What Do You Get for a Day’s Labor in Haiti?

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Not much, since you’d only be earning one hundred and thirty two pennies. Yup, the average person in Haiti receives $1.32 for a day of labor.

Now, compare what they earn and what we spend on a daily basis, and you can see some real discrepancies in our standards of living. Refrain from thinking that goods in Haiti are a lot cheaper, because they’re not. Many are priced higher than in the US, and for a product of lesser quality, too.

When is the last time you had to go without one of the items below because you couldn’t afford it? Last month? Last year? Never? Imagine having to face the dilemma of trying to decide which necessities you’d go without every day. Which ones would you choose? 

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Source: U.S. Dept of Labor, U.S. Bureau of Labor Statistics, 2009

City of Dust

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A touching article from the New York Times about a Haitian police officer’s loss of his two daughters during the earthquake in Haiti nearly a year ago. Excerpt below, find the full article here:

The police chief pressed his hands against the wall to hold himself in place, even as the walls crumbled and calved, trying to avoid being thrown off the back of whatever large creature had come for vengeance. And when the building stopped spasming, and he knew himself to be alive, Termilus reflexively shouted, “Praise God.” He fell to his knees and crawled until he was free of the rubble, a regal man humbled by the overwhelming force of nature. Like the others who were caught out — at their offices or schools, in their cars or the market or returning to their families — like everyone who couldn’t know what was waiting for them beyond what they’d just survived, Frantz Termilus instinctively started walking home, his uniform powdered in a white chalk.

Wright Brothers & the Apollo Moon Missions

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How do you prepare for a new undertaking? Do you spell out every minute detail, contingency plan, backup strategy, and process before shipping? Or do you iterate, hoping for the best and making changes on the fly – with the knowledge that experiencing mistakes can lead to greater insights later on? 

The Wright Brothers were iterative. They tried something, failed. Tried again. Failed. They repeated this process over and over until they hit success. The approach worked well, because the outcome of a mistake (some minor injuries, perhaps) didn’t warrant the extra time it would have taken to avoid an accident in the first place. How many years later would we have seen the airplane if Orville and Wilbur were afraid of a broken arm?

wright bros

For the Apollo moon missions, a mistake would have been (and was) much more grave. Over-preparing isn’t a concept that would have applied well here. But how often does an project have to be so perfectly thought out, so carefully orchestrated, in order for it to succeed? Rarely. Last time I checked, none of my friends were astronauts, and you never see things happen quickly with a bunch of geeky guys poring over a slide rule.

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Are either of these approaches correct? In the right context, either one can be.  But I think that success lies in thinking more like the Wright Brothers: taking risks and never being afraid to crash once in a while. If you’re not adopting that mindset, someone else will, and they will be busy planning to meet tomorrow’s needs while you’re still stuck on yesterday’s plans.

A Lesson on Giving from Billionaires

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Harvard Business School has a wonderful post titled “How to Give Your Money Away More Effectively”. The text is below, or feel free to access the original article.

“No one gives away money as intelligently as they made it,” declared Andrew Tisch at a recent meeting of the Board of Advisers to the Harvard Business School Social Enterprise Initiative. That observation neatly encapsulates the biggest challenge facing the non-profit sector in the decade ahead.

FORTUNE magazine’s July 5, 2010, cover article describes how Warren Buffet and Bill and Melinda Gates are recruiting billionaires to take the Giving Pledge, a promise to give away at least half their net worth. If, however, too many of these donations are directed so that the donors and their family members can join prestigious Boards of Trustees or if the money gets widely dispersed to a myriad of under-performing local nonprofits, then society will not enjoy the full benefits from the funds expended and the sad truth of Andrew Tisch’s observation will be re-affirmed.

But if all the billionaires’ bequests were to be effectively deployed through charitable organizations committed to performance measurement and accountability for outcomes, this huge wave of philanthropy could transform large segments of society.

It’s not an impossible challenge. As we’ve described in a recent HBR article the Gates Foundation, for example, conducts due diligence and subsequent monitoring of the performance of the charitable organizations it supports just as any good investment manager would. That is why Warren Buffet directed that his own enormous bequest be deployed and administered through the strong processes already existing at the Gates Foundation.

Beyond the likes of the Gates Foundation, we see an emerging type of charitable organization modeled on venture capital funds, such as New Profit Inc. of Cambridge, Tipping Point Community and NewSchools Venture Fund in the San Francisco Bay Area, Venture Philanthropy Partners in Washington D.C., and Sea Change Capital in New York City. These funds pool large donations from contributors (tellingly referred to as “investors”) and distribute them to a relatively few nonprofits selected through a rigorous due diligence process that identifies organizations capable of delivering outstanding social outcomes on a wide scale. The funds offer their grantees large, multi-year commitments complemented with strong governance and active support for the nonprofit’s executive leadership team, board of directors, and operational management.

Thanks to these Venture Funds, several nonprofits are attracting sustainable funding for programs that have clearly demonstrated an ability to effectively address social problems long considered intractable. Take Youth Villages whose programs help young people, previously mired in bureaucratic state social service systems, achieve a productive life. Its programs have a success rate three times greater than those of state-run programs, achieved at one-third of the cost. It delivers this nine-fold advantage consistently across the seven states in which it operates.

But even with a recent $40 million grant from the Edna McConnell Clark Foundation, Growth Capital Aggregation Fund, Youth Villages receives substantially less than 1% of the $20 billion dispersed annually by philanthropists and governments on youth services despite offering demonstrably superior results than hundreds of similar but less effective deliverers of services to the same populations.

Youth Villages is not unique. Citizen Schools, an after-school program, Nurse Family Partnership, a health program for pregnant women, and Jumpstart, a program that raises the performance of kids in Head Start by an average of 30%, are but a few of the nonprofit organizations that could effectively deploy a great deal more money to extend the impact of their innovative programs.

As things stand, the CEOs of these high-performing nonprofits spend much of their time going cap-in-hand to raise money each year. Why aren’t the donors seeking these winners out? Society would surely be better served if the exemplary CEOs of these effective programs could spend much more of their time leading their organizations to deliver better services to more recipients.

Some people from the non-profit sector object to the financial market-inspired approaches that we espouse in our article on the grounds that the “spirit” of the capital markets somehow runs counter to the spirit of the nonprofit sector. But although the private sector is not perfect, as the global financial crisis has painfully revealed, many of its practices can be productively deployed to produce a far more effective and efficient voluntary sector.

The voluntary sector continually pleads for more funding to solve the nation’s long-standing social problems. Their case would be far stronger if the large sums of money already deployed to this sector year were better directed to organizations, such as Youth Villages, that consistently delivered the most value for the money.

The Coach and the Players

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I’ve blogged a bit about NGOs working in isolation. Since the knowledge pool and output capacity of a collective effort is far greater than any individual organization could achieve on its own, “team effort” is necessary for impact to truly be maximized. The ext337 blog has a great discussion around this.

I liken it to a basketball or baseball coaching taking out his key players and trying to play himself (baseball coaches used to do this, which is why they still where uniforms). Anyway, the point is that this is a need for both action (the basketball players), but also oversight and planning (the coach).

But I haven’t heard many organizations that focus on being the coach – after all, how do you get someone to support your work if you don’t do any of the action yourself? 

Thinking about abundance

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I strongly suggest reading the ext337 blog about a different paradigm in how non-profits should view the resources they have. Here is an excerpt:

As I think more about nonprofits-as-venues, as places where projects are performed (to push a metaphor just a tad too far), I think that thinking in terms of abundance rather than scarcity is one of the big changes that is necessary. We have to think not just in terms of what we can do, as individuals, within our organization, but we have to believe that the necessary skills are out there — we just need to find them.

Beth Kanter has some insightful responses at her own blog, under the post Why Should Nonprofits Choose Abundance (and Breathe).

Paul Farmer: 5 Lessons From Haiti’s Disaster

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I liked Paul Farmer’s (of Partners in Health) recent blog post so much that I reposted it in its entirety here. Someone with much more credibility than myself has done a great job of outlining some key points to keep in mind in helping Haiti.

The original post is located at the ForeignPolicy.com.

1. Jobs are everything.

All humans need money — they need it to buy food and water every day. And no matter how hard the government or the aid industry tries, people will want for all three things until they are employed.

The world pledged some $10.2 billion in recovery aid to Haiti after Jan. 12′s devastating earthquake. Imagine how many people that money could employ, putting them to work on tasks like removing rubble (only 2 percent of which has been cleared to date), rebuilding key government buildings, and planting trees in a country that is almost entirely deforested. And yet so far, just 116,000 people have been employed in this way. Haiti has 9.8 million people, and at least half were unemployed even before the earthquake. If we focused our efforts on the singular task of getting them jobs — even if we did nothing else — Haiti’s reconstruction could be a success.

2. Don’t starve the government.

The international community doesn’t know best. Local people do. NGOs like the one that I am lucky to work with cannot replace the state — nor can the United Nations or anyone else. We don’t have the expertise, and we won’t stay forever. We don’t have the same stake in building a community that the locals themselves have. And if aid is to work, it can’t fall apart when the expats leave.

On this, almost everyone agrees. But the opposite approach has characterized Haiti relief. The dollar figures tell the real story: A mere 0.3 percent of the more than $2 billion in humanitarian aid pledged by major donors has ended up with local authorities. That money will hardly compensate for the 20 percent of civil servants who died in the quake.

Some donors argue that the Haitian government is rife with corruption and mismanagement — and that infusing it with money will only make matters worse. But we need to strengthen the public sector, not weaken it. And that will take a working budget. It’s impossible to be transparent and track your budgets when you lack computers, electricity, and even the personnel to do so. Until the government has the resources it needs, Haiti will remain the republic of NGOs.

3. Give them something to go home to.

Today, some 1.3 million Haitians live in tent camps amid often squalid conditions — yet no one has been able to convince them to resettle. Why don’t they want to leave? Because there is nothing to draw them back. Many of these displaced men and women didn’t own the houses that collapsed around then; they rented them — often under very unfavorable conditions. They were in debt to bad landlords. They had no schools or clinics.

Enticing them to return home will mean providing exactly what they lacked before: housing, education, and health care. Ironically, Haitians are getting some of those things now in the camps. They have shelter in the 69,700 tents distributed by donors; they have the food and hygiene kits that NGOs offer. The tent camps may well become semipermanent homes if those services don’t also exist in the cities, villages, and towns.

4. Waste not, want not.

At least half of aid money probably never reaches its recipients, eaten up by overhead; often it’s even more. I know of no other business or enterprise in which this would be an acceptable operational strategy. Equally frustrating, sometimes the money doesn’t show up at all. Of the donor dollars promised for 2010, Haiti has so far received a mere 38 percent, or $732.5 million, excluding debt relief. Nine months after the disaster, not a cent of the U.S. donation for Haiti’s reconstruction has been disbursed; it’s tied up in appropriations. Imagine trying to re-engineer a devastated country when your budget is at the mercy of political whims in foreign lands.

5. Relief is the easy part.

Disaster relief is not reconstruction. We haven’t rebuilt Haiti despite giving 1.1 million people access to drinking water; we didn’t remake the country with the 11,000 latrines that have been installed. “Building Haiti back better” means sustaining those temporary gains and adding education, health care, services, and good governance.

What’s most important in getting started? Economic growth. Yet it is a challenge hardly mentioned in aid documents or strategies — coming up only twice in the United Nations’ most recent 44-page report. Poverty of the kind that was so acutely revealed this January can’t be defeated until there is a brighter economic future for the millions of Haitians who are ready to seize it.