In Cambodia, nearly 60% of rural households do not have a toilet and instead practice open defecation, resulting in problems like increased diarrheal disease that is a leading cause of death for children. The government set a goal to increase national sanitation coverage to 100% by 2025 (starting from 34% in 2010), a challenge that can not be met by simply giving toilets away because of the costs involved. iDE started to address this issue in 2011 by developing a new latrine that was extremely affordable and easy to make for local concrete manufacturers, selling over 200,000 latrines in five years. While these numbers indicated a successful business model, something new had to be done to continue to sell at this rate and reach the 100% goal as the market for toilets eventually reached saturation.
Thai Rotha, an iDE Sanitation Teacher in Cambodia, meets with a prospective client about the benefits of buying a hygienic toilet. (Photo by Chris Nicoletti/iDE/2017)
Unveiling a new way to sell toilets
Thai Rotha, an iDE sanitation sales agent, parks her motorbike outside a wooden framed home on stilts. She gets off and opens her smartphone to note the location: Kachow (village), Popeus (commune), Sveyontor (district), Prey Veng (province), Cambodia (country). She also tags the GPS coordinates. Rotha meets with the female homeowner in the shade underneath the house to escape the oppressive heat of the dry season, her friendly manner quickly putting the potential customer at ease. Rotha uses a laminated book with drawings that convey how the lack of sanitation contributes to sickness in the family, especially for children. As she talks, Rotha pulls out her smartphone and shows the woman pictures of toilets installed in the village next door within the last month. The woman wants to buy, but she says she and her husband have no money to spend on it right now. Rotha notes the decision and also sets a reminder to follow-up. Rotha gets back on her motorbike and sets off for the next client. By the end of the day, she will have visited six homes and made three immediate sales.
Rotha, age 23, is the youngest of five siblings and still lives with her parents near Phnom Penh. A friend told her about iDE, an international development non-profit organization that addresses global poverty by using donor funding to build business solutions that scale. Before becoming a sanitation sales agent (iDE calls them “sanitation teachers” or STs) eight months ago, she was unable to make much money. As a sales agent, Rotha is not an iDE employee; instead, she is part of a cadre of agents going door-to-door in Cambodia’s most rural communities, receiving a commission of $4 for every $34 latrine that she sells. She’s made $300 in eight months, enough to purchase a new motorbike, and is now saving money for the future.
The reason for her success lies in the power of her smartphone to feed data to a cloud-based management information system (MIS), capturing both the sales Rotha makes this day as well as those she doesn’t.
Balancing supply and demand with data-driven insights
In iDE’s offices in Prey Veng, Thai Rotha’s orders are received by San Ounsa, her Supply Chain Coordinator. At 26, just a few years older than most of her agents, Ounsa attended Svay Rieng University and has a Bachelor’s degree in Rural Development. She comes from one of the poorest provinces in Cambodia, which also happens to be where some of the best toilet businesses have emerged as well. As an international social innovation organization, iDE’s employees tend to be citizens of the country they are working in (93% of its total workforce of nearly 1,000 employees are locals)
San Ounsa, Supply Chain Coordinator
Ounsa’s job is to review the orders entered by sanitation agents in Salesforce. While the software automatically assigns the order to the closest latrine business owner to the customer, Ounsa determines if that manufacturer will be able to deliver the latrine in a timely manner. Ounsa contacts the business owner to check out how things are going. These small businesses sometimes shut down suddenly, for example when the owner has to go help out his family or get a harvest in. Once Ounsa confirms the business has the capacity to fill the order, she negotiates an anticipated delivery time frame to the customer, then the business makes a phone call to the customer to arrange for delivery.
In the original business model, where agents and manufacturers were exclusively connected, business owners who had high-performing sales agents struggled to keep up with the demand, while other manufacturers whose agents were having trouble making sales sat idle. The new mobile ordering process untethered agents from manufacturers, enabling iDE to resolve this market bottleneck by decreasing the time it took from order to delivery and increasing the number of orders fulfilled. Being able to view sales and delivery data in real-time exposed this load-balancing issue, and also provided a means for the supply chain coordinator to re-balance orders to ensure that everyone involved stayed as busy as possible.
The paper trail vs. the digital highway
Prior to iDE’s MIS, each sanitation sales agent was coupled to a single latrine manufacturer. The agent would travel to remote villages and collect orders on paper. Days later the order would reach the latrine business owner. Depending on how many orders the latrine manufacturer was already working on, fulfilling a new order and getting it to the remote village for installation could take weeks. By then the customer may have decided to cancel buying the toilet.
iDE had begun to explore the idea in 2014 that a MIS could be implemented to help sales. While in the process of adopting Salesforce to handle the measurement and evaluation needs required by their donors, iDE created a new custom-built app based on the actual sales process that would capture transactions at the most granular level. Using TaroWorks, iDE designed the data collection app for smartphones to enable remote sales agents to enter and upload orders from the buyer’s location. This accelerated the process, eliminated paperwork, and minimized mistakes in ordering and transcription. With better tracking and faster completion, the agents saw a reduction in cancellations and became more motivated to make sales as their incomes started rising.
Although Salesforce originally designed a customer relationship management solution to help sophisticated sales teams pull in big deals, the customizable nature of Salesforce made this shift to capturing individual toilet sales data possible. While other companies had started to explore this potential with Salesforce, iDE’s implementation was the first to use it in an international development context.
Coordinating a network of independent suppliers
In Cambodia, Michel Dauguet leads the sanitation marketing program. iDE’s organizational structure is extremely decentralized, with each of its eleven country offices having strong autonomy in the management of their local programs. A veteran businessman with more than 20 years of experience in southeast Asia, Michel was previously the CEO of a number of medium-sized companies including several that he founded. He speaks quickly and passionately about how having data in near real-time has boosted the speed of innovation.
Before the MIS, we had no idea of the backlog. We didn’t even know we had a block in the supply chain. We had reports that the supply could not follow up with the demand, but it was hard to discern if it was a bottleneck in the production capacity, meaning we needed more latrine business owners, or the existing ones needed to produce more. Another option was that the production was sufficient, but the peaks and valleys, the volatility in demand, caused problems. Is the problem that the manufacturers are subject to a stop-and-go type of process where they have a lot of orders and have to hire a lot of staff and then they have no orders and have to decrease their production capacity significantly?
-Michel Dauguet
The MIS not only answered these questions, it also gave the management team a powerful tool to address other persistent issues. A lot of well-intentioned ideas — both in the private and non-profit sectors — fall apart in execution and management. But with the MIS, iDE better understands closing rates by individual sales agents as well as sales teams and the change in the backlog from day-to-day.
What is valuable to the funder is much more precise information. Data is messy and without an MIS to organize it, it can hide inefficiencies and be ignorant of unwarranted behavior or negative effects on the community. All of these are evaluation questions that a donor would normally have to fund deliberately, but with an MIS all of these questions can be much more easy to answer.
-Michel Dauguet
Implementing an MIS like this, however, is rarely funded by traditional donors, whose grants focus on program activities that are measured by numbers of households reached rather than addressing program efficiencies. The Australian Government, focusing on enhancing the accountability and effectiveness of aid programs, and the Stone Family Foundation, supporting increased access to sanitation for the poor through business models that scale, underwrote the development of iDE’s MIS.
iDE’s Sales Managers constantly review sales agents’ performance, identifying both those who are struggling to make sales as well as the high-performing individuals. Because everyone involved has sales goals that lead to incentive payments, everyone is interested in increasing sales. Lessons learned from outstanding sales agents get passed on to those having trouble through regular meetings between managers, coordinators, and agents. The order data is shared with everyone, so the whole team knows the latest on how many toilets have been sold, where, and how long it takes to get them installed.
Analyzing data to fill in the market gaps
When iDE first implemented the MIS, they wanted to capture sales data to speed up the delivery process. But sales ended up being only part of the story. Looking at the data, Michel discovered that something very important was missing: information about sales attempted but not successful. What would have been overwhelming to track on paper, was actually very simple to add to, and analyze with, the existing MIS.
When you looked at our sales on a map, they looked like little points of light with lots of darkness in between: villages that simply weren’t buying latrines. I called it the Dark Matter report — in astronomy, dark matter is all that blackness around the stars.
-Michel Dauget
We learned that we were leaving out significant parts of the market
-Michel Dauget
Estimates said that it would take six months to visit all the villages. Then the data started coming in and the sales teams were reporting they had done so in just two months.
There was a wave of realization among top management that there was self-inflicted damage caused by poor sales planning and the teams were not fully exploiting the actual accessible market. Without the data, the sales coordinator could have said, ‘You don’t know my market context,’ but now we had an objective arbitrator that allowed us to have a productive discussion about sales planning.
-Michel Dauget
In one week, Thai Rotha visited three different villages, making 19 sales calls, and selling six latrines. San Ounsa and Rotha review the Dark Matter report to determine what they can do to convert those 13 missed opportunities into future successes. Michel reviews the Dark Matter report with Sales Managers to identify areas where other options may be needed to increase sales, such as new latrine designs, financing options, or targeted subsidies for the poorest customers.
The MIS serves as a backbone that infuses a high level of rigor and transparency, which is why iDE is replicating it across its other programs. For example, in Ghana, a new sanitation business called Sama-Sama has been designed from its beginning to gather very granular data and make it accessible to every level of the company.
The MIS is definitely the spine of the program. It’s really amazing when you visit a provincial office. Once you give the tool to the people and teach them how to do custom reports, charts, etc., it is amazing what they come up with. They are developing their own dashboards and visualizations and they are interrogating the data in ways that you can never think of. This is incredibly empowering for all members of the staff.
-Michel Dauget