Mehmood Khan's Rural Dreams

As a child, Mehmood Khan, the son of a farmer in Nai Nangla, would trudge a few kilometers everyday to get to school. When it rained, he would fold his clothes in a neat bundle and wade through the water carrying the school uniform on his head just to make sure it did not get wet.

After school, he would help his family on the farm – tending the cattle, ploughing the fields and chasing the hens into the coop.
He, by his own admission, made it big just by chance: "My brother, a successful cardiologist in Florida, and I are products of an accident – we were ejected by the system," he says.
Today Khan is the Global Leader of Innovation Process Development at Unilever. Khan has launched Unilever's brands in countries such as Vietnam, Cambodia, Laos and Mongolia, and later heading their innovation function globally. As Khan grew in stature his district sunk deeper into poverty with myriad problems like illiteracy, poor living conditions, and lack of basic amenities for health and hygiene.

Khan decided he had to find a permanent resolution to the problem. The solution was simple: get a bunch of individuals, companies and NGOs to collaborate. Khan wishes to make this a self-sustaining solution that all the stakeholders involved benefit from. Excerpts from an interview with Khan:


The Germ of An Idea
Khan: If you look at the population of the world – of 6.6 billion people – nearly 4 billion are living below a $2 income [a day]. And 870 million or so are living below a $1 income. How can we make their lives better? That was my personal ambition for a long time. If rural areas don't improve, we won't be able to unlock India's growth potential. The world will not improve. Creating conducive conditions in villages has another benefit: we won't create a mess in the cities.

The trigger
Khan: When Pratham, the education NGO, launched a charity in the UK, I was reminded of a summer project I had done in my IIM days under Prof Ravi Matthai, former director of IIM-A. He was writing a book on experiments in educational innovation and the chapter I worked on was on the leather industry in Jawaja in Rajasthan. We figured out a way to bring technology into what was a dying industry so that we could remove the stigma involved with leather production.
We involved the Central Leather Research Institute in this experiment and that helped revitalize what was otherwise a dying industry. When Pratham came to UK, I had a sense déjà vu: I realized that the kind of things that we had been talking about in the 1970s was actually being implemented on the ground by entities like Pratham.

That set me thinking. Though I have always come back to my village in the last 40 years, I didn't know how severe the problem there was. When I grew up there was no school in the village. Now there is one, but it isn't showing great results. In December 2003, I invited Pratham volunteers to test children in the local school. The results hit me hard: even 4th and 5th graders couldn't read a paragraph or do basic mathematics. The student-teacher ratio was awful: 1 teacher to 100 students. I had to do something about it.

We then pestered the Pratham board to come to Mewat. They were reluctant because they had never done work in villages before. So we collected statistics – only 2 percent of the girls in the region were going to school and the overall education was only 23 percent, whereas the country's statistics were close to 62percent. There was a serious problem here. Pratham finally agreed but they had never worked in rural areas before and were concerned about the safety of their people. So I became a guarantor for them – much like a local guardian.

In spring 2005, we got started in this area. About 40percent youth are unemployed in Mewat even though it is so close to Gurgaon. We used these unemployed youth as volunteers. They were trained in Pratham methodology and we asked them to start taking classes wherever they could. What was fascinating for me was that they took classes without taking money! That's how the process started.

Taking off
Khan: Instead of we giving a formula of what needs to be done, in spring of 2005 we did a stakeholder meeting. We invited villagers and divided them into syndicate groups. We followed a process like we do in Unilever or any other company – of filtering issues coming from the people. But people had their doubts about how illiterate people can do this? How can they articulate sensibly what their problems are? But in two days, we got a large output with four big issues at the helm – education, unemployment, health and hygiene, and water! Next we did action planning – about who will do what. And surprise surprise! The people took upon themselves nearly 80percent of the action!

If You Can’t Get Through It, Get Around It
Khan: There are some things that are simply unacceptable: for instance, you can't have a ratio of 1:100 for teachers and students. I took upon myself all such things. So for the appointment of teachers specifically, I leveraged my IIM networks and approached the education secretary of Haryana who happens to be an IIM grad. He empowered the local sarpanch and the deputy commissioner so that they can appoint teachers in cases where the teacher-student ratio is so badly skewed. This was an inherently new model wherein they didn't have to go to Chandigarh for every approval. So if there were 40 or more students, the sarpanch could appoint a local teacher. If the appointed teachers didn't perform well in six months, they would be sacked. So in the last two years, they have appointed 4000-5000 teachers in Mewat! In contrast, the whole of Haryana had merely 15,000 appointments.

My main collaborator from the government's side is the governor of Haryana, A.R. Kidwai. He once told me that he wanted people to move from traditional agriculture to horticulture and dairy. But doing that was not easy because there are no demonstration farms that people can see. So I volunteered to set up a demonstration farm on my land. In October last year he decided to come and see it. In 60 years of India's independence, no one had ever been to this village. And when the governor decided to come, it set in motion the whole government machinery. The SDM and DC called me up in London to ask me where this village is! They had to then fix the roads and basic infrastructure since the governor was visiting.

Assembling the forces
Khan: We are using the forces of collaboration and co-creation in this experiment. So we have aligned with us — NGOs, individuals and companies who have something to contribute. For instance, a professor called Shai Vyakarnam at Cambridge University's Centre for Entrepreneurship and Judith Crosland had set up a charity in the UK called Grassroots Empowerment Network. They were looking for a place where they could do some initiatives. So we became trustees of GEN and are now doing work in Mewat.

Then I used my networks to bring in other stakeholders. For instance, I met NV 'Tiger' Tyagarajan, executive vice-president, Genpact, at IIM-A's Global Management Summit in London. He told me how costs for the BPO industry in Gurgaon were becoming prohibitive. I told him that how just outside Gurgaon is this area where 40percent youth are unemployed and suggested that he should employ people from there. But his contention was that they don't know English and computers. So I said you should learn from us at Unilever: if people don't know how to drink tea, we show them how to drink tea! So why don't you educate them in English and computers? I asked him for used computers to train these people. We hope that once suitably trained they would be employable in the BPO industry. Our ambition is to shift the BPO industry from Gurgaon to villages.

On the other hand, companies like Aviva and L&T were looking for insurance agents and construction workers respectively. We encouraged them to recruit from Mewat. We set up recruitment camps where we assembled unemployed youth and these companies were free to interview them. Aviva, for instance, hired 15 people who are now earning at least Rs 15,000 a month! Similarly, Unilever appointed agents for its Shakti programme in these villages.

Red Alert
Khan: In education, we have involved the Planning Commission. In the villages here 75percent of the population is below 18 years of age. Pratham does a survey every year. Mewat used to be a red district that means that more than 30percent of the children were not going to school. In January 2008 85percent of children between 6 and 14 years were going to school. We agreed with Montek Singh Ahluwalia that in 2008-09 we would get 100percent of these children to go to school. Planning Commission is willing to allocate money. But then you have to work with rest of the machinery – bureaucracy, Ministry of Human Resource Development, Haryana Government. Funding is flowing, but the point is how do you put it to a productive use?

Scaling up small initiatives
Khan: In July 2007, the girls [in the village] said that they wanted sewing machines so that they can stitch clothes. They started by stitching clothes for their families and later for others as well, and earning money in the process. We are trying to get garment export houses in Gurgaon to outsource work here. Rasooli Kanwar Khan Trust (RKKT) is working out a Common Facility Centre in Nai Nangla, with at least 20 sewing machines, which will serve as a production company. I have purchased 10 more machines and the Mewat Development Agency (MDA) has bought another 10. These 20 machines will be housed in the RKKT premises and Karan Puri, an entrepreneur with textile and garment showrooms in Gurgaon, will train 20 girls in garment production. Eventually he will source garments from here.

The same thought flows through all our initiatives. So when we procured the sanitary napkin machine, we immediately approached Kishore Biyani. Once the machine becomes operational in February 2009, Big Bazaar outlets will stock sanitary napkins produced here. Big Bazaar has also agreed to outsource stitching of quilts to women here.

Ushering change through women
Khan: Women are change agents. We have to make them responsible so that they can charge of their lives and their families. In Mewat the average fertility is eight children per woman. In fact, one woman in Mewat has the record for the highest number of children in India – 23 children! My point is that women, in general, make better entrepreneurs and responsible citizens. If you educate a woman, you educate the family.

In Vietnam when we at Unilever launched a product, within seven days we would try and get it across to household across the country. We launched Lux and Lipton there. Vietnam had 120,000 such shops in 1994. We noticed that women managed the majority of these shops. Men did the physical work at the back-end – bringing in the merchandise, handling storage. But the sales front-end were all women. Women make better presenters, better sales girls. Plus, our products are household products where women make decisions, so they connect well. I also saw that culturally a society develops when both men and women work together. These South East Asian societies were on the move because women were playing an equal role.

When women are in charge, the household is better managed, the family wouldn't have more than 2-3 children and there is a balance in the family. This is starting to manifest in Mewat as well. The girls here have a sense of enterprise in them. They have started earning money by stitching clothes. They have become change agents. They are at an age where parents and siblings listen to them. They have started to send their younger siblings to school. If women are educated, they learn to be responsible mothers. They learn why it is important to restrict the number of children they have.

Using Enterprise to create change
Khan: In the new world, we need to use enterprise as the point of change. It is either about one person becoming an entrepreneur or a group of people coming together to build a business. Just after I finished my MBA from IIM-A in 1977, I joined the Bhartiya Agro Industries Foundation, an organization set up by Manibhai Desai, a Gandhian. The idea behind BAIF was creating employment at the 'doorstep'. I picked up this learning from the BAIF: how to convert local livestock into a productive enterprise at the 'doorstep' of the farmer. That's a thought that stayed with me. So for me, a cow or a buffalo is also an 'enterprise'. A cow, by the way, is a more efficient converter of input into output. Feed a cow Rs 20 a day and you'll get an output of Rs 60 a day. A buffalo consumes more fodder – feed it Rs 50 a day and get an output of Rs 70. In Indian conditions with the water table depleting and conditions changing, a cow is more efficient.

In this context, Mother Dairy is the bigger enterprise. Mother Dairy steps in as a marketing outlet and is a viable model that has worked well elsewhere. The Mother Dairy outlet, it employs 4-5 people directly but has a larger impact on the village. Nai Nangla has an agricultural output of Rs 1 crore a year. With Mother Dairy coming in, the GDP of these villages will rise by Rs 72 lakh a year, going by a targeted milk collection of Rs 6 lakh a month! They have installed a computer in Mother Dairy – that has brought science to the village. If a village has a Mother Dairy, women are empowered: they have greater control on the money earned from selling milk. If the output is sold outside the village, men take the money and get drunk and squander all of it.

Large companies create a multiplier effect
Khan: Unilever did a study in Indonesia with Oxfam that found that large companies create a 60 times multiplier effect on job creation in society. So while Unilever employs 5,000 people in Indonesia, the value chain gives jobs to 300,000 people. We are working on the same premise in Mewat. In a value chain there is backward integration in terms of suppliers and forward integration in terms of customers. The same thing applies here as well. Large companies need to participate in poverty alleviation for their own good. Today 50percent of HUL's growth comes from rural India. If Mother Dairy raises the income of people, people will buy more soap, more shampoo, etc. Similarly if Aviva employs people, they will have more money to spend on other things. So in the end, everyone benefits from it. This will fuel the economy.

Impressing the Academia
The experiment in Mewat has started to spark off interest amongst academic researchers worldwide. Dr Pierangela Morlacchi, a lecturer in Science and Technology Policy Research at UK's Sussex University, is following this as an action research project. Prof Shai Vyakarnam, Director of the Centre for Entrepreneurial Learning at Cambridge University's Judge Business School is writing a white paper for the World Economic Forum and he has taken this project as an example. Louise Koch, an anthropologist, has started working on a project for Copenhagen Business School on the collaboration and co-creation aspects of this initiative. Channel 4's James Johnson and Rajesh Vyakarnam have made a documentary film on this, titled 'The Challenge and the Hope'.


The Hurdles
Getting this project off the ground was far from easy. Apart from the usual suspects- local politics and failed promises, the group had to deal with a social disconnect as well

Local politics:
"While democracy is working in India, there are too many goons in Mewat who have a vested interest in the region. They and push their limited agenda and try to disrupt larger community cause."

Disconnect between promises and reality:
"There is a gap between what the Central Government says and what the ground realities really are. For instance, we are still struggling to get a broadband connection to the village despite the government promising to get it for us."

Finding people committed to the cause:
"It isn't easy to find people willing to be part of this project to undertake development work in backward places like Mewat."

Winning people's trust:
"People in such areas are used to hear false promises from government agencies. We had to deliver results to be credible."

Women's education:
"People in Mewat do not want to send girls to schools. We had to create conducive conditions to make female education possible."

Water:
"There is no direct water supply in the village. People had to walk several kilometers to bring drinking water. Some time back we managed to convince the authorities to send water tankers to the village. But we still do not have a viable option."