Humanitarian Aid 101: #3 – Getting the lowest price is not the same thing as being “efficient.

If I was to ever teach an intro-level course in humanitarian principles and action, it would go something like this:

Lesson #3. Getting the lowest prices or running the least expensive program is not the same thing as being “efficient.”

Be sure to check out my guest post of today over at the Peace Divided Trust blog, “Re-thinking Efficiency.” I could almost have simply re-posted that post here for Lesson #3.

I get where the “less expensive is better” line of thinking comes from. Aid providers of all sizes are strapped for cash (very often swimming in GIK, but strapped for cash). At a very basic level, obviously, having less cash means that you have to make some hard choices about where you’ll put those hard-won donor resources. This is a reality of life.

The problem is that for the past forty-plus years, the stance of far too many NGOs has been to try to do more with less. I’ve written before about how aid costs what it costs. Contrary to the mis-education of the public (and also ourselves) in past decades about what it all costs, aid (relief and development) is in actual fact a very costly endeavor. We have broken down budgets and sometimes inappropriately removed “overhead” in order to indulge ignorant donors (not stupid, ignorant) who wanted their donations to go “directly to beneficiaries”, and we have somehow arrived at the conclusion that fixing poverty is financially cheap. It’s a seductive fiction, meant mainly to appeal to apathetic rich Westerners in the late 1960’s: “See? You can make a difference just by opening up your wallet. The problems of the third-world poor are uncomplicated and inexpensive to remedy. A water well in remote Kenya costs only $50…”

And few things could be farther from the truth. Your $100 does not buy a cow that lifts a family in Sumatra out of poverty. There is no such thing as zero overhead – and any organization who makes such a claim is either lying or internally clueless. It costs money to spend money. And it costs a lot of money to run humanitarian aid operations and development programs properly.

Why? Well, very simply, because quality and sustainability matter. There is just no substitute for doing it properly from the beginning. You need what you need. And that costs money. And spending money requires sometimes hard decisions, getting priorities right. If you need someone with a degree in agronomy who can also speak and write fluently in English, you need someone with a degree in agronomy who can speak and write fluently in English. There is no viable substitute. The cash you saved by going with a retired pastor who speaks only some English will come back to haunt you when the final evaluation rolls around… and if not you, it will haunt the community you thought you were helping in 10 years time when it’s time to undo the damage done by your badly implemented program.

We’ve spent far too many years incorrectly assuming that “good stewardship” and “efficiency” were synonymous “get the lowest price up front.” But it’s time to recognize that we pay now, or we pay later. Or worse and more to the point, we’re gone and those beneficiaries who’d put their trust in us will pay later.

It is important to correctly estimate what we really need to do properly what we say we’ll do for those for whom we say we’ll do it. We’ve spent far, far too long simplistically trying to get the lowest price. Obviously this is not an excuse to live expat aid worker lives of wanton excess. Obviously this is not license to blow donor cash on boondoggle, pet projects and expensive but useless junkets. I’m not talking about always going with the platinum option. There is plenty of needless spending in the humanitarian industry that truly does need to be eliminated. But we need to be consistently investing in the stainless steel option.

When it comes to running programs properly there are no shortcuts, there are no inexpensive strategies. Aid costs what it costs. Try to cut and squeeze below that and things don’t go well for those we claim we’re trying to help. And when our programs don’t actually help because we didn’t resource them adequately, they’re worse than inefficient: they’re failure.