Digging into the details

This week are looking at organization structures, the scope of the venture and the hiring plan. I have very little knowledge defining organizational structures in business terms. So I did a little bit of research to find the right terms. I have worked in both start ups and large companies, the former being completely flat the latter was divisional and hierarchical.  CycleRaja will only function in a flat design driven structure. The future of CycleRaja is based in design innovation. To encourage innovation the company has to be organized to support employees' creativity. Creativity is not limited to making the helmet "shiny". Many businesses loop design at the end of their product process to "shiny-fy" their product but what a lot of companies don't understand is the full range of what design can offer. Creativity is a key ingredient when you are penetrating a unique market. By focusing on the needs and behaviors of our target market we will be able to creativity break into the market and spread and have the kind of impact that we would like to have. 

The core leadership team has to have a member with a business background and hopefully someone who has experience working with developing economies. 

Scope of the social venture

We looking at the business cycle in class this week (shown below). Visually looking at the process makes it easer for me to understand what will be done in house and what will have to be outsources. 

Research and development will be conducted through a partnership with a material engineering company based in India that has experience working with foams.

The production of the soft core foam and the customizable shells will be outsourced to micro-factories that will set up by CycleRaja but handed over to the community. The idea is to support local economies and help people build expertise in manufacturing. 

Marketing and sales: Marketing will be outsourced to companies that are local to the cities that CycleRaja is expanding to. To popularize CycleRaja helmets it is important to use mediums that our target market is familiar with, this includes advertising on regional channels using local celebrities. Another aspect of marketing will including hiring autorickshaws  to penetrate into different areas of the cities and advertise. This is a mode that is used by politicians during elections and by the government to announce health camps for the poor.

Autorickshaw used for political campaigning 

Distribution: To ensure that the bicycle helmet is available in every local store I have to make it easier for cycle store owners to access it. For example I recently found out that Decathlon India (http://www.decathlon.in/) a warehouse for sports goods has made it easier for shop owners to stock up on bicycle accessories because they offer them for cheap. Decathlon has reduced their distribution cost by setting up a single Costo like self service warehouse with goods that both private individuals and business owners can buy. Would that work for me? Will I have to set up hub in each city to support distribution. I think I have rethink this aspect of my business. I could also emulate distribution  of successful Indian cycle companies like TI Cycles of India. 

Service: CycleRaja will not have it's own shops where the helmets will be sold. By using existing local cycle shops we will be eliminating service costs. 

Partnerships 

Distribution of bicycle helmets will not be possible without the help of local small business owners and therefore it is important for CycleRaja to build good relationships with them. Other partnerships include our foam suppliers, manufacturers and the leads in our distribution system that will take our helmets and put them in the hands of the bicycle shop owners. 

Hiring plan

I don't have the hiring plan right now but I have an idea of what I need. Starting off I will require a marketing team to help bring CycleRaja visibility and to educate the public about bicycle safety. I will also need a team to work on building partnerships with shops and to monitor the distribution. I will have to think through the timeline for the hiring period. I would like to keep the team small and tight for the first couple of years to reduce spending and focus on the product and breaking into the market.

Phew. I wish there was a term for "brain pain from thinking business" because that is what is happening right now.

Market plan and new product pricing

I have been struggling with balancing low cost design that provides protection and making a profit.
If I need my target market to immediately adopt the bicycle helmet that I propose, the helmet has to cost about $3 or even less. If I decide to go with a new design then I will not be able to use existing  manufacturing which makes it more expensive for me to set up my own factories. Battling between the two my design itself it slightly stagnant. As a designer I have never had to battle pricing, manufacturing and considering things like cost of distribution and marketing. I am going to admit that it stresses me out a LOT.

Initially I thought I could push down the price of the helmet for the poor cyclists and create a premium helmet for the bicycle enthusiast. I talked to Prof Z and realised that maybe I need to rethink this. Maybe I need to start streamlining the process of my product. Considering both the business aspect and the design at the same time starts curbing what I can do on both the ends. After I looked at everyone's stakeholder presentation, especially the team working on the innovative motorbike raincoat for Jakarta, I realised that I should make the design of the bicycle helmet independent of the business aspect. This will help me focus on the business aspect of it first and in the meanwhile I will be able to innovate on the design.

So now, essentially I would like everyone in India who owns a bike or even those who don't own a bike to feel safe enough to come out and cycle in the cities. That is my eventual goal. Cycling will ease the traffic and have a low carbon footprint. I realised, however, that I need to focus my user group down. In business, as in design, if you start with a very large user group your product attributes will be diluted and nobody will buy your product. I adjusted my target market.

In the image above I say that the penetrated market is going to be non-techie Bangaloreans but that is going to be my initial market. I would like to move into bigger cities like Delhi, Mumbai and Kolkatta as soon as the sales in Bangalore move upward.

Next steps: Looking at the other presentations I realised that I don't have exact numbers for when I will break even and start making profits. That is probably something I should have so stakeholders will be more willing to give me their attention.

Every step in this project is a huge learning.

Happy Break everyone!

Who need another bike helmet?

There are multiple reasons for low adoption of helmets by cyclists in the population that I am targeting with my product.

1. Cost: As I mentioned in my elevator pitch the cyclist population that I am targeting buy bicycles for less than $20. They use these cycles for more than 10 years and very often they buy them second hand. Bicycle helmets cost $20. As bicycle helmets are not mandatory, cyclists are unwilling to pay the same price as their cycles for something they perceive as useless.

2. Inaccessible: Bike helmets are available in specialty bike stores that do not cater to the low income working populations. Online stores such as www.bumsonsaddle.com make bikes and related accessories available to a richer clientele.

Through this course I hope to design bike helmets that are low cost, easy accessible and set a trend that will drive this population of cyclists who don't wear helmets to adopt helmets.

Address the accessibility aspect of my venture I want helmets to be available in places that my target customers frequent. This includes local cycle shops show in below in the picture which has traditionally been the place that people go to get their cycles fixed. Simple issues like punctures, new tires etc are handled by these kind of shops across India.

I don't think I will be able to convince people who have never worn helmets to wear helmets by just making it cheap and easy accessible. The Indian audience needs more value out of every rupee it spends. What is the bike helmet offered more than just protection? What if it improved your bicycle commute by reducing the dust and pollution that you inhale? What if your bike helmet made it possible for you to get to work and school no matter what the weather  is like outside? These are ideas that I'm toying with now that I'm getting into designing the helmet. I have below the value that my product will add.

Trying to get people to adopt something new is a little difficult. I have to find a way to easy the process of change from not wearing a helmet to wearing one because the success of my product depends on it.

Image from: http://downtheroad.org/Alaska-Canada-USA/letters/b1_New_Delhi_1india.htm

Problem spot

As a designer I'm hesitant to claim to be able to solve problems without completely immersing myself in the environment that I want to design for. For this course I want to use my design background to solve pressing social issues in India because

1. India is my home and there are many issues that I have faced and seen that I've wanted to tackle.
2. India's growing economy is a great platform for social ventures.

Issues of access to clean drinking water, sanitation, education and waste management I want to eventually want to address. I feel, however, that I am not currently equipped to design for these issues because my distance from my target audience. Also I have no prior background of working in rural India. I've spent the last few weeks brainstorming on areas that I want to look into and I have finally narrowed it down to one area.

Last week's reading "Identifying Venture Opportunities" helped my hone in on my problem definition. As of now, my concept will look at supporting and promoting bicycle riders in Indian cities.

The problem

In my brainstorming session I looked at what the problem is and why I want to address it. From my own experience as a cyclist in a big city in India and from the stories shared with me, I drew out some key points. I also looked at research on bicycle usage in Indian cities.

What is my market?

When we talk about the "urban" population people associate rich urban bicycle riders. On the contrary, a large percentage of bicycle riders fall into lower middle working population who commute short distances daily. Literature even suggests that as literacy increases cycle ridership decreases. There is an emerging market of young professionals in cities who adopt bicycles as their mode of transportation for different reasons from fitness to low carbon footprint.

 What can I do?

 I have not narrowed the scope of my project with a single solution. I am currently exploring everything from services and cheaper safety equipment to policy level changes that need to be implemented. Something interesting I found was that under the JNNURM fund development policy makers want to include cyclists and infrastructure for cyclists as part of urban development. It will take a long time for that to be implemented but that validates my area of focus to some extent.