This post originally appeared in Harvard Business Review.
Noisy and ungainly, India’s three-wheeled auto rickshaws are an iconic form of urban transport that can be hard to love. Without knowing their place in Indian life, an outsider might take one look at their loud engines and open sides and suggest that rickshaws should be replaced with modern vehicles that are faster, bigger, and more comfortable. But despite their flaws, rickshaws have become an essential ingredient in the transportation stew of India’s cities: they account for 20 percent of motorized trips in some cities, provide jobs to tens of thousands of drivers, are inexpensive to buy and operate, and are an elegant (if rickety) solution to the problem of affordable, short-distance urban transportation for the middle class.
So the question is not whether “tuk-tuks” (as they are called because of their distinctive engine noise) should be replaced, but how they can be made to work more reliably. Until recently, the trade-off for lower price was uncertainty. Hailing a rickshaw was a matter of chance for would-be customers, while drivers might wait hours for a decent fare.
Fortunately, there really is an app — and other technology — for that. New tools are already making rickshaws more reliable and demonstrating how modern technology can be mashed up with traditional technology to solve problems in developing cities around the world.
The Rickshaw Revolution
In the past, auto rickshaws’ flaws stemmed from low rates of usage, an inability to identify demand and supply in real time, and inefficient pricing that often left both sides dissatisfied. The opportunity to address these issues by leveraging the one billion mobile phones (and counting!) in India was clear.
Rickshaw hail businesses started out tracking the real-time availability and location of drivers through a makeshift system of drivers self-reporting their availability via text messages. With the growing penetration of smartphones, tracking was elevated to GPS in the last few years, but the improvements were similar: a new ability to connect riders and drivers in a timely, reliable way. Rather than relying on happenstance, hailing an auto rickshaw became systematic, especially since the city of Rajkot launched a pioneering model in the form of G-Auto, a city-backed fleet of auto rickshaws, in 2012.
Individually operated rickshaws that previously meandered along disjointed routes with no connection to their customers’ needs now run on optimized routes, leading to improved service and and greater road safety. Security has also improved for female passengers, as smartphone hailing apps provide users with the identity of their drivers, allowing for easier reporting of harassment. The system also means that because many drivers have doubled or tripled their number of rides completed in a day, they have been willing to accept the fare displayed on the meter rather than constantly haggling over price. Their increased productivity has put many rickshaw operators on a path to ownership and, in many cases, the means to upgrade to cleaner vehicles.
One company that has made this revolution possible is Autowale, which relies on GPS, smartphones, and basic technology that can run on more basic mobile phones. According to Fast Company, Autowale’s technology is in use by more than 1,000 drivers, who have provided more than half a million rides to customers, providing a crucial “last mile” connection from public transportation and citizens’ final destinations. The transfer of technology to drivers has been a game-changer, doubling their income and taking much of the stress out of a competitive job. It started at ground level, training drivers (some of whom are illiterate) to use their non-smartphones to send and receive texts. Customers accustomed to broken rickshaw meters and overcharging were pleasantly surprised to find systems in place that let them effectively challenge fares that were out of line.
Today, new players can tap into this previously inaccessible sector. Logistics and hyperlocal delivery startups are exploring whether these trackable auto rickshaws can be utilized in non-peak hours. The higher-tech auto rickshaw model is expanding in Indian cities through businesses such as Autowale, mGaadi, Jugnoo (which bought Autowale this year), Autoncab, G-Auto, and Ola. In Mumbai, for example, the Autorickshaw and Taximen’s Union launched OnGo, an app allowing cashless payments for rides, which can bring financial inclusion to thousands of drivers. Uber recently shifted its focus away from its Indian auto rickshaw operations, shutting down in the midst of homegrown competitors that are fostering closer relationships with their drivers.
Tinkering with technology designed for the rich
The rickshaw revolution shows how existing solutions can be improved without major disruption. In the global South, where most of the world’s poor live, solutions tend to be hyperlocal, with an extremely low profit margin. The key question is whether we can use modern technology to enhance these solutions without adding cost or cutting access.
Most technological innovation is geared toward the planet’s richer populations. The challenge is to apply these innovations to situations that have developed organically among the poor — and to do so without messing up imperfect, but useful, systems by chasing aspirations of what has only the potential to work.
Improving systems such as India’s urban auto rickshaw service requires a deep understanding of how they grew and how they work. Even slightly improved (but still low) profit margins can be enough to lift rickshaw drivers out of poverty, making them better citizens and customers and enriching the areas where they live and work.
This is technological disruption, but of a targeted, sensitive sort. In the rickshaw revolution, two groups with different kinds of knowledge came together: people with deep understanding of the genesis and development of local solutions, especially for those living at the margins of society, and people who are on the top of the best technology, whatever its source. The essential point of this modern mash-up is to use technology to make marginal improvements in existing technology. There is enormous value to be captured by innovation that is more tinkering and crafting than game-changing.