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BRICs: India Innovates

Aravind: Efficiency in a Battle with Blindness


Aravind: Efficiency in a Battle with Blindness


India has the largest population of blind people in the world. Aravind Eye Hospitals offer free operations for poor people, yet by maximizing efficiency can still turn a profit of nearly US$8 million a year.



Aravind: Efficiency in a Battle with Blindness

By Hsiao-Wen Wang
From CommonWealth Magazine (vol. 428 )

Looking out through the gauzy film over her eyes, 60 year-old Karuppe stares at the sun over the turquoise skies of Madurai, in the southern Indian province of Tamil Nadu. To her it appears as a reddish-yellow smear, like a tear on parchment, aged and blurred.

Sunday is finally here. Today, Karuppe dons a checkered saffron sari, puts on slippers, and makes her way to the village's Hindu temple. At eight-thirty, the Hindu goddess in the shrine is decked out in strands of jasmine, surrounded by wafting incense. Karuppe takes her place in line with more than 200 others already in the hall next to the temple, waiting for refractive examinations, eye pressure measurements, and doctor consultations.

Over one half of the more than 200 people here will be taken to the Aravind Eye Hospital in downtown Madurai for free cataract surgeries.

This is just one of the over 2700 "eye camps" Aravind Eye Care System has initiated to reach out to rural residents.

Free Surgery for the Poor, Still Profitable

India has the largest population of blind people in the world. Of the 12 million blind Indians, 80 percent have been blinded as a result of complications from cataracts, including 300,000 children. A simple cataract operation could help seven million Indians regain their sight.

Setting the eradication of blindness as its objective, Aravind Eye Care System has pioneered free surgery for poor people, and offers cataract operations costing between 50 and 200 US dollars.

Avarind's orientation toward patients and communities has determined its scale and its innovative approach, according to R.D. Thulasiraj, executive director of the Lions Aravind Institute of Community Ophthalmology (LAICO) and director of IT and systems for Aravind Eye Care System. When he quit his job at a company in Kolkata for a position at Aravind paying one-quarter of his previous salary, the hospital had only 40 beds. The overflow of patients forced people to lie down on the lobby floor, and each day the hospital could only see a total of 80 patients and conduct five cataract operations.

These days the five Aravind hospitals in Tamil Nadu province can accommodate 6000 walk-in patients and perform 850 to 1000 cataract operations per day. Patients get surgery one day and are released from the hospital the next. Aravind has ascended to the position of the world's largest privately run ophthalmology institution. Last year alone Aravind examined over 2.7 million patients and performed 285,000 cataract operations.

What boggles the mind is that nearly 60 percent of the patients don't even have to pay a single rupee, yet Aravind still made nearly US$8 million last year.

Aravind's unique operational model and contributions have earned it the Bill & Melinda Gates Award for Global Health and a certificate from the Clinton Global Initiative. The US-based Fast Company magazine placed Aravind among the world's top 50 most innovative businesses, ranking it ahead of Toyota.

Eye-opening Efficiency

More than anything else, what sets this hospital chain apart isn't its size or the difficulty of the surgeries it performs, but, in the words of management guru C.K. Prahalad, "organizational workflow innovation."

Indian peasants making a subsistence living cannot afford transportation costs, nor can they afford a day off to take a five-hour bus ride to Madurai to seek medical treatment. So Aravind came to the village, working with local groups to hold weekend eye camps. Word spread exponentially among the peasants, and now thousands of patients flock to the eye camps each week. Like a small flame, the eye camp brightens up the darkness of the village.

This patient-oriented philosophy has enabled Aravind to simplify its workflow and boost efficiency.

Entering an Aravind Eye Hospital, one encounters men dressed in typical southern Indian white gowns, and women with children moving to and fro in the clinic like a chaotic swarm of bees. In actuality it is a swarm with a clear direction and an order of its own.

A young woman in a white sari with neatly done-up long braids directs the patients, a young lady in a purple sari does refractive examinations, another in a red sari enters the patients' medical histories into a computer, and one in a green sari handles operation consultations. After paying a 50-rupee fee, illiterate patients take five minutes to register, another five minutes for a doctor's examination, three minutes for an eye examination, and another five minutes to get eye drops that dilate the pupils and then receive the final diagnosis. Throughout, no one gets lost or frustrated. Even when the facility is packed to capacity, each patient can complete the entire process in 15 to 90 minutes. If necessary, patients can go to the hospital's optometry shop and pick up a pair of glasses for 100 to 200 rupees.

100 Operations in Six Hours

Aravind's famous cataract surgery is the very essence of the Ford Motor Company's assembly line model.

At 7:00 a.m. the optometrist and his assistant are already in their scrubs and headed into the operating room. At 7:15 two patients are lying next to each other on operating tables, each with a large tray with surgical implements to one side. As soon as the doctor removes cloudy cataracts from the first patient's eyes, the female assistant works to stop the bleeding and apply bandages,

and the microscope has already swung over and focused on the surgical site of the second patient. And as the second patient undergoes his surgery, a third patient is already lying down on the first gurney. Over the course of six hours from 7:00 a.m. to 1:00 p.m., a seasoned doctor can perform 50 to 100 cataract operations, and a young physician can handle 15 to 20.

According to Thulasiraj, none of Aravind's physicians would look forward to a day with few operations. On the contrary, they would find it a great disappointment.

The secret to Aravind's capacity for providing cataract surgery for US$50 and intraocular lenses for five dollars is the hospital's free clinics.

Counterintuitively, Aravind does not lose money every time it performs an operation for free, explains Dr. Namperumalsamy, co-founder and chairman of Aravind Eye Care System. In the medical business, overhead such as medical instruments and manpower accounts for the highest costs. The more patients they see, and the more operations they perform, the lower their average fixed cost per person becomes. So each time they do a free operation, they raise their profits ever so slightly. At Aravind, medical instruments cost six US dollars per unit, compared to as much as US$95 in the United States.

Indeed, Aravind's reputation for innovation has become so well known that students from Johns Hopkins and Harvard have come there to serve as interns, as Namperumalsamy relates with scarcely concealed delight.

While India's large population has proven a weighty medical burden, it has also given the country's health care system greater possibility for specialization. And while they are naturally pleased to see the West knocking at their door for morsels of wisdom, if India is to eradicate blindness, it must do much more, much more quickly, executive director Thulasiraj notes soberly.

The Madurai breeze gently caresses the bodhi trees by the roadside, sending thousands of leaves swirling. Clutching a blue registration card, Karuppe hopes that after her operation next week she will be able to see the fields clearly under the sun, greeting a splendorous golden autumn harvest.

Translated from the Chinese by David Toman

Profile: Aravind Eye Care System

Founded: 1976

Revenue: US$19.5 million (NT$640 million) (March 2008 to March 2009)

Profits: US$7.9 million (NT$260 million)