Is Aravind Eyecare the world’s finest organisation?
Over the last eight years, we have invited the leaders from this remarkable organisation to join us on Wavelength USA and to share the Aravind story at Wavelength Connect, so in February 2018 Wavelength Co-Founder Jessica Stack and I decided to visit Aravind in Chennai and Madurai, India, to see it for ourselves. What we found impressed us so much we are returning in January 2019 with Inside Aravind, taking a group of 20 clients to inspire and provoke them about what a highly successful, purpose-driven business looks like.
Dr Aravind Srinivasan and Wavelength Co-founder Jessica Stack at Aravind Eye Care Systems new $70m hospital in Chennai.
First, let’s look at the scale of Aravind Eye Care System’s impact and operations. Since inception in the late 1970’s Aravind has treated over 32 million patients and performed over four million surgeries – the majority for free or significantly subsidised – and is continuing to scale and grow its operations. Indeed today it operates a dozen hospitals, a multitude of vision clinics in small villages and even sets up day camps in the hardest to reach villages. It has also just built it’s largest, state of the art, $70m facility in Chennai (out of cash reserves) and has two more hospitals in the pipeline.
Next let’s consider the power of its compelling mission of ‘eliminating needless blindness’ that attracts organisations and individuals around the world to want to partner with it whilst appealing to the intrinsic motivation of its 5000+ employees (80% of which are women, by the way). Indeed, you will find on the wall of every department a sign articulating how that department helps Aravind achieve this mission. For instance mission of the housekeeping department is ’To contribute to Aravind’s mission of eliminating needless blindness by providing a clean, pleasant and functional environment for both patients and staff’.
Then there is its astonishing operational efficiency. The average Aravind surgeon performs 1.5-2k cataract surgeries a year at a level of quality that matches or even beats any other hospital in the world including the Mayo Clinic in USA. Their peers in other hospitals? Well they manage on average 400 cataract surgeries a year, so that’s a 4-5 x difference.
This level of productivity drives astonishing margins of 35% EBITDA enabling Aravind to offer circa 50% of its eye care services/surgeries free of charge or at absolutely minimal cost to the urban and rural poor.
However, the social impact is not just limited to the millions of patients who’ve benefited from free or ultra low cost eye care. Its ‘raw’ material over last 40 years has been tens of thousands of young woman from poor rural communities who, with a basic level of high school education, are offered the opportunity to train as paramedics, earn a decent wage, and thus transform their lives and that of their families.
Moving away from the core hospital business lets look at the remit and impact of the Aravind owned, but fully independent subsidiary, Aurolab. Aurolab generates $25m in annual revenues (growing at 15% a year), employs 800 people and has developed over 200 products designed deliberately to enable people around the world who couldn’t access eye care-related drugs and devices to do so at a fraction of the usual cost. Aurolab was established when the cost of the lenses Aravind were using to restore sight cost $100 so their solution was to develop a new product of better quality for $10, yes $10 – thus enabling them to fulfil their purpose.
Finally, you have an Aravind Institute, Laico (Lions Aravind Institute of Community Ophthalmology) set up specifically to teach (at break even cost only) any other NGO or organisation that wants to adopt their model to further their ultimate mission of eradicating needless blindness – yes they have open-sourced their model.
Of course it’s not perfect – what organisation is – but the leaders of Aravind Eye Care System are not sitting on their laurels. They see both opportunities for continuous improvement in the core business and are facing head-on the disruption from digital platforms they see coming round the corner.
Over the last 25 years I’ve had the privilege of visiting the boardrooms and shop-floors of some quite remarkable organisations around the world. Whilst some might be more customer focused (Ritz-Carlton), more profitable (Google) more innovative (Lego/Tesla), as socially impactful (Grameen Bank) or more disruptive (Netflix) absolutely none has achieved such incredible impact on such multiple metrics.
This is for me, why Aravind Eye Care System is arguably the world’s finest organisation.
If you agree, disagree or – even better – are aware of another that comes close to Aravind please let me know…..
Written by Adrian Simpson, Co-founder & Chief Connector, Wavelength, with huge thanks to Dr. Aravind Srinivasan, our host and Chief Medical Officer at Aravind Eye Care System in Chennai.
Inside Aravind 2019 – 27-31 January 2019
Join us as we go inside one of the world’s most admired, successful and socially impactful organisations. Aravind’s purpose is to ‘eradicate needless blindness’ and since its inception in 1976 it has treated over 58.5m patients and performed 6.8m eye surgeries – 50% for free or significantly subsidised rates at a level of productivity, quality, profitability that serves as a model for the rest of the world.
Aravind can practice compassion successfully because it is run like a McDonald’s, with assembly-line efficiency, strict quality norms, brand recognition, standardisation, consistency, ruthless cost control and above all, volume. On every key metric of business performance: Purpose, Productivity, Profitability, Quality, Innovation, and Social Impact – Aravind excels.
Wavelength is a world-class leadership company. We aim to make the world better through business by enabling ambitious leaders to develop their connectivity, knowledge and resilience. We understand the key issues facing companies today: employee engagement, service excellence, social innovation, digital disruption, leadership resilience and change management. Our unique programmes and insider access to progressive and inspiring organisations offer a radically different model for learning and tangible return on investment.
That’s why a company like Aravind Eye Care System is on our wavelength.
Find out more about Wavelength here.
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