Tracking down Dr Sabahat Azim, founder and CEO, Glocal Hospitals, for an interview is fraught with missed calls and bad mobile network. Based in Kolkata, Glocal is a rural healthcare chain with five hospitals in villages like Sonamukhi and Dubrajpur across West Bengal. Azim spends much of his time travelling from one hospital to another, and also driving through parts of Uttar Pradesh, Bihar, Orissa and Assam as he trots up thousands of miles to grow Glocal to 50 rural hospitals by the end of 2013.
Tracking down Dr Sabahat Azim, founder and CEO, Glocal Hospitals, for an interview is fraught with missed calls and bad mobile network. Based in Kolkata, Glocal is a rural healthcare chain with five hospitals in villages like Sonamukhi and Dubrajpur across West Bengal. Azim spends much of his time travelling from one hospital to another, and also driving through parts of Uttar Pradesh, Bihar, Orissa and Assam as he trots up thousands of miles to grow Glocal to 50 rural hospitals by the end of 2013.
This punishing travel schedule through India’s interiors has been a habit for Azim, a former Indian Administrative Services (IAS) officer of the Tripura cadre, and a trained doctor. What’s new though is the business jargon—terms like break even points, revenue targets, recovery on investment and consumer satisfaction—he generously uses to describe his company’s trajectory.
Partnering with the government to bring e-governance to India’s villages, the company Dr. Sabahar Azim led helped create rural entrepreneurs who provided a multitude of services via 18,000 Common Service Centres (CSCs).
“My biggest learning from my IAS days was that grants don’t work. If you really want to create services that benefit people, and make sure they are run efficiently, people must pay. Otherwise, the value of goods and services goes down,” says the former bureaucrat, who resigned from government service after seven years to found Glocal. “A good business’ intention should be to make these services affordable and accessible.”
Glocal, which was funded by marquee VC firm Sequoia Capital and Elevar Equity, has crafted a canny business model to achieve its main objectives—to bring protocol-led, quality healthcare to rural centres, and to do so at price points that make sense. Essentially, it does this by careful disease mapping (to identify the most prevalent diseases that must be treated), and hawkishly controlling operating expenditure and wastage.
My biggest learning from my IAS days was that grants don’t work. If you really want to create services that benefit people, and make sure they are run efficiently, people must pay.
– Dr. Sabahat Azmi
Glocal’s first hospital in Sonamukhi, 126 kilometres away from Kolkata, has validated their model since it opened up in July 2011. Built at a cost of roughly Rs3 crore, this 50-bed secondary hospital which treats up to 200 patients every day offers common medical services at affordable prices—Rs25 for an injection, Rs35 for urine test, Rs100 for X ray or an ECG, and Rs2500 for normal birth deliveries. It also successfully met its first benchmark target. “Our hospitals are designed to reach operation break even in six months, achieve their revenue targets in 12 months, and have return of investments of 36 months.” Actually, the Sonamukhi hospital took six months and 18 days, Azim painstakingly points out. “But it was our first, and helped establish our learning curve. My sense is the others will get there quicker.”
This dogged monitoring of business fundamentals and performance might seem at odds with his hospital’s local surroundings. But Azim believes it’s the key to working in rural India. “Many people think they can enter the rural market with a low-cost, pared-down product but that will never work. With the mass media and mobile revolutions, aspirations here are very high. To survive here is tougher than in any urban centre—you need incredible efficiency to offer that quality at lower prices.” He likens the situation to the automobile market in western Europe where everybody already has a car so for every extra rupee they spend on a vehicle, they expect a higher return. “We can’t treat these customers like second grade citizens, or beneficiaries.” Of course, there are challenges, he says, including getting doctors to view medicine as a profession, not as a “business practice” although he’s quick to add that this is an ill which afflicts the medical fraternity across India, and not just rural areas. Yet, he’d rather focus on the opportunities “The Indian rural healthcare market is valued at $20 billion. Trying to crack that was never easy.”
