Inflexion points

Various thoughts have collided in my head over the last week concerning value for money* in tropical conservation and development. I can see two possible inflexion points, which are clearly related in some sense, but also reflect different concerns linked to the issue of scaling up.

The first I’ll call the So What? point. At the bottom end of development, if someone spends $1,000, say, on donating school books, then most people’s reaction is simply to celebrate the fact that now some kids in a poor country have some books that they would not have had otherwise. It would seem churlish to question whether, in fact, there might be a better way to spend the money.

However, if someone else spends $10m on school books, then one is naturally inclined to question what is the eventual impact of this donation. How much better educated are the kids? How many are lifted out of poverty – or at least become less poor – as a result? They spent $10m on school books, but so what?

The second inflexion I’m calling the Get out of Bed point, and is the minimum grant size likely to interest a development practitioner. It is to a large part set by the organisation for which you work. BINGOs may not chase grants smaller than $1m, while the smallest NGOs will happily jump through several hoops for just a few thousand dollars.

The problem comes when a would-be donor perceives one as having a lower Get out of Bed threshold than one in fact does. One does not want to seem ungrateful, and maybe if there were less hoops  to jump through or less strings attached (hint to donors: these make small grants much more worthwhile), and/or if the grant would be easily renewable (dependable funding is always appreciated!) then we might go for it, but every application form takes up senior staff time when they might be better off just managing what they’ve already got on their plates. This can be a tricky issue for small but growing NGOs to navigate.

I haven’t had the time to really think this through, but I suggest that the best conservation and development action probably takes place when the two inflexion points are roughly aligned for both the implementing agency and its main donors. If the Get out of Bed threshold is much lower than the point at which the So What? test becomes applicable then the organisation concerned is desperately short of money (or fixated on raising money rather than achieving notable results). Conversely if  the Get out of Bed point is significantly higher than the  So What? question level, then the agency is probably swimming in cash and may well be more concerned about spending its great dollops of wonga than achieving value for money.

Contrary thoughts or suggested examples of the different cases are welcomed in the comments section.

* Note this discussion is not about the quality of service provided, efficiency of the activities undertaken, or the level of overheads applied. For the purposes of this post please assume such variables can be controlled for, although there may be an inevitable degree of confounding factors.

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2 responses to this post.

  1. Posted by David on November 8, 2011 at 7:27 am

    This is a very useful and clear schema, I like how the two points balance, and it’s a useful acknowledgement in the So What that the degree of concern over actual outcomes changes with project size. I wonder what that implies for groups that aggregate a lot of small donations in order to do larger work on one project (i.e. humanitarian relief) and some of the problems they have faced in soliciting small support but then justifying its usage, as well as some of the critiques of simplistic “how much is the overhead” reviews of charities.

    Reply

  2. Government donors are getting very low on human resources themselves, and they want to keep attending the different high level meetings. This means time for project analysis and monitoring goes down.

    The whole movement towards “flexible funding” and budget aid could in fact be seen as a political correct way of explaining away that the Get out of Bed point of donors is going up fast.

    Reply

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