Increasingly, non-profit organizations like Population Services International (PSI) and Marie Stopes International (MSI) are applying commercial franchising strategies—like those employed by McDonald’s and Subway Sandwiches—to improve health in developing countries. Social franchising unites healthcare facilities and providers in a network with a common brand, strict quality standards, and specified health services at affordable prices. With years of experience behind them, PSI and MSI are the two leading organizations in franchising for health.
Under the Support for International Family Planning Organizations (SIFPO) projects funded by USAID, PSI and MSI recently launched the Social Franchising for Health course on the USAID Global Health eLearning Center. The course outlines the health system challenges that social franchising is designed to address, including:
Through interactive content and real-life country examples, course participants will learn about these and other aspects of the social franchising model. They will be able to articulate how success is measured, how social franchising strengthens health systems, and what best practices are emerging. To take the short course free of charge, register here. Franchising for a Better World: Franchising in the Social Sector Visit free educational sessions at the International Franchise Expo to learn about social sector franchising, the application of the principles of commercial franchising to: Speakers: Scott Hillstrom: Chairman and Co-founder, HealthStore Foundation Julie McBride: Senior Social Franchise Technical Advisor, Population Services International (PSI) Sessions:
The mission statement of the International Franchise Association’s Social Sector Task Force is: “To Enhance The Quality Of Life In Underserved Populations – One Opportunity At A Time”. Social sector franchising has been used in areas of health and other product and service distribution, and has created opportunities for local entrepreneurs to deliver a variety of products and services in underserved communities worldwide. It also has created other benefits including employment and related commercial activities. The inherent capabilities of commercial franchising include its ability to establish and enforce standards; create and sustain critical mass in the communities it serves; and achieve cost savings because of economies of scale. These capabilities can be gained by social sector franchises.
Two of the most successful health care franchises, Child, Family, Wellness (CFW) and Population Services International (PSI), will provide an overview about the impact social sector franchising is making in health care delivery around the globe in areas of dire poverty. Curious to learn about this compelling model and/or how you can help? Come to this 45 minute session to find out how it works. By Jason Daley for Entrepreneur Magazine
Franchising is a powerful business model capable of efficiently delivering to the masses such varied resources as oil changes, emergency medical care, accounting services and jelly doughnuts. But could it do even more? Philanthropists are considering whether the franchise model can be used to bring vaccines, contraception, clean cooking fuel, food and other basic necessities to people in the developing world. The idea, known as social franchising or microfranchising, is beginning to catch on. After a few years of experimenting, the aid community is refining its approach and is ready to make social franchising a major plank in the way nongovernmental organizations (NGOs) assist the world's poorest regions. The model is similar to commercial franchising, but the bottom-line goal is not pure profit--although many social franchises do aim to become self-sustaining. Rather, these organizations measure success through the number of people they feed, vaccinate or otherwise serve, and the number of franchisees provided with jobs. In general, a social franchise, often sponsored by or spun off from an NGO or aid organization (although there are many independent social franchises), creates a network of local entrepreneurs who sell products or services door to door or from their homes. For instance, World Health Partners, a nonprofit launched in 2008 in India, recruits people in remote rural villages with limited access to healthcare. Through cell phones and portable computers, these reps connect their neighbors to a doctor in a larger city for a telemedicine session. Other franchises offer internet connections or the use of cell phones, fortified dairy products, family-planning materials and even beekeeping supplies. Most social franchises rely on charitable donations or grants to stay in operation, but as the businesses become more sophisticated, many are hoping to reach self-sustainable levels. Chuck Slaughter, founder of clothing and gear company TravelSmith and an entrepreneur who has helped turn around several international apparel brands, started his social franchise, Living Goods, in 2007, delivering lifesaving products to the poor by harnessing the power of the market. Using what he calls the "Avon lady" model, his crew of franchisees go door to door in villages in Uganda and Kenya, selling basic medicines, healthful foods, high-efficiency stoves, solar lights and other health and safety products. To read more, please click here. A ewe and her offspring outside a DKT facility in Pakistan were merely wandering by the family-planning clinic. Social-sector franchising takes advantage of franchising’s systems and on-going support to do good in the world. Franchisees in developing countries make a living helping their communities. By Nancy Weingartner for Franchise Times A couple’s method of birth control, along with the number of family members and their names are posted on the front doors of homes in Bali. In Mozambique, posting family planning specials, such as injections, on Facebook is DKT’s Intimo clinic’s most efficient marketing tool. Its Facebook page has more than 6,600 “friends.” Young men in Brazil are encouraged to use their GPS apps to share their condom experiences and location as part of a contest run by a local clinic. “The U.S. is much more prudish about this subject” than the rest of the world, claims Chris Purdy, president and CEO of DKT International, a social-sector franchise that provides family planning and reproductive health products to the developing world. We’re prudish, he continues, because there’s no denying family planning was created so people can have sex without having children. It may seem all about pleasure, but for women, controlling their fertility is a way to control their destiny, Purdy says. Fewer children mean more food on the table, more rest for the mother, more education options for her children. And in areas with limited prenatal care, fewer pregnancies may result in healthier moms and offspring. DKT, based in Washington, D.C., was started by libertarian Phil Harvey 20 years ago as a nonprofit to promote family planning and HIV/AIDS prevention through social marketing. Harvey began his career selling condoms through the mail, a relatively controversial practice in the ‘70s. The business evolved into Adam & Eve, a mail-order company for sex products, and some of the profits are used to fund DKT. Harvey retired from DKT at the end of 2013. Today DKT has programs in 19 countries, which use both social media to market and a franchise framework to provide a variety of family planning services. The nonprofit was named in honor of D.K. Tyagi, India’s assistant commissioner of family planning who died of cancer in 1969, but not before he made significant inroads into India’s family planning efforts. DKT uses all the techniques and infrastructure of commercial franchising, but doesn’t charge an upfront fee or royalties. Instead, the nonprofit makes its operating money through the products its sells clinics. Midwives are the targeted franchisees, and donor money is used to update or build clean, branded clinics where windows aren’t broken and equipment generally works. In keeping with the franchise model, DKT provides continual training and education, as well as audits to ensure the clinics follow procedures. For instance, in Indonesia, “mystery shoppers”—or in this case, mystery customers—are employed to ensure the clinical experience is up to code, Purdy says. Incentives for midwives to become franchisees include a clean, modern facility; ongoing education and products; and cachet in the community since the clinics are advertised on television and billboards. The good news for family planning advocates in developing companies is that individual incomes have risen over the years, while the cost of contraceptives has stabilized, Purdy says. DKT offers franchisees a wide range of products, a number of which require some medical expertise to administer, such as IUDs and implants. Condoms aren’t a big part of the business because they can be purchased over the counter elsewhere. But the main draw is DKT’s ability to drive business to the clinics through large-scale advertising, something an individual clinic owner would not be able to do, Purdy adds. It’s effective because even families in the remote areas of countries like Pakistan have television reception. Controversy sells Not surprisingly, the social-sector franchise that provides not only preventive measures, but also abortions, can be controversial in some areas of the world. Which is why DKT works with local governments. When Ethiopia recently legalized medical abortions, DKT was part of that change, Purdy says. Between 70 and 80 percent of its $160 million budget comes from sales revenues of products to clinics, Purdy says. While conforming to the franchise’s standards, each clinic has its own personality and the services are determined by demand. In Indonesia, for instance, injectable contraceptives are the most popular method of family planning because people there believe medicine must be injected into the blood in order to be real, Purdy says. This is a positive for the franchisee, because it means women must come back every three months for another shot, as opposed to an IUD insertion, which doesn’t require frequent return visits. Because choosing an IUD cuts down the providers’ profits, “We have to watch provider bias,” Purdy says. Most of the visits are from women, since they’re the ones directly affected by the issue; however, Purdy says the occasional man will show up for an appointment with his wife, especially if she’s considering an IUD. Since it’s a foreign object inserted into a woman’s uterus, the man “might be worried it will affect him,” Purdy says. Marketing condoms can be a touchy subject for government censors, as well. “When you talk about condoms, (men) don’t want to hear about HIV, they want to hear about the benefits,” Purdy explains. “So we talk about pleasure.” In Pakistan a suggestive ad for Josh Condoms, starring a controversial actress, who talks openly about sex on a late-night television show, was banned by the government. Which, of course, led to the ad, which depicted an average-looking guy marrying a supermodel because he used Josh Condoms, to be a downloadable success on YouTube. DKT was proud it hit a nerve. “It sparked a huge debate about why can’t we talk about condom use,” Purdy says. “We’re happy with the results even though the ad pulled.” (In 2013, DKT sold 538 million condoms worldwide.) Combining social-sector franchising with social media has enabled the brand to grow throughout the developing world, attracting donors such as the Bill and Melinda Gates Foundation, the United Nations Population Fund and USAID. The brand grows, the families don’t—or if they do, it’s responsibly. DKT’s CEO Christopher Purdy served as country director for programs in Ethiopia, Indonesia and Turkey before returning to the U.S. to work at the social-sector franchise’s headquarters. This Academic Case Study by Stefanos Zenios, Lyn Denend, and Stacey McCutcheon is published by Stanford Graduate School of Business 2013 - this introduction is reprinted by permission. The entire suite of articles may be found: Full Paper: http://csi.gsb.stanford.edu/psi-i-taking-service-model-scale Secondary story on PSI: http://csi.gsb.stanford.edu/psi-ii-changing-perceptions-and-behaviors Full Health Innovation Insight Series: http://csi.gsb.stanford.edu/global-health-innovation-insight-series Global Health Innovation Guidebook: http://csi.gsb.stanford.edu/sites/csi.gsb.stanford.edu/files/GlobalHealthInnovationGuidebook_2.pdf Population Services International (PSI) was founded in 1970 as a nonprofit organization focused on improving reproductive health in developing countries using commercial marketing strategies. Over the years, PSI broadened its mission to address family planning, child and maternal health, and HIV and AIDS prevention, screening, and treatment. As part of ongoing efforts to provide critical health services in developing countries, PSI sought to address the high unmet demand for family planning in Pakistan. Based on the organization’s earlier work in Pakistan, PSI knew that the majority of low-income women sought healthcare services from the private sector. Yet, despite being better equipped than public healthcare facilities, these private providers were generally not delivering family planning services. PSI learned that the financial incentives were low and that few providers actually had the necessary training and skills to counsel clients, perform IUD insertions, or prescribe pills or injectables. As a major NGO with a wealth of accumulated experience and significant resources at its disposal, PSI had the knowledge and ability to provide training to physicians. However, in order to educate enough providers to make a meaningful difference in a country with a population of more than 176 million, it would need to scale its training program quickly. This required devising a compelling business model with incentives to motivate qualified providers to participate. The second challenge to successfully achieving scale would be raising the awareness and visibility of the trained providers so that Pakistani women could find them. This mini-case study describes how PSI devised and implemented a social franchising model to rapidly address these needs and achieve scale in the target communities. [Read Case] |
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