The Profit Motive

by

Jane Karuru, SHF franchisee in the tiny village of Kirima, near Mt. Kenya, describes what motivates her

The desire to make a decent living and be able support your family is universal, and it’s one of the things that makes SHF’s micro-franchise model effective. Nurses are motivated not only by a commitment to serving health needs in their communities, but also by the desire to make money. Ask any SHF franchisee what they dream of and you’ll hear things like: “To build an extra room on my home,” “To send my kids to a better school,” “To get a better life for my family.”

This has a lot of advantages over government and non-profit models where nurses are salaried and have no incentives to provide better quality care. In general, SHF nurses work longer hours, provide better customer service, and are more responsive to community demands.

But this motivation to make money is also one of the greatest challenges/risks of the SHF model — how do you encourage franchisees to be driven entrepreneurs, while ensuring that they prescribe drugs rationally, maintain standards, and follow franchise guidelines? SHF currently does this by regular monitoring through field officers and strict punishment for violators, but this is time and resource intensive and difficult to scale. And it’s not fool-proof: at times franchisees misrepresent their sales, source products outside of the network, and in the worst cases prescribe drugs irrationally.

The challenge to strike balance financial viability and the delivery of quality health services to the poor will be an ongoing one for SHF — and one that will likely require a lot of experimentation and adaptation as we grow. For now we’re on a major hunt for more Janes, who have both the commitment to community and the drive to build viable enterprises, as we plan to open 15 new outlets in the next 3 months.

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One Response to “The Profit Motive”

  1. arthur vw Says:

    CC,
    I need to send you a book when you are home called “Let their people come” written by a World Bank economist named Lant Pritchett…he argues the best way to alleviate poverty is through a massive guest worker program that allows people to come to rich nations to work in manual labor and service jobs. 8 weeks of wages in the US is equal to the capital a micro credit borrower in Bangladesh could earn in her entire life. the political obstacles are huge, but it is an intriguing idea nonetheless. stay well.

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