It is increasingly axiomatic today that an organization can’t sustain merely with offerings of services, making knowledge available to its customers (do not like the word beneficiaries or client) and providing advocacy. This approach can be considered as conventional business strategy, which is good enough to survive but not sufficient to grow. I find it as an assembly unit with well-defined process and controls, which employs enormous resources (human, money and time) but produces outputs, which is even less than for its own subsistence consumption.
This is a classical instance of learning disability of an organization, which was conceived and operating for many decades with shareholders capital and the so-called management is unknowingly transformed into an obsolete operating system (OS), which was relevant many years back, but now, such OS does not have any relevance and compatibility owing to the changing market scenario, new breed of customers-who have unique demands and different environment for investing resources, which are utter confusing “post-modern market web’ for the old OS. And, needless to say, that this is the ‘point of no-return’, from which turnaround strategy is not practically feasible.
Perhaps, in the contemporary time, many non-profit development organizations are facing this problem. Economic and political pressures, taxpayer revolts, and a few high-visibility scandals have all hurt the nonprofit sector. As a result, nonprofits face critical decisions about their future—and perhaps their very survival. Many nonprofits are considering a fundamental change in organizational structure because of economic pressures such as increased competition from business, government, and other nonprofits; a shrinking supply of experienced leaders willing to remain in the sector for inadequate wages; and increasingly urgent and complex community needs.
Without going into the details of specific cases, it is easily understandable that there is a gradually increasing concern of communities, customers and general public on the fidelity of the very concept of non-profit. The primary question is: how does an organization work for not making profit? And, why there is no remarkable evidence of poverty reduction, even after providing enormous financial aids, capacity building services to poorest nations of the world? Indeed, these are not new questions; answered for last few decades and it is an established fact that non-profit organizations are important and necessary for development. However, to inject a true spirit of development into most least developed areas of the world, non-profit organization needs re-structuring in the operating system with timely and relevant marketing principles, which should be powered with a new breed of development professionals with latest skill sets, expertise and outlook. Unfortunately, such changes are rare and one of the reasons for resisting such changes is the so called ‘dead woods’ and their enwrapped traditional outlook about development which is completely inert and unaffected with the new world of development.
This is purely a problem of limited understanding of actual marketing principles and its application in development. This is crucial for non-profit organization to give up a utopian philosophy of development which is derived from conventional donor driven, grant oriented activities, propelled with very general impact parameters like ## people having access and using renewable energy technologies in least developed countries. Why can’t we teach the community to fish, instead of providing the fish?
I believe, development model shall be linked to market forces and the prime objective should be to empower poor households with entrepreneurship skills for functional business enterprise building. Anything without profit and anything for free is unproductive, unattainable and counter-productive. And, therefore, we shall have capacity development services, to build entrepreneurship, business and employability skills at community level. This is inevitable.
The development organization should only enable community/households to have the access to market and market forces. This should be the community, who will decide-what do they like to produce, process and trade for enhancing their living standards, socio-economic growth and bringing happiness to their lives. Unfortunately, it is experienced that many development organizations do not provide freedom to community to decide. Community’s prosperity should be built on its ability to perform economic activities, which would attract appropriate funding through windows like microfinance, payment for environment services, climate financing (not necessarily grant, aids). Anything that jeopardizes the community’s true desires for development (economic and social) endangers the future of development and anything that jeopardizes development endangers sustainable growth of the world.
Soft Power and Great Indian Painting:
The notion of soft power is relatively new in international discourse. The term was coined by Harvard’s Joseph Nye in his book The Paradox of American Power to describe the extraordinary strengths of the United States that went well beyond American military dominance. As the former head of communication of UN, Shashi Tharoor quoted Nye: Power is the ability to alter the behavior of others to get what you want, and there are three ways to do that: coercion (sticks), payments (carrots) and attraction (soft power). If you are able to attract others, you can economize on the sticks and carrots.
I can see a clear relevance of the concept of soft power for the development organizations. The soft power, a not-for profit (development) organization rests primarily on three resources: its culture (in aspects where it is attractive to others), its development values (broadly the global value proposition) and its implementation modality (again, teaching –how to fish). In today’s information era, only those development organizations are likely to gain the inherent control of soft power and so succeed: those whose dominant cultures and ideals are closer to prevailing global norms (which now emphasizes liberalism, pluralism, autonomy and localization); those with the most access to multiple channels of influence over how development issues are globally and regionally framed; and those whose credibility is enhanced by their regional and international performance. Indeed, as stated above, all these aspects are linked to marketing and its essential forces. Therefore, to make relevant and contemporary, development organizations must meet fire with fire and that is only possible, if they are powered with ‘soft power’.
The other reference on great Indian painting came from a passage of the much-misunderstood novel of Salman Rushdie: The Satanic Verses. Mr. Rushdie writes of the ‘the eclectic, hybridized nature of the Indian artistic tradition’. Under the Mughals, he says, artists of different faiths and traditions were brought from many parts of India to work on a painting. One hand would paint the mosaic floors, another the human figures, a third the cloudy skies: ‘the individual identity was submerged to create a many-headed, many-brushed Over-artist who, literally, was Great Indian Painting’.
This evocative image could as well be applied to the very idea of re-structuring of development organizations with competent, advanced skills human resources. This can also be an idea of organizational team building and oneness. Unfortunately, this oneness and managing human capital is still scratch a living from the soil. Undoubtedly, to transform this scenario, we need new stream of financing and investment model. Development organizations cannot rely solely on aid or unsustainable business models; it needs to mobilize the power and scale of capital markets, which provide a far greater capital opportunity than current public sector or philanthropic funding. In order to achieve this, organizations need to make it as profitable to invest in tackling pressing social issues as it is to invest in regular commercial activity. One of the inspiring leaders of modern world rightly says: “With a donation, money has one life. With a business it has many lives” - Muhammad Yunus, Nobel Laureate, Founder Grameen Bank.
Keshav C Das
Advisor, SNV Netherlands Development Organisation.