By Lincoln Wilcox and Efosa Ojomo
The United Nations defines access to safe drinking water as a basic human right, but according to their newest report, three out of ten—or 2.1 billion people—still lack access to it. Water may be life, but unfortunately it’s not free.
Governments and development organizations have spent billions of dollars over the past several decades in an attempt to address this inequity in low- and middle-income countries, but the unfortunate reality is that many of these efforts have fallen flat. The United States, for example, has spent more than $360 million on rural water supply schemes in Africa and other regions that have broken down and no longer work. When outside actors provide communities with resources like wells and water treatment infrastructure, too often no sustainable mechanism exists to maintain them. And even if they don’t break down, donated solutions are inherently unscalable.
So how do you create a solution that sticks? In our research, we’ve found that it starts with innovators and entrepreneurs who create robust markets that serve people who are currently unable to access water. These new markets provide the necessary resources to make safe water not only affordable and accessible, but also financially sustainable since they generate revenue that can then be used to maintain and grow the market. Consider how these two organizations, each with different business models, have created viable, lasting solutions that address the access to water challenge in the regions where they operate.
Drinkwell: Developing technology for safe water
In the densely populated nation of Bangladesh, the country’s clean water crisis reached an all-time high when it was discovered that arsenic had contaminated the nation’s groundwater. It was this crisis that inspired Minhaj Chowdhury to form Drinkwell, a social enterprise that sells low-cost, high-efficiency water filtration systems to local entrepreneurs who build a business around providing safe water.
Empowering entrepreneurs who can leverage their social capital to reach customers is a key component of the company’s model, which Chowdhury credits with its sustainability. But the company also ensures the long-term viability of its “Water ATMs” by providing entrepreneurs with maintenance support and financial management assistance.
Drinkwell started selling its solution in 2013, but unlike to thousands of donated wells that have provided water for limited periods before breaking down, the organization’s financially sustainable model shows no signs of decay. To date, more than 200,000 people now load “water credits” onto their DrinkWell cards and use them at designated DrinkWell sites in India, Bangladesh, Laos, and Cambodia, and the organization aims to expand its network to serve more than 5,000 communities in the next year. Drinkwell’s success offers a blueprint for closing the gap on access to clean, affordable water.
Manila Water: A public-private partnership that works
25 years ago, as many as ten million people in the Philippines didn’t have access to safe water. In the eastern region of Manila, the capital city, barely a quarter of people had access to potable water. The situation got so bad that the government was compelled to enact a National Water Crisis Act, which paved the way for innovators to work with the government to solve this problem. This gave birth to Manila Water, a public-private partnership between the government and the Philippines’ oldest conglomerate, Ayala Corporation.
As a private company, Manila Water had a strong incentive to distribute water to as many customers as possible. To do this, its executives invested in new systems for production, treatment, and distribution of water; trained an entirely new workforce; and reshuffled the existing organization structure to focus on increasing access. At the same time, the government retained its ability to regulate the industry to best serve the people of Manila. This hybrid public-private relationship between Ayala and the government has paid off immensely as more than 99% of people in the region now have access to affordable, clean water. In addition, Ayala is exporting its expertise to neighboring countries, including Vietnam, Thailand, Myanmar, and Indonesia. Sometimes the government has the will, but the private sector might just have the way.
In a world where water, the most basic resource we need to survive, is still out of reach for more than two billion people, a fundamental rethinking of how we address the challenge of providing this critical resource is necessary. No one organization can solve the global water challenge, but organizations like Drinkwell and Manila Water have shown a way to develop innovative models—through leveraging entrepreneurship, new technologies, and government partnerships —to tackle this seemingly intractable issue. And unlike more conventional answers to the problem, these solutions are fundamentally sustainable and scalable. That’s why they remain our best hope for making water accessible to all.
Lincoln Wilcox is a research associate on the global prosperity team at the Clayton Christensen Institute.
Efosa Ojomo is a senior research fellow at the Clayton Christensen Institute where he leads its Global Prosperity research.