SEPT 28, 2003
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Q&A: Jagdish Sheth
Given the quickening 'half-life' of knowledge, is Jagdish Sheth's 'Rule Of Three' still as relevant today as it was when he first enunciated it? Have it straight from the Charles H. Kellstadt Professor of Marketing at the Goizueta Business School of Emory University, USA. Plus, his views on competition, and lots more.


Q&A: Arun K. Maheshwari
Arun Maheshwari, Managing Director and CEO of CSC India, the domestic subsidiary of the $11.3-billion Computer Sciences Corporation, wonders if India can ever become a software product powerhouse, given its lack of specific domain knowledge. The way out? Acquire foreign companies that do have it.

More Net Specials
Business Today,  September 14, 2003
 
 
The Convenient Millionaire
Bindeshwar Pathak has turned his chain of public toilets into a profitable not-for-profit business. Now, others want to follow suit.
"What started out as a mission to help scavengers has ended up changing my life for the better"
Bindeshwar Pathak/ Founder/Sulabh International

It is quite likely that you don't know Bindeshwar Pathak, a 60-year-old do-gooder (yup, that he is) despite the many awards the man has received.

It is equally likely that you-if you happen to run into him, that is-put him down as a politico; he is given to sporting the narrowing-as-they-go-down pajamas, longish starched tunic, and smart and short sleeveless waistcoat that India's more sartorially minded politicians wear. Pathak isn't one, although, given his profile, there isn't a party in the country that wouldn't have him.

Pathak's NGO (non governmental organisation) Sulabh International faces no such identity issues. Its visible manifestation, spanking clean Sulabh Sauchalayas (Easy Loos in another lingo), some 6,000 of them, are present in 26 Indian states and three Union Territories. The largest one is at Shirdi, a pilgrim-hotspot, and boasts 150 toilets, 150 bathrooms and 5,000 lockers.

Then, there are the rudimentary two-pit toilets-dig two; use one till it fills up; seal it, wait for the waste to turn to fertiliser and use the second; open the first, dispose the fertiliser; repeat process-the organisation has built, over a million of them. All told, Sulabh International employs over 50,000 people, permanent and temporary. That's quite an empire built around, er, waste.

From Teaching To Toilets

Had things turned out the way he wanted them to, Pathak, born into a reasonably well-off Brahmin family in rural Bihar in the 1940s, would have ended up a professor of sociology. Let down by his poor showing in his graduate examinations, however, Pathak turned to, in chronological order, teaching elementary school, serving as a vigilance officer in an industrial unit, and helping out his father in his Ayurvedic medicine business.

A SNAPSHOT
Bindeshwar Pathak, born in 1943 in Vaishali District, Bihar
EDUCATION
B.A. (Sociology), B.N. College, Patna, in 1964. M.A. (Sociology), Patna University, M.A. (English) Patna University, Ph.D, D.Litt
WORK EXPERIENCE
Worked as a schoolteacher, vigilance officer, seller of Ayurvedic medicines, translator, publicity-in-charge; founded Sulabh International in 1970
AWARDS
Padma Bhushan; St. Francis Prize for Environment conferred by Pope John Paul II; Dubai International Award; National Citizen's Award
NOW WORKING ON
Next big idea (water treatment); Sulabh Institute of Sanitation; autobiography (Journey of a Toilet)
CONCESSION TO HUBRIS
The Sulabh International Museum of Toilets, a museum chronicling the history of the toilet at Sulabh International's HQ in Delhi

Frustrated by his returns from this series of low-paying jobs, Pathak, who was by now married, made another aborted attempt to breach the ranks of academia. And so, 968 found him serving as a translator ("without a salary", grins Pathak) on the Bihar Gandhi Centenary Celebration Committee. Four months thence, he managed to parlay this into a salaried tenure as the entity's publicity-in-charge.

One of Pathak's first tasks was to work on a project, which, in classic Indian style, was ambitiously titled Restoration of Human Rights and Dignity of Scavengers. To put this in perspective, scavengers in India didn't (in some cases, they still don't) just sort out garbage; they also cleaned out stand-alone toilets that weren't connected to a sewerage network. Most scavengers were born into the profession, fallout of India's notorious caste system.

The Indian Constitution had banned scavenging, but the lack of effective sewer systems meant that the trade continued to thrive. Pathak spent three months living in a scavenger colony outside Patna, a milieu that must have been alien to him given that he is a Brahmin by birth ("an inconsequential thing", he shrugs). Scrounging around for ideas that could improve the lot of the scavengers, he stumbled across a decade-old World Health Organisation (who) publication, Disposal of Human Excreta. The book suggested the use of pit-toilets; the two-pit variant was Pathak's innovation.

By this time, Gandhi's centenary was well and truly over and Pathak found himself without a job yet again. However, he was determined to take his idea far. He applied for a grant from the Bihar government, and much to his surprise, managed to get one after waiting for a few months (a minor miracle by the prevailing Indian standards).

Pathak started building toilets across the state; sometimes politicians and bureaucrats hassled him, at other times they were his biggest supporters. He found himself in debt-in classic Bollywood style, he sold his wife's jewellery-but he plugged on.

His biggest break came from a chance encounter with officials from the Reserve Bank of India's Patna office. The RBI building in the state capital was located opposite the Gandhi Maidan, an open area that had rapidly degenerated into an open-air toilet. The bank really stank. Unable to convince the state government to do anything, bank executives approached Pathak. Before they knew it, he had cleaned up the place; a few months later, he opened a public toilet, the first Sulabh Sauchalaya-Sulabh International, Pathak's NGO was founded in 1970, a few years before his meeting with the RBI-and one funded by the central bank. Its unique selling proposition was a bathing facility-not too many public toilets still offer this. At 10 paise a pop, using the toilet wasn't exactly cheap but on the first day of its operation, over 500 people lined up to use it.

Buoyed by the response, Pathak moved to other towns in Bihar, then Kolkata, and then the rest of India. Predictably, when who and UNICEF hosted a sanitation seminar in India in 1978, it was Pathak whom they held up as the poster boy of India's sanitation revolution.

Sulabh has managed to generate returns of 15-20 per cent on an annual Turnover of Rs 100 crore

The man continues to enjoy an iconic status with organisations such as these to this day. United Nations Development Programme's Human Development Report for 2003 raises Sulabh to a near iconic status. A sampling: "Pioneering work by Sulabh International... has shown that human waste can be disposed of affordably and in a socially acceptable way". And "The Sulabh latrine can promote environmental sanitation in most densely populated urban areas". (UNDP Human Development Report 2003, Oxford University Press, New York, 2003, Rs 495)

A Profit-centric Model

Sulabh International's profit-centric business model-a strange one for an NGO-stems from Pathak's experience in obtaining a grant, his first, from the Bihar government. You won't get far on grants, he recollects a bureaucrat telling him.

Here's how the model goes, and it is one Pathak hasn't tampered with: Municipal corporations, sometimes, even private companies, give Sulabh land and some money to build a toilet. In most cases (not all), the municipal corporation chips in 10-15 per cent of operating expenses besides providing free water and power. The corporation saves by not having to add more people to its rolls-a perfect example of operational outsourcing, one of modern business' most evocative mantras. When not connected to the sewerage network, the public toilet generates biogas used to power streetlights. "We normally do not charge money for that," says Pathak.

Do Indians really not have a problem paying to take a dump? Pathak believes so. The only people who have a problem paying, he says, are "new lawyers, policemen, and the occasional troublemaker". "Even beggars pay to use the toilet; you can see this at our toilet near Chowpatty in Mumbai."

Most public toilets break-even, but those located near highly congested areas return massive profits, which in turn "cross-subsidise some loss-making toilets", according to him. All told, the business returns constant margins of 15 to 20 per cent on average annual turnover of around Rs 100 crore. Not bad when you consider that the money stems from, well, you know what!

Encouraged by Sulabh's success, and by the fact that a mid-sized public toilet breaks-even in around eight to nine months (you can't say the same for most businesses), a host of other sanitation entrepreneurs has entered the business.

Sulabh's complex near AIIMS. While most of its toilets earn money, ones in congested areas return massive profits

A Mumbai-based construction company, for instance, has built public toilets in parts of North India including Delhi and Chandigarh. The company has chosen to follow the Sulabh model in all aspects save one: The bulk of its revenues come from glitzy backlit hoardings affixed to the sides of the building. Pathak is all for such sanitation-entrepreneurship. "One has to make money to live," he says. "In every part of the country, if we can inspire just five people to build two-pit toilets, it will not just create employment, but also improve the living conditions of people." However, he does think some of the new players are not in it for the social-service aspect. "They just want to make money. They only build toilets near major markets, not in slums or where people really need access to such services."

Trappings Of Success

It is a measure of Sulabh's success that Pathak has to move around with bodyguards. The money the NGO earns goes into building more toilets, but Pathak admits that he lives well. "I feel I have earned it," he confesses. "I have a nice house (in Delhi's posh Panchsheel Park area), and a nice car (a Mercedes, no less), and I could not have dreamed of this when I was Rs 50,000 in debt (he was, when he sold his wife's jewellery); what started out as a mission to help scavengers has changed my life for the better."

Pathak's detractors have accused him of everything, from money laundering to land grabbing. Many of his toilets are built on prime land. There's one abutting Nehru Park in Delhi's tony Chanakyapuri borough; another next to Varanasi's Assi Ghat. Pathak fields these accusations with practised ease. "If one is doing well, people always find things to pull you down," he says. "Unlike others who run pay-and-use toilets, I do not rent out ad space," he adds, "and public toilets have to be on prime land; what's the use of hiding them in back alleys where no one will use them."

No one, not even his worst critic, however, can really question the relevance of Pathak's work. Almost 120 million Indian houses do not have toilets. Of the 5,000 cities and towns in India, a mere 232 have something resembling a sewerage network. Indeed, only eight boast full-fledged sewerage systems. Sulabh also claims to have rehabilitated over 50,000 scavengers; it runs a (English-medium) public school in Delhi for their children, and a technical institute that imparts vocational skills to the less well off in Patna and Delhi.

Next step? There are several. For starters, Sulabh is living up to the 'international' in its name by going global: It has built a public toilet at Thimpu, and is in the process of constructing one at Kathmandu. India's Ministry of External Affairs has enlisted Pathak to build toilets in Afghanistan, part of the country's aid package. Now, says Pathak, it is up to other NGOs to do their bit. "I cannot cover all of India, leave alone another country; and the Sulabh model can be replicated anywhere in the world."

Then, there is Pathak's next baby, wastewater treatment. Water from public toilets, the man believes, can be treated and used for aquaculture.

And finally, there's the Sulabh Institute of Sanitation, a 40-acre facility near Gurgaon that will teach, what else, sanitation. "There is a major industry in sanitation, and there is money. I want to tell the youth of India that they can both make money and do national service in this business," says Pathak. If he succeeds, public toilets, not call centres or nanotech labs, could be the next big thing in India.

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