incentive program.

3)     You want them to fight over points – Once they trust the points system, however, you want them to fight over points. You will be at the receiving end of a lot of flak, a few disparaging remarks even. The questions may sound accusatory such as – “How did I get so few points?” or “Why did he get so many and I received so few?”. When you start to hear those – you know you have traction. You have their ear. Now is the time to fill them with the sweet music of rewards! The worst thing for an incentive program would be if everyone ignored it.

4)     Who is afraid of unions – One of the first meetings I had when I started was with the union leader of the valvemen in the city. What a meeting it was! If I said, I came out with a bloody nose that would be putting it mildly. However, we have learnt that having a union can be really helpful. A union is a great way of organizing the valvemen and it provides a readymade chosen few who could then influence all the valvemen to work with you. Once we convinced the union leader on the incentive program it has been a lot easier to function with the valvemen. It also provides you a new voice when there is any sort of disgruntlement on the other side.

5)     You need institutional backing at least in name – In our case the valvemen are contracted by the city water board. Being the primary employer, they hold sway with the valvemen and are consequently cast in the main villain’s role in their saga. Their influence however is crucial here. We developed a feedback loop from the water board to the valvemen. The water board now monitors valvemen performance through the same messaging system that informs the customers. As a result, if a valvemen didn’t send correct notifications, they would hear about it from their water board supervisors. Even though it is primary a verbal warning or praise, it goes a long way in cementing the importance of sending in timely notifications to the NextDrop system.

6)     Are you funny and charismatic? – An important note in conclusion; No incentive program can work without some old school charm. I continuously feel that the role of charisma is grossly under-estimated in enhancing productivity. Here is a perfect example. None of the ideas on the incentive program would have worked without a team that has been able to charm their way into the valvemen’s daily lives.

 

Here ends the first part on what I learnt while creating the incentive program. In part II, I will throw in some field experiments based on behavioural economics, game theory and some highly original ideas that we have come up with to structure the incentives. In the meantime if you all have any ideas you always thought would work and are itching to find out, here’s your ready laboratory.

 

NextDrop FAQ: Why Did You Guys Start in Hubli?

25 Jan

Since we recently got invited to be a panelist at The Indus Entrepreneur (TiE) event in Hubli, I was thinking about questions that we had interesting answers to/we get asked the most often.  The top question: Why Hubli?

I thought it would be interesting to go through the Pros and Cons of starting in a Tier II city (as opposed to a Tier I city like Mumbai or Bangalore).

I’ll start with the Cons:

  • Banking: It’s is pretty tough.  Trying to get Foreign Direct Investment through the Indian banking system is tough enough without having to deal with the fact most Tier II city branches have never dealt with it before. 
  • Human Resources: It’s much harder to get top talent to move to Hubli.  The US equivalent is basically choosing between a job in San Francisco or a job in Wichita, Kansas.
  • Location: Given the fact it there are only 2 flights into and out of Hubli (which actually shut down for the last 8 months and just reopened), it’s difficult to get places.  To get to Delhi, it would take about 2 days (because I don’t want to land at night for…safety reasons).  Also, you don’t get many visitors (again, hard to get to).

The Workarounds/Business Hacks (to overcome the Cons)

  • Banking: There was a very large learning curve there, but after a while, I think they got the pattern.  Once a pattern is established, things go smoothly.  It took about a year, but it’s good now.  If we were to do it again, I think we may have had our “local” branch in a big city (because we go there once a month anyway).  I don’t know if it’s any better, but I think I’d like to try it that way.  Most things can be done online now anyway, so I think it could work.
  • Human Resources: This one is pretty interesting.  I was talking to one of the founders of a pretty famous Hubli company, Sankalp, and they said their competitive advantage is really by training students from Tier II city colleges (the ones that didn’t get accepted into the prestigious semi conductor companies) and just make them stellar.  This seems to be the trend in India because I know other famous companies like Infosys, Wipro, Accenture, IBM etc.. do it too.  Their training programs last between 6 months-2 years (Crazy, right?!) But it’s the Indian corporate workaround for the fact the Indian college education system does not really seem to prepare students for the corporate world.  But what does a startup in Hubli do when you need people, and you need them… yesterday?  Sankalp worked around it by starting in Bangalore, and then when they got big, moved to Hubli.  They already had built enough reputation for people to take a risk and join the company.  Their solution for small startups like ours (whichI thought was incredibly insightful/pretty much what we ended up doing): The founders just need to do be incredibly hands on and do most of the work/train their staff.  Let me say that again, because I felt like this was a huge nugget of wisdom that most people can learn from: the founders need to be on the ground and put the proper systems in place/train their staff to reach the levels of excellence they expect.  Essentially, you need to create a 6month-2 year training course,  implement, and execute it (in real time/while you grow your business).
  • Location: Batching meetings so you can just make one trip and knock out 3-4 things.  It makes you more focused and saves you money anyway (because you won’t leave unless you have 3-4 compelling reasons why!)  Also, honestly, in the beginning, you don’t really want people coming by to visit because you don’t have much to show that’s interesting yet.  It’s better to fly under the radar until you have something good.

The Pros:

  • Focus: The problems that we are working on are the same across India, just at different levels of complexity. So when you start out, you want to isolate one variable, and figure it out.  In Hubli, we asked one question: Can we get useful and accurate information from the valvemen?  The answer: Yes. That’s the only thing we tried to solve, and that’s what we did.  If we had started in a much larger city, we’d be spending so much time figuring out the pipe network, who reports to who, the politics, and navigating the beauracracy, we wouldn’t have time to answer the most pressing questions.  
  • Human Resources: Back in high school, our basketball team had a very effective strategy to see who would make the team.  Anyone who made 5am practices (getting there by 4:45am) for a whole summer, made the cut. Guess what- our team was undefeated and we won our league every year.  It’s the same with starting in a Tier II city.  The upside is that you know that the people who do join you are incredibly committed to your cause, and will do anything to make it survive.
  • Less Red Tape: Related to the first point, it’s much easier to navigate…everything really, in a Tier II city. And for a startup, that’s really one of the most important things it can ask for.  The people in power are much more amenable to trying new things, and the systems are much more straightforward (which is still incredibly complicated!) But figuring the path of least resistence in a smaller city and then applying the same concepts to a larger city, I think, gives you the most bang for your buck.
  • Location: Similar to the Human Resource answer, you know that the people who do visit you (investors, interested individuals), are really interested in what you do.  Also, we mostly travel by bus/train, and tickets are really cheap- I can book at the last minute and still get a good ticket (~$20 round trip gets me to Mumbai or Bangalore in a sleeper bus!)
  • Cost: Hands down, super cheap to live and work in Hubli (Compared to a bigger city).  Food is great, and housing/transport/office rent is inexpensive.  We’ve kept our burn rate considerably lower because we live in Hubli.

Overall, if I had to do it again, I would still start in Hubli.  Yes, it’s much less glamorous, but the pro’s, in my head, definitely outweigh the cons.  I would also encourage any other social enterprise starting out to really figure out the overall problem they are trying to solve, work backwards, and figure out the first key question they need to answer.  Then ask yourself: what’s the easiest geography to answer the question in?

As always, thoughts/questions/comments are much appreciated!

Tech Adventures!

14 Jan

We have a wonderful post by our newest developer, (drumroll please) Devin Miller!  He put college on hold to come and work with NextDrop (and we are incredibly thrilled to have him here in Hubli, let me tell you).  Anyway, lets get to it. Here’s what Devin has to say about his experiences thus far.  

It has been a wild few months since I arrived here in Hubli at the beginning of September.  As I am still a university student, a year ago, I would have thought I’d be in school right now, continuing my studies.  I had no idea that I would be moving to India for 10 months to pursue working with the NextDrop team. 

 

Before arriving in India, I got to get my feet wet by exploring some of the NextDrop code.  I had a blueprint in my head of how the technology worked after reading through some of the blog posts and the business plan.  Crowd-sourcing, water, social-impact… it all sounded so exciting.  I was informed I would be part of the scaling team here at NextDrop.  Toyota’s “Lean manufacturing” came to mind by reducing waste and overproduction; these ideals played a huge role in the work I am doing here.

 

So what do I do here at NextDrop?  Thej, our lead programmer, and I, make up the tech team and work together to maintain and to build the next version of the NextDrop technology.  Upon arrival here, there were many concerns about our system and more importantly, the data that we were collecting. 

 

Where do all of our messages go? Do they arrive on time? Do the residents even open our messages?

 

These were just some of the questions that were posed.  We could provide a lot of answers after generating delivery reports from our voice calls and from our SMS gateway.  We took all this data on messages/calls and created a program to help us process all that data, turning the data into useful information.  This information told us how many messages were delivered, the status of the message, and whether they were delivered on time or not.  We were able to reduce the number of invalid messages being sent and also better inform our customers to be more receptive to our messages.  When I first arrived here at NextDrop, about 75% of our messages were delivered successfully. 

 

Only 75%? What about the other 25%!?

 

Invalid phone numbers, mismatched SMS template being rejected by the NDNC registry, duplicate messages accidentally being sent, just to name a few.  We were able to decrease the number of void messages being sent by addressing these reasons and still work towards improving the success rate of these messages today.  Our message delivery success rate is now at a steady 90%.  

 

Collecting the data and the availability of the reports within the company, greatly improved our customer service resolution time.  We were able to provide the customer with information that we did not have previously, for example, a customer may ask why they never receive our messages; from the delivery report, we could report back to them that their message inbox is full and that’s why they don’t receive any messages from us.  (This has happened!)  More importantly, we could report back to the customer in a timely manner.

 

This is just one example of collecting data and performing analysis, thus turning it into information to make data-driven decisions.  The coming back Lean principle, reducing waste, and cutting costs, are important for any company, especially a start-up.

 

A lot of my time is spent programming and maintaining the administrative dashboard that is the command and control center for the NextDrop backend.  One of the most important things I have learned is that the user interface (UI) is essential!  It is everything!  If you want to develop a successful product that users want to use, the UI is of the utmost importance.  We have been able to make drastic changes in how we interact with our dashboard, and now we have come to rely on it.

 

Our database a few months ago looked different than it does today.  Although it is still incomplete, we are slowly starting to fill in all the gaps.  With no central location for your data, such as a database, it is impossible to concatenate enough data and make sensible and logical decisions.  That was the case when I first arrived here.  We did not have enough information about where our residents lived exactly to bill efficiently.   There was a huge lag time in between finding an area to bill, actually contacting/finding the customer, logging the information in the field, and entering the data into a computer.  (This was probably the biggest bottleneck in the process.  Do not allow data entry to pill up!  The sooner you have the data entered, the more equipped you are to make better decisions.)

 

Changes to the administrative dashboard and entering all of the data into one central location drastically reduced this lag time.  We were able to bill more efficiently, by collecting information from residents, such as landmarks and neighborhoods (sub-sections of a valve area).  We also performed SQL database queries to find areas receiving good service and that have not been billed recently, meaning they are ready to be billed.  Recently, we have set records on how many customers we have billed in a single day.  Go Billing Team!

 

If there is one thing to take away from this, it is this:

The more data one collects (in a centralized location) and turns this data into information, the better data-driven decision-making becomes.

 

I know our blog may seem quiet at times, but I can assure you, we are here and we are working hard.  So much to program . . . so little time . . .

 

 

Devin

 

Why Social Enterprises Need Academia/Subject Matter Experts

3 Dec

Conversation with our water expert, Emily:

Anu: “Emily!  Oh man, the meeting with the low income areas in Bangalore was great!  I think we can make a HUGE impact there! Did you know 10% of their income goes to water? I had no idea it was that high! Did you realize that?”

Emily: “Anu, that number seems really high.  I don’t think they spend 10% of their income on water.”

Anu: “Really? But when we asked them how much they spent on water, they were talking about anywhere from 200-500 INR/month! And that’s what Ashish found too…why would they say otherwise?”

Emily: “Ok Anu, think about it.  If someone came and asked you how much you spend on water, and it looks like you may be able to do something about it, don’t you’d think you’d over report how much you actually spend? Anyway, here are some research papers  that study this exact thing– and most of them agree on people spending about 1%-2% of income, including opportunity costs, on water. ”

Anu:“….UGH you’re right.  This is why I’m really glad you’re here.”

(Paraphrased conversation, but you get the point).

The thing about being a social enterprise (as opposed to just being a regular business), is you have to try and keep track of the social impact you’re making (or at least the potential you can make).  Businesses are well equipped to track the bottom line (which we actively do), but we’re not as good at the social bit.  And we just have to acknowledge that part.  From my own personal experience (which I should have remembered), I know that I can get a person to change their answer (to the same question) just by the way I phrase it!  There are so many nuances to surveying, and studying impact that “market research” just won’t uncover (as evidenced by the myriad of graduate classes available on the subject).  All we as a social business know is that there is some sort of opportunity for positive change, but quantifying that opportunity is something we leave to the professionals.

This is why we think collaborating with world leaders/experts in the field is crucial to our success.  Business and capital markets naturally lead itself to being efficient, but what if you’re efficient at the wrong things?  That’s where the experts come in: channeling that efficiency into doing something that makes positive change.

Anu, is the point of this post to say that the numbers from the last post are running high (re: impact?) Yes, probably.  I’m revising it to say that’s what our crude initial market research studies found, but academic papers suggest that we’d save ~ 2% of income, NextDrop would be able to save ~30% of that.  I’ll leave it up to others to use their numbers for how much a typical family makes (but the papers we read show something between 1300 INR- 6000 INR/month).

Also, is the other point to engage/call to the academic/expert water community? Yeah, pretty much.  It’s also a…personal learning to put out there for other social enterprises.  Make sure to have some experts on board to gut check your theories.  It’ll save you a lot of trouble in the long run when you realize you are nowhere close to doing the thing you thought you were doing.

It’s no fun learning when you were probably wrong, but it’s incredibly important if we want to get at what’s right.

Again, comments/questions/etc.. are always welcome! Has this ever happened to you?  What are your thoughts? Do you think we’re still off here?

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