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 . . .





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?

So…It’s Been a While…(I.E. We Are Alive and Kicking! Part II)

19 Nov

I feel like that’s the title of every other blog post we write- apologies.  There’s just so much going on, lots of really interesting things happening, and so much we are learning, I forget that people can’t read our minds- we actually have to write about it to transfer information (unless someone has invented telepathy in the time we’ve been over here in India, which would be really amazing.)

Potential Scaling Plans:

So we’ve been eyeing Bangalore, to see if we can actually make the impact we want to. First, as luck would have it, Ashish, an Indian Institue of Management, Ahmedabad (IIMA) student from Bangalore, emailed us because he was bored and looking for a project to do during his break.  (We love when we get smart people who want to work with us!)  He began our market research in Bangalore, and came up with these initial findings:

Ashish is going to continue to interview people, and do an independent market sizing exercise for us, and we expect his report by the middle of next month, which we hope to share with everyone (thanks for being awesome Ashish!)

Basically, Ashish’s preliminary research told us that it was worth investigating Bangalore further. After some more conversations with people from Water.org, they introduced us to one of their local partners in Bangalore, Mythri Seva Sarma Samithi (MSSS) who is working to improve water/sanitation in 19 urban slums in Bangalore (among other things).  They graciously took precious time out of their day to show us around, and find out if a NextDrop solution could be helpful to the people they serve.  Here is what we found:

  • The Bangalore Water Supply and Sewerage Board (BWSSB) has given a contract to 4 NGO’s to help provide legal in home water connections to 96 slum areas in Bangalore (MSSS being one of the 4 contractors). This means that there is a large population (~96,000 families we know of) who will have access to in home connections, one of the biggest assumptions we had to verify
  • MSSS is ahead of schedule, the connections have already been installed, and now they are waiting for the BWSSB to start providing water to these areas
  • One of the main problems in the slum areas is simply a lack of water
  • Some areas that MSSS works in already have in home connections, and get sufficient water supply.
    • Of those areas, we estimate from our conversations, that people (especially women), lose approximately, 4-6 hours/week when the water is off schedule.  It was reported that water was off schedule ~ 2-3 times/month (more in the summer season). Also, it was reported that many times, depending on how far work is from their house, one person from the family will miss an entire day of work if they believe water is to come that day.

From our learnings, we believe that if we can get families to change water collection behaviour, we can save each low income family ~$27.59/year, amounting to a savings of  ~$500,000/year  for the 96 slums in Bangalore with in home water connections.  This only includes the monetized opportunity cost of waiting for water, and does not include any benefits from: sharing NextDrop water information, keeping children in school, health benefits from receiving clean water, increased time to do household chores, money saved from buying private water (which seems to happen quite frequently at ~ 1 INR/pot of water-located 1 KM away), and increased access to water due to timely information.  These are all things that I believe could be true, but would like to study it further when we operate in these areas.

Here are the assumptions we used when we came up with these numbers (We would love to get input and see if these numbers seem reasonable to you all!)  The biggest assumption, I feel, is that we can change water collection behaviour.  From our learnings in Hubli, we have found that if we provide accurate information, people seem to benefit from the service- which we are confident we can do.  However, those were in middle income brackets, and I believe that we will have to spend more effort in lower income brackets to accomplish this.  This is something we are really excited to take on, and a new challenge we would love to enter into, with other partners on the ground who know more than we do- like MSSS.  (We love learning, partners, and challenges!)

  • An average family loses 15 Hours/month due to unpredictable water timings ( reportedly off schedule 2-3 times per month, and 4-6 hours lost each time it is off schedule, on average)
  • The person who stays at home to collect water is the woman
  • There are 96 slums which will be receiving in home connections (~96,000 families, at 1000 families per slum area)
  • 75% of the people in slums have a cell phone (~72,000)- this is one stat we’re not sure about, it could be low or high
  • Assuming NextDrop customers include 50% of the total market (low income residents with cell phones) ~36,000 NextDrop customers
  • The average amount a woman makes is 1300 INR/month (and another paper to corroborate this)
  • The number of hours a woman works to make the full salary is 160 hours/month (hourly wage= 8.1 INR)
  • The NextDrop message will only help the family 50% of the time
  • Assuming exchange rate is 53 INR/1 USD

Next Steps:

  • We need to follow the money.  Basically, now we need to get a contract to provide this service to low income brackets.  What we are learning in Hubli is that it costs a lot (and more of a headache than its worth), to collect these small micro payments from individual customers (surprise surprise).  We can do it, but it’s not something we want to spend our time and resources doing. The reason we wanted to do this in Hubli was because we wanted to see if this information would actually be useful, and we wanted to get actual feedback from users.  We’re convinced that it is, which is why we’re comfortable pursuing a contract to provide this information to low income brackets.  Also, we’d like to use that bandwidth to shift our focus to other metrics for success, like an increase in monthly earnings, and other discernable social outcomes.  We still have to think about this a little more, but it’s something we’re excited about doing: Getting some real impact going!

So that’s where we are with that.  We basically need to find a partner who is interested in providing this information to people who could really benefit from it.  This is where the business model evolution comes in: instead of end users, where can revenue come from?  That’s what we’re working on for the next few months.


It’s not something we’ve talked about, but we have a new Vice President, Nishesh Mehta, who has joined our team recently!  He is a World Bank/Charles River Associates guy who decided to quit his job and move to India in September (woot!)  He’ll probably be writing about his experiences working with valvemen, as he is in charge of our valvemen incentive scheme (and doing a fine job at that!) He has learned some really interesting things, and I’m excited to have him share those learnings.

Also, we have Thejesh G N, our data loving hacker in residence, who is leading our tech efforts! You can look at all his awards and accolades (most recently a Mozilla Scout– congrats Thej, we’re proud of you!)

And then, of course, you know Quijano, our new Chief Operating Officer.

That’s something we’re really happy and proud of: adding new and amazing talent to our team to really reach our potential and do all the amazing things we want to do!

As always, if you are interested in joining our team, we are always looking for great talent! Drop us a line:)


We’re getting better at troubleshooting, fixing, and getting paid.  We’ve increased the number of valvemen who are providing consistent service, and now we’ve put a system in place to fix people in a timely manner, make sure they are getting good messages, and then getting paid!  We’ve made progress, but we still have more to go.  We’re close to cracking it though, and I’ll let Quijano and Nishesh fill you in on all that good stuff.  They’re doing a fantastic job, and I don’t want to steal their thunder!

Phew, I think that’s it! Of course there’s always more to write about, but I’m going to wrap up this post for now.  We’ll try to get better at posting at regular intervals.

As always, we’d love any questions/comments/concerns/just want to say hi!

On the Quest For More Social Impact, Scaling, and Big Picture Things

26 Aug

When smart people  tell us that we’re not making the social impact we really hope to be making, we usually tend to listen.  So then the next obvious question: What’s our next move?  Well, after talking to some other really smart people from Unitus Capital, we realized that we are straddling the social and the non social.  We’ve found a product that people (across a whole lot of economic levels) really like (for various reasons).  Which is great- we’re all for people loving us.  But since we went into this business to maximize social impact, that’s what we are going to try and do.

How do we do that?  Elementary my dear Watson: Use Hubli to perfect the information delivery mechanism, and pick the next city we scale to based on where we WILL make the most social impact.  (Ok we lied-we didn’t come up with that idea- one of our amazing advisors, Catherine Berman did.  This is totally why we have advisors.)

Learnings/Hypothesis: Tier II cities like Hubli probably don’t have a high number of people that fall into the “If Statements” that Amanda outlined, which will get to the type of impact we’re looking for.  We think that there will be more people who fall into that category in larger, Tier I cities, like the working poor of Bangalore.  This is still purely speculative, and we have no numbers to back this hypothesis up…yet.

Next Steps:

We at NextDrop understand where we make discernable socioeconomic impact: where both the man and the woman work, they do not have the social network to help them collect water (if they miss water collection), and they don’t have the coping mechanisms (storage containers vs number of people in the household vs number of days between each supply) to deal with missing the water supply.  What we need to do is quantify this market size in Bangalore: what percentage of the population (if any) does this definition apply to?

That’s very specific- what if you find that the market is too small for the business to be viable?

Upon talking to more smart people, (like April Rinne from Water.org), we realized that this could very well be the case.  Are there people who are new enough where they don’t have established social networks/coping mechanisms for missed water, but old enough to have access to piped water/in home connections?  We don’t know- that’s what we have to figure out.  But if we find that this market IS too small, what we will do is figure out what other types of water information we can provide to serve low income households. We’re thinking things like timings of water tanker truck arrivals- basically things that can still leverage the same NextDrop mechanism but in a slightly different water context. We’ve perfected (or in the process of perfecting) the delivery mechanism here in Hubli, and it may be a great chance to see how the mechanism works in a new context.  How robust is it?  What tweaks do we need to make it work?  All exciting questions we would love to be able to answer.

Also, a note on “Big Picture Things”- just for kicks.  Mostly the way we work/our philosophy.  As always, input is more than welcome.

Paul Graham said it best in his blog post about “Frighteningly Ambitious Startups”   In this post, he goes on to talk about “frighteningly ambitious ideas”: how to create the next generation of competition for Google, replacing email, replacing universities (you get the idea).  Basically things that are incredibly difficult and at the beginning sound ridiculously crazy.  I want to quote his advice on tactics: How he thinks companies should go about actually making this happen.

Let me conclude with some tactical advice. If you want to take on a problem as big as the ones I’ve discussed, don’t make a direct frontal attack on it. Don’t say, for example, that you’re going to replace email. If you do that you raise too many expectations. Your employees and investors will constantly be asking “are we there yet?” and you’ll have an army of haters waiting to see you fail. Just say you’re building todo-list software. That sounds harmless. People can notice you’ve replaced email when it’s a fait accompli[4]

Empirically, the way to do really big things seems to be to start with deceptively small things. Want to dominate microcomputer software? Start by writing a Basic interpreter for a machine with a few thousand users. Want to make the universal web site? Start by building a site for Harvard undergrads to stalk one another.

And that, my friends, is our strategy (well, not building a site for stalking part):  Start with deceptively small things.  We want to tackle big hairy audacious goals, like structural change.  But you know where we start?  With the small, focused thing.  Because that is actually really hard to do well, turns out.  We’re STILL trying to figure out how to provide accurate water information to the city of Hubli, and we’ve been at it full time for the past year, working our tails off.  That’s not to say we’re not close, but I’m saying that on paper, it looks really easy to do.  Geez, I came in thinking it would be really easy to do! (And it constantly amazes me how long “simple” things take to accomplish) That’s what people say when I tell them our business.  “Really? That’s it? Don’t people know this already? That sounds so simple”  Yes.  Deceptively simple.  But when we pull this off, our team will know just how hard it was, and we’ll definitely be patting each other on the back.

I think in the social enterprise space (the little I know of it at least) people are so used to talking about that big hairy audacious goal that they’re trying to tackle.  And people who prefer Paul Graham’s philosophy (starting small, doing it well, change the world), maybe get kicked to the side a bit.  Because at the end of the day, MAKING CHANGE IS NOT SEXY.  Doing good things means a doing a lot of really painful, really unsexy/boring things 99% of the time.  It’s looking at a lot of data, hearing a lot of things you don’t want to hear, and making decisions that are really not fun (because honestly, who wants to say that their brilliant ideas are not so brilliant, turns out?) You think finding out that you are currently not making the social impact that you thought you were making is fun?  No, it is not.  Not by a long shot.  But you face it. Brood a little bit (like maybe 1-2 hours) and then move on.  (And write a blog post about it).

So that, for anyone curious, is our strategy.  We’re doing Hubli well- getting the information delivery mechanism down.  Then we’re gonna do it and measurably make people’s lives better (maybe in Bangalore, we’ll see if the data backs it up).  And then when we get that under our belts, we’ll tackle bigger things.

What are those bigger things?  Honestly, it’s too early to tell.  I mean don’t get me wrong, we have a lot of ideas and theories.  But I’m not out here to distract everyone from keeping the eye on the prize, and holding us accountable.

What is the prize?  Delivering results in Hubli &  showing we can make measurable social impact in one more geography.  If we can do that, we are well on our way to tackling those big hairy audacious goals that everyone loves talking about.

PS If you are a smart person and want to consult for us/work with us/be part of our awesome team, shoot us an email!  We are always looking for smart people to tell us what to do.

What Sort of Social Impact (If Any) Are We Actually Having Anyway?

24 Aug

It’s a good question, and what we brought on Amanda Meng from the Fletcher School of Law and Diplomacy to find out.  Here are her thoughts on the matter.  (We will let her introduce herself, we are linking interested people to her personal blog about her experiences in India, and we are so sorry for taking so long to post this Amanda!)

If there’s something just as fashionable as social enterprise these days, it’s impact evaluation (especially of the RCT variety). So it makes perfect sense that NextDrop would request some of the great minds at Berkeley to design a rigorous evaluation that could isolate change caused by the information service.


The first phase of an impact evaluation is preliminary qualitative research, aiming to answer one question: Is there measurable, socioeconomically relevant impact?


Enter me.


Last year I was an economic development M.A. student at the Fletcher School of Law and Diplomacy. In August I’ll move to a Ph.D program at Georgia Tech to dig more into an earnest curiosity in how Information Communication Technology can affect development and democracy outcomes. When my advisor mentioned this opportunity, I jumped at the chance to join the inner, elite Berkeley circle and participate in an evaluation that might explain how access to water delivery information can overcome a lack of access to said water.


After outlining a utilization focused evaluation question, nailing down NextDrops’ assumptions of change, and four weeks of focus groups and guided interviews, I’ve discovered how and where we can find a social impact from NextDrop’s service. And from this reservoir of information, my own concerns of the danger in the hype for social enterprise in the development realm have floated to the top.


Finding Impact


Countless chais, puzzled looks, dosas, and inviting smiles later, I began to better understand users, non-users, and the context that NextDrop’s service lives in.


Based on discussions, interviews, and direct observation:


Users range from lower income slum areas to upper middle class, majority falling in the middle class. Highest potential  areas (in terms of subscription renewal) are middle and upper middle class. Water comes to these individuals every 2-5 days. Households are generally able to store sufficient amounts of water until the next supply cycle in underground tanks and/or roof tanks. Having enough water to make it to the next supply cycle depends on size of storage containers and how intermittent water supply is. Middle and upper middle class households all have underground and/or roof tanks. Upper middle class users reported occasionally missing supply cycles without a problem because they had sufficient water stored. Users and non-users claim to be aware of the water schedule, which is printed in the newspaper. They have expectations of which days water should come and those expectations are usually met. Most users and non-users across classes are not worried about having enough water and have little stress caused by water supply. The lack of stress across class is best explained by the ubiquitous practice of women staying in homes at all times (easily able to collect water) whether it is a housewife, mother-in-law, teenage daughter, middle-aged mother, or maid.


So why do people use? They like the convenience of knowing, whether they are 10 feet away from the tap, or a kilometer down the street at the market.


From this research emerged an archetype of users that could exhibit socioeconomically relevant impact, but it requires a few quite particular “If” statements that I imagine may be hard for NextDrop to isolate, reach, and tailor an impact evaluation to.


Socioeconomic impact exists…

  • If NextDrop service is on-time
  • If all members of the user household are out of the house (work/school) and the household can’t afford help or don’t have neighbors to rely on
  • If water supply is sufficiently intermittent that missing a supply day requires the household to go to other supply sources (coming once every 5 or 6 days)
  • If water collection methods are limited (in some sort of proportion of size of water collection containers to number of members in household) such that the household is pressed to not miss collecting waters on days of supply


If these conditions hold, then impact can be measured with

  • hours of work/school missed
  • number of times forced to collect water from alternative sources
  • loss of disposable income due to cost of alternative source
  • health impact due to quality of alternative source – self reporting of water related illnesses (doing a baseline survey of how different water sources are used… drinking v cleaning v laundry could give an idea of vulnerability to water born illnesses)


I am still in the process of estimating how large this population is in urban India. In this search I have found the following interesting statistics: 20.45% of Indians fall into the lower middle class which consumes 2$ – 4$  per person per day (2005 PPP) – this would be the income bracket that I think the impact archetype falls into. Partly because from observation, this is the group that doesn’t have underground or overhead tanks. Additionally, studies show that the higher a husbands educational attainment (which is correlated with income), the less likely their wives are to be employed. Which brings me to another relevant statistic: the female labor force participation rate (LFPR). It has hovered at around 23% for the past few decades. If you include women in school, the rate jumps to 32.3%. Urban women’s LFPR is consistently lower than their rural counterparts.


This leads me to my developing concern of the hype and hope the development world has placed in social enterprise.


When we think about water systems and development, the real challenge is access – access to water. This lack of access most certainly frustrates what we call development symptoms/outcomes. They are our indicators: health, hygiene, efficient time use, income constraints, empowerment, livelihood opportunities. In this case, outcomes are impacted by the coping mechanism adopted (ie – households have to pay for water to be trucked in; use of alternative, contaminated water sources; members of households stay at home to wait for water and therefore cannot use time efficiently). And, yes, NextDrop may impact these outcomes for a certain user profile. But what this social enterprise doesn’t change is the system that creates the symptoms. Communities don’t have 24/7 water for reasons like infrastructure, technology, corruption, or perhaps resource constraints. These are the system inputs that NextDrop likely can’t and won’t touch.


Consider lack of access as a power issue. On the street level, power may manifest as bribes to valveman or other water utility employees to open certain valves more often or for longer periods of time. At a government level, this power struggle has more to do with priorities and the voice of constituents to set government priorities. A community culture of accountability and power structures in the home and the community also play a role. What I am getting at is, a social enterprise that offers a service to make a lack of access more comfortable, does not change the systems’ power structure, is not development, not systemic change, and it may even be dangerous.


Why is it dangerous? To affect the system, constituents or utility workers have to be empowered to hold their public servants accountable. A big part of empowerment and accountability is the ability to envision change. What if NextDrop’s service of sending a text on the water schedule makes households more complacent with the water schedule? more complacent with the poorly performing water utility? and effectively lowers their expectations?


That’s dangerous.


NextDrop becomes merely a crutch for coping. It doesn’t impact the system, and in fact, it needs the broken system. If and when water is 24/7, the service would not be needed. So in terms of market and the all powerful incentive, a social enterprise that relies on revenue from a text on water delivery may be particularly incentivized to have the water utility never offer 24/7 water.


If we look away from the user side, we can see one, unproven opportunity for NextDrop to create system change. And that is through the valvemen. What if calling in to NextDrop’s IVR system is acting as an accountability mechanism for vavlemen? If it is, does this mechanism improve timeliness of water supply? These are questions that might point to a system change.


To those on the elusive quest, I offer caution in how we identify the work of development. And the way I see it there are systems of inequality that allow lack of access and  poverty to thrive. Any organization, enterprise, government, or person that does not recognize this symbiotic relationship between the system and symptoms of poverty and inequality and is not working to change that system, is not working in development.



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