Promoting global development, not just band-aid charity

Citation

Ackoff, R.L. (2006), "Promoting global development, not just band-aid charity", Strategy & Leadership, Vol. 34 No. 3. https://doi.org/10.1108/sl.2006.26134caf.002

Promoting global development, not just band-aid charity

Promoting global development, not just band-aid charity

Concerned corporate leaders, who believe that endemic poverty in countries around the world threatens their stakeholders and their business operations, should consider whether the international programs they and their governments are supporting truly promote and sustain development or are merely charitable projects or self-serving initiatives.

For example, many current efforts by corporations to contribute to sustainable global development do not strike me as promising because they are largely focused on finding ways to convert less developed countries into profitable markets. They seek to modify products sold in developed countries so as to be saleable in less developed countries to convert the poor into profitable customers. It is hard to see how shampoo and toothpaste, however modified and packaged, can contribute to development of their users. They may improve quality of life, but they don’t contribute to development. To be fair, corporations selling cheap cell phones and rugged computers for use in underdeveloped countries, and integrating them into development efforts, may make a significant contribution to global development.

I am aware of the large amounts of relief given to the disadvantaged in crises. This is obviously necessary and an appropriate thing for corporations and governments to engage in. Of course the victims of man-made and natural catastrophes should be helped. But this is a bottomless pit unless the charity provided also fosters development.

In fact, the challenges faced by leaders who seek to stimulate global development and thus make inroads against global poverty are daunting. If poverty is defined as living on an income of less than two dollars a day, fifty per cent of the world’s population is impoverished. In parts of Africa it goes up to as high as seventy per cent. The World Bank currently estimates the number of poor in 2015 will be exactly the same as Robert McNamara estimated there were in 1973.

What’s especially worrisome to me is that I see little evidence that international programs currently directed at producing development know what development is. Development is not the acquisition of wealth, or an increase in the standard of living, as they assume. Development is a process of increasing one’s competence, an ability to satisfy one’s own needs and legitimate desires and those of others.

Development occurs in the process of learning, not earning, as growth does. Development is not so much a matter of how much one has as it is of how much one can do with whatever one has. A developed country can produce a better quality of life with few resources than an undeveloped country can with many. Of course, at any level of development a higher quality of life can be produced with more rather than less resources.

Knowledge of how to facilitate development of disadvantaged communities and nations is already available. Supported by corporations as well as government agencies, it has been used in disadvantaged neighborhoods in developed countries, in peasant villages in Mexico, and in many other places[1]. Six valuable lessons I learned from producing pilot programs to promote development and then scaling them up are.

First, organizations, institutions, or government agencies of any size can serve as facilitators of development. They should engage in it directly by providing support to others without intermediaries. Only by so doing can they learn how to facilitate the development of others. Furthermore, by so doing they acquire “something to show” for their efforts and can more easily justify continuation and expansion.

Second, a pool of resources – financial, human, and equipment – should be made available to those who are less developed. This should only be used in development efforts, and in ways that contribute to an increase in the competence of the recipients. The recipients, not the donors, should decide how the resources would best be used. The donors may expresses their opinions but should not impose them on the recipients of the resources.

Third, the less advantaged should be allowed to make non-self-destructive mistakes. They can learn from mistakes – by identifying them, determining their source, and correcting them. Furthermore, they will learn more from their own mistakes than from the successes of others.

Fourth, decisions on how to use these resources should be made democratically: by those who will be directly affected by them or by representatives that they have selected, and by others who will be indirectly but significantly affected by these decisions.

Fifth, corruption should not be tolerated. Its presence should be a sufficient reason for discontinuation of a development-support effort. This should be made very clear at the beginning of an effort. Corruption consists of the appropriation of resources intended for use in the development of others. Where it is rampant, it is a major obstruction to development. It also produces a feeling of futility in many of the intended recipients and provides a fertile soil for fanaticism and terrorism.

Sixth, the effort should be monitored and evaluated objectively by a group whose members are acceptable to both the recipients and the donors of the aid.

Consider some aspects of these lessons in more detail.

Sources. Each developed country should have an agency to administer development programs. It should receive and process applications for aid.

A percentage of the income tax collected in every developed country should be designated for investment in equalizing development among nations. Institutions and organizations receiving subsidies or contracts from the governments of more developed countries – especially colleges and universities – should provide the human resources required on development projects.

Monitoring. A record should be prepared for each significant development-intended decision. This record should include, among other things, the expected effects of the decision, by when they are expected, and the assumptions, information, knowledge, and understanding on which these expectations are based. It should also record how the decision was made and by whom.

The monitors should then track the expectations and assumptions. When a significant deviation from them is found, it should be diagnosed to determine what produced it. The decision makers should then take corrective action.

A record should also be kept of these corrective decisions. Monitoring these makes it possible to lean how to learn. This may well be the most valuable thing one can learn.

Decade for development?

To enlist more corporate leaders in the global effort I’m tempted to suggest establishing a Decade for Development. However, I don’t believe that such calls to action are likely to be effective. Instead, I suggest that corporate leaders and the people they influence should start doing something individually.

As an example of what can be accomplished, in response to a request from GlaxoSmithKline, one of the world’s major pharmaceutical companies, one that already has a distinguished record of community involvement, I developed a proposal to which the company is now committed. The idea behind the proposal came from two sources. The first is a very successful community development effort carried out by a research center at The Wharton School of the University of Pennsylvania with a so-called urban black ghetto in Philadelphia. The story of that effort appears in print in several places[2]. It led to the adoption of the process used in sixty-two other cities in the USA.

The second example is an anti-littering campaign conducted in the United States in which non-governmental organizations accept responsibility for keeping a designated stretch of highway clear of litter. They regularly police the designated stretch of road and remove trash. Signs are posted that identify the organization that has adopted the part of the highway affected.

Using lessons learned from these two projects I propose that organizations engage in the following type of development effort, one divided into four stages:

1. 1.

   Stage 1. Each organization selects a disadvantaged community in the city or region in which its headquarters are located. It adopts this community and becomes a facilitator of its development, using the steps described earlier.

2. 2.

   Stage 2. It induces the local Chamber of Commerce, or some similar community-based organization, to induce other organizations into doing the same thing. In this way it initiates a City- or Region-Wide Development Program.

3. 3.

   Stage 3. The originating organization initiates similar community adoptions in each city or region in its home country in which it has operations. Other organizations in the community or region of the originating company do the same thing.

4. 4.

   Stage 4. Each organization then adopts a community in each foreign country in which it has an operation.

I have found it desirable to employ one or more persons who live in the community selected and who have shown leadership potential. It also helps to provide him or her with a small amount of discretionary funds to use for development purposes only. In the United States I have been able to do this for a neighborhood of 22,000 people on an annual budget of only $35,000. That neighborhood was eventually able to generate several million dollars of income each year by its own initiatives.

My hope is that corporate leaders will make a commitment to initiate a development-facilitation effort in a community to which they have or can gain access. Unless organizations are willing to become engaged in community development efforts, I can see no reason for us to expect public efforts to become more effective than they are currently.

To be effective, a corporate sponsored development effort will require inspirational and courageous leadership from concerned executives worldwide.

Notes1. Ackoff, Russell L., Redesigning the Future, Wiley, New York, NY 1974.2. Ackoff, Russell L. and Sheldon Rovin, Redesigning Society, Stanford University Press, Stanford, CA, 2003, pp. 155-56.

Russell L. Ackoff Anheuser-Busch Professor Emeritus of Management Science in The Wharton School of the University of Pennsylvania (RLAckoff@aol.com). A prolific author, his most recent book is Beating the System, co-authored with Sheldon Rovin (Berrett-Koehler, 2005).