Analysis of Aravind Eye Hospital

An Eye on Hope Miracles do happen. Don’t believe me? Ask that boy whose eyes would finally be able to see how the face of his mother is much more beautiful than even that angelic face that he had always imagined while listening to the lullabies she sang for him or how his cricketing hero actually looks like or how his kingdom of sand – that the world calls as a playground actually bore the signs of his footsteps or how the faces of his friends, who cheered for him for being specially-abled or who dissed him for his disability, change expressions on seeing him again. Now, here is a question for all the B-School students who are taught to derive the equivalent clink of coin-sound for all human emotions, day-in and day-out or for all the professionals who have grown up taking pride in putting a dollar tag on every single sentiment on this earth. Can you put a price tag on this miracle? How much would you be ready to invest if you could make this miracle a mundane reality for millions and millions of people in India? Can you be stoic enough emotionally to discard this proposal by taking help of an equally heartless financial jargon of profit-margins and return on capital employed? Or would you take a step forward and approach this problem the right way rather than the easy way. Arvind Eye Hospitals, since their inception, have proven time and again, year-after-year, that a business that deals in miracles like this can be self-sustainable if you have the right sentiments, intentions, vision and the sincerity to cater to the base of the pyramid, which because of its sheer volume, in a country like India can prove to be a self-dependent and autonomous business model. Put yourself in the shoes of the patients just for a moment, and you’ll understand how it can prove to be an economically viable model with a focus on intangible benefits rather than the tangible ones. Imagine a hypothetical case of Laxmi, who lives in Tangachi Mattam, a village forty kilometers away from Madurai, who decides to bring in her 10-year-old, bespectacled son Vishnu, to be examined at the centre this Saturday when he complained of irritation in his left eye. Ordinarily, it would have taken them a whole day to go to Madurai by bus and back, not to mention the cost of Rs 200 round trip. If the vision centre develops in every city, the consultation with the Doctor cost them Rs 20 – at less than the price of a coffee cup in a hip cafe, one little boy’s eyes can finally return to his school books. The model certainly can be emulated if the businessmen can abandon their perennial thirst for endless money for this cause and concentrate more on the intangible benefits of this exercise rather than tangible ones. But the question is how? Part-I – How ? If we look at the current status of blindness in India, about 90% of blindness is relatively easily treatable and cataract remains a major cause of blindness. Our annual cataract surgical rate is about 3. 5 million but the current levels of cataract surgery are far below the number required to clear the existing backlog, besides taking care of incidence. There is an urgent need to perform more cataract surgeries every year. If we look at the current service delivery pattern, the Government does about 25%, NGOs and voluntary organization 41. 2% and private 33. 8%. There is also an increasing shift towards IOL surgery. The increasing need in the community for eye care services combined with poor utilization of existing resources indicate a strong need for organizational development aimed at such eye care providers. One major need is to better equip these institutions to deal with the burden of blindness, to aid in the transition towards IOL surgery other standard procedures, to standardize duality of eye care provided by them, to promote cost effective practices for self-sustainability and finally to help the hospital leadership to articulate a well defined vision and goal for their hospital. Based on Arvind Eye Care’s experience, a capacity building process with other eye hospitals should be initiated. Arvind should set itself a target of partnering in capacity building with 100 voluntary eye hospitals that were under performing or in the start-up phase. The ultimate goal would be to help in developing each of these hospitals into a facility capable of doing high volume, high quality work and become financially viable. The financial viability will remain a critical issue in order to protect these voluntary organizations from the uncertainties of external funding. The first initiative in this direction has already come from the Lions International who wanted to establish a process for capacity building for the hospitals supported by them and as a spin off other INGOs like Sight Savers, CBM, Seva and IEF too joined hands for their partner hospitals. LAICO is currently partnering with 140 eye hospitals, of which 118 are from India and the remaining are from other countries like Nepal, Bangladesh, Africa, Cambodia, etc. LAICO, is working on the following 4-step strategy to help with the capacity building of the under-performing and other NGO hospitals. The results so far have been astounding for LAICO. The following graphs show how the capacity development workshops have been a path-breaking success for this business model in general and the participating hospitals in particular. The resulting efficiency increase through the economies of scale is also evident in the cost recovery of the participating hospitals as shown in the graph below. But the biggest challenge in terms of the execution of the plan is to ensure the sustainability of this execution. The above analysis leads us to identifying some of the factors that affect the capacity building process as many of the hospitals have drastically increased, while some hospitals have shown no improvement or decrease in the performance. The leadership of the hospital is a major factor. The location, availability and involvement of the leader affect capacity building. Wherever there has been a permanent leader with a vision, those hospitals have shown a very good improvement. Resistance to change and openness among the team members are also crucial. The hospitals need to have teamwork rather than one person doing the entire show. If the institution is not interested in doing high volume or is satisfied with the current level of services, capacity building is difficult. Where ever the leader focuses more on resource creation rather than on resource utilization, an imbalance between performance and capacity arises. Operational areas, even having a single ophthalmologist or part-time ophthalmologist also affect the long-term sustainability of the hospital especially when these doctors leave the hospital. The pattern of compensation also affects the growth of the hospital. To some extent incentives help the hospital increase its performance but this does not help the hospital to grow as an institution. This brings us to the vital question – what should be the change in the outlook of the organization to sustain this change and continue to register growth in the strategy chosen. Part-II – How sustainable is sustainable? No matter the individual or the reason at hand, all effective leadership styles have one thing in common- they all contain the Four Cs- Character, Communication skills, Consistency, and the Creativity needed for successful problem solving. Of course, within each of these four traits, variances of extreme proportions are noted by those most inclined to utilize them. The ability to get onto the correct path for creating your own effective leadership style stems from within the individual, for realizing that it is the followers who recognize if a leader is successful is the first step. Share the glory with your team, but keep the pains to yourself. Small, cash-strapped nonprofits often find that the most accessible funding is restricted to specific initiatives, programs, and contracts. They accept them because they nominally fall within the organization’s broad mission statement, but they are much better aligned with the donor’s strategy than with the nonprofit’s. Because the funds barely cover the direct costs of the additional activity, much less the indirect costs, the nonprofit reenters the funding market again and again, each time as a bigger, less focused, and more cash-starved entity. Hence, within the non-profit sector, one can safely say that â€Å"The tree dies from the top†. As a consequence of this stick-and-stretch syndrome, nonprofits often develop anaerobic life styles. At one extreme is the bloated bureaucracy: It may have some hardworking parts, but as a whole, it’s slow moving and survives because of mission legitimacy, not mission performance. At the other is the ever-busy nonprofit characterized by action paralysis. The organization is so busy executing the day-to-day stuff, raising money, implementing programs, and so on, that it never steps back to consider the full implications of its actions. The combination of stickiness to the mission and stretchiness to market demands can undermine a nonprofit’s effectiveness. The stretchiness keeps it very busy on a day-to-day basis; it’s constantly executing programs and working to raise funds. But in a strategic sense, the organization moves very slowly because the stickiness holds it in place. Before it can move forward, it must unstick the inertia at its center and then creep forward one step at a time, carrying with it all its baggage. To create a strategy that is both ffective and measurable, nonprofits first need to translate their core mission into a narrower, quantifiable operational mission. Next, the nonprofit needs to convert the operational mission into a strategy platform using the following 4-step strategy process. Step 1: The Mission Statement. This statement tends to be broad and far-reaching and usually identifies the customer need the organization attempts to serve, such as hunger, homelessness, or une mployment. The purpose of the mission statement is to inspire. Its credibility lies in the significance and scope of the problem it has identified. A powerful and compelling long-term goal will draw the attention of funders, workers, and volunteers. Habitat for Humanity International’s goal is â€Å"to eliminate poverty housing and homelessness from the face of the earth [and] put the subject of inadequate housing in the hearts and minds of people. † The mission tells you the nature of the problem, but it doesn’t identify how Habitat will address that need or how much of it will be served by the organization. Step 2: The Operational Mission. This step brings the lofty, inspirational mission into the realm of quantitative goals. While the big mission should be broad enough to guide action through periods of organizational and environmental change, the operational mission must be narrow enough to allow the organization to trace its impact. The organization’s work should always be measurable, even if it must use proxies to do so. Habitat for Humanity, for example, tracks not only the number of homes it has built, but in some areas it also estimates the extent of poverty housing yet to be eliminated. Step 3: The Strategy Platform. This delineates how the operational mission will be achieved, including which programs to run and how to run them. The strategy platform consists of four important components: client and market development, program and service development and delivery, funder and donor development, and organization development and governance. (See the exhibit â€Å"Blueprint of a Strategy Platform. †) Each one should directly relate to the operating mission and should dovetail with the other components. Most important, every program should correspond to its appropriate strategy platform component. Step 4: The Choice of Programs. Once an organization has the platform for supporting the various strategy components in a coherent way, the day-to-day tasks of choosing which programs to fund and which to cut are much better guided. When a new program appears on the organization’s radar, the first question to ask is, How does the program contribute to the appropriate strategy component—funding development, for instance, or operational development? Conclusion: The leader in a non-profit like that of Arvind Hospital, should instead of trying to be all things to all people, should pick a niche, craft an operational mission and, flowing from it, formulate a coherent strategy platform. Then it should vigorously pursue those programs that support the logic of the entire strategy. That approach improves nonprofits’ chances for changing the world. Unfortunately, too few nonprofits conduct such strategic assessments of their work. And it is this difference which determines that how sustainable is sustainable?