Thursday, October 15, 2009

My SELCO Experience: Kalyan Kumar Banerjee, Senior Vice President, MindTree

You don’t need to go more than 20 kilometres outside the Silicon City of Bangalore to enter the world not reached by our electricity grid. While rich like us get electricity delivered at our doorsteps at a marginal cost of five rupees a kilowatt-hour, the poor need to pay money (at 5000 rupees an electricity pole) if they desire electricity at their homes. And if they cannot shell out this down payment, they are doomed to remain in the middle ages even as we plan our leadership in the knowledge millennium.

This story is not about them, but about my discovery of a wonderful organization called Selco. Selco is in the business of providing solar solutions to rural India. They are based in Karnataka, and have their presence in every district. What does “solution” mean? It means they provide you with something that works for you and it makes sense for you to invest in it. They don’t create the technology; that comes from different vendors.

When we think solar, what’s the first idea that comes to your mind? My God, it’s too expensive, I don’t need it. This is a legitimate feeling if electricity is seamlessly delivered at your doorstep at an artificially low cost. If we had to invest in “green” electricity, without disrupting the poor of their land and homes, and paid an honest price for it, the solar equation might suddenly look different. However, that’s not the central point. What I realized is, if solar is expensive for us, it’s expensive for the poor as well. Only, they don’t have an alternative. Thus solar becomes a feasible option, simply because it’s the only available option.

This is where Selco comes in. I see them as innovators in three distinct ways. One, they understand your specific need and provide you a custom solution. What does this mean? Imagine the midwife in a village needing light by night to perform her “operation”. Light at a fixed source does not help her, as it is still dark where she needs it the most. What if she wore something like a miner’s safety lamp, so the light moved with her, wherever she went? Now, that’s innovation, and that’s what Selco provides. This is not the only kind of customizing out here. You could choose a solution where the lights are on just for four hours every evening (you don’t need the light after eleven at night, maybe). Or a solution that switches on once dusk sets in and switches off at the first light of dawn. Such solutions become very useful where it is inconvenient to switch on or off manually.

The second innovation is financial. They know the cost of one-time acquisition of your solar solution is high, and unaffordable for the rural poor. So they have tied up with financial institutions to design loan schemes which are customized based on the customer’s repayment capacity (daily, weekly, monthly, bi-monthly and so on) - Much like Mohammad Yunus and his micro finance revolution.

The third innovation is subtle. It’s about honesty. They tell you the right cost of acquiring solar solutions – how long the battery will last, and how long the panel will last. And they tell before they sell. And ready with supporting you through the life of the product, after they sell. So when you do business with Selco, you know the real cost of ownership, and you know you will utilize the full potential of the solution you are investing in. How is honesty an innovation? Well, as we mature as an economy, I believe there will be more and more business based on relationships and on trust. Honest solution providers will win more often than the sell and scoot vendors.

What was I doing with Selco in rural villages consuming solar solutions? We had created “India Immersion” internships for students from SMU (Singapore Management University), and as part of this program, we wanted them to be exposed to “India”, not just MindTree. Leveraging on Selco was a fortunate choice, as the students got their right exposure to social entrepreneurship, spirit of service, role of values in business, and of course, diverse flavours of the India outside Bangalore. Needless to say, their learning from the exposure to rural India topped anything we could have provided inside a classroom.