Problems with scaling technological innovations

This is an excerpt of a blog post from Tomorrow Global written by Lillian Gu (@lillian_gu) who interned with the Campaign, supporting our Financing Healthier Lives project and the Health and Microfinance Alliance. One of the “interoperable innovations” that she describes in her post on Tomorrow Global is about how to make water sanitation solutions sustainable when there are so many different, incompatible water filtration systems, meaning there is a high risk of failure and waste. PATH is offering an open-source solution to a design standard for water filters that is analogous to the AA battery. Will the market adopt this solution? To read the full article, go here.

Interoperable Innovations: 3 Examples

Many of the technological innovations we enjoy today are convenient because of their broad availability and compatibility…The same balance of innovation and interoperability exist in international development. There are so many exciting and creative innovations out there to improve access to health, clean water, financial services, education, and so on. The long-term goal is always to move from pilot to scale. However, if innovations aren’t compatible with existing or emerging technologies, they will never scale successfully.

NGOs can also shape the market (Water Filtration)

PATH’s C1 Common Interface Water Filter (Source: PATH)

PATH’s C1 Common Interface Water Filter (Source: PATH)

The problem of interoperability isn’t limited to services, but applies to tangible products as well. Many home water filtration systems are donated to improve access to clean water. Anytime you donate a physical object, you have to think about long-term maintenance (see ‘5 questions to ask when donating medical equipment‘). With water filtration systems, filters have to be regularly replaced. Because filters are often expensive or difficult to find since they are model-specific, donated home filtration systems go to waste.

PATH’s C1 Common Interface is a design specification aimed at solving these issues. The idea is that with one common specification, all manufacturers of filters and water devices can produce compatible products. One analogy PATH uses is standardized batteries. It doesn’t matter if you need batteries for a radio or a flashlight, you can use Duracell or Energizer or a store brand. All size AA batteries are the same shape, size, and charge. PATH has already partnered with manufacturers to produce water filters, but they offer a free license so that any manufacturer is welcome to compete. The jury is out to see if the market will adopt PATH’s specifications.

2 thoughts on “Problems with scaling technological innovations

  1. Joel – Apologies for a very belated response! You make a good point – I agree that ‘open-source’ is a confusing word to use in this context. I’ve asked the Microcredit Summit Campaign to update the language in the intro paragraph to say “design standard” instead of “open-source solution.” I think PATH does want to drive down prices, but what’s interesting about PATH’s C1 Common Interface is that it’s not just a standard size for the filter, but a standardized connection point between water filter devices and filter elements (see picture). So manufacturers could still design different filters and devices – as long as it fits that common connection. With a quick search, I couldn’t find any information on how C1 has progressed in the past year, but definitely an interesting concept. Thanks for your thoughts!

  2. “Standardized” and “open-source” are not synonyms. You are talking here about making standards for filter size and shape, not about “open-source”.

    “Open-source”, a term originating in software, implies that the hidden methods of construction of a product (e.g. the computer programming source code, or the recipe for Coke) are revealed to all. That is certainly not the case for AA batteries: the AA battery is, as you say, standardized in shape and charge but very non-standardized in chemical composition, and those chemical compositions are very much closed to competitors.

    This is economically important because manufacturers want to resist the commoditization of their product, but if they make the effort to develop an improved product they can only reap the economic benefit of that effort if the differences remain closed-source (ie, secret).

    With filters there is little or no difference in the internal composition of the product: all ceramic filters are much more similar to each other in composition than AA batteries are to each other. That means if filters are shaped exactly the same they become a commodity, and then only the largest manufacturer (who can produce a commodity filter at the lowest cost) has any economic incentive to go with the standard. The other manufacturers, who cannot compete on price, understand that going with the standard begins the slow decline of their market share as consumers begin to buy from the cheapest producer.

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