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What a Cloudy Future of OpenLMIS Means for Open Source Software

By Wayan Vota on February 5, 2020

openlmis open source sustainability

OpenLMIS is an open source global good for digital health that was purpose-built to be an electronic logistics management information system (LMIS) for health commodity supply chains.

Started in 2008, OpenLMIS has grown across seven countries with funding from a litany of donors, including the Rockefeller Foundation, Gates Foundation, USAID, and others. They invested in a robust set of core partners, including BAO Systems, Clinton Health Access Initiative, JSI, Ona, PATH, SolDevelo and VillageReach to develop the supply chain software.

By every measure, OpenLMIS is a successful multi-country, multi-donor, multi-implementer open source software platform. That is why their recent presentation to the Digital Square community was such a shocker.

OpenLMIS Sustainability Challenge

The OpenLMIS team has the same sustainability challenges that all open source global goods face – in digital health and across international development sectors.

Donors, governments, and humanitarian organizations want to use cutting edge software that’s specific to their needs, but none of them want to pay the full cost of developing or sustaining those solutions.

Recently, the OpenLMIS team came to a cold conclusion that they shared in their Digital Square presentation: there isn’t enough funding for them to continue the development of OpenLMIS through the existing consortium.

That left them three options for OpenLMIS’s future.

  1. Create a separate nonprofit organization to fund OpenLMIS through a creative mix of core grant funding and project-specific deployment contracts.
  2. Find a private sector company that could build a revenue stream around OpenLMIS, potentially by developing a paid premium commercial version.
  3. Fully release all control of the software to the GitHub community and walk away from leading active OpenLMIS development.

The OpenLMIS team is going with option 2, which I can understand is the least painful choice to make today, but may just be misplaced optimism before they eventually have to go with option 3.

If the OpenLMIS team, and the very smart business people in its core members, can’t find a viable revenue stream, how will an outside company do that? And why would they want to versus investing in their own, existing solutions?

If OpenLMIS is Floundering…

I am really surprised that OpenLMIS is having such sustainability issues. From afar, they seem flush with funding by the scope of their deployment impact and breath of their developer community.

I also assumed (obviously, naively) that OpenLMIS, which is funded by USAID to solve supply chain problems, would get significant funding from the USAID Global Health Supply Chain Program – USAID’s $9.5 Billion investment into supply chain logistics. This is USAID’s largest single contract ever, and its totally focused on the very same problem that OpenLMIS is trying to solve.

That USAID and Chemonics are not fully supporting the exact global good funded by USAID for supply chain logistics, is a stunning indicator of how difficult it is for any open source software solution to gain traction within international development’s largest funder.

If OpenLMIS can’t get sustaining project funding from USAID’s signature contract, what does that mean for the rest of us open source solution providers?

And sadly, I’m not sure $75,000 from DIAL can answer that question.

open source software costs

Join Us to Discuss Open Source Software Costs

USAID has introduced the Software Global Goods Valuation Framework to enable donors, software development organizations, governments, and others to estimate the cumulative development cost for software global goods. Recently the framework valued 3 global digital health goods at $109 million dollars.

Please RSVP Now for a lively online discussion of the Framework and how we can use its two key outputs to better value digital health solutions:

  • The retrospective development costs of a software global good
  • The ongoing costs of maintaining and further developing the software

Together these estimations of financial investments into software global goods provide a calculation of their valuation to-date and can serve as a data point for consideration by decision-makers in selecting software systems to meet country public health needs.

Please RSVP Now to engage with four people intimately involved with the framework:

We’ll dive into new research from USAID and the Boston Consulting Group that analyzed the development costs and maintenance needs of OpenMRS, Commcare, and iHRIS using the Software Global Goods Valuation Framework and how each of us are using this new tool in our global good development process.

What are Global Good Software Costs?
15:00-16:00 GMT – February 27th 2020
RSVP Now for Virtual Participation Information

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Written by
Wayan Vota co-founded ICTworks. He also co-founded Technology Salon, MERL Tech, ICTforAg, ICT4Djobs, ICT4Drinks, JadedAid, Kurante, OLPC News and a few other things. Opinions expressed here are his own and do not reflect the position of his employer, any of its entities, or any ICTWorks sponsor.
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13 Comments to “What a Cloudy Future of OpenLMIS Means for Open Source Software”

  1. Can DIAL’s current opportunity for support in sustainability planning answer the question of whether the solution to Global Goods viability is singularly donor support throughout the entire life cycle of the product, nope. What it can do is help projects think through critical issues to sustainability that include not just sources of funding, but also their strength of community, organizational capacity, talent, and scale of impact. Taking time to systematically analyze sustainability pathways and develop a plan allows projects to go back to their community and donors and work through the unique and difficult questions that they, like OpenLMIS, are struggling with. I highly encourage those who care about sustainability to join the webinar highlighted above. Also take a look at the Digital Square webinar that led to this post. We have it over on the Open Source C enter forum with an opportunity for continued dialogue. Most Global Goods rank long term sustainability as one of their most critical challenges, we need to work towards repeatable success stories. https://hub.osc.dial.community/t/digital-square-january-webinar-global-good-sustainability/989

    • Wayan Vota says:

      I’m sure that the OpenLMIS team spent way more than $15,000 in looking at their sustainability model and yet they came up with the exact same options all of us have with open source global goods. The problem isn’t our sustainability modeling or community building, but the inherent constraints of the larger development ecosystem. An ecosystem that can’t be fixed within the bounds of a Open Source Center Grant.

  2. Derek J Ritz says:

    I found this to be very interesting article (thanks Wayan) and the Digital Square webinar on which it was based was equally interesting (and entertaining… as the auto-stenographer tried to translate OpenLMIS into various soundex text snippets).

    The sustainability of public goods is a problem, everywhere, always. It is the “tragedy of the commons” problem. I wonder if our approaches couldn’t be informed, especially for something like OpenLMIS, by the approaches used by OECD countries to sustain NATIONAL public goods.

    My thinking is that, in error, we sometimes conflate value creation and value capture. A GLOBAL public good represents value creation. Resources (donor funds) get poured into something that has some value (and there is an upcoming webinar on this very point… see above). But to sustain something… shouldn’t we be looking to the folks who are doing the value CAPTURE? And in the case of OpenLMIS — this is the country MOH… isn’t it?

    Sorry if I have lost the plot… but it seems to me that we would be well-served to connect long-term sustainability of a public good to the people who are capturing value from it, and therefore will have some way to make a business case for expending ongoing funds to support it. Framing it this way… the benefit of a GLOBAL public good is that it can create economies of scale from multiple NATIONAL public goods (the deployed version of the global asset). This economy-of-scale would (or should, anyway) mitigate the support costs for a community of national deployments.

    Of course… this economy-of-scale benefit can be undermined. Putting sustainability costs on the table should cause each country partner to want to think seriously about how much of a snowflake they want (or can afford!) their implementation to be… but that is a topic for another day. 😉

    Warmest regards,

    • Wayan Vota says:

      Derek, I think you are intimately familiar with the inherent issue we have in digital development – that LMIC governments do not prioritize, and therefore underfund, investments in critical technology infrastructure for their health systems. One could argue that they underfund health overall (and education, and…). The net result is that we’d all starve if we tried to rely on LMIC government funding. Donor funding is the only way many of these tools can get created and survive.

      • Derek Ritz says:

        Wayan – you’re completely correct… I do have intimate knowledge of this challenge and its characteristics. My lament is that there is NO DURABLE WAY to address this issue if we cannot convince the parties that capture value to also be the parties that sustain the source of that value.

        Yes… there are situations where LMIC governments have underfunded health. And within their too-small health budgets, these governments may also underfund digital solutions (what if they dedicated even 2% of THE to digital health investments?? It would be game-changing!). My point is that we can’t expect to truly solve the problem by simply treating it as a dysfunctional engineering constraint. To REALLY solve the tragedy of the commons, we’ll need to cultivate a pay-for-value mindset with ALL of our LMIC partners. (News flash… as has been noted by others… not every digital health project will make it over the “value” hurdle… but that’s just market forces doing their job of culling the herd).

        Wayan, I am too optimistic to believe this is impossible. I’m not naive enough to think that successfully getting acceptance of this pay-for-value approach will be easy… but it doesn’t need to be. Lots of worthwhile things are hard.

  3. Ed Gaible says:

    @Derek, thank you for your perceptive post. Of course, the issues is properly the _unsustainabity_ of the Commons. I did not attend the Digital Sq presentation — it would be helpful to know what the cost estimates are to fully fund ongoing development of OpenLMIS through the current consortium.

    • Wayan Vota says:

      Hi Ed. USAID recently created a software valuation tool to find the answer to your very question about the cost of fully funding ongoing development of open source global goods in digital health.
      While it hasn’t been used on OpenLMIS (to my knowledge), it was used on OpenMRS, CommCare, and iHIRS, valuing them at a collective $109 million dollars, with a collective $8.2 million annual investment. However, I know for a fact that the three systems don’t get anywhere near that in annual support (my team manages iHIRS).

      • Cavin Mugarura says:

        heheheehe the cost of funding badly developed software like open MRS has to be high, doesn’t take a rocket scientist to figure that out. Also such tools are good for conferences,but not useful in the real world. There’s no way of computing the cost of developing software, they are too many variables at play, but interns would never know that. Drupal for example has received lots of support and funding mainly from the private sector who use it and see the value, when something is bad, no amount of money will help it, well money can help in patching it. The concern should be on whether it was designed well not the cost, the cost takes care of itself one way or the other

  4. Cavin Mugarura says:

    If the software was written badly it will die a natural death. No amount of donor funding will save it. They are many open source software products that dont need life support from USAID and other donors. Drupal, Magento come to mind. They are many others i just chose to name 2. They are hundreds or thousands that have died, we need to leave them where they belong, in the grave.

  5. Ed Gaible says:

    Hi Cavin. Me personnally I have no idea as to the quality of the code or the fit of the product for its purpose. But I do know that the product is trying to survive in a sector that generally has a huge amount of public funding (healthcare) and that often creates market distortion. (Is healthcare a human right? Is education? is there a threshold for either of these sectors, like can your kids learn so much in school that you should have to pay more?) The OpenLMIS code could be terrific and the need could be great, but the market could be tiny and selective enough that the product dies anyway.

  6. Thanks, Wayan, for continuing the conversation and organizing another webinar on this.

    I agree with some of the post and comments, but I also think the “cloudy future of OpenLMIS” misses the pro-active and positive steps the OpenLMIS Community is taking to shift the software platform towards a revenue model that sustains it without on-going donor dollars to keep the lights on. Ultimately, the current philanthropic donors, USAID and the Gates Foundation, are not in a position to sustain core software activities in perpetuity for OpenLMIS or for many other global goods that have a total annual support cost around $50M as estimated by Digital Square.

    To address this, the OpenLMIS community is taking specific and positive steps in 2020: (1) Creating a mechanism for the public health implementations to pay for annual ongoing maintenance/updates; (2) Exploring a larger customer base as a subscription platform offered to Private Health customers, such as private clinics and pharmacies; and (3) Establishing a partnership where a private partner is responsible for the core software maintenance while also connecting OpenLMIS into their value-generating activities – integrating OpenLMIS with their products and services and promoting OpenLMIS with their sales staff. Our community drafted principles for doing all this in a way that still preserves our open source core and our community values and priorities.

    I’m not saying it will be easy. In 2020 these steps the OpenLMIS Community is taking will require significant work and on-going collaboration the community and private partners. I look forward to continuing to participate in OpenLMIS’s journey and sharing what we learn with the Digital Square and Global Goods and ICTWorks communities. And in the short-term I look forward to the webinar on February 27.

    (On the topic of code quality, the OpenLMIS team has a lot to share and that could be a webinar or ICTWorks post of its own — how we think about code quality, how we track automated test coverage, architectural patterns we use, how we track and prioritize tech debt to fix).