Based on its recent analysis of the IT-based water management market, Frost & Sullivan recognizes Arad Group with the 2014 Global Frost & Sullivan Award for Emerging Market Innovation. Acknowledging utilities’ lack of adequate infrastructure, expertise and finances, the Arad Group strives to provide end users in emerging markets with customised water meters, meter-reading systems, and tailored training programs.
Arad Group specializes in tailoring water meters to the country’s requirements. For instance, Indian water meters are built to withstand air shocks resulting from disruptions in the water supply.
The company also addresses the challenge of faulty pipelines and resultant water leaks in emerging markets. In 2013 it launched a water-management mobile application in Israel, linking consumers to their water utility’s database. It offers them access to a wide variety of data including consumption levels, forecasts, leak alerts, and information about anticipated water-supply disruptions in the area.
Arad Group’s automatic meter-reading (AMR) solutions allow water utilities to detect the exact location of leaks in the pipeline and fix them without having to replace the entire pipeline. While the Drive By AMR system makes use of a vehicle that is fitted with a remote reading device to rapidly collect multiple meter readings across large areas, the more economical Walk By AMR system uses a portable hand-held device.
Arad Group also developed CityMind, a web-based meter data management system that enables remote management of multiple meters. This tool provides users with reports, statistical analyses, and real-time alerts, and it has a special algorithm that reduces false-positive meter alerts by 55 percent.
“Another innovation from Arad Group is that it places the radio systems inside the meters, as opposed to its competitors’ strategy of placing them externally,” said Frost & Sullivan Research Analyst Neha Anna Thomas. “Internal placement eliminates the risk of theft or damage to the systems.”
Emerging markets play a significant role in the company’s expansion plans, as is evident from its intentions to establish footprints in countries such as Malaysia, Indonesia, Peru, Venezuela, and Colombia. These markets are likely to account for almost a third of the Arad’s revenues in the short term.
However, despite the plethora of products and solutions that the company makes available to emerging markets, it still has to contend with the traditional challenges of price sensitivity. It surmounts this issue by augmenting its service portfolio to provide financing solutions to utilities.
“Arad Group follows a step-by-step approach when establishing and expanding its business in emerging markets in order to circumvent the typical language and cultural barriers,” noted Thomas. “To begin with, it establishes local partnerships for sales and services. Once the level of activity in a particular market is satisfactory, Arad Group establishes a subsidiary there and in the process, transitions from indirect to direct operations.”
Arad Group also provides utilities with multi-tiered technical support services. The first tier involves local teams that are present in all emerging markets that customers can approach for services such as queries and meter replacement. The second tier involves product specialists who are based in Israel and the United States. If there is a problem that cannot be solved at the first two tiers, it is directed to the company’s R&D wing in Israel, which forms the third tier.
Often, companies are met with resistance from consumers in emerging markets when introducing high-end products and solutions, due to their lack of familiarity. To mitigate this challenge, Arad Group launched professional training services to advance the knowledge and skills of its customers, ensuring optimum utilization of its water-management systems.
Each year, Frost & Sullivan presents this award to the company that that has demonstrated focus on growth through geographic expansion. The award recognizes the company’s ability to localize for emerging market requirements, using an inclusive approach, customer service, and unique ”go-to-market” models.
Frost & Sullivan Best Practices awards recognize companies in a variety of regional and global markets for demonstrating outstanding achievement and superior performance in areas such as leadership, technological innovation, customer service and strategic product development. Industry analysts compare market participants and measure performance through in-depth interviews, analysis and extensive secondary research to identify best practices in the industry.