NextBillion.net - Development Through Enterprise - Healthcare Delivery at the BOP: The HealthStore Interview - Comments

Scaling the HealthStore model

Rob Katz — Thu, 10 Nov 2005 13:20:18 -0500

While key ingredients to HealthStore are local entrepreneurs and good training, it seems clear from the interview that the middle management is crucial as well. Without their relationship with MEDS, HealthStore couldn't provide low-cost drugs. Without their relationship with the government, they'd have a hard time operating in the regulatory environment. Both of these relationships are the direct result of good middle-upper management. If HealthStore is to scale, they'll need entrepreneurs as well as local champions with connections to government and civil society to ensure that the model's price points can be maintained and they won't get shut down by regulators.

Refining and Spreading the Healthstore Model

_Graham Douglas — Wed, 09 Nov 2005 21:50:04 -0500

As noted in the interview, key ingredients are the local talented entrepreneurs and good training. More generally, the model is built on meeting a known demand rather than on being top-down supply-oriented. This suggests the model could be refined and spread to cover all demands of end-users by starting with the selection and training of local talented entrepreneurs to become what I call Direct Support Advocates in the emerging bottom-up distributed economy. These advocates could be the local link to help end-users formulate, express and communicate demand across the whole range of goods and services. Moving in this direction seems to be necessary to overcome the difficulty non-local suppliers have in understanding and meeting bottom of the pyramid demand. Graham Douglas Integrative Federation™ www.integrative-thinking.com

Healthcare Delivery at the BOP: The HealthStore Interview

Rob Katz — Wed, 09 Nov 2005 09:22:58 -0500

In conjunction with NextBillion.net’s series on Healthcare Delivery at the BOP, Rob Katz recently spoke to Michelle Fertig and Herc Tzaras, authors of the forthcoming What Works case study: “Franchising Healthcare for Kenya: The HealthStore Model.”

Michelle Fertig and Herc Tzaras will receive their Masters in Business Administration from Columbia Business School in 2006. Earlier this year, Michelle and Herc traveled to Kenya to conduct field research on a company doing innovative public-private healthcare delivery work at the BOP. HealthStore’s mission is “to improve access to basic health services and essential drugs for children and their families in the developing world.” Recognizing that ineffective distribution systems often prevent essential medicines from reaching BOP communities, HealthStore has established a network of pharmacy franchises reaching all the way down to the base of the pyramid while simultaneously providing living incomes for their nurse-owners.

1. What is the most innovative element of HealthStore’s model, in your opinion?

The combination of a for-profit franchise network with a non-profit central franchisor is the key innovation. The HealthStore Foundation (HSF) is non-profit and so there is no incentive to "cheat" the franchisees. Its job is to set the franchisees up for success, and it does this through relationships with the government, a non-profit drug distributor, regional support offices, and on-going training programs. Entrepreneurs are not only given the necessary support to earn a sustainable income, but they also gain the satisfaction of managing their own business without handouts. These local entrepreneurs are empowered to succeed in an environment where they are surrounded by poverty and despair. The communities in which they operate benefit because they are given access to essential, affordable medicine and because can be inspired by the success of the franchisee.