Reposted from Mendoza College of Business: http://bit.ly/17cf0kX
By Ed Cohen
A team of four Notre Dame MBA students took first place in a social entrepreneurship case competition for the second consecutive year with an incentive-savvy plan to boost distribution of clean water in rural Ghana.
The team of Jessica Bonanno, Steve Lehmann, Daniel Portilla and Patrick Riley devised the winning proposal in the third-annual Innovation in Social Entrepreneurship Case Competition, held March 27-29 at Brigham Young University in Provo, Utah. The Notre Dame MBAs competed against their counterparts from BYU and the universities of Portland, Colorado and Utah.
The teams were challenged to solve a problem facing Safe Water Network, a nonprofit founded by the late actor Paul Newman and still affiliated with the Newman’s Own Foundation. The network’s goal is to develop innovative ways to provide safe, affordable water to those in need.
The Gigot Center for Entrepreneurship at Notre Dame’s Mendoza College of Business sponsored the Notre Dame team and helped the students prepare for the case. Viva Bartkus, Notre Dame associate professor of management, served as faculty mentor and adviser. Lehmann is also president of Notre Dame’s chapter of Net Impact, a group that promotes the use of business skills to support social and environmental causes.
The competition was hosted by BYU’s Ballard Center for Economic Self-Reliance.
The teams focused on a Safe Water Network purification facility in the Ghanaian village of Dzemeni near Lake Volta. Ghana is a country in West Africa. The facility draws water from the lake and sells it, at low cost (about 1 to 2 percent of average monthly income) to the people of the village. Pipes carry the clean water out to other nearby villages, where it can be purchased at kiosks.
According to background information provided to the teams, Safe Water’s desire is to transfer ownership and operation of the facility to local owners, but after a few years the system was not yet profitable.
Drawing on Lehmann’s prior experience in engineering and international development, the Notre Dame team first recommended replacing the facility’s infrastructure with easier-to-maintain technology. They also devised an incentives-laden business plan relying on micro-franchises granted to entrepreneurs. Under their plan, the entrepreneurs would make no profit on water sold up to a certain volume, established by the community or system manager. But once sales exceeded that threshold the franchise owners would earn a 50-70 percent profit.
“This weeded out folks who wanted to be kiosk owners but wouldn’t really hustle,” said Lehmann,” Lehmann said. “Once you get past the threshold point, the incentive to sell one more marginal unit of water is very, very high, so … people were incentivized to sell a lot and motivated to educate the community about (the benefits of) clean water as well.”
Ryan Hebert, Safe Water Network program associate, said he thought all of the teams at the competition had insightful ideas, but he and his fellow judges agreed that the Notre Dame team’s recommendations were a cut above.
“Of all of the teams, they articulated the clearest understanding of the particular challenges Safe Water Network faces, and they demonstrated an ability to unite high-level strategic logic with real-world examples to arrive at well-reasoned conclusions,” he said.