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Extreme Affordability Journal

The following is the latest installment in a journal series by Arthur Patterson that covers the progress of the 2009 Entrepreneurial Design for Extreme Affordability class. (To begin at the beginning, see the March 4 entry.

Racing to the Finish Line

June 4, 2009

The studio floor is in shambles. Teams made their final presentations earlier in the day but now are cleaning up for an exposition where the public, including potential investors, can see the products. Earlier prototypes, some only two weeks old, litter the floor and work surfaces.

Change has been the constant. The team that began exploring water pumps for Ethiopian subsistence farmers altered plans when it observed women in the marketplace manually shredding and pulverizing chili peppers. The product it presents at class end is a crank-operated grinder.

Some solutions come at the eleventh hour, literally. Many business plans were tweaked up to the night before final presentations. Not until the last week did a team improving the design of a stove consider the skirt—basically a metal funnel the pot sits on to maximize heat—could be used on other stoves. Offering the pot skirt as an accessory for different stoves is one of those solutions that comes partly from happenstance, partly from trial and error. The fact that it happens in such a short time frame, with a team composed of engineers, business students, future doctors, and designers, does not go unnoticed.

“What I want you to know,” Professor Jim Patell tells the audience watching the final team presentation, “is how much you’re not seeing in these 20-minute presentations.” Countless ideas have been tossed about, multiple prototypes have been developed and discarded, projects have been changed in midstream—standard protocol for an iterative design process.

All 10 teams have working prototypes ready to be taken to market. Many plan to seek additional funding to test the viability of their products in the field, which could include a return trip to Rwanda, Myanmar, India, Ethiopia, or Nepal.

The finale of the class, the Expo, becomes louder as more guests arrive. Daniella Raffo, MBA Class of ’10, demonstrates how pre-packaged nutrients can be added to measured amounts of flour, thus simplifying and reducing costs of the fortification process.

On the other side of the studio, Patty Buckley, MBA Class of ’09, shows how her team’s solar concentrator uses a lens to amplify sunlight directed at a solar cell. The simple wooden frame of this device adds to its affordability.

The second quarter of Entrepreneurial Design for Extreme Affordability has been a haul for everybody involved—several students say they average 30 hours a week on this class alone, while faculty, staff, and volunteers on call to be resources or sounding boards have often sacrificed precious Saturdays to meet with and coach the teams.

The prototypes and a viable implementation plan will count toward a grade. As the hundreds of guests trickle out of the studio, there’s a grand feeling of accomplishment that recognizes the 20 weeks of class, the student trips, and the constant interaction with partner organizations and fellow teams. Students toast each other and now have graduation or summer break in their future.

The ideas and prototypes that line the tables, however, will live on, some with the help of students from the class, some through the partner organizations with which each team initially paired, and some a year or two later when a new team from a future class revisits an idea.

The academic component benefits 40 students. The products produced as a result of the class, however, could ameliorate the lives of hundreds, thousands, and, hopefully, millions.

The Prototypes Are Working

May 20, 2009

The rough-hewn prototypes actually work.

As a student gradually turns on a hose, its bib conveniently built into the d.school floor, a minute amount of liquid nutrients inches through a clear tube toward the water nozzle. The end result: fortified drinking water. To better show how the internal valve operates, team members pass around a model made from Lego building bricks.

Another team demonstrates a reflector lens that illuminates solar panels used to charge a cell phone. The students tell how an earlier prototype with a Fresnel lens worked so well that it set a piece of wood on fire.

Some use simpler technology, like the team looking to separate seeds from dried red peppers. Samuel Hamner, a mechanical engineering student, adds rocks and chili peppers to a tin can kitted out with an internal mesh cage, seals the top, and shakes vigorously. The rocks and peppers stay within the cage, but the seeds are successfully separated.

“This is going to get messy. Good,” Professor Patell says when a team fills a hopper with dried beans. Sadly, there are no mishaps, which provide puerile entertainment as well as opportunities to learn from mistakes.

Only two weeks of class remain and this is the last formal opportunity students have to reach out to other teams. “Our business plan becomes more complex as our product becomes more simple,” Laura Jones, MBA Class of ’09, says with a chuckle. Her team is now trying to improve the valve assembly on an existing pump, with a goal of fewer parts, more reliability, and an increased water flow.

The team trying to make biomass fuel pellets from an extrusion process huddles around its prototype after class lets out. Team members review the possible scenarios to power their extrusion mill, including a method where a vehicle would drive over a form.

“You have gravity all over the world,” Patell says. “Use it to your advantage and have your process rely more on human weight. It worked with the two kids who jumped on the pedals of a water pump to increase power; it could work here, too.”

Getting the Product Made

May 13, 2009

The prototyped suction pump engineering student Isaac Penny holds consists of two steel pipes, one smaller in diameter that neatly slides into the larger pipe. A few rubber washers and capped ends create a rudimentary pump.

"Product design is well and good," says Laura Jones, MBA Class of '09, "but you have to figure out how to make the thing; that's why we need engineers."

Making the product is the theme of today’s class. Guest lecturer Krista Donaldson of the University's Hasso Plattner Institute of Design is one of those engineers, having worked in countries like Kenya where she helped manufacture water pumps for a company now known as KickStart

"Engineers and designers working remotely tend to focus on the early stages and forget product manufacturing, service, and retirement," she says. She shares stories about how factors like corruption, bureaucracy, and tribalism impact every phase of the production and distribution process. And then there’s trying to maintain consistent manufacturing tolerances."“Manufacturing doesn't work like it does here."

In Kenya she conducted quality control tests for water pumps and hoped for a 15 percent defective rate. She thought it was more like 40 percent, but the reality was closer to 75 percent. Part of the error margin was due to the skill level of welders and part was the quality and consistency of materials used. She saw a shift toward importing a majority of the pumps from China during her five years in Africa starting in 1998.

Whether or not teams and their partner organizations decide to manufacture in the country where the product will be used, which depends on the availability of nearby resources and skilled laborers, they still have to figure out how the products are going to be made. Donaldson goes over the basics: A jig is a guiding device. If a screw has to be anchored to a product at a certain angle, a jig is made so that process can be repeated identically. A fixture is a holding device, like a clamp or vise.

"Your product may be out there, but your jigs and fixtures aren’t," Professor Patell says. "That's how you protect your intellectual property from your knock-off competitors."

Show and Tell at the Graduate Level

May 4, 2009

Carissa Carter lurked outside a Michigan wood pellet factory doing her due diligence. The mechanical engineering student’s team wants to design a machine that can make fuel pellets out of agricultural waste or cow dung. “I was shocked at how simple the process is after they finally invited me in for a tour,” says Carter, who was in town for unrelated reasons but latched on to visiting the plant, since nothing similar exists in the Bay Area. “There are not a lot of complicated steps,” she says. “Nobody has made a pelletizer that runs without electricity, but we’re going to try.”

That pluck resonates throughout the design-review presentations, where team members candidly explain their strategy and how they arrived at their current prototype. It’s like the class has hit hyperdrive—three weeks ago teams were fine-tuning a sentence identifying customer need; now they are moving water upward in crudely made pressure pumps.

More than PowerPoint slideshows and charts and graphs, the presentations establish a forum of shared ideas.

A java lover in the audience asks the team working on a chili pepper grinder if they considered adapting a manual coffee grinder for their needs. Kind of, they answer. They tested an antique food processor from the late 1800s, but it didn’t address the customers’ need for a unit that would contain the fine pepper dust, which can cause respiratory irritation.

A team of students who are trying to make a pressure pump with a price of $25 to $35 tells of a team from the 2006 class with the same goal. It designed a pump made of 14 parts but the price soared when the pump ended up being manufactured with 148 parts.

In the design studio now, physical clues to how the prototypes were made abound: Boxes from store-bought appliances, remnants of PVC pipe, taped-together ice cream containers connected to rubber tubing, and batteries litter the communal work spaces.

“What are we missing? What more can we do?” a team asks after completing its presentation. Faculty and students toss around ideas while some students poke around the prototypes, possibly looking for clues to their engineering problems in the solutions of others.

Role-Playing Elevator Pitches Move Students Toward ‘The Ask’

April 29, 2009

Graeme Waitzkin, MBA Class of ’10, waltzes into the simulated elevator with a bundle of lengthy tree branches on his right shoulder. He spots his mark—a potential investor—introduces himself, and begins his 3-minute pitch. Women in rural Ethiopia spend 20 percent of their waking hours gathering wood used to cook meals for their families, Waitzkin says. His company wants to make a device, priced under $100, that will turn agricultural waste into fuel pellets for cooking stoves. An intrigued potential investor, played by Professor Jim Patell, asks for a business card and is handed the bundle of wood while Waitzkin fishes in his pocket and the class breaks out in laughter. Handing off the bundle is a savvy, albeit comic, move showing the investor that Waitzkin’s team understands the needs of its customer. The gong strikes and time’s up.

Each of the 10 teams presents an elevator pitch: Some use prototypes of products they hope to build, some present photos of potential users. One team looking to tout the benefits of adding nutrient fortification to flour cites how the United States iodized salt in the 1930s, and how that virtually eliminated thyroid-related health conditions like goiters. Students and faculty add dashes of reality to the presentations: White boards on sliding rails act as elevator doors; one team plays Muzak in the background during its pitch; Professor David Beach tries to distract a student making her presentation.

“You should have made ‘The Ask’ before the three-minute mark,” Patell says. He suggests requests be specific, whether that means asking for an exact amount of funding or requesting to meet at a set time or place to further discuss a proposal. More important, he says after the 10 teams make their pitches, is how the “pitchee” views the “pitcher.” Students say the pitcher should be viewed as competent, passionate, and likely to succeed. Patell agrees and says prototypes bolster perceived competence. One presenter doesn’t have exact numbers ready when the pitchee asks, but she pulls a prototype pepper grinder out of her backpack to show what her team plans to make.

Another student criticizes his own presentation, saying he felt a little too much like a huckster. This opens discussion of what type of pitch was the most effective. Many students say “The Ask” portion was the most difficult to give.

“The biggest compliment you can pay someone is to ask for their help,” Patell says. “It shows you respect their competence. Don’t let that bog you down.”

Business Plans Should Begin with User, Work up to CEO

April 22, 2009

Long before a consumer buys a product, before a product is manufactured and distributed, and before investors buy in, there has to be a plan. The teams in this class are off to a good start because they already have identified their future customers’ needs. But before an idea can be pitched to investors, the team must answer in the affirmative these questions: Will it work? Can it be made? Will anyone buy it? Can the new company survive and thrive selling it?

Professor Patell again uses examples to illustrate how an implementation plan can answer these questions. He tells how a team from a former class proposed a company in India that would collect garbage bags littering the streets, heat them to a malleable state, form them into roof tiles, and sell them locally. Its implementation plan illustrated how the prototypes worked properly, the tiles could be made easily, there was a demand, and the company could thrive by employing locals to gather bags and make the tiles. The plan went further, stating growth intentions for the first five years of business.

Patell and Stuart Coulson, a coach for this and prior classes who has extensive experience with data communication startups, stress how important it is to start with the individual user and build the company up from there. The team should prototype a product and write a bottom-up, discovery-driven implementation plan that factors in not only end users but how the new company would create employment for materials suppliers, laborers who make the product, and lenders who provide credit to users. The team must determine not only the features of the product but how it can be manufactured, distributed, and sold, and it can count on hitting some snags. There are a lot of moving parts in implementing a business in a foreign country, Patell says, offering the example of one company that ran out of capital because of rules in India requiring a 30-day waiting period on wire transfers of money from outside the country.

The management structure of the nascent company also needs to be included in a successful plan. “Venture capitalists won’t fund you until you sort out the decision-making process,” Coulson says. One of the top two reasons startups fail, Patell adds, is due to a falling out among founders. The plan serves as not only a contract between team members but also a blueprint for the company’s direction.

Nailing Down a Team’s Point of View

April 15, 2009

It’s show time on the d.school’s main floor. Teams making their Point of View presentations get pretty creative. Some perform skits; others put on a faux game show. One student stands atop a 12-foot ladder to emphasize the pressure needed to pump water upward.

Thinking unconventionally is nothing new for these groups. What’s unique about this experience, however, is that the teams make presentations to the other teams, who then ask the presenters questions. There are no secrets and no competitiveness among teams, just shared learning. One team is working on harvesting peppers and another on exhaust hoods for cook stoves, yet they still ask each other pointed questions to better understand their own customers or to help the presenting teams hone their Point of View statements.

Teams don’t walk away from this session saying, “We’re going to make widgets or provide tetanus vaccinations for kids in Ethiopia,” although they could be doing just that by the end of the quarter. What they’re doing, more specifically, is laying the groundwork for the rest of the term.

The following Point of View statement is drafted by a team that visited Rwanda: “An undernourished Rwandan mother, dependent on her current crop for survival, needs to grow nutritious food without land and without gambling her family’s sustenance.” As vague as that may sound, the statement allows the team to explore a specific family of ideas, like sack gardens or growing troughs that can be placed on a roof or side of a structure. The need is clear: Provide extra growing space on a finite amount of land. However, the possible approaches are numerous.

“The big thing now is what,” says Professor Patell, who is referring to what the teams will propose to their partner organizations in the field. “It doesn’t matter which idea you choose, as long as you’re passionate about it.”

From Understanding and Observing to
an Established Vision

April 9, 2009

The class assembles in the auditorium section of the d.school. Rows of chairs, some orange, some white, contribute to the room’s random orderliness. Red rolling leather sofas accommodate any overflow. Jim Patell gives a lecture that is part motivational speech, part guideline of what to expect.

He begins by mentioning a Fortune magazine article that has just been published. It’s about the Entrepreneurial Design for Extreme Affordability course and highlights d.light, a company that found its beginnings in the

precursor to this class. Patell is proud of this success story, a company that manufactures affordable rechargeable LED lamps that eliminate the need for kerosene, but he emphasizes some projects might not get the publicity of d.light, although they still should be considered successful.

"Products can be brought to market faster through our partners than starting a new organization," Patell says, referring to the organizations that teams have paired with. Many students will have no further involvement with their product or service once the class terminates in early June, while some continue in hopes of starting a business. Regardless, efforts of all teams are instrumental. The point settles in with the class that everybody’s product or service, even if not taken to market, has an effect on the entire class, since information and progress reports are openly shared.

Furthermore, this is the week in which one of the most creative leaps in the design process—developing a Point of View—begins to take shape. Throughout the first quarter the teams have honed their understanding and observation techniques. The culminating event, the trip to meet with customers thousands of miles away, put those skills to use. Now, it's a question of where and how to direct all of the gathered information.

The Point of View tells a compelling story in a single sentence, matching a user to his or her need. It acts much like a thesis statement does in supporting an argument and will guide the teams for the rest of the quarter in developing a specific product or service. Example: An Ethiopian subsistence farmer [the user] struggling to save for his children’s future needs a way to remove whole corn kernels from the cob in an ergonomic process [the need] that would lead to more profitable selling, planting, and storing. Once the team has crystallized its Point of View, it can move forward with a more clearly defined mission.

"How do you get creative accidents to happen on schedule?" Patell asks the class. Through trial and error. The reason to build a prototype is to examine the features a team is most unsure about, to reduce risk for what will become the final product.

The most important dynamic is to operate as a group—to have members work independently on different aspects of a project (parallel processing), but to come together and make major decisions as one.

This is where the management aspect of the course comes into play, where teams should view their project schedule as a planning tool and social contract. He even suggests scheduling time to make group decisions. This will prevent any one team member from carrying too much of the load. "Setting yourself on fire to illuminate others only works once," Patell stresses. He refers to former conflagrant relations within a startup company that grew from a previous class. Tensions ignited because the three founders all thought they were the decision maker. Some, he says regretfully, are no longer speaking.

For the duration of the week the teams will be working on the Point of View for their team and will present that to the entire class the following week.

Team Members Return from Trips Energized,
Ready to Tackle Projects

Laura Jones, MBA class of ’09,tries irrigating a field thetraditional way near Dedaye, Laura JonesMyanmar in the Irrawaddy Delta. As part of her March, 2009 study trip, Jones said she spoke with a 75-year-old farmer who carried two watering cans, weighing 20 to 30 pounds each, to irrigate his flower field. “In order to gain empathy for what it’s like to use that watering system, I asked to try to fill, lift, and carry the cans down a row of plants, watering as I went. It was VERY difficult, because the cans were heavy and the balancing rod across my shoulders was uncomfortable and slipped quite a lot. Even doing two trips down rows of crops was pretty exhausting for me (especially in 90-degree heat). I can barely imagine what it’s like to do that hundreds of times each day.” Gaining empathy is a critical step in the course, Design for Extreme Affordability.

April 2, 2009

Spring quarter for the Design class kicks off tonight. Some have returned from their study trips, while the half of the class that didn’t make the journey is eager to know what the others discovered.

Students trickle into the building, some dragging oversized suitcases with airline tags displaying exotic three-letter destination codes—KTM, KGL, ADD. Groups form around the suitcases, as aluminum pots, bicycle wheels, and miniature models are unpacked, scrutinized, and taken apart by faculty and fellow students. Those who visited Kathmandu give Nepali hats to their teammates, but it’s obvious the trip was strictly business, as the conversation immediately returns to stoves, water pumps, illiteracy, and nutrition.

Laura Jones, MBA Class of ’09, explains how local farmers can’t pay down their debt because the crop prices they had hoped to get this year were based on returns calculated using last year's elevated economy. That, and a devastating cyclone last May, has dampened chances for recovery from the current economic crisis.

A farmer from Myanmar told Jones,"“I can’t even buy food, so why would I buy anything else?" Daunting words for a team trying to come up with a low-cost product or service, but it shows that every cent matters to these customers.

Taiei Harimoto, a mechanical engineering student, says his team has decided to concentrate on cooking stoves. "A team from last year's class worked on it," he says, "but it still needs work."

Just how much can a cooking stove be overhauled? Understanding the end users helps in answering that question. Factors as simple as whether the users squat or stand when using the stove have to be considered. Harimoto says people he interviewed didn't mind if the cooking surface was raised, as long as he could convince them the fire would be raised, keeping the distance from the flame the same. A less explored part of the stove, he says, is the exhaust hood. Currently the stoves are fueled by firewood and/or rice husks, which cause a great deal of smoke. Users like the idea of a chimney or smoke hood above the stove but want to be sure it isn't too obtrusive.

Another team was questioning the design of a mobile pressure pump they saw used in the field. It sits on a triangular frame—a part that adds approximately $10 to the total price of the pump. They were convinced they could make it cheaper. Does redesigning the wheel to save a few bucks make sense? Absolutely. Customers are taking out loans to buy the pumps and stoves. A few dollars less could be the price point of affordability, especially since credit is scarce and local interest rates are insane, Harimoto says.

Connecting with customers on an emotional level was difficult, especially when a translator was involved. "Messages tended to get sanitized," says Peter Russo, of the Mechanical Engineering's joint program in design, and written language can also be a problem. His team was exploring options for adding micronutrients to food products like flour. In Nepal he displayed two packages of noodles, one containing nutritional supplements and one not. A man, illiterate, mistakenly pointed to the unfortified product and said it contained the additional nutrients. "Even though the people there are on board with the concept of fortification, some can't read the labels," Russo says.

Some teams had direct exposure to the life of their customers when they stayed in the barn of a Nepalese family north of Kathmandu. On the level below were goats and water buffalo. In the mud-floored kitchen, however, a black and white television blared away in the corner. If homes didn't have a generator, they were subject to power shedding—planned 8-hour-long power grid outages. This made charging laptops and cameras, used during presentations with customers, rather difficult for the team members. More important, it helped them understand the limitations imposed on their customers. It made the experience more real, says Jenny Chen, MBA Class of '10.

Stories similar to these are heard throughout the night's class, as students eat Indian food and share scale models of water towers and portable reservoirs (pocket ponds). The first quarter of the class allowed students to get to know each other and for teams to form. Now, teams will attack their projects at different speeds.

"If you’re ready to bang out a prototype tonight, feel free to do so," Patell says. The class begins to lose its group dynamic starting tonight, he explains. "There will be a lack of synchronization, and that will be fine," he says, referring to teams working at different speeds. The goal for the next two weeks is to debrief from the trips. Then each team will present its findings to the entire class. Instead of having those students who made the trip talk, the team members who stayed behind are responsible for getting up to speed and addressing the assembled class.

Chen knows that if a generation of people can be educated about micronutrient fortification in their food, it can easily become a way of life. Right now her team isn't challenged with just the technical feat of redesigning a machine that blends nutrients into flour used for cooking. 'There's a whole ecological solution that has to be developed from the bottom up,' she says. Being in the field has helped with that approach.

As the evening session winds up, there's an unmistakable energy in the room. The class may be finished for the night, but the ideas are just beginning to form.


Spring Resarch Travel

March 25, 2009

The teams are visiting their respective countries and meet next week for a review session. Stay posted.


Taking the Class On The Road

March 18, 2009

Finals are winding down, and the student teams are ready to embark on their trips. The logistics of getting 20 students to 5 locations is quite a challenge for Patell and David Beach, who co-teaches the course. "Four is the magic number," Patell says, as he can fit two men and two women into two hotel rooms and one jeep. Add any more to the group and costs skyrocket for larger vehicles and more accommodations. And since the class is all about extreme affordability, paying attention to costs must remain paramount.

Assigning two teams to the same project could heat up the competition. "In this case it’s all about knowledge sharing," Patell says. "Basically, we’re getting an effective eight heads on each project instead of four." After the trip, one team may focus on one aspect—say water pumps—while the other pursues water collection and storage.

"The whole point of the class is to change the rules and the landscape," says Nate Meng, a medical school grad student. "We’re trained to look at things from a different perspective." He explains that his team has been asked to come up with two proposals upon returning from their visit:

• A Blue Sky project. This is a product or service that looks far ahead. Something like: If a factory can be built here, then local residents can manufacture the water pumps that they would use to farm their own fields. It’s a big-picture scenario that is possible but requires more long-term planning.

• A product that quickly can be brought to market. This team is to come up with a product that can be conceived and completed in the timeframe of the remaining quarter.

Meng and his teammates—Laura Jones, MBA Class of 2009, and Isaac Penny, a mechanical engineering student—are the only three-person team in the class. Jones and Penny will be making the trip to Myanmar and recently started researching water collection as well as preventing deadly venomous snake bites while farmers are working in rice paddies. It is also the team with the insulated bag for its field kit.

Each team sent two of its members on the trips and will meet in early April to review the information collected in the field.

Listening to Real Customers

March 11, 2009

Ten teams have been assigned. Two each will visit the following five locations during the break between winter and spring quarters.

• Rwanda and Nepal. Here, the teams will be working with Project Healthy Children, which is committed to increasing children’s dietary intake by adding micronutrients.

• India. The teams will assist d.light, a company started from a former Design for Extreme Affordability class that seeks to provide safe and affordable lighting options for those with no access to electricity.

• Myanmar and Ethiopia teams will be paired with IDE, an organization with the goal of ending poverty by helping subsistence farmers improve their technologies.

Equipped with the need-finding, listening, and prototyping skills learned over the quarter, each team is also asked to bring a field kit with tools that will help during meetings with their customers. With luggage space at a premium, most field kits are no bigger than a grade schooler’s lunch box. If a team is working on water-collecting techniques, duct tape, tin foil, and a Ziploc bag might be essential in trying to prototype a low-cost cistern. Professor Patell swears by a roll of duct tape and a Leatherman knife, saying anything can be done with those tools.

The goal isn’t to build an item in the field but to induce ideas while listening to the customers. A student from a previous class bought an antique corn–shelling tool on eBay to include in his team’s field kit, although he had a hard time getting it out of the hands of the people he met in Ethiopia, as they wanted to immediately put it to use. One of the Myanmar teams in this class will be working on the possibility of introducing refrigeration technology, so it used an insulated, soft-sided lunch box to carry the contents of its field kit.

 

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