Environmental Engineering Reference
In-Depth Information
POD water puriication company. Water contamination is a global issue requiring local
solutions.
When solving the water puriication problem in a new region, TWI must irst diagnose
the speciic water problem to narrow the technology options and develop the most cost-
effective option. Finally, it must deploy the solution with an appropriate business model for
the given innovation.
TWI achieves scale because the speciic solutions developed can be deployed in simi-
lar global regions without substantial redevelopment. For example, the central valley of
Mexico has an arsenic problem because wells are drilled in element-rich earth. There are
similar regions and water conditions in Argentina, China, Chile, Peru, New Hampshire,
New Mexico, etc.
21.3.5 Limitations for TWI 1.0
The demand for the TWI 1.0 was ensured owing to the BoP process. Many communities
began to hear of the unit, and our local entrepreneurs began to sell units. Collection efi-
ciency surprised everyone, achieving >50%, which was better than local municipalities
achieved for water fee collection. It was good, but not good enough to sustain our efforts
and business model.
One problem with the Xerox model is that TWI must inance the installation of the units;
break-even occurs much later as does proitability. Since TWI was a start-up company and
undertook venture inancing, an expensive form of capital, TWI searched for larger part-
ners that could inance the expansion of the business. However, from microinance orga-
nizations to development banks, no partner was willing to participate. In addition, the
organic franchise model resulted in a slow rate of sales. Combined, the cash low problem
for TWI increased with time.
With this information incorporated into the innovation process, TWI realized it needed
to change the implementation element of innovation, and pursued ideas to distribute the
product more quickly to consumers. Thus, TWI let the technology and market applica-
tion (in-home consumer) remain ixed while modifying the implementation (distribution).
Sales did increase, although further analysis showed that the rate of solving home purii-
cation problems and the cash low issue were still not optimal.
21.3.6 Lessons from BoP
TWI's innovation process also revealed important conclusions regarding the BoP protocol.
The protocol is consistent with the start to a good innovation process to gain initial market
application insight on the potential range of technologies required, and to determine busi-
ness factors and models related to the individual consumer . Unfortunately, business models
related to the BoP consumer all too often require long-term inancing, as the consumer is
cash-poor. Even though they are willing to spend a larger fraction of their income on water
puriication, proits can only be realized over long periods of time with tremendous com-
mitment of inancing. Thus, such models seem more appropriate for larger organizations,
such as large multinational corporations, that have greater access to low-cost capital.
However, such large corporations are notoriously un-innovative and since most are
public, the demand for short-term inancial return outweighs the humanitarian impact
of innovation. The BoP protocol may in fact be applicable to only a small set of companies
since there is little intersection between innovative small organizations in which capital
Search WWH ::




Custom Search