Entrepreneur Driven Approach

The entrepreneur-driven approach best integrates the entrepreneurs’ knowledge on the local context (supply, market etc.) and his labour’s existing skills and assures a production tuning to the real local market conditions. The lump sum nature of the upfront investment subsidy, as well as the performance based production incentives encourages the entrepreneurs to cost efficient construction and production tuning.

However, since both, construction and production tuning are under control of the entrepreneur, the speed of the project implementation fully depends on the pro-activeness, investment and management of the entrepreneur. Therefore the entrepreneur driven approach only functions as long as the project deadlines allow coping with delays on investment, with management errors by the entrepreneurs and even with dropouts, if an entrepreneur decides to invest rather in other businesses than in clean brick production. A project framework which doesn’t allow dropouts or delays automatically shifts the entrepreneurial responsibility from the brick maker to the project, since the project implementation unit will have to take over management and investments, as soon as delays endanger a timely success. Under such circumstances the entrepreneur-driven approach turns into an informal kind of turnkey arrangement with unclear competences and responsibilities. Vague rules of cooperation endanger the success of the project and even may generate conflicts between the different stakeholders, which will finally lead to a bad name of the VSBK technology. Hence, identifying the right entrepreneur is critical for the success of the project in an entrepreneur driven approach.

Subsidised turnkey arrangements

Unlike the entrepreneur-driven approach, a turnkey arrangement allows the project unit to fully control the project implementation and the related investments. The full control goes along with full responsibility, since the entrepreneurs’ local knowhow won’t flow in the establishing of the VSBK as in an entrepreneur driven approach. Therefore, the implementation of turnkey arrangements depends on a highly skilled project team which must be perfectly familiar with the local contexts (supply, labour, market). For this reason, turnkey arrangement don’t usually suite for a piloting a new technology, but may be considered as a dissemination mode, once the technology’s local teething problems are resolved, the local context is well known and sufficient support services are available on the market to support the entrepreneur after the handover of the production unit.

Numerous experiences show that a turnkey arrangement may assure efficient establishing of new production unit, but since the entrepreneurs aren’t sitting in the driver seat from the beginning of the new venture, problems can appear after the kiln is handed over to entrepreneurs for the commercial production, resulting in low quality output, losses and bankruptcy, giving the technology a bad name. Countless abandoned turnkey factories from the 1960-80s all over the world are witness to the high risk of failure of wrongly selected approaches.

Tax advantages and a favourable regulatory framework

It has to be kept in mind that shifts towards cleaner production has its price. Even in the industrial world combinations of cleaner production and at the same time economic advantages only coincide in rare cases. That is why parallel development of appropriate regulations and incentives are of utmost importance. Especially polluting brick kilns of South Asia are well established, in most cases they have been operation for more than 50 years and are an economically attractive business. To shift into a completely unknown and new technology is not easy for most BTK operators. Hence a favourable policy regulatory and incentives must always be accompanied with VSBK technology transfer.

Time required to transfer cleaner brick production

Often time required to transfer cleaner brick production is under estimated. A VSBK is not plug-and-play device but technology requiring careful tuning and optimising of the raw material supply soil processing, green brick making and firing. These process/practices vary in different places and according to technologies. It takes considerable time to change these established practices.