Eradicating Poor Vision Around the World with Essilor
Essilor is the world’s largest manufacturer of ophthalmic lenses and optical equipment, with products available in most countries around the world. The company’s overall business strategy and all associated actions are driven by its strong mission of “Improving lives by improving sight.”
Essilor’s ambition is to eradicate poor vision in a generation. To address the needs of 2.5 billion people around the world with uncorrected poor vision, the company created a new inclusive business division, “2.5 New Vision Generation” (2.5 NVG). It operates in 15 countries including India, China, Indonesia, Kenya, and Bangladesh.
FSG’s Neeraja Bhavaraju and Aaron Mihaly recently had chance to discuss the program and its origins, achievements, challenges, and future with Jayanth Bhuvaraghan, Essilor’s Chief Mission Officer, and Anurag Hans, Head of the BoP Innovation Lab, both based in Singapore.
We have shared five key insights here and you can read the full conversation below.
“Our Chairman and CEO, Hubert Sagnières, strongly believed that if that our overall mission is ‘improving lives by improving sight,’ then it should be true for all inhabitants of the world, not just the 2 billion people living in top cities who have access to formal vision correction services.”
— Anurag Hans, Head of the BoP Innovation Lab
Five key insights from Essilor on creating shared value
- Link your shared value initiative to your corporate mission, and work to secure company-wide buy-in: Our mission of Improving Lives by Improving Sight was always there, and was always understood very well. I didn’t have to go around inventing a new mission or purpose statement for the company and get everybody to rally around it. I just had to take what the mission was, articulate it, put the right things behind it, and to explain it to people. Once we had that, things became very easy.
- Bring the same market sizing and customer segmentation rigor to shared value initiatives that you would bring to commercial investments: We found out that [the size of the unaddressed market for vision care] was huge: out of the 7.5 billion in the world, there are about 2.5 billion, 90 percent of whom live in base of the pyramid (BoP) communities, who need but currently lack vision correction services and access to a simple set of spectacles.
- BoP consumers want products that are designed specifically for them, not a bare-bones version of rich-world products: We’ve seen that the reason why most BoP interventions fail is because companies try to copy their “class A” model, scale it down, and try to give a stripped-down version of their product or service to these consumers. This doesn’t work because BoP consumers are probably as choice-conscious and style-conscious as their urban counterparts. Therefore there is a need to create a product range that keeps in mind the aspirations and lifestyles of these consumers.
- Serving low-income markets does not imply applying low-tech solutions; rather, BoP markets can be a frontier for technological innovation: In [BoP] markets, cost to serve is basically the killer. We rely a lot on technology to ensure that our operations are lean and efficient. Primary vision care providers in India right now are able to place orders with us through mobile apps. Our field staff […] has access to mobile apps to plan their visits for taking orders, manage inventory, etc.
- Set an ambitious long-term goal, beyond what your company alone can achieve, and recruit partners to help you reach it: By 2020 we’ll have created 50 million wearers [customers] in BoP markets. In the context of the overall problem, that’s still miniscule. And we’re still learning as we go. But Essilor is committed to a poor-vision-free world by 2050 — in one generation. Over the next 30 years, Essilor will not just act itself, but will also bring all the necessary actors around the cause of vision to work together to make sure that these 2.5 billion people get access to vision correction services. That’s a big commitment from our side. That 30-year ambition, even at a steady state, means that we will need to soon ramp-up many fold.
What was the original impetus for Essilor’s inclusive business division, “2.5 New Vision Generation”?
Anurag Hans: We are the leading ophthalmic lens and equipment manufacturer in the world. We’ve been in this industry for 170 years now. We feel we are truly blessed to be part of an industry where just by virtue of the activity of making vision products available we have a huge social and economic impact on our customers and their families. Our company’s mission is “improving lives by improving sight.”
Our Chairman and CEO, Hubert Sagnières, strongly believed that if that is our overall mission, then it should be true for all inhabitants of the world, not just the 2 billion people living in top cities who have access to formal vision correction services.
In 2012 that formed the genesis for doing a deeper dive into the size of the problem beyond the markets that we traditionally served. We found out that [the unserved market] was huge: out of the 7.5 billion in the world, there are about 2.5 billion, 90 percent of whom live in base of the pyramid (BoP) communities, who need but currently lack vision correction services and access to a simple set of spectacles. In 2016, a WHO report also estimated the global cost of lost productivity due to uncorrected poor vision was a staggering $272 billion per year.
Jayanth Bhuvaraghan: At the time, our subsidiaries around the world had been doing a number of corporate social responsibility activities; these programs were good and impactful in the areas where they operated in, but were not impactful at scale.
We needed to do something even bigger than this to address the problem if we were serious about it. So we set a goal of eradicating poor-vision by 2050 — within a generation. That’s our dream. And we really believe that we, together with the support of our partners and cross-industry players, can do it. When you define such a big goal, it is clear that you have to do it sustainably and create a primary vision care infrastructure which does not exist today in many of the countries we operate in.
This thinking brought about a paradigm shift in our approach.
We needed to go back to the drawing board. We needed to innovate on new products at lower costs, with new business and delivery models to reduce the cost to serve, thereby completely redefining what we do in traditional markets.
And that’s when we decided that to integrate this into the mainline business would not make sense till we scaled it up and demonstrated sustainable impact at scale. Therefore it needed to have its own identity, its own P&L, and its own vision to be sustainable and impactful.
AH: That’s when we started our new inclusive business arm, which we called “2.5 New Vision Generation,” or “2.5 NVG” for short. We focused on building primary vision care infrastructure to provide the much-needed access to the BoP markets.
A large part of 2.5 NVG’s work is focused on creating micro-entrepreneurs who are trained on basic primary vision care skills so that they can screen their fellow community members and start micro-businesses to dispense a basic pair of 2.5 NVG spectacles.
JB: In addition, to address the need for innovation, we set up a BoP Innovation Lab, based in Singapore. Due to the uniqueness and impact potential of this initiative, the Economic Development Board of Singapore came forward to offer their support for setting up the Lab, right from the inception stage.
We put together a team of bright young individuals who were motivated by this cause, and we started looking at what we could do. The idea was to quickly look at ideas, incubate them, pilot them, and see if they have potential to scale; if so, scale them, and if not, drop them and move on to the next project. At any given point in time, the Lab is working on 10–15 projects in different parts of the world. The lab was a big boost for 2.5 NVG because the 2 entities were kind of like sparring partners. They would challenge each other, push each other, and support each other ultimately to better serve the consumer.
How did 2.5 NVG and the BoP Innovation Lab go about tackling this huge problem?
AH: We discovered that there were 4 main reasons why these 2.5 billion people have uncorrected vision.
One was awareness. Many BoP consumers were not aware of the need to get their eyes checked, or believed that poor or deteriorating eyesight is part of getting old and there’s nothing to be done about it.
The second problem was access — often the nearest optical shop or optician was 50 kilometers or farther away from these communities.
The third problem was affordable products because the products up to that point were designed for top-of-the-pyramid consumers.
The fourth one was attitudes. In BoP communities we found longstanding social attitudes which prevented children and women from wearing spectacles, even though they might need them.
To tackle these, we needed a multi-pronged approach. The most logical place for us to start was with affordable products because that is one of the things that we know how to do well. We had a dedicated product and merchandising team which designed a completely new range of products customized for BoP customers.
They started with BoP customers’ willingness to pay and then worked backwards: what needs to be done to ensure that the end product, while meeting all Essilor quality standards, would still be affordable for the BoP consumer?
In parallel, we started working on business model innovation to create inclusive business models that could solve the issue of access to a trained vision care provider. Over the last 5 to 6 years, we have developed various models that can tackle this issue of access for BoP communities, ranging from training of primary vision care providers, creating mobile and fixed vision care infrastructure in partnership with hospitals and partnering with local NGOs to include vision care in their existing basket of community services, etc.
By the end of 2020 we will have created 25,000 primary vision care providers that are providing vision screening and spectacle dispensing services in their communities.
We also had to tackle the other problems like attitudes and awareness. We wanted to make sure that vision was a top priority for policymakers, so we set-up the Vision Impact Institute, which is a one-stop repository of all evidence-based research related to the field of vision care. Until then, such a repository did not exist. This Institute handles the advocacy and awareness for the cause of uncorrected poor vision.
We also scaled-up our philanthropy efforts because we realized that even by conservative estimates, about 20 percent of the 2.5 billion people in need would not be able to afford even a basic pair of spectacles. Our Essilor Vision Foundation now operates in more than 40 countries, with over 1 million people equipped with a pair of eyeglasses till now.
How have you gone about developing a vision product for the BoP market?
AH: We’ve seen that the reason why most BoP interventions fail is because companies try to copy their “class A” model, scale it down, and try to give a stripped-down version of their product or service to these consumers. This doesn’t work because BoP consumers are probably as choice-conscious and style-conscious as their urban counterparts. Therefore there is a need to create a product range that keeps in mind the aspirations and lifestyles of these consumers.
Similarly, when we looked at developing merchandising or communication solutions, we had to set up a dedicated team of marketing professionals who understood the BoP consumers and had a strong motivation to develop this segment. It all started with extensive market research to get deeper insights into the needs, aspirations, fears, and lifestyles of the rural consumers which could be used to create messages that resonate with the rural consumers. This process had to be followed every time we expanded to a new country.
How do you address the problem of access to vision products?
AH: In the vision care industry, service delivery depends on the availability of trained refractionists people who are trained to perform an eye screening and prescribe the power of the spectacles needed. Like most other healthcare categories, the availability of trained manpower is a big bottleneck in our industry as well.
For the rural poor in developing countries, eyeglasses and refractive services are primarily available only in urban areas through optical shops or hospitals equipped with vision clinics. With the shortage of trained manpower, the optical shops are in no position to expand into rural areas and develop those markets. Primary health centers in rural areas have only the basic healthcare and pharmaceutical facilities. As a consequence, the rural users are left unattended to and continue to suffer from poor vision, which has a huge socio-economic impact.
One of 2.5 NVG’s flagship programs, Eye Mitra, involves training local vision care providers who then run their own optical shops that are close to where BoP consumers live. We invest in training because if we don’t invest, then nobody will. Once they’re trained, we don’t bind them to sell only our products: they’re independent micro-entrepreneurs who are free to procure locally or from any one of our competitors. That’s okay — in these communities, we commit to setting up a dedicated supply chain to service these small vision care providers. But ultimately they do end up procuring a large part of their supplies from us.
Our BoP Innovation lab is also looking at technology innovation: adapting existing technologies or developing new technologies to make our operations in BoP markets more efficient. In these markets, cost to serve is basically the killer. We rely a lot on technology to ensure that our operations are lean and efficient.
Primary vision care providers in India right now are able to place orders with us through mobile apps. Our field staff, which is the business development support for all these primary vision care providers that we create, has access to mobile apps to plan their visits for orders, inventory management, etc. We focus a lot on forging a physical supply chain which can further bring down the cost to serve.
How do you track the social and business impact of your BoP business?
AH: Tracking the business impact is similar to how we do so in our traditional business because irrespective of the market we’re operating in, our focus remains on getting the right product to the consumer at an affordable price at the right time.
The key social metric we track is the number of new wearers that we’re generating, because we’re working towards that 2.5 billion number.
In addition to tracking the business and wearer performance metrics, we have also tried to understand the socio-economic impact of our inclusive business models, both on the lives of the primary vision care providers as well as the wearers and the communities.
An independent study on the overall impact of the Eye Mitra model, carried out by Dalberg Global Development Advisors, revealed that spectacle wearers in India saved an average of 1.5 hours a day on daily tasks such as farming and domestic chores, and experienced increased independence in movement and travel.
Besides income and productivity, according to the study, 91 percent Eye Mitras reported feeling more respected in their community while 92 percent of the female Eye Mitras reported positive changes in their social status, as well as increased self-confidence.
The study showed a total quantifiable impact of US $4.4 million a year alone in the 6 districts of Uttar Pradesh, India surveyed, representing close to 400 Eye Mitras serving 70,000 spectacle wearers.
This amount includes the economic impact of increased earnings for Eye Mitra, increased income through improved productivity of wearers as well as revenues for rural suppliers and other small businesses who benefit locally. If the Eye Mitra initiative was scaled up to all districts in India, this would represent a total potential impact of US$487 million a year.
What have been the key success factors as you have grown this business?
JB: When you have a grand ambition such as eradicating poor vision from the world within one generation, you need a really powerful mission that can unite the entire organization around the ambition.
For us, our mission of Improving Lives by Improving Sight was always there, and was always understood very well. I didn’t have to go around inventing a new mission or purpose statement for the company and get everybody to rally around it. I just had to take what the mission was, articulate it, put the right things behind it, and to explain it to people. Once we had that, things became very easy.
We are also successful because of the total support and direct involvement of our Chairman and CEO, Hubert Sagnieres. It’s very rare to find such an example where a CEO supports a cause so strongly. And of course the Board of Directors and the Management Committee wholeheartedly supports our mission as well.
Last but not least, creating a dedicated organization with sufficient resources and clear deliverables brings about the focus on execution that you need to pursue such an ambition.
What were the biggest challenges you’ve had to overcome?
JB: We really had to re-invent the whole business model. We had to unlearn a lot of things as well. There were people who’d been working at Essilor for 25 to 30 years, doing business in a particular way, joining my team. They had to go into these markets with a fresh mind and then, understanding the challenges there, devise new methods and models for delivering spectacles.
There were also challenges in the field around access. There was no point of contact in the local villages where people could get their eyes examined, so we had to create that. In many countries we didn’t have enough trained professionals. And most of these professionals end up working in the big cities as there is enough unmet need there as well. So it’s really a catch-22 situation: do we wait for more professionals to get trained so that some of them can go to villages to solve the problem, or do we do something else?
While we wait for the professionals to get qualified and more of them to come and work in the villages, we know we’ll probably lose a whole generation, who will live and die without good vision, because it’ll take 30, 40, or 50 years to produce so many professionals. So we worked on innovations such as training micro-entrepreneurs to become local vision care providers.
It is really about creating the primary vision care infrastructure in rural areas.
What do you think the future will hold for your work?
AH: By 2020 we’ll have created 50 million [customers] at the BoP. In the context of the overall problem, that’s still miniscule. And we’re still learning as we go. But Essilor is committed to a poor-vision-free world by 2050 — in one generation.
Over the next 30 years, Essilor will not just act itself, but will also bring all the necessary actors around the cause of vision to work together to make sure that these 2.5 billion people get access to vision correction services.
That’s a big commitment from our side. That 30-year ambition, even at a steady state, means that we will need to soon ramp-up many fold.
To do that, we need technological innovation to simplify the process of getting a vision care technician to these communities or those services to these communities.
We also need a huge advocacy and awareness around the importance of vision care. Vision care is a pretty small space in terms of global actors. And therefore, as we look at expanding our operations, we need to look beyond vision.
We are looking at tech innovators, healthcare players, developmental organizations, etc. to see if we can build a model that looks at overall health, or some other adjacent, more appealing, more encompassing category. And we are actively looking at developmental or social finance as a tool to bring the resources needed for a scale-up of this size and to get the relevant entities involved in evidence-based actions.
We are in a category that by design contributes to a lot of the Sustainable Development Goals (SDGs). In fact, our vision care programs contribute to 7 out of the 17 SDGs and vision itself is related, for example, to livelihoods, health, education, and others.
There are a lot of very robust, direct linkages between vision care interventions and socioeconomic impact in those categories. These can really make the case for global investors and global funders to come in and intervene in this category.
JB: We have a huge, huge task in front of us, but this is the most exciting part.
By providing good vision to the underserved, we are ensuring that they are included in the mainstream, are able to be more productive, earn more and enjoy a better quality of life. This is priceless! In addition, given the huge socio-economic impact that good vision brings, we really believe we will help developing countries fast-track their economic progress.
Also, by empowering people to find their own solutions, we are creating sustainable livelihood opportunities, successful micro-entrepreneurs from rural communities which instill a strong sense of pride and achievement. We are working to ensure the benefits of economic progress reach everyone equitably.
Finally, by creating new markets, physical infrastructure and next-gen consumers, we are on the path to more than double the size of the optical industry in a generation!
We believe that this is a great example of shared value creation.
Read more interviews with shared value leaders in global health >
