Category Archives: Nonprofit/NGO/Agency Management

Aid in Haiti is failing

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A few weeks ago, the radio show This American Life did an great show focused on aid in Haiti. If you want to understand the roadblocks to improving things in Haiti, it’s worth your time to listen to this show. Notice how some of the blocks are because of policies donors have implemented to try to prevent corruption.

It can be hard to get your mind around, but aid actually sometimes harms people, rather than helping, even in Haiti. There are stories of rice farmers in rural parts of Haiti not being able to sell their crops because, with all the rice donations from other countries, there is no market for products. Would-be Haitian contractors are also missing out on jobs because foreign contractors are being chosen by aid agencies instead. Sometimes cheaper, or even most modern, doesn’t mean better, in the long-term, for local people needing the aid.

Time has a story Haiti’s Failed Recovery: Who’s to Blame? that presents the two camps regarding why recovery in Haiti is failing:

For the anti-NGO camp, Haiti is a case study in the hypocrisy of the global relief bandwagon that descends on poor countries victimized by wars, famine and natural disasters. A growing chorus of critics accuses humanitarian-aid groups of using misery to validate their existence, spending funds inefficiently and creating a culture of dependence among the people they are supposed to help… If you belong to the “blame Haiti” camp, you’re less likely to ascribe the post earthquake mess to outsiders than to the country’s defective political culture. In recent years, development economists have sought to explain why some countries lift themselves out of poverty while others chronically underachieve. Stable, transparent institutions – like police, courts and banks – are critical to the success of poor nations. But Haiti’s long history of disarray has left it with few institutions worthy of trust. For those who emphasize such internal factors, Haiti wouldn’t be saved even if every dollar of aid money were spent and every NGO disappeared tomorrow. Until the country’s political class proves it can govern, Haiti’s people will continue to suffer.

I certainly offer no solution — it’s a systemic problem across sectors that defies a simplistic solution. I will say that aid agencies need to be reading these stories and looking at their messages to the public and to donors. They need to be showing how many local staff they are hiring versus how many foreign staff they are bringing in, and highlighting what steps they are taking so that Haitians are not just contributing to their own relief, they are leading it, and will eventually take over from the aid agency completely. They also have to be open about corruption – don’t shy away from talking about problems with transparency, even if it’s just in internal reports or reports to donors.

It’s not time to give up. But it is time to pay greater attention.

ADDITION ON JAN. 12:

John Mitchell, Director of ALNAP (Active Learning Network for Accountability and Performance in Humanitarian Action) has posted a blog about how the media is portraying what is happening in Haiti. It’s very much worth your time to read.

New Congress Brings Stark Agenda for Nonprofits

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The new Republican majority in USA Congress will have a big impact on programs that affect charities and the people they serve. The Chronicle of Philanthropy lists what the nonprofit world can expect from the new Congress. It’s must reading!

This is a followup to my earlier blog warning that the Fall 2010 election in the USA should have every nonprofit’s attention – and every NGO’s attention abroad that receives money from the USA in some way, directly or indirectly. It provides links to commentaries by other organizations as well as ways to address the proposed changes.

As I noted in that earlier blog, US government budgets have already been cut severely, and the cuts that are coming will become even more severe — and the irony is that the same local, state and national governments cutting nonprofit budgets are also asking nonprofits to maintain their services in the face of these cuts.

Also see these tips to use your web site to show your organization’s accountability and results.

Beware those charity rating sites

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Very few nonprofits hand out cash to people. Instead, they provide services. Those services could be just about anything: nutritious food for people who can’t afford to feed themselves, live theater, counseling for people who have been victims of domestic violence, shelter for unwanted animals, job training for people desperate to enter or re-enter the workforce, day care activities for people with severe disabilities, and on and on and on.

Many of these services are designed, overseen or provided by professionals — people who have the training and experience to provide specialized services. These nonprofit professionals are just like those in any for-profit profession: they have spent a lot of money on their education and training, they have bills to pay, they have health care costs, they want to be able to buy homes and put their kids through school, they need a retirement plan, etc. And to keep the best people, nonprofits have to pay competitive salaries (and their competition isn’t just nonprofits — its businesses as well).

All of these organizations have rent to pay, equipment and supplies to buy (copy machines, computers, paper, furniture), insurance and utlities to pay for, and on and on.

What about any of these costs isn’t related to program costs? A copy machine may mean the difference between serving 1000 people as opposed to just 100. A trained social worker with a Master’s degree may mean the difference in providing a job counseling program and not providing one at all. A paid, full-time manager of volunteers may mean the difference between involving 100 volunteers and just a dozen or less.

With all that in mind, I have a lot of skepticism for claims that nonprofits give too much to administative costs, as well as for grading systems that are focused mostly on financial reports and not-so-much on the results of a nonprofit’s work. Some nonprofits have told me that they have been forced to hire a revolving door of short-term consultants instead of full time employees because, the way sites charity rating organizations or the way funders count administrative costs, a consultant can be counted as a program cost, but an employee, doing exactly the same work, is considered administrative.

As the Nonprofit Quarterly put it recently, “With one holiday giving article after another urging donors to do their homework on charities, it would be nice to believe that those that set themselves up to inform donors would take care not to do harm.”

Here’s some of the many criticisms of these charity rating sites:

Here’s my advice: when evaluating a charity, look for accredication by professional bodies, such as the Council of Accreditation. Look for membership in national or international networks. Look at what the organization says it does; don’t just look at activities – look at results. Look to see if they involve volunteers — not because volunteers are “free” and replace paid staff but, rather, because volunteers prove community investment in the organization. If you don’t see this documented on the organization’s web site, email the organization and ask for it.

But remember that many large donors refuse to fund administrative costs, and that means the organization may not have the funding to hire the staff that would be needed to provide the level of detail regarding its programs you and others may want — because, you know, that’s an administrative cost.

A war on nonprofits & NGOs?

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The Fall 2010 election in the USA should have every nonprofit’s attention, as well as the attention of every NGO’ abroad that receives money from the USA in some way, directly or indirectly. Government budgets have already been cut severely, and these cuts will become even more severe over the coming months — and the irony is that the same local, state and national governments cutting nonprofit budgets are also asking nonprofits to maintain their services in the face of these cuts.

In addition to the budget cuts, there is also a significant backlash in the USA, and in some cases, abroad, against nonprofits and NGOs; there is growing rhetoric against the work of mission-based organizations, which are being accused of everything from promoting inappropriate agendas to being corrupt.

Your organization needs to get up to speed on what could be called the war on nonprofits and NGOs:

Your organization needs to develop a strategy that employs a variety of activities over the next year to ensure local officials, state legislatures, and US Congressional representatives, as well as political leaders that are not office holders, understand just how vital your organization is and just how well managed and efficient it is. This isn’t something nice to do; it’s absolutely necessary to your organization’s survival.

There are several things your organization can do:

  • Build a relationship with elected officials, politicans and pundits:
  • Ensure that office holders, representatives from local political parties and various media representatives receive press releases regarding your organization’s results and the difference your organization makes. This can be evaluation results and testimonials from clients or volunteers.
  • Invite office holders, representatives from local political parties and media representatives (radio, TV, newspapers and bloggers) to events where they will hear about the difference your organization makes, or to observe your organization “in action.” Thank office holders, politicans, media representatives and others for attending your event with a personalized followup letter or email.
  • Set up meetings with elected officials, politicans, media representatives and others, one-on-one. It can be a morning meeting at their office, a lunch, whatever. Try to know them on a personal level.
  • Respond to criticism and rhetoric from elected officials, politicans and pundits. Respond with a phone call, a request for a meeting, a letter, an email, a newspaper editorial and/or a blog. Responding to criticism is vital both in countering negative PR and in showing office holders, politicans, pundits and others that you are listening!
  • Post your annual reports for the last five years online. Give an idea of why things cost what they do. Spell out administrative costs — what does having a copy machine allow you to do that you could not otherwise? How does having computers and Internet access allow you to serve more clients? Why do you rent or own office spaces, meeting spaces, event spaces, etc.?
  • Post information about your paid staff and their credentials online. Show that the staff you are paying are worth their salaries.
  • Talk in your newsletter and blog about what a cut in the budget will look like, what programs would have to be eliminated, what services you would not be able to provide, etc. Don’t sound desperate but do be clear about why decisions are being made and what cuts will look like.
  • Talk in your newsletter and blog in blunt terms about expenses. For instance, involving volunteers is NOT free; talk about all the costs that come from involving volunteers, your commitment to involving volunteers as something much more than free labor, etc.

You cannot afford not to do this!

Also see: Going all-volunteer in dire economic times: use with caution.