#1 Charity Water Case Study PDF

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Introduction Today, about 1 out of every 9 people on the planet (800 million people) are in an actual water crises. Many people in developed countries like the United States complain about not having enough water to saturate lawns, wash cars, and fill swimming pools. In contrast, actual water crises equate to shortages of potable water, meaning there is no access to clean, safe water to take care of their

basic needs, such as drinking, cooking, and washing hands after using the bathroom. Unfortunately, without potable water, individuals’ lives are hindered in more ways than just thirst. Ultimately, health, education, economic condition, and virtually every component of “quality of life” are severely affected by potable water shortages. How well can the rest of your day turn out if it begins by extracting the day’s water supply from a pit of sludge? 

Charity: Water helps people all over the world obtain access to clean, safe water by making the donation process efficient, transparent, and convenient for donors. 

The eight‐year old non‐profit is focused on solving this urgent water crises. With over $100 million donated, it has funded 15,000 projects in dozens of developing countries, providing clean water to more than 5 million people. Based in New York City, the small group has approximately 70 full‐time employees (see 3 at right), 10 interns, and around 800 volunteers (volunteer here). The organization also has numerous partners across the world. 

Charity: Water works in three steps:  1. Fundraising and donations: Charity: Water educates people about the serious

nature and extent of the water crises and enables them to act by giving charitable donations (or by volunteering). They give up birthday gifts or sell lemonade to fundraise for water projects. Or, they donate to a friend’s campaign. 2. Exactly 100% of public donations go to the field: When the campaign closes, Charity: Water pools the funds with the rest of the money raised on MyCharity: Water during that same time period. They work with their partners to pick where and how the proceeds will be used on the ground, and then send 100% of it to the field so the work can begin. 3. Transparency through proof of purchase: Over the subsequent 18 months, Charity: Water’s partners buy supplies and work with communities to implement the projects. At integral stages of each the project, Charity: Water collects photos and GPS coordinates and sends them to all the donors involved in each project, so they can see how their dollars are going to work. Below is a screenshot of a real example of (the beginning of) an email report that Charity: Water sends out, following a campaign last year. 

Opportunity Space / Innovation Process An Opportunity Space is an industry, market segment, or area where an entrepreneur can create new value by filling in a void caused by a market imperfection. The Innovation Process is how the entrepreneur creates a new solution to the market imperfection. 

When Scott Harrison became dissatisfied with his luxurious life as a successful club promoter in New York City, he decided to go serve the poor in Liberia.

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 Over the course of about two years, he lived and worked with people who had many overwhelming challenges with the basic needs of life. He also noticed that in order to obtain what little (most often dirty) water was available, women and children were expected to walk long distances, and this commonly took several hours each day. Through these experiences, he realized that without an available, sustainable source of clean, safe water, most of the other challenges the people faced would be nearly impossible to overcome.

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Education, for instance, is especially difficult for girls after puberty, who have no place to care for personal hygiene near the school. Without an available source of clean water and a private place to use the bathroom, one to two weeks of the month are eliminated from school attendance. 

Health is an obvious concern when all water must be carried in and precariously boiled. Waterborne disease is the biggest killer of children on the planet, and one half of all deaths in the world occur as a result of waterborne illness. There are still many ways to accidentally ingest disease causing, and often lethal (especially for infants) organisms in the water. Cooking, cleaning, clothes washing, bathing, and health care all require large amounts of clean water. When the water is not clean, health suffers. 

Food supply is affected by how much water is available to water gardens, and how much time is available to take care of food‐producing plants and animals. Without an ample food supply, all other tasks are hampered.  Economic condition is based in part on the number of hours a community can contribute to productively developing available resources. When health and food supply are compromised, that number decreases while the number of available workers also decreases.

Further, when education is cut short, the decreased efficiency and impact of the work done stagnates the economy. Finally, a stagnant economy is a high barrier to obtaining appropriate water, food, health, and education.  So Scott Harrison got right to work. He formed Charity: Water to solve the water crises. Read on to find out how this non‐profit works a little smarter to raise millions and how it is effectively solving the water crises in developing countries around the globe.

Five Types of Value An organization’s performance is largely attributed to its effectiveness in managing resources. The Five Types of Value framework provides a useful indication of organizational performance and will be extensively used throughout the course: 

Value in Use The effectiveness of a product, service, or experience in fulfilling customer needs. This is measured by the customers' overall satisfaction. 

When charitable contributors go to make a donation, they need 3 things: First, they need to know that their money will make a difference. Second, they need to know that their money will actually get to the cause, and won’t be completely used up by administration costs or totally phony campaigns. Third, they need feedback after the donation is made as to know that their contributions directly, substantially, and sustainably impacted someone’s life. Charity: Waters attacks each of these three requirements in a very aggressive but sleek manner. 

First, Charity: Water posts videos and stories of the real people that need donations. Staff and volunteers from the company follow these villagers and take pictures of the women and children who walk, carrying heavy “jerry” cans through fields and over

mountains. They show photographs of the disease infested, stagnant ponds where hundreds of villagers converge to retrieve water each day, just so their family has enough water (albeit dirty) to survive. They also interview villagers, so they can tell the entire stories of people who have to travel up to seven trips a day to distant villages to retrieve enough water for their family to survive. By bringing these real‐life details into the hearts of people who have the power to give, Charity: Water helps donors see and feel the urgent, dire need for their support. 

Second, the company seeks private funding from private parties to cover all administrative costs, so that 100% of public donations actually reach the field. In this way, donors are assured that their full contribution will make an undiluted difference where they expect it to take affect.  Third, Charity: Water has totally transparent feedback from each project. Their accounting systems are integrated with their website, so they can show each sponsor where their dollars are being leveraged. This means showing photos of the specific project where the donor’s money went and GPS coordinates of the village where the project took place, all in a well documented report that is sent to each donor. 

Value in Exchange The efficiency of a product, service, or experience in fulfilling customers’ needs. This equates to the benefits received from the purchase (and the overall satisfaction) minus the costs of money, time, and energy spent. 

Because Charity: Water gives 100% of all publicly donated dollars to their projects, and subtracts nothing for their administrative costs, public donors feel that their dollars go further than with other charities. This provides a source of competitive advantage over competing charities. 

Donors are further rewarded by being enabled to see the results of their financial support, through vivid photographs, GPS coordinates, and reports.  Another aspect in the exchange is when social groups create synergy by engaging in a mini‐culture of giving centered around an event like a party, a wedding, or triathlon. These social synergies go much further in solving the water crises than lone donations.  Finally, Charity: Water creates efficiencies (that contribute to high Value in Exchange) through its field volunteer program. Aside from Twitter‐facilitated meetups and influencer marketing campaigns (in which the company piggy‐backs on the social power of superfans), Charity: Water leverages an outstanding field volunteer program. It begins with high caliber employees who utilize superior recruiting, training, and leading skills. These employees vet and interview candidates. When accepted, each volunteer goes through a two day training at the corporate office in NYC, and is then sent out into the field alone for a 6 week, self funded trip. While in the field, volunteers travel through remote regions of developing countries to check on established clean water facilities, photograph impact, and send reports back to headquarters. Since these volunteers are required to have already lived in a developing country for 3 months, they are somewhat seasoned for this type of work, and they are a huge value to the charity, at a very small cost.

  Value in Distribution Measured by the availability, accessibility, and convenience of a product, service, or experience. Value in Distribution paves the road for growth as it allows more customers to use the product more easily. 

Charity: Water has made several strategic decisions that facilitate accessibility and availability to donors. First, they have a super‐streamlined website, including an easy, relevant domain name (charitywater.org), a big bright “DONATE NOW” button that appears on almost every page of their site, and a very simple, fast process for creating campaigns and donating (it literally takes less than a minute to set up a campaign). A screenshot of part of Charity: Water’s website is shown below.

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Second, they leverage social media such as Twitter and Facebook to popularize their giving campaigns.  Third, they use a variety of strategies to reach social circles, enabling groups to easily carry out campaigns for various reasons on their site. These methods are discussed in the figure below.

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On the receiving end, Charity: Water and their partners have nearly unlimited ability to solve the water crises for any particular village, no matter what kind of clean water system is needed. In other words, instead of trying to push a single “silver bullet” strategy for getting clean water to every community, Charity: Water partners with a full range of experts in the field who provide whatever resources are required for any particular location. Below are some of the common ways they provide clean water to such a geologically diverse range of locations:

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Value in Finance The financial performance of the organization. This is measured by examining the numbers, for example: revenue, cost structure, growth, cash balance, stock price, asset efficiency. Value in Finance demonstrates past growth.  Since its launch eight years ago, Charity: Water’s growth has been steady and dramatic (see bar chart below). As you study this chart, keep in mind that the United States has seen a decline in charitable giving during some of the years where Charity: Water saw tremendous growth. 

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The organization is also extremely efficient and transparent, with 100% of all public donations going straight to the field. Even the CEO, Scott Harrison, receives a salary of less than $160k per year, which is a relatively tiny amount for a successful NYC business. In fact, for being so efficient and transparent with its financials, Charity: Water has obtained several distinguished accomplishments, awards, and certifications, including:  ● Passed the rigorous process to qualify as 501 (c) (3) Ruling (Certified non‐profit)

● AIP Rating ● 100% Model Audit Opinion (Auditors found them in complete compliance with their self‐imposed 100% model) ● Charity Navigator Rating of 4 out of 4 stars ● BBB Accredited Charity  These high profile achievements also provide a very important role in the company’s Value in Use, as they contribute to the company’s credibility. That Value in Use, in turn, contributes back to the Value in Finance, thus strengthening the upward cycle. 

Value in Fitness Measures organization’s ability to grow, adapt, evolve and continue to generate resources from its environment. Value in Fitness promises future growth. 

One clear indication that Charity: Water still has the ability to gather new resources from its environment and leverage them in novel ways, is its partnership with Google. They announced a $5 million pilot project to develop a sensor that will tell them how much water is flowing through each well. These sensors will be integrated with 4,000 of their wells and most importantly, they will enable Charity: Water to know when the wells are not functioning properly so they can send a repair team in with appropriate speed.  Another indication of Charity: Water’s high Value in Fitness is its recent partnership with name

brand Satya Jewelry to create the new Oasis necklace, a stunning and unique piece. With the sale of each Oasis necklace (priced at $98), $40 is donated directly to water projects in Orissa, India.   The non‐profit also continues to create lucrative relationships with generous partners and donors. Recent examples of these include: FGI, “I Know That Voice” Films, and Amazon (.5% of your purchase can go towards the charity of your choice when you visit through “smile.amazon.com”).  

Governance Organizations create value through strategically establishing a cohesive set of governance mechanisms, consisting of rules by which the organization operates, structures, and directs its resources. 

Founder Scott Harrison grew up in a very restrictive home, and now he’s turning that around in his company by enabling his employees to have decision‐making power. At Charity:Water, decision rights are distributed throughout the organization. Employees have a great deal of authority to make decisions that influence how the company serves its customers. This, in turn, enables more responsive service, yielding higher customer satisfaction. Embed video: http://www.charitywater.org/about/jobs/

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 Resources The means of production that are governed to generate performance and value creation.

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Some companies foolishly try to be all things to all people. CEO Scott Harrison is not a mechanical engineer or industrial designer by trade. He’s not a geologist. He doesn’t speak a plethora of African languages. But he does know how to assemble and lead talented employees. He also successfully orchestrates efficient, reliable partnerships.

Charity: Water is wise to partner with other older, more experienced organizations to accomplish most of the work in the field. Below, one of these teams of experts is pictured with their large drilling truck.

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Another unique resource that Charity: Water had to create from scratch was branding. Branding is the mental concept (of the company or product) that exists in the minds of customers. In order for a branding campaign to “brand” its idea onto the minds of customers, it needs a simple, sticky idea. The central idea of Charity: Water is that, after the donations are conveniently made, donors are made aware of what their money accomplished. Where there’s just a big black hole with most charity organizations, Charity: Water’s customers find out (at key points in the project timeline) who exactly they helped (as you saw in the email above). This successful branding campaign is a source of competitive advantage over competing charities because it clearly differentiates the experience of giving. 

Media Sources: 1. Water glass with lake: http://reachingutopia.com/drink‐water/ 2. Children in dirty water with cows: http://thewaterproject.org/water‐wells‐for‐schools/eshienga‐school‐well 3. One child in dirty water filling jug, with bystander:

http://www.charitywater.org/birthdays/ 4. CEO Scott Harrison: http://gethopegivehope.com/the‐story‐of‐charity‐water‐ceo‐scott‐harrison/ 5. 4 children carrying water: http://www.faithsforsafewater.org/ 6. Child laying on ground drinking from mud puddle: http://news.rediff.com/slide‐show/2009/jul/01/slide‐show‐1‐failed‐nations‐in dex.htm 7. Child sitting filling up water jug in shallow pool: http://www.eco‐zone.com/_blog/Blog/post/Water‐Bourne_Diseases/ 8. Child drinking from yellow can: http://africaneeds.org/issues‐solutions/waterborne‐diseases/ 9. Four women carrying full jerry cans: http://www.theguardian.com/global‐development/poverty‐matters+famine?pa ge=2 10.Charity: Water field volunteers: https://www.charitywater.org/blog/the‐fantastic‐five/ 11.Charity: Water website: Charity: Water 12.Facebook logo: http://www.njfilmfest.com/ 13.Strategies for fundraising (6 rectangles with images and text): Charitywater.org 14.Strategies for delivering clean water to communities: http://www.charitywater.org/ 15.Chart of Charity: Water’s financial growth: http://www.charitywater.org/about/financials.php 16.Oasis necklace: http://store.charitywater.org/products/oasis‐necklace 17.Amazon.com logo: http://fantasysportfans.com/free‐giveaway‐to‐get‐ready‐for‐the‐fsf‐official‐sit e‐launch/amazon‐logo‐8/ 18.Man taking pictures and image of world, etc.: http://www.treehugger.com/culture/born‐in‐september‐heres‐a‐charity‐just‐f or‐you.html 19.A few Charity: Water staff: http://www.charitywater.org/about/staff.php 20.Young man with empty yellow jerry cans jumping: charitywater.org 21.Scott Harrison dumping water from jerry can: www.relevantmagazine.com 22.Drilling rig (Charity: Water partners): http://www.charitywater.org/blog/news‐from‐central‐african‐republic/ 

Possible Videos: Importance of water, and framing the problem: http://youtu.be/BCHhwxvQqxg 2012 Recap video, pretty exciting: http://vimeo.com/55584735...