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It’s a real question: how do you bring 21st century technology to global regions that don’t yet have true capitalism? One further wrinkle — and an urgent one it is — the technology you’re dealing with is for one of life’s biggest got-to-haves: water.
Xylem, a company whose very existence is premised on “providing innovative solutions to global water challenges,” says tackling the third-world sustainable-technology issue takes a combination of private, non-governmental organization (NGO), governmental and business partnerships.
About 1.5 billion farmers worldwide are “small holder,” i.e., those who farm their own food and cultivate about five acres of land. About 50% of the total workforce in India is involved in farming.
It is ironic that irrigation and water works, which about 15,000 years ago were some of the first signs of human civilization itself, are today in poor parts of the world still bereft of the motors and pumps that most the developed world has taken for granted as ubiquitous at least since after World War II.
Only first step
In March, Xylem introduced the Saajhi (Hindi for “companion”) treadle pump, which requires no electricity and is field serviceable, with a minimum number of removable parts and no tools required. Farmers operate the stepping pump with a dual foot pedal — like doing StairMaster at the gym — to generate a strong water flow through a hose and spray nozzle. Its use should cut irrigation time, ease the farmer’s burden and make water application efficient.
But, due to a paucity of good ways to get the pump into the hands of the small farmers that need it most, the company can’t stop there. The Saajhi, therefore, is the first product in what Xylem calls its Essence of Life business model.
Xylem, with more than 12,500 employees worldwide, is headquartered in White Plains, N.Y., and had 2012 revenues of about $3.8 billion. The name “Xylem” is derived from classical Greek, the company says, and in English typically denotes the tissue that transports water in plants.
Xylem knows all about the dismal records compiled by governments and companies that just “parachuted” technology into the world’s poorest regions. What’s needed are sustainable business models.
“Many places in the developing world are littered with the rusted remains of equipment that was introduced to improve productivity but over the long term couldn’t be maintained or sustained,” says Keith Teichmann, director of innovative networks, Xylem. “Two major problems are that farmers have no surplus income to invest and a distribution network may be lacking for sales and service.”
At a list price of about $200, Teichmann says Xylem is currently booking orders for the Saajhi from multiple customers for delivery starting in August. Its distribution model entails partnering with companies that sell agri-business necessities to small plot farmers.
Long-sought solar pump
The next stage in the program’s development will be even more significant, Teichmann says. The long-sought solution to sustainable pumping has for some time been seen in an affordable, portable, solar-powered pumping system. “People have been chasing this for a long time because it’s so much better than a diesel-powered pump. We’re putting complete units into the field in the fourth quarter, and our product will be released toward the end of the year. The systems will cost about $800.”
Products introduced by means of this type business model need to be profitable, says Teichmann. At the same time, Xylem support for the Essence of Life and its products speaks well for it in working with developing-world governments on major infrastructure projects.
In developing products for harsh rural environments, Xylem says it delivers affordability to rural customers as well as profitability that ensures business-model growth and longevity. Inevitably, however, sustainability will rely on the farmers imbibing the entrepreneurial spirit of capitalism based on the reward of effort.