“The Glory in Creating Honey”

If you have read my other blogs in 2012, then you know I’m spending the entire year complaining about how shopworn the discussion of “values” has become, with organizations and corporations trumpeting the supposedly remarkable attributes attached to their worldly efforts. In fact, such efforts strike me as an arid exercise in public relations, designed to impress outsiders with righteous-sounding words, with little reference to the actual weight they carry inside the organization.

I’m arguing that we need to get away from vague talk about values, and focus instead on virtues, which are qualities that can be fostered and nurtured, both organizationally and individually.

So far this year, we’ve considered such virtues as patience and generosity, and now I want to turn my attention to diligence. Diligence is a characteristic of most successful people and groups; a diligent entity completes all tasks without complaining, finishes projects on time, over-delivers and under-promises, and understands that the life of an organization, just as for the people it comprises, is a long process and needs to be nurtured carefully.

We sometimes play an imagination game at EMW called “Abracadabra,” where staff members are handed a magic wand and asked to wave it around, say out loud their greatest wish for EMW or themselves. It’s a way of naming dreams, but we are all well aware that only disciplined hard work will allow those dreams to come true.

“Diligence,” Ben Franklin wrote in The Way to Wealth, “is the mother of good luck.” I truly believe that individuals and organizations can create their own luck, and one thing business school brochures never mention is that luck has much more to do with success than smarts. A diligent organization carefully builds the resources, infrastructure and systems necessary to capture good luck when it comes around. A sloppy organization isn’t prepared to take full advantage of good luck and, like the hapless lottery winner, fritters it away instead of using it to build the future.

If you don’t mind a ranting digression, can I just remind everyone that “overhead” is not in itself a bad thing? Rating agencies, donors, foundations and self-appointed experts all conspire to sanctify or demonize an organization based on that most holy of numbers, the percentage of its budget spent on overhead. This is idiotic. Don’t get me wrong: overhead (administration, finance, fundraising, marketing, data management, etc.) should be as low as possible; donor funds should be used to the utmost to benefit people directly.

But show me an organization or company that doesn’t invest in the necessary systems and infrastructure to sustain growth, and I’ll show you one that doesn’t believe in its own future. Growing rapidly means being able to serve more people, but you can’t grow if you lack the basic infrastructure.

Let’s be honest, at some point, you have to stop spending 100% of your time and money on implementing programs, and spend a decent amount of it thinking about how to prepare yourself for good luck to come your way. This is the essence of diligence. So there may be a year or two here and there where the “overhead” ratio goes way up. This might be a sign of organizational malpractice. Or it might instead be an example of a diligent organization doing what it needs to do in order to ready itself for the future. Donors should be diligent too, and figure out the difference.

No discussion of diligence would be complete without the social insects – bees, ants and those impressive builders the termites. The industrious ant is rightly celebrated in fable and scientific literature, but the busy bee is more appealing. For one thing, bees make something delicious.

Let’s make a quick trip back in time to visit one of the great philosopher poets on the subject of bees. According to Virgil in his famous poem about farming:

“Often too as they wander among harsh flints they bruise their wings, and breathe their lives away beneath their burden, so great is their love of flowers, and glory in creating honey. And though the end of a brief life awaits the bees themselves (since it never extends beyond the seventh summer), the species remains immortal, and the fortune of the hive is good for many years, and grandfathers’ grandfathers are counted.”

This then is the purpose of diligence – the glory in creating honey, a substance that simply amazes me. How could it be that a bunch of bugs somehow produce something so sweet, fragrant and pure? It’s a miracle, really, that all that buzzing around results in ambrosia.

As I write this, I’m on my way back to Oakland after our annual EMW staff retreat in Da Nang, Vietnam. This event is always a profound pleasure, as it brings together most of EMW’s talented staff in one place for a weekend of discussions, feasting and merrymaking. Organizational honey, the event is a celebration of all that has been accomplished, and a serious discussion of all that remains to be done.

We are brutally honest with ourselves, examining our shortcomings and making plans to fix them, and yet we do it from “a great love of flowers,” or in our case (not being bees), a deep joy in building the structures that allow us to fulfill our mission.

Toiling away in the salt mines of grant proposals, financial reports, trainings and the like can feel like drudgery at times, but done with diligence, these activities lead to success. Luck isn’t something that just happens; it is something that a diligent organization can make manifest. If you have done everything right, then you simply need to wave your magic wand, say “Abracadabra,” and glory in the honey.

But what about those times when there are no (or minimal) penalties, or the risk of being caught is very low, or the rewards are inconsequential for following a particular item in a code of behavior? It’s what you do when nobody is looking that defines integrity, in my book, along with constantly seeking to align your daily behavior with your raison d’etre.

I find it interesting how many organizations and companies claim integrity as a core value without defining what it means. This casual attitude has led to an unfortunate diminishment of the power inherent in the word, which then becomes just another item on a list of values, with no particular weight given to it, or any real understanding of what it means. As someone who loves and revels in language, I find this deplorable and upsetting.

It’s comparable to the misuse of the word “unique,” which should be saved for those instances when the item under discussion truly is alone in the world – unique is not a synonym for “good.” Therefore, something cannot be “very unique,” since that something either is or isn’t the one and only. Einstein was a smart guy, and yes, he was unique. My brother is also pretty intelligent, but it makes no sense to call him “very Einstein.” It’s enough that he is a tenured professor at Penn State; we wouldn’t want him to get a swelled head.

Similarly, integrity is a powerful virtue. To say that a company has integrity is to bestow on that organization a reputational seal of approval that can only be won after long effort, and can easily be lost. For an organization to have integrity, each and every individual in the organization must at all times exhibit the kind of behavior that is beyond reproach, in matters big and small. Integrity is one of those virtues that require constant practice, and if you don’t get the little things right the big things are nearly impossible.

Of course, we are all human and we make mistakes. I have sometimes screwed up my expense claims to East Meets West, accidentally adding in dinners with friends as part of a reimbursement claim, or failing to notice mistakes made by the bookkeeper. I do my best to instantly correct these mistakes, although chances are (given how much I travel) nobody would ever notice and the dollar amounts are trivial.

But as we all know, this sort of behavior is a slippery slope and easily rationalized. Pretty soon, what used to be an accident becomes a behavior. So I try to practice overcompensation – if I make a mistake, I don’t just correct it, I go above and beyond. I might make a donation to EMW, for example, or treat the staff to after-work drinks, or deliberately forego filing legitimate expense claims. Over the years I’ve found this to be an effective way of keeping myself honest, one that acts as a powerful corrective to the repugnant attitude of “I work hard and always deliver, so the organizations owes me.”

When I hear people in our industry (international development) describe a given agency as “lacking integrity,” I always know what they are talking about. They are referring to groups that claim to be helping the poor, but mostly seem to be helping themselves – enjoying a life of luxury while offering lip service to helping the disadvantaged.

Personal and organizational integrity can be painful at times, and it always requires attention. If people make mistakes, they should correct them immediately and offer to make it right – and so should an organization. I remember once discovering that EMW had accidentally misled a donor. Due to an unfortunate breakdown in communications caused by staff changes, we completed a project and sent a final report to the donor showing that we had correctly expended the funds, but only half of what the donor gave us.

Although the donor had not noticed the discrepancy, I felt I had no choice but to call him and offer to refund the balance of his donation. He wasn’t all that happy, and may well have mistrusted my motivations. How many times have you heard of an organization returning donor funds if the project came in under budget? It was, however, the right thing to do.

In life, we may frequently be faced with the temptation to lie, cheat and embellish; the rewards are often enticing and the penalties a lot less painful than getting your knees blown off. Integrity is all about listening to that internal voice that reminds you that it’s wrong, and developing in yourself the persistent habit of never giving in to those sorts of temptations. In our overly abundant society, there are plenty of perfectly legitimate rewards you can give yourself instead.

It wasn’t until I was a teenager that it suddenly struck me; what she really meant was, “patience is one of the virtues you should cultivate in yourself.” And not for the first or last time, I wondered if I was perhaps an exceptionally slow learner.

Virtues have been on my mind a lot lately, since I feel that the conversation about “values,” both personal and organizational, has become stale and unproductive. Because organizations seeking to define themselves tend to pick values by committee, the values selected are, while undeniably worthy, mostly meaningless in everyday life. In other words, they don’t serve as a useful working guide for staff and board. Values seem to exist in some exterior void, behind glass, like a piece of wall art that nobody notices anymore.

Virtues, on the other hand, are easily accessible, there to be nurtured and encouraged. They only exist in active practice.

So what would it mean for an organization (nonprofit or for-profit) to say that it is patient? Think about this: Organizations are created to solve problems. Important problems cannot be solved in a year, or even five or ten. Being patient is the explicit acknowledgement of this reality.

A patient organization, knowing that it needed a long time to make any headway in solving the world’s problems, would think of project cycles in ten-year increments at least. Programs would be set up, and program partners selected, on the basis of long-term commitments to solving difficult problems, instead of short-term projects that barely scratch the surface. It’s the difference between a merely incremental approach (e.g., helping one more child get an education, or one more rural village get a handpump) and truly catalytic change.

Catalytic change comes when an intervention fundamentally alters the way a system responds (hopefully for the better). For example, a low-performing school system that is failing the community’s low-income children transforms into one with highly motivated teachers and good graduation rates even for those children.

In a patient organization, the leaders would evaluate the organization’s capacity based on whether it had the necessary systems, staff and cash reserves to keep the programs running and the lights on for the long term to achieve catalytic change. Senior staff members would focus their attention on training and developing newer staff members for the future, creating a culture of continuous learning and development. All staff members would seek opportunities to improve their skills and intellectual capital, secure in knowing that their ability to be successful is measured in years, not months. Mothers and fathers could take time off for childbirth, and the organization would celebrate parental leave, confident that the staff member would return and that having children adds to the maturity and reliability of staff. The top leaders would make public commitments to stay in it for the long haul, creating a sense of security and inspiring other staff to make similar commitments.

Let’s talk frankly–there’s not much you can get done in just a year or two. Short-termers are largely a waste of resources. In both the nonprofit and for-profit worlds, senior staff tenure is astonishingly short; I think the average for a Chief Development Officer or Chief Marketing Officer is around twelve months. Twelve months! You spend the first six months just learning the basics of the job.

This is exacerbated, at least in the nonprofit world, by the short attention span of donors, who often have trouble thinking about programs that last more than two or three years. What a different conversation it would be, don’t you think, to sit down with a donor and explain that ten years is the minimum amount of time it would take to get traction on the problem at hand, and that it would be irresponsible to launch something knowing that you were going to wind it up just as it got going?

Imagine you are a child in a school and you win a scholarship that covers school fees, books and supplies every year. But the agency that gave you the scholarship will only support you for three years; after that you’re on your own. I guess that makes you “sustainable,” but in my personal dictionary that’s defined as “sorry, we don’t feel like helping you anymore.”

In my view, you take on a moral obligation when you provide something as meaningful as a scholarship; you should at least have the decency to carry it to some sort of conclusion – graduation from high school or college, for example. This is the real, deep meaning of patience – the willingness to commit to a long-term engagement in order to have a profound impact. It doesn’t just mean being able to sit around quietly waiting for something good to happen.

Patience is the wisdom to make long-term investments in finding solutions. Like teaching your kids the same lesson over and over and over again. I may be a slow learner, but having three children has taught me that much.

Personally, I’d find it a little creepy to be admonished by my workplace to “enjoy my family,” but maybe I’m just a misanthrope. And the Boy Scouts, what Scout doesn’t remember the endless recitation of the Scout’s personal list of values: “trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean and reverent.” Eventually I had to get out of Scouting before I hurt myself trying to be both friendly and cheerful at the same time.

All sarcasm aside, I want talk about how and why values are so important in business, whether for-profit or non-profit. Actually, I want to shift the focus a bit, and turn the discussion from values to virtues.

What’s the difference? I’m no philosopher, but it feels to me like the conversation about values has degraded the inherent meaning of the word. Too often, the creation of a list of organizational values is tasked to a committee that finds non-controversial values that everyone can agree with – precisely because they are so undemanding. “Integrity,” for example. Who could be opposed to that? What does it mean, anyway, for you, the lowly staff person working in some giant organization?

Maybe it means, “don’t steal the office supplies or you will be fired.” Or maybe it means, “if you see a co-worker stealing office supplies, immediately report that person to your supervisor.” I’m sure that will work out well.

Values are a slippery concept, because they are so situational and easily claimed. Even the most bloated bureaucracies purport to value “efficiency,” while tiny marginal organizations proudly proclaim themselves to be “high-impact.” And everybody loves sustainability, most particularly the 50% of small businesses that fail every year, I suppose.

Virtues, on the other hand, are up to you as an individual. In good organizations, powerful virtues are rewarded by the organizational culture, and flow naturally into organization-wide values. Let’s take generosity as one example.

To be generous – as an organization, business or individual – really means, when you dig into the history of the word, to carry yourself with a sense of nobility. Confident in your own abilities and accomplishments, you are willing and able to help others. By demonstrating generosity, you show the world that you value yourself, understand that you live connected in a community, and hold yourself to high personal standards of character.

A generous individual within an organization is one who is always willing to share credit and to credit others for their good work, who never hoards information but offers it willingly so that other can do their jobs, who goes out of his or her way to make sure that newcomers feel welcome, and takes a particular satisfaction in helping others to be successful.

A generous organization exhibits a lot of the same characteristics, often with respect to smaller companies or nonprofits. A generous organization makes its resources available to others, helps them succeed, opens doors with key funders or business partners, and is quick to praise and share credit.

A generous leader takes it as their personal responsibility to enable other members of the team to be successful – coaching, encouraging, guiding, supporting and nurturing. A generous organization or company rewards staff members who act the same way, and encourages actions in that direction.

Let me give you just one example. Several years ago, I was able to get a meeting with Indra Nooyi, the Chairman and CEO of PepsiCo. I sat with her and one of her top lieutenants, Saad Abdul-Latif, and explained a program we wanted to undertake in Chennai, India (her hometown). She listened carefully, asked penetrating questions, and then promised to help. She had Saad introduce me to the CEO of Pepsi India, Sanjeev Chadha, whom I subsequently talked to and met with a number of times.

Based solely on her request and Saad’s introduction, Sanjeev not only spent time talking and emailing with me, but made a number of key introductions that have proved to be enormously helpful as we build our program in India. And not only that, he did so in a way that just felt great – not once have I had the sense that he begrudged the time, or felt annoyed at having to help a little NGO with a social mission.

I think of these three executives from PepsiCo every time I am approached by a student from a local business school, or an engineer with a cool design, or a start-up organization needing help with fundraising, organizational development or anything else. I hope that East Meets West always acts in a way that honors the help others have given us.

Organizations that not only post their values on the websites but act on them every day are better and generally do better over time than organizations (and businesses) that are too focused on the bottom line, on beating the competition and on hoarding information and resources. They are better places to work, and reward and encourage people for whom the personal virtue of generosity is important.

The science of altruism and the study of generosity is in its infancy, but there are many encouraging studies showing the relationship between strong values and organizational and personal success; check out the University of Notre Dame’s program. Unfortunately, there are far more negative examples in the news lately showing what happens when values are ignored. For easy confirmation, do a quick online search for “Greg Smith” and Goldman Sachs – a company informally known as the “Vampire Squid.”

The Vietnamese Lunar New Year is about change and renewal. The old is kissed goodbye, the new embraced, and everyone looks for signs that the coming months will bring good luck, prosperity, and opportunities to laugh and love.

What better time to start thinking about a new theme for my blog?

And so every January I start considering different blog options. Just see what inspires (or appalls) me, and respond? Develop a theme, and try to stick to it for twelve months? Hard to decide, but eventually Tet comes and goes, and I have to make a choice.

So here you have it – for the Year of the Dragon, I’ve decided to spend the entire year talking about values. It’s my belief that great organizations are defined by the values they inculcate in their community – staff, allies, board, advisors, partners, friends and family. Next month, I’ll launch this series by talking about generosity, and why this particular value is so crucial to building great organizations.

But what does “great” really mean in terms of organizations? You may have heard of the book Good to Great, which defines great as above-average market returns for private companies. Great can also mean “big”: think of huge companies like Exxon or enormous NGOs like Save the Children. But for the word “great” to have any real meaning, it can’t simply be about profit margin or size.

In fact, being great is all about selecting, and adhering to, a set of core values that connect individuals with the institution. No single value can possibly make an individual or organization great; it has to be part of a mutually reinforcing network. We’d all agree, I think, that honesty is an important value. But you can be both honest and ineffectual, or honest and lazy. Would you want it said about you, “She’s really honest, but never gets anything done?”

It’s also true that to build a great organization made up of great people, you sometimes have to make hard choices. If there are people who are unable or unwilling to uphold the values of the organization, they have to go.

Now, if you’re wondering whether values are really so important, let me tell you about a conversation I once had with a C-Suite executive from a major American corporation. At one point he burst out saying, “The dumbest people in the world are graduates of this country’s top MBA programs.” He then regaled me with tales of major business mistakes, made mostly by people with huge amounts of intellectual ability – and stunted values.

Here’s something to think about if you want to be a great success working for a great organization, you’d better exercise your values. I’ll tell you how to do that in eleven easy lessons this year, and if you have ideas to contribute, please send them my way. By the end of the year, we’ll have a definition of what makes a great organization, made up of great people. I hope you’ll stick with me for the journey.

What I heard was both inspiring and disturbing. Let’s start with the disturbing part; I’ll get to the inspiring bit in a minute. According to a report from the Ministry of Agriculture and Rural Development (MARD), the majority of new clean water systems fail. It’s hard to believe, but 60 to 70% of all new water systems built by either the government or an international agency stop working in under two years. Most of those fail within one year and nearly 30% never work at all.

The systems are, by and large, overbuilt, expensive failures of engineering and social development, with virtually no serious attention paid to preventative maintenance, value engineering, good-quality components, community buy-in or financial sustainability. In fact, for government-built systems, it is often the case that the government builds only the water tower and pumping house, leaving the actual delivery of the water to people’s homes up to the local commune authorities to figure out. This rarely happens.

I’ve seen many of these projects while in the field, but one in particular stays in my memory. Built by one of the world’s leading clean water agencies, it featured a giant pump house, two large wells, and four concrete cisterns to store the pumped water for people to come and collect. On the day I visited, the commune leader accosted me with a legal-sized sheet of paper, one side of which was densely covered in writing. He then harangued me for 20 minutes, detailing all the things wrong with the water system – the pumps cost a fortune to run, they break down all the time, the cisterns aren’t big enough, so only people who line up very early in the morning get water, and on and on.

This was the side of the paper labeled “things that are bad about our new water system.” He then turned the paper over to the side labeled “things that are good about our new water system.” The page was blank. “Nothing is good about this system,” he yelled. “Not one thing!”

This is tragic, not the least because the system probably cost between $150,000 and $250,000 to build. What a waste of money and goodwill, not to mention the crushed expectations of the villagers. The good news is that EMW re-built that water system five years ago, running pipes to every home in the village. It continues to deliver clean water, seven days a week, 24 hours a day.

In fact, the EMW failure rate for new water systems is practically zero. We guarantee every system for one year, and monitor them for up to five years. After a decade of work, well over 350,000 people are connected to an EMW water system; in the past two or three years, we have only had one water system stop working. This was because the road-building authority ran over the pipes, breaking them all. Some of the much older systems – built eight or ten years ago – need serious upgrading, it’s true. But more than 80% of those older systems are still functioning.

And here’s the crazy thing – our systems cost half as much as those built by other agencies or the government.

“How can that be?” you might ask. “What magic formula has EMW discovered?”

It’s not magic, and here’s the inspiring part of this article. Our success is built on the hard work of the local staff, who pay very close attention to high-quality value engineering, training of local water managers, financial sustainability, community buy-in and rigorous quality control every step of the way. If we can do it, so can any other agency. It’s a real shame so many of them don’t put their money where it could be more effective—long after the ribbon cutting ceremony is over.

Reading the news is generally depressing, but few things have made me so sad recently as the announcement by the World Wildlife Fund in Vietnam that the last surviving Java rhinoceros in Vietnam was killed by poachers this year. The poor thing, forced to live all alone after every last one of his sisters and brothers, aunts uncles and cousins, mom and dad were killed by poachers. Finally he too succumbed, shot not for his meat, but for his horn, which supposedly has medicinal value to Chinese consumers. He was found dead, with a bullet in his leg and his horn cut off.

All across Vietnam, the natural environment is under unrelenting attack from development, poaching, pollution and habitat loss. You can see it everywhere you go – forests that used to be havens for millions of birds eerily quiet, coral reefs with nothing left but a few clown fish and dirty seaweed, streams and rivers stripped of all their resident life.

There used to be a glorious area north of Hanoi called Tam Dao National Park. The park is still there, but the number of birds you can see has dropped dramatically. In Tam Dao, there is a wonderful old hotel called the Mela, owned by an Algerian former diplomat named Mekki Salah. Over the past few decades, he has taken tens of thousands of pictures of the birds of Tam Dao, copies of which adorn the walls of the hotel. He told me over dinner one night that he hardly bothers to take any new photographs, since the chance he will spot a bird in the field has radically diminished in recent years. Instead, he pores over his old pictures, remembering the days when the trees were full of flash and color.

You can find wildlife in Tam Dao – birds and other animals are sold openly in the local markets, and are on the menus of the local restaurants, which otherwise feature the ubiquitous “su-su,” a sort of stringy spinach, and not much else. Forest rangers say they find tens of thousands of traps every year in national parks.

In one restaurant, I ordered a plate of deer grilled with ginger once. It cost three times as much as the pork or chicken, and tasted terrible. Deer aren’t an endangered species, and neither are the local turtles, but they will be soon if something doesn’t change. And for the record, turtle tastes awful too.

I taught one of my daughters to scuba dive in Vietnam, and she eventually got her open water certification in Hoi An. We later went diving in Da Nang and Quy Nhon, two towns with lovely beaches and coral reefs. Or should I say, former coral reefs. In both places, over-fishing and dynamite fishing has wrecked the reefs. There are a few places left in the country with moderately-healthy reefs, but most are like those in Quy Nhon – no more living reefs, just muddy sea floors littered with broken coral.

I was in a bar in Ho Chi Minh City a few months ago, having one of the local beers served over ice and eating boiled peanuts, when I got into a conversation with one of my neighbors. He told me about this new treat that had been popping up in local bars all over the city – fried water dragon. The water dragon is a cute little lizard often imported in the US as a pet. They are found near streams and rivers, and used to be plentiful. No more.

Once it became known that bar owners would buy the lizards when small to fry up and serve to customers, this became all the rage, and from what this guy was telling me, giant piles arrived in the city every day from the countryside. True or not, I’m not sure, but from what he told me, water dragons have been hard to find. They have basically been wiped out by hunters.

The Vietnam Red Book is a list of all the rare and endangered species in the country. I was horrified to learn just how many animals are in the book, and how many populations (elephants, tigers, guars, etc.) are down to just a few dozen members. It’s a tragic story; once those iconic animals are gone, they are never coming back.

I feel sad for the animals, but they are just the charismatic tip of the iceberg. The truth is that Vietnam isn’t all that healthy for humans either. Rampant pollution of the air and water has made breathing in the towns and drinking from the tap anywhere in the country hazardous. There is hope, of course, and many organization working to change things, but I’m in a bad mood today, so I’ll write about those efforts another time.

East Meets West President John Anner with his first daughter Eva who was born three months premature

My first daughter was born three months early, at 920 grams. She seemed unbelievably tiny to us, smaller than the burrito especial you can order for lunch at any taqueria in the city’s Mission District.

My wife and I, being groovy San Francisco parents, were planning a home birth with quiet new age music, a midwife, and perhaps some non-allergenic incense smoking gently on the mantle. It was not to be, much to our surprise, but we did get to do something equally wonderful.

After the sudden birth, three months early, our midwife told us about Kangaroo Care, which we had never heard of before. So my wife and I spent 10 hours a day in the hospital, holding our precious baby five hours a day each. It was a special time, and I think she did better as a result, with no long-term issues. But let’s not kid ourselves – it was the technology that saved her life.

We had access to the neonatal intensive care unit at a very good hospital, with CPAP machines, ventilators, incubators, phototherapy and all the great doctors and nurses you could want. No amount of kangaroo father care, midwifery or new age music would have made a damn bit of difference in the absence of the necessary technology. And what was true for us in San Francisco 18 years ago is true now in the poorest countries in the world. Were it not for advanced medical devices and dedicated staff, our daughter would have died soon after birth.

Tragically, this is still the reality for far too many of the 13 million premature babies born every year, with nearly all of these deaths taking place in the poor countries of Asia and Africa. Many of those who survive suffer life-long morbidities due to lung damage, severe jaundice and other pathologies of prematurity.

Around the world, huge progress has been made in reducing child mortality, and this is a very good thing. As a result, many nations are on track to reach targets set under the Millennium Development Goals (MDG), in particular MDG 4, which calls for a 60% reduction in under-5 child mortality.

Thanks to interventions as varied as vaccination, improved access to clean water and hygiene, anti-malarial bednets and better nutrition, the number of kids dying each year has dropped significantly, from 11.9 million deaths in 1990 to 7.7 million in 2010. As you might expect, most of these deaths occur in the poorest countries of Africa and Asia.

Reading the reports of organizations that measure progress on MDG goals, one startling conclusion leaps out – around the world, the proportion of child mortality that is made up of infant mortality has rising substantially. As overall child mortality has dropped, infant mortality has not kept pace. Babies dying at birth or soon thereafter now make up nearly half of all childhood deaths.

In some countries, Nicaragua for example, 75% of childhood deaths are infant deaths. If we want to save more children’s lives, we have to focus our attention on infants. And yet, very few UN reports focus attention on infant mortality and what can be done about it.

Unfortunately, saving babies is a bit more complicated than helping children ages 1-5. Infant mortality is more often than not neonatal mortality, meaning most babies are dying in the critical period right after birth. How can we save these kids?

For starters, it has to be understood that the kind of care that newborns need is for the most part outside the realm of expertise of traditional birth attendants, public health workers and primary health care stations. Therefore, progress towards reducing infant mortality goes hand-in-hand with progress towards making sure that births are in a facility that can either provide specialized care, or can whisk a baby to such a facility in very short order.

The main killers of babies are various problems with breathing – the failure to breath correctly at birth, or respiratory distress syndrome which is a common problem of prematurity. Infection is another big source of mortality. Too many babies that are admitted to the hospital die of infections they get in the hospital, or they are admitted due to an infection resulting from the way their birth was handled.

Babies, especially those that are premature or low birth weight, get cold easily, and they have to be kept warm. Even slight hypothermia is correlated with increased mortality from things like pneumonia, infection and other problems. Jaundice is another big problem – although rarely fatal in itself, untreated jaundice can cause severe morbidity.

To make big progress on reducing child mortality, then, requires us to focus attention in the coming years on infant mortality. To make big progress on infant mortality means getting more of the 60 million home births to take place in medical facilities or birthing centers and making sure that there is effective clinical care available to treat breathing problems, hypothermia and jaundice.

To treat babies, though, you need medical facilities that are adequately staffed and correctly equipped. As EMW has found in the past seven years of implementing our Breath of Life program, medical equipment alone won’t save any babies. Too often, expensive and complicated equipment sits unused, since the staff are unprepared and not supported. At a minimum, there has to be adequate staffing and overnight care (not to mention electricity).

The solution, then, looks something like this: Improve the medical system to make sure that there is an effective infant intensive care facility available to every family that needs one. Reduce barriers such as high payments to families availing themselves of supervised childbirth and infant care. Figure out how to prevent infection.

It sounds complicated and expensive, and it is. But it works, and it will work just as well in a country that is now low-income as it did in the US and, more recently, China. Done correctly, it may well be the easiest and least-expensive solution to make real progress in reducing child mortality left for us to try.

To illustrate my point in this blog, we are going to do a little time-traveling and I’m going to tell some stories about myself. Here’s the point I intend to get across: Not all people deserve to be helped, and sometimes trying to help only makes things worse. Done incorrectly, efforts to make a difference create perverse incentives and corruption.

The EMW staff are faced with this problem every day in our work in Asia, and finding the right partners means the difference between program success and failure. With the right partners, anything is possible – -but you can also waste a lot of time and money if you don’t pay attention.

So here’s my story:

By the time I was a sophomore in college, I knew exactly what I wanted to do with my life. I wanted to work in the field of international development, directly with the people. Not for me the life of an academic, or policy wonk, or administrator. I wanted to see real projects being built, get my hands dirty, and spend as much time as possible on site.

So I spent the last year of college working on a senior thesis comparing agricultural development efforts in Cuba and Tanzania (at the time I was enamored of collectivist efforts to rapidly develop the countryside), and as soon as I finished that I applied to the Peace Corps. By the time I was twenty-three I was launched on my first international trip. I took off on an old 747 from New York’s JFK, and landed in an entirely different world – Dakar, Senegal.

I immediately fell in love. That first night, I spent hours walking the streets, totally lost, incompetent in any local language, absorbing the sights and smells and laughingly trying to communicate in broken French to buy food in the market, ginger beer from a street vendor, and a couple of souvenirs. The memory of that night has never left me, and ten years later when my first daughter was born I gave her the middle name Dakar.

But Senegal was not my final destination; the next morning we packed up and headed north, to Mauritania. A few weeks of advanced language training, and suddenly I found myself deposited in a tiny African village not far from the Senegal River, the border between Mauritania and Senegal. This village, called Gorrel Boubou, was a long-time Peace Corps site, and had hosted many volunteers over the years for two years at a time. Actually, many if not most Peace Corps Volunteers in Mauritania didn’t make it for the full two years; illness and loneliness took their toll.

The village was nearly completely lacking in modern infrastructure – no roads, electricity, toilets, running water, refrigeration, medical care, media or schools. Located on the edge of the Sahel, the local trees were mostly Acacia thorn trees and Neem, and vast expanses of sand and bare earth surrounded us in all directions. Chickens and guinea fowl roamed freely, and most families had a few goats or, rarely, a cow.

The beverage of choice was green tea, and we ate millet, sorghum, and for a treat broken rice. Some men who had traveled around for work or trading spoke Wolof or Hassaniya (a dialect of Arabic) but for the most part these sturdy farmers were Halpulaar – peoples long ago conquered by the great Peul empire that stretched across North Africa and forced everyone to speak their language, Pulaar. After a time, having no choice, I became fluent in Pulaar as well.

I was under the impression that I had been sent to this village as an agricultural extension agent with the mission to help the village develop gardens as a nutritional supplement and for market. Being young, fresh out of college and with no real-world experience to speak of, I pretty much didn’t know a thing about agriculture in Africa, but as I always say, the good thing about Peace Corps is that the volunteers don’t have enough resources to do any real damage.

But that’s not quite true. As I quickly came to learn, the villagers of Gorel Boubou had long since figured out that Peace Corps volunteers, by comparison to their own standard of living, were quite wealthy. Nearly every family lived entirely at the subsistence level, with annual average cash incomes of probably no more than $100 (in 1983 dollars). Meanwhile, my monthly living allowance was somewhere around $120. Villagers knew that, like my predecessors, I would only be around for a maximum of two years, and would spend most of that time simply learning the language and trying to figure out what the heck was going on. In their view, my main functions were to entertain the kids, provide supplies of tea, sugar and other things as needed, and serve as the local ATM. Rare was the day when somebody didn’t come by asking for money or supplies.

This was true on the village level as well. Village leaders, both male and female, had no interest at all in working together. In their view, my job was to go to the capital, find money for projects, and bring it back to them. I was to hand it over, ask no questions, and leave them to implement. It didn’t take long to determine that nothing ever really got done, the money disappeared, and when I asked questions I was told that the funds were not enough, and I should go back and get more. I put up with this for about four or five months, and decided it was a waste of time and money.

So I took off. I went walking and riding my motorcycle around all the other villages in the area, sitting and talking with village elders and seeing if there wasn’t something more interesting and useful that I could do. I finally found a village called Wabunde, comprised of ex-slaves (slavery was prevalent among the Arab families in Mauritania at the time, but slaves could buy or marry their way out, and it wasn’t based on skin color. There were a couple of families in Wabunde not much darker-skinned than myself). Ex-slaves formed their own culture; they were known as the Harratin and spoke Hassaniya but followed African cultural and economic patterns, farming instead of herding camels like the Arabs and Bedouins.

Anyway, the farmers in Wabunde had never before gotten any help with their agriculture, and were ready and eager to work together. A severe drought had made traditional agriculture impossible, and most were living on US food aid, as was I. For the first six months of living there, most of what I ate was US-supplied surplus red sorghum and dried low-fat milk powder, along with what everyone called “Kennedy Oil,” since the first donated cooking oil to arrive in Mauritania came during the Kennedy administration.

We made a deal – if they would invest the time and labor to build a good irrigated rice field, I would raise the funds to buy the required diesel pump. And so they did. For four months, we dug all the trenches by hand, built a fence around the full 13 hectares, constructed a concrete catch basin to slow and direct the water, put in seed beds and vegetable gardens and so on. I was able to get some help from a German agronomist living nearby, and arranged to have the fields turned with a tractor, but other than that all the work was done by hand, by the villagers, right through Ramadan. We did all the surveying by sight with string levels and sticks.

Once I saw that the fields were going to be complete, I went to Nouakchott and raised the money to order and deliver a big Lister diesel pump, made in England and designed to last forever. The day we turned it on people were so happy they let the water run over their fields for hours, up to a depth of one meter or more, making me more than a little hysterical. Eventually we all calmed down and planted rice and vegetables.

The villagers made it a great project, and we grew a lot of rice, two harvests a year, at 3 to 4 tons per hectare, along with tomatoes, eggplant, cabbage, onions, carrots and so on. Wabunde, for the first time in its history, had enough food to eat and enough to sell. I’ve only been in intermittent touch since then, but apparently the village kept that pump running for years.

Results-based financing or Output Based Aid has
dramatically increased EMW’s capacity to deliver
clean water to people in Vietnam

Philanthropy suffers from an inherent asymmetry problem—there is a lack of feedback between the recipient of assistance and the source of funds, compounded by information obscurity.

In the private sector, this problem is much less severe. If I run a restaurant, for example, and the food is no good, people may come once but not return and I go out of business. Packs of professional and amateur reviewers publish their opinions, there are official inspections from the department of health and so on. In other words, there is substantial direct feedback as to whether I am doing a good job in the proper way at a reasonable price.

In the non-profit sector, however, if I am a donor and want to help large numbers of poor people in some far-away place, I give the funds to an intermediary, an NGO like East Meets West. East Meets West then takes the money, implements the program, and writes up a nice report to send me. But how do I know whether what they say is true?

In most cases, I have no direct contact with the beneficiaries, and even site visits are arranged and controlled by the intermediary. There are no independent agencies that visit and verify that things were done in the right way, and that the recipients were pleased with the service they received. I don’t speak the local language, I have no idea if some other agency could have done the same job for less money, or if the people really wanted the project in the first place.

One way around this problem is through the use of independently-verified output-based aid, or OBA. This is an innovation in development finance that has been tried in numerous places over the past few decades, with a substantial increase in interest in the past ten years or so. (It is also called results-based financing, or performance-based aid.) The World Bank, for example, manages an OBA fund that has moved $3 billion or so in six sectors over the past ten years, including four grants to EMW (two are pending).

The basic idea is that financing comes after the results are delivered, not before. In the case of EMW’s Clean Water and Sanitation program (recipient of a grant of $4.5 million, see http://www.gpoba.org/gpoba/node/599), what we were required to do was to implement the program by building systems and connecting households. We borrowed the funds from a commercial bank and then we would build the water systems. Under our agreement with the World Bank, we had to meet a large number of criteria for water quality, environmental review, open bidding from contractors, and so on. Everything is written down, reported on, and made available to the donor. The next step, once the projects were complete, was for the World Bank to send out an “independent verification agency” who conducted a random audit of our water systems to ensure that what we reported was actually true. They spent weeks in the field visiting rural villages and writing their own reports.

Once the World Bank was satisfied that we had met the terms of the agreement, they reimbursed us for the costs of the system at a level that had been previously negotiated to ensure that we covered our actual expenses, but at maximum efficiency. If we failed to deliver what we promised, we would not be reimbursed (thankfully, this has not happened). In other words, we as the intermediary agency had to take on the performance risk – no performance, no grant. Using this funding mechanism, EMW has brought clean water to 250,000 people in Vietnam over the past five years, and we are actively supporting the government of Vietnam to use this model on a larger scale.

OBA gets around some of the biggest problems in doing good international development work. It provides incentives for efficiency and innovation, it significantly increases transparency, it has a built-in mechanism for tracking results much more closely, and the result reports can be trusted because they are independently audited. In addition, the OBA only delivers 80% of the grant after the first verification visit; the rest comes only after another visit six months later, to see if the system is still working. So another benefit of OBA is that it provided an incentive to do programs that are durable and sustainable.

OBA or results-based financing makes the intermediary agency accountable for outcomes, not just for disbursement. It short-circuits the asymmetry problem and creates incentives to do the proper thing, at the right price, in a way that satisfies the beneficiaries. It’s not a panacea for all the problems of international development assistance, but we have found it to be a powerful mechanism for improving our programs and increasing our organizational capacity.

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Find out more about EMW’s Clean Water and Sanitation program.