The Aravind Eye Care System

16 Pages·2016·0.25 MB·English

The
 Aravind
 Eye
 Care
 System:
 An
 Inspired
 Institution

A
 Case
 Study

"Intelligence
 and
 capability
 are
 not
 enough.

There
 must
 be
 the
 joy
 of
 doing
 something
 beautiful.

Being
 of
 service
 means
 going
 beyond
 the
 sophistication
 of
 the
 best
 technology,

to
 the
 humble
 demonstration
 of
 courtesy
 and
 compassion
 to
 each
 patient."

– Dr.
 Govindappa
 Venkataswamy

–

1. Background
Aravind Eye Care System (AECS) is a non-profit eye hospital chain in India. It was founded
by Padmashree Dr. Govindappa Venkataswamy (fondly known as Dr. V) at Madurai (Tamil
Nadu) in 1976. Inspired by and named after the renowned sage Sri Aurobindo, the mission of
AECS is to provide compassionate and high quality eye care that is universally affordable.
Since its inception, AECS has treated over 38 million patients and performed more than 5
million eye surgeries and laser procedures.
About 40 million people across the world are blind. Nearly 80% of these cases are curable.
Blindness afflicts around 1.5% of the population in the developing nations. Cataract is a major
cause of this blindness. It accounts for about 75% of all cases in Asia. A cataract forms as the
natural lens of the eye clouds over time, and has to be surgically replaced by an artificial one.
Over the four decades of its existence, AECS has created a major impact towards eradicating
cataract-related blindness in India. Its network presently includes ten eye hospitals, a research
institute, an intraocular lens factory, an eye bank, and a training institute. AECS has also
established an extensive and robust outreach program, wherein doctors reach out to remote
villages to conduct eye camps that are sponsored by various charitable institutions.
To progressively eradicate needless blindness in India, AECS emulated the fast food assembly
line approach of McDonald’s and intelligently adapted it to eye care. This allowed the
institution to leverage the power of standardization, scale, product recognition, accessibility,
and service efficiency. The three pillars of the AECS business model are: a) high volume, b)
high quality and c) affordable cost. Its operational and growth model has been widely
applauded, and studied in depth by numerous internationally reputed business schools.

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2. The Institution
The Aravind Eye Care System (AECS) is presently a 4,000-bed hospital system that offers a
comprehensive range of specialty care, covering everything from cataract to corneal ulcers to
eye cancer. It treats 3.5 million patients annually, and performs over 400,000 surgical and laser
procedures. This makes it the world’s largest and most productive eye-care services group.
The uniqueness of the AECS model arises not so much from its clinical competence or efficient
processes, as from its deeply humane value system. If somebody is blind, Aravind considers
this to be a matter of its active concern - irrespective of the person’s capacity to pay. As an
institution, AECS thrives on generosity and actually benefits from serving those in need.
AECS doctors carry out around 2600 surgeries per surgeon per year, compared to an all-India
average of about 400. The institution’s processes are oriented towards enabling surgeons to be
at their productive best. Its battalion of paramedical staff (young village women who are
rigorously trained to carry out the routine tasks associated with eye surgery) allows the
doctors to focus on the diagnosis and the surgical procedure itself. The extensive training and
experience of these surgical nurses enables some of them to detect vision problems with their
bare eyes that a doctor may not spot as quickly even through a microscope.
The scale and productivity of AECS are all the more remarkable on account of the fact that its
services are ultra-subsidized (or even free) for the poor, without compromising even an iota on
the quality of treatment. It remains a self-financed institution that sustains itself by treating the
well-off patients who are attracted by its reputation for excellence in eye care.
At AECS, there are no eligibility criteria or “assessment of means” to decide if a patient should
pay for the services. The choice of whether to pay lies exclusively with the person. A barefoot
farmer may come in, and utilize paid services. On the other hand, Dr. APJ Abdul Kalam
(before he became the President of India) once wandered into the free section of the hospital
when he had forgotten to carry his money wallet, and received wonderful service. The AECS
philosophy may best be described as, “Do the work well, and the money shall follow.”
AECS not only works towards the mechanical restoration of “sight”, but also seeks to actively
affirm the dignity of its patients. The organization invests immense energy into bringing eye
care within the reach of people who may otherwise be too poor to seek out its services.
All the patients receive the same excellent surgical care regardless of ability to pay. The same
doctors work across its free and paid service sections. However, paying patients can choose
private rooms, air-conditioning and other technology options, whereas non-paying patients

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recover in large dormitory style wards. Patient outcomes hold their own in comparison with
those of the best hospitals in the world. AECS never advertises, relying instead upon satisfied
patients to carry its banner.
AECS fuses innovation with empathy, the principles of business with active service, and outer
transformation with inner change. It integrates universal access to services together with the
notion of self-reliance. The institution synergizes between the quality, the cost and the demand
for its services, and thus demonstrates that high quality surgical outcomes may be fostered by
high volume as well as affordability.
AECS is not just a financially sustainable organization, but a profitable one too. In a good
year, it made an operating surplus of US$ 13 million on revenues of US$ 27 million. Patient
services as well as institutional growth and expansion are all covered by patient revenue.
AECS cheerfully assists other hospitals around the world to enhance their productivity and
efficiency by deploying its principles and practices. Rather than build a fortress around the
magic that it has developed, the institution amplifies its strength by sharing it with others. It
has open-sourced its success for the benefit of all its stakeholders, and for humanity at large.

2.1 The Genesis of the Institution
After retiring as the Head of the Department of Ophthalmology at Madurai’s Government
Medical College, the 58 year old Dr. V wished to continue his professional work of providing
quality eye care to the poor and the rich alike on an even larger scale. He put his life savings
on the line to establish the Govel Trust. Under its auspices, a modest 11-bed eye clinic was
founded in order to work towards the eradication of “needless” blindness in India.
Dr. V recruited his extended family to join in this mission. His youngest sister Dr. G. Natchiar
and her husband Dr. P Namperulsamy were the first to come on board followed by Dr.
Vijayalaksmi (the sister of Dr. Nam) and her husband Dr. M. Srinivasan. The team
established three simple rules, and seeded them as the organization’s DNA from the outset:
Ø We shall not turn away any patient, irrespective of the person’s economic capacity.
Ø We shall never compromise upon quality.
Ø We must remain financially self-reliant, so as to refrain from compromising our freedom.
This meant that all of Aravind’s activities needed to embody compassion, excellence and
integrity. Indeed, Dr. V started the institution without raising any external funds or donations.
Marketing was directed exclusively towards people who did not have the capacity to pay, and

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sixty percent of its services were to be given away for free. All the same, world-class quality
was to be offered and maintained at all times. The organization that was founded on this
seemingly absurd framework is paradoxically the world’s largest provider of eye care today.
Born in October 1918 as a farmer’s son in Vadamalapuram (a village eighty kilometers from
Madurai), Dr. V grew up walking barefoot to school. He tended the family buffalo, and wrote
his lessons in the sand. The loss of a cousin sister due to childbirth complications seeded in the
young boy the conviction of becoming a doctor, so as to prevent such untimely tragedies.
After graduating with a B.A. in chemistry from Madurai’s American College, Dr. V received
his medical degree from Stanley Medical College, Chennai in 1944. He joined the Indian Army
Medical Corps thereafter. However, he had to retire from the armed forces in 1948 after
developing chronic rheumatoid arthritis and psoriasis.
This severely debilitating and painful disease persisted for a long time. Dr. V found it difficult
to walk or even hold a pen in his badly crippled fingers. He never married either. This noble
suffering perhaps prepared him for the mission of eradicating curable blindness.
Despite his condition, Dr. V earned a Diploma and a Master’s Degree in Ophthalmology. In
1956, he joined the faculty of the Madurai Medical College. Through painstaking
determination and hard work, he taught himself how to cut and operate the eye with his
twisted fingers. He learned to hold a scalpel, and to perform cataract surgery. Eventually, he
was able to carry out over one hundred eye surgeries within the space of a single day.
In the ensuing two decades, Dr. V introduced a number of innovative programs to deal with
the problem of blindness in India. He developed the Outreach Eye Camp programs in 1960,
and a Rehabilitation Centre for the blind in 1966. Dr. V was also instrumental in the creation
of a training program for Ophthalmic Assistants in 1973.
In his clinical work, Dr. V personally performed over one hundred thousand successful eye
surgeries. In recognition of these achievements, the Government of India awarded him with
the Padmashree in 1973.
As a young man, Dr. V had become a disciple of the sage Sri Aurobindo. The latter’s teachings
emphasized that in life, human beings must transcend into a heightened state of consciousness
so as to become better instruments for the divine force to work through.
Thus inspired, Dr. V audaciously ventured to create the Aravind Eye Hospital as a self-
supporting, humanitarian institution. He was propelled much less by a business strategy than
by an intense desire and an infinite vision to offer selfless service to those in need.

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2.2 Establishing the Enterprise
The initial source of funds for AECS was personal savings and the family silver. For instance,
in order to build the first hospital, Dr V mortgaged his house. His siblings pooled their life
savings (Rs. 500 each), and even pawned their jewelry in order to pay for the construction.
Aravind was guided from the outset by the policy that the paying as well as the free patients
would be treated side-by-side. The patients who could afford to pay were charged no more
than the fees levied by the comparable hospitals in the city.
The enterprise generated a surplus from the very beginning. The accrued funds facilitated the
construction of a 30-bed hospital within one year. A 70-bed hospital meant exclusively for free
patients was built in 1978. The existing paying hospital building was opened in 1981 with 250
beds and 80,000 sq. ft. of space over five floors.
In 1984, a new 350-bed hospital was opened in Madurai to cater exclusively to free patients.
In stages, the number of beds increased to 1468 (1200 free and 268 paying) in the hospitals
there. The equipment was always of the best quality, much of it being imported. However, the
examination rooms, waiting halls and other facilities were utilitarian.
In addition, a 100-bed hospital was set up at Theni in 1985. A hospital with 400 beds was
opened at Tirunelveli in 1988. An 874-bed hospital was opened at Coimbatore in 1997. In 1998,
the Rotary Aravind International Eye Bank was set up at Madurai. In 2003, a 750-bed
hospital was started at Pondicherry - the home of the Aurobindo Ashram.
AECS targeted the lower and middle class segments of society, but also provided treatment to
the upper class people. The paying patients paid market prices because Aravind was the
quality leader in its field. The income so generated helped to subsidize the organization’s core
mission. In fact, AECS positioned free service not as a charitable service but as one of the
many options in a price menu that ranged from zero to market rates.
While Dr. V. was the chief architect and keeper of the AECS mission, each member of the
core management team took on the primary responsibility for one aspect of organizational
functioning. Dr. Natchiar oversaw the clinical and service side of operations, while Dr.
Namperumalsamy guided the clinical specialties and advanced training for the doctors, along
with research and innovation. Mr. G. Srinivasan looked after the maintenance and expansion
of the physical plant. Dr. Vijayalakshmi and M. Srinivasan provided leadership with respect to
cataract surgery and its advances. Mr. Thulasiraj led the outreach activities, and organized the
training of other eye care providers who wished to learn from the experience of AECS.

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As new hospitals were added, a second-generation leadership team from Madurai was
transferred to the new location to facilitate their launch. Because of their significant experience
with the operating procedures and principles at Madurai, the transition was relatively smooth.
While the initial focus of the Govel Trust was on building eye hospitals and reaching out to the
poor, several supplementary activities were added in order to accelerate the progress towards
the goal of eradicating needless blindness. For instance, Aurolab was established in 1992 for
the production of intra-ocular lenses (IOLs). Further, Lion’s Aravind Institute for Community
Ophthalmology (LAICO) was founded in 1996 in order to promotes best practices, carry out
structured training and research programs, and also conduct capacity building activities.
The establishment of these and other support organizations such as the Aravind Medical
Research Foundation (AMRF) and the Dr. G Venkataswamy Eye Research Institute
gradually helped Aravind Eye Hospital to evolve into the Aravind Eye Care System (AECS).

2.3 Scaling the Organization
AECS realized that the key requirement for rapidly scaling an organization is to standardize
the core activities. The surgical procedures for cataracts and even the screening activities at its
eye camps were highly amenable to value-engineering techniques. The ancillary activities that
supported the organization’s core operations also lent themselves well to standardization.
As a result, every core activity at AECS is carefully designed and efficiently orchestrated. For
instance, detailed procedures govern how an AECS eye camp is to be promoted, how patients
are to be brought in, how its logistics are to be organized, how medical screening is to be done,
and how patients are to be selected and prepared for the journey to the main hospital. The
same applies to the surgical procedure as well as the preliminary and post-surgical processes.
In the spirit of learning-by-doing, AECS constantly innovates its delivery model. For instance,
when Dr. V’s application for a bank loan to support free eye care for the poor was rejected, he
built the ground floor of his hospital as “fee-for-service”. However, the foundation of the
building was laid deep enough for the vertical expansion of the facility with ease at a later date.
Similarly, less than one in five potential patients were found to actually avail of “free surgery”
offer during the initial eye camps. It was discovered that poor rural people faced many barriers
in making the choice to have the surgery. AECS then added services such as food, lodging,
and transportation to address those constraints. As a result, the acceptance rates increased to

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around 90%. Through a similar process of trial and error, the yield at refractive camps (where
eye glasses are prescribed and fitted) surged from less than 10% in 2000 to over 80% in 2006.
However, unsuccessful experiments are terminated after being given a fair chance. For
instance, several surgical camps were initially conducted on-site in order to make it convenient
for rural people to accept the surgery. However, the medical outcomes were hard to manage
because of the variable quality of the surgical environment. AECS abandoned the surgical
camp model, and reverted to utilizing the camps only for the purpose of screening the patients.
In 2004, AECS began to establish permanent Vision Centers in villages in order to provide
basic eye care services. Staffed by paramedical personnel and equipped with a high-speed
communication link to the main hospital, the Vision Center conducts eye examinations and
helps identify refractive errors. If spectacles are needed, the prescription is sent to the base
hospital for fulfillment. Complicated as well as surgery cases are referred to the main hospital.

2.3.1 The Managed-Care Hospital Model
All the Aravind-owned hospitals are vertically integrated medical facilities. That is, AECS
directly controls all of their operations - from the design of the hospital to its physical building,
and from the training of the staff to the manufacturing of key supplies (intraocular lenses,
sutures, blades and instruments). All the Tamil Nadu hospitals continue to run on this model.
In 2001, with a view to expand its reach, AECS began to experiment with an alternative
business model in the form of “managed-care” hospitals. Three such medical facilities have
been developed in other parts of India so far, in collaboration with different agencies.
The Indira Gandhi Eye Hospital and Research Center in Amethi, Uttar Pradesh was
established by the Rajiv Gandhi Charitable Trust. The Priyamvada Birla Aravind Eye Hospital
at Kolkata is funded and largely overseen by the MP Birla Group. Sudarshan Netralaya at
Amreli in Gujarat was established in collaboration with the Nagardas Dhanji Shanghvi Trust.
These institutions are relatively independent from the main hospital system in Tamil Nadu.
They are not led by an AECS-trained doctor, but are supported by a manager trained at
LAICO. The staff members at these facilities also see themselves as separate from AECS.
There is a significant difference in the degree of vertical integration between the core and the
“managed-care” hospitals. AECS is involved in almost every operational aspect of the southern
hospitals, while its scope of work at the managed-care hospitals is limited to surgery and
overall management. It has little involvement in the building, financing or outreach activities.

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Cultural differences come in the way of the AECS model being effectively transferred to the
managed-care hospitals. For instance, the internally trained nurses perform a wide range of
roles such as assisting in the operating theater, processing admissions and maintaining the
facilities. However, the efficiency and dedication of these “sisters” in the managed-care
hospitals is not observed to match that at the core hospitals. A few of them were deputed from
Madurai to develop the local nursing staff. However, such transfers have decreased over time.

3. The Work Flow
The hospital processes at AECS, across the paying as well as the free sections, are carefully
designed and well established. These play a key role in enabling high operational efficiency.
Patients start gathering much earlier than the starting hour, and enter the hospital through the
designated Outpatient Department (OPD) entrance. They usually drop in without prior
appointment, and are often accompanied by one or two family members.
At 7 am sharp, the first patient is registered at the Reception Counter. (S)he fills out the basic
personal information in a card, and then waits in line in front of a Registration Counter. The
computerized registration process takes about a minute per patient, and prints out an OPD
patient card as well as a tag that serves as the patient passport for subsequent visits.
Patients then take their seat in the designated waiting area. After the preliminary checks
carried out by the paramedical staff, the standard routine begins with the Refraction or the
Vision Test. The patient then meets the Resident Doctor at the Examination Station, where
the diagnosis and the recommendations are recorded. Special tests (dilation, A-test, blood
tests) may be necessary for some patients, while additional procedures (blood pressure, ocular
tension, urine sugar) are required for patients over 40 years of age.
A senior Doctor examines the patient thereafter. Finally, the patient is counseled and
discharged from the OPD – often for further consultation at one of the hospital’s Specialty
Clinics. The entire process takes no more than two hours, depending upon the tests needed.
Each unit has a nurse-in-charge responsible to manage patient flow. She alters the sequence of
the procedures for any patient in order to minimize the bottlenecks that develop at certain
stations. Refraction is the longest procedure, and therefore a common bottleneck. In that case,
some patients may be sent to the junior doctor’s examination first. Paramedical personnel are
stationed at critical places in order to direct people, and to avoid confusion.

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At the end of the hospital visit, the patient card / file is retained by the nurse in the respective
department. It is later brought back to the Reception Area, where the diagnosis is entered into
a computer system. Patients coming for repeat visits are known as Recurring Patients. They
register at a separate counter, which has a similar work routine.
Spectacles are prescribed to many patients after the refraction tests. They might (but are not
obliged to) go to one of the spectacle shops located in the hospital. Run as separate profit
centre, these shops sell spectacles at less than what they would cost in an external optical shop.
The grinding and fitting of the glasses are done in-house while the patients wait. The system is
geared to enable patients to leave the hospital with glasses within a time span of four hours.
Patients requiring surgery are admitted immediately, subject to their readiness as well as the
availability of rooms. The paying patients may choose specific doctors to carry out the surgery,
as well as the type of surgery (e.g. phaco-surgery), the type of lenses (rigid or foldable etc.),
and the type of rooms. These requests are processed on the computer, and an admission or
reservation slip is generated. Staff counselors assist the patients in making all of these choices.
The workflow in the surgical wards is equally smooth and efficient. The nursing staff comes in
at 6.30 am, and the names of patients to be operated on during the day in each theatre is put
up by 6.45 am. The computerized scheduling process incorporates all the preferences that have
been expressed by the patient at the time of registration.
The patients to be operated upon during the day are moved to a ward adjacent to the
Operation Theatre (OT). After the local anesthesia injections, their eyes are washed and
disinfected. By 7.15 am, two patients are lying on adjacent operating tables within the OT.
The OT has four operating tables that are laid out side-by-side. Two surgical teams, each
consisting of one doctor and four nurses, operate simultaneously. Every team looks after two
adjacent tables. Although operating theatres usually do not allow simultaneous operations to
take place due to the risk of infection, no such difficulty has been reported at AECS.
The first patient is on table #1, ready for the operation, with the nurses fully prepared. The
doctor commences the procedure, which takes up to 12 minutes to complete. When the first
surgery is over, the doctor moves to table #2 where the second patient is ready with the
microscope focused upon the eye that is to be operated upon. The instruments are ready too.
Meanwhile, the first patient is bandaged by the nurses and moved out, and the third patient is
moved in (on table # 1) and readied for the operation. As soon as the second patient’s surgery

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is completed, the doctor moves back to table # 1 to operate upon the third patient. The surgeon
shuffles between the two tables thus, with hardly any intervening break or loss of time.
The doctors carry out surgery in the morning, while the operation theatres are scrubbed in the
afternoon. The patients who have already been operated upon are moved back to their wards.
AECS is very particular about the quality of the surgery. The management keeps a very close
track of the intra-operative as well as post-operative complication rates. Each case of
complication is traced to the operating team that performed the surgery, and the reasons are
identified. Corrective action, including training of whoever was found deficient, is undertaken.
The AECS administration deploys excellent IT systems to keep track of all the patients as well
as the workload in the different units of the hospital. The system generates daily schedules that
take into account the patient load, specific preferences for particular doctors that may have
been expressed by the patients, and the pending work.

4. The Operational Strategy
The extraordinary success of AECS lies in the innovative design and thoughtful integration of
several operational elements that are woven tightly together into a virtuous cycle of synergistic
performance. Numerous strategic choices have been made in the course of the institution’s
development. Some of these were based upon pure economic reasoning, while the others
helped align the management processes with the core mission of the organization.
The development of this unique institution has been characterized by five strategic choices, in
particular. Each one of these elements is essential for overall success. If even a single element
were to fail, the entire system could unravel. However, when they all click synergistically
together, the startling results are there for all to see, experience and even emulate.

4.1 Focus on Cataract Treatment
Since its inception, the organization’s unstinting focus has been on the elimination of cataract
blindness. In founding Aravind, Dr. V. could have gone in many directions. He chose cataract
blindness. That rest of the AECS strategy was predicated upon this singular choice.
Even as AECS is a multi-faceted clinical and research institution with many ophthalmic
specialties, it principally remains a large-scale cataract surgery “factory”. Cataracts being the
leading cause of blindness in India, about 65% of AECS surgeries are done for their removal.

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