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Mon. Sep 23rd, 2019

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How McDonald’s inspired an extraordinary Eye Hospital in India

7 min read

We need to warn them: this will be the most exciting story you will read today. Maybe this week. The inspiring force behind Aravind was its charismatic founder, Govindappa Venkataswamy, or Dr. V.. A farmer’s son, he studied medicine, specializing in gynecology. Afflicted by rheumatoid arthritis at a very young age, he turned to ophthalmology and spiritual pursuits, becoming a devotee of Indian philosopher Sri Aurobindo. He soon realized the potential impact he could make with his new specialization. Teaching himself to hold a scalpel in his gnarled fingers, he became an eye surgeon and spent two decades at the government hospital in Madurai as the head of the ophthalmology department.

The problem of avoidable blindness rapidly escalating remained a major cause of concern in the Indian healthcare scenario. In a developing country the government alone cannot meet the health needs of all owing to a number of challenges like growing population, inadequate infrastructure, low per capita income, aging population, diseases in epidemic proportions and illiteracy.

Realizing this, Dr. Venkataswamy wished to establish an alternate health care model that could supplement the efforts of the government and also be self supporting. Following his retirement at age 58 in 1976, he established the GOVEL Trust under which Aravind Eye Hospitals were founded. The hospitals were named after Sr Aurobindo, one of the 20th century’s most revered spiritual leaders. In essence, Sri Aurobindo’s teachings insist on transcendence into a heightened state of consciousness and becoming better instruments for the divine force to work through. Intelligence and capability are not enough. There must also be the joy of doing something beautiful. Being of service to God and humanity means going well beyond the sophistication of the best technology, to the humble demonstration of courtesy and compassion to each patient.download.jpg

Aravind is not just a health success, it is a financial success. Many health nonprofits in developing countries rely on government help or donations, but Aravind’s core services are sustainable: patient care and the construction of new hospitals are funded by fees from paying patients. And at Aravind, patients pay only if they want to. The majority of Aravind’s patients pay only a symbolic amount, or nothing at all. Dr V was guided by the teachings of the radical Indian nationalist and mystic Sri Aurobindo (Aravind is a southern Indian variation of Aurobindo), who located man’s search for his divine nature not in turning away from the world, but by engaging with it.

This philosophy, however, has produced a sustainable business model because of the other major influence on Dr. V: McDonald’s. Sri Aurobindo and McDonald’s are an unlikely pair. But Aravind can practice compassion successfully because it is run like a McDonald’s, with assembly-line efficiency, strict quality norms, brand recognition, standardization, consistency, ruthless cost control and above all, volume.

Aravind’s efficiency allows its paying patients to subsidize the free ones, while still paying far less than they would at other Indian hospitals. Each year, Aravind does 60 percent as many eye surgeries as the United Kingdom’s National Health System, at one one-thousandth of the cost.McDonalds-LOGO.jpeg

Aravind’s ideas reach around the world. It runs hospitals in other parts of India with partners. It is also host to a parade of people who come to learn how it works, and it sends staff to work with other organizations. So far about 300 hospitals in India and in other countries are using the Aravind model. All are eye hospitals. But Aravind has also trained staff from maternity hospitals, cancer centers, and male circumcision clinics, among other places. Some share Aravind’s social mission. Others simply want to operate more efficiently.

The vast majority of people blind from cataracts in rural India have no idea why they are blind, nor that a surgery exists that can restore their sight in a few minutes. Aravind attracts these patients in two ways. First, it holds eye camps — 40 a week around the states of Tamil Nadu and Kerala. The camps visit villages every few months, offering eye exams, basic treatments, and fast, cheap glasses. Patients requiring surgery are invited with a family member to come to the nearest of Aravind’s nine hospitals; all transport and lodging, like the surgery, is free.

When Aravind surveyed the impact of its camps, it found to its dismay that they only attracted 7 percent of people in a village who needed care, mainly because they were infrequent. To provide a permanent presence in rural areas, Aravind established 36 storefront vision centers. They are staffed by rural women recruited and given two years’ training by Aravind. They have cameras, so doctors at Aravind’s hospitals can do examinations remotely. These centers increase Aravind’s market penetration to about 30 percent within one year of operation.

At Aravind’s hospitals, free patients lodge on a mat on the floor in a 30-person dormitory. Paying patients can choose various levels of luxury, including private, air-conditioned rooms. All patients get best-practice cataract surgeries, but paying patients can choose more sophisticated surgeries with faster recoveries (but not higher success rates). The doctors are identical, rotating between the free and paid wings.

Also standard for all patients is the Aravind assembly line. Dr. V spent a few days at McDonalds’ Hamburger University in Oak Brook,, Ill., but that visit was a product of his longstanding obsession with efficiency. “This man would go into an airport and walk around with the janitor and see how he cleans the toilet,” said Dr. S. Aravind, an eye surgeon with a masters degree in business who is Aravind’s director of projects. (He is Dr. V’s nephew, also named for Sri Aurobindo.) “He would go to a five star hotel and follow the catering people.”f7cf3df79e5146b9d252e44eabc74ff3.jpg

Doctors are hard to find and expensive, so the surgical system is set up to get the most out of them. Patients are prepared before surgery and bandaged afterwards by Aravind-trained nurses. The operating room has two tables. The doctor performs a surgery — perhaps 5 minutes — on Table 1, sterilizes her hands and turns to Table 2. Meanwhile, a new patient is prepped on Table 1. Aravind doctors do more than 2,000 surgeries a year; the average at other Indian hospitals is around 300. As for quality, Aravind’s rate of surgical complications is half that of eye hospitals in Britain.

This volume is key to Aravind’s ability to offer free care. The building and staff costs are the same no matter how many surgeries each doctor performs. High volume means that these fixed costs are spread among vastly more people.5509035927_927bee3ca6_o-750x500.jpg.pagespeed.ce.8VvjKqpv8K

In the 1980s, Aravind faced a dilemma. A new surgery, which implanted a lens in the patient’s eye, had become the gold standard for treating cataracts. But these lenses were not made in India, and Aravind could persuade manufacturers to reduce their cost only from $100 to $70 per lens. Should Aravind begin providing first-class treatment for paying patients and second-class treatment for free ones? Or should it try to get enough money from paid patients to cover intraocular lenses for all? Neither was acceptable.

The solution was to get into manufacturing. In 1992, Aravind set up Aurolab, which now makes lenses (for $2 apiece), sutures and medicines. Aurolab is now a major global supplier of intraocular lenses and has driven down the price of lenses made by other manufacturers as well.

Aravind could not do its work without paying patients, of course — they subsidize free patients. They also improve service, by demanding high quality for their money. But it also works the other way around: the free patients improve service and price for patients who pay. “One of our big advantages is the scale of the work we do,” said Dr. Aravind. “You become a good resource center for training doctors, nurses, everybody. Because of high volume, doctors get better at what they do. They can develop subtle specialties.” And free patients make cost control a priority. “If 60 percent of your patients are paying very little or nothing, your cost structure is attuned towards that,” Dr. Aravind said.

Whenever there is an innovator like Aravind, the question arises: how replicable is this? Do you need a Dr. V? Or is there a system that ordinary mortals can adapt?

The answer is a little of both. Other hospitals can and do successfully use the model. Lions Clubs International, which has worked to prevent blindness for more than a century, finances and supports a training institute. Aravind also works with the Berkeley-based Seva Foundation to grow eye hospitals in other countries. “There are a lot of eye hospitals in the developing world. Almost every single one is considerably underproducing,” said Suzanne Gilbert, the director of Seva’s Center for Innovation in Eye Care. “Surgical programs so often focus on the technique being used. Often the same level of scrutiny not applied to management, human resources and other systems that make the surgery work.”

By 2006, when he died, Dr. V. had passed on the running of the hospital to other family members, although he continued to be venerated as “the chief.” To this day nobody occupies his office, which is maintained as a shrine at the hospital.

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Research Source:

  • https://www.myhero.com/Venkataswamy
  • http://www.aravind.org/default/aboutuscontent/genesis
  • http://www.aravind.org/content/aravindmediapdffiles/journalcasestudies/HowMcDonald.pdf
  • https://opinionator.blogs.nytimes.com/2013/01/16/in-india-leading-a-hospital-franchise-with-vision/
  • https://www.forbes.com/global/2010/0315/companies-india-madurai-blindness-mcdonalds-and-dr-v.html#43d4a66f5ab7
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