Charities: outputs, outcomes and resolutions

On my recent trip to Africa, I was reminded about the level of poverty and suffering that can exist immediately adjacent to verdant, gorgeous landscapes and bustling, thriving cities. We planned to drive from Cape Town to Franschhoek, in wine country, where my sister-in-law Kate was getting married the next day. As I wedged myself into the overburdened car with bags under my legs and on my lap there was a knock on the window. A man was begging for money with his small son perched on his shoulders, a boy who was only a little older than my own sons, Ari and Leo. I could barely move so I didn’t reach into my pocket to give him anything, but I regretted for weeks afterwards. I can’t imagine not being able to provide for my own boys.

Franchhoek

So beautiful, it’s easy to think about just that.

Later on the drive, I asked Kate, who runs an amazing organization called Africa Health Placements, if she could recommend a well-run charity that was making a difference in poverty relief in South Africa. She thought about the question and answered that the best places to donate to were those making a lasting impact, for example those engaged in health issues and education.

At one level, I think Kate is completely right. In the long term, that father and son in Cape Town only have a future if one or both of them can get an education, learn skills to get a job and ultimately provide for themselves. However, to paraphrase Keynes, it doesn’t help if in the long term they’re dead.

This brought me to further questioning some common wisdom about charities, that it’s outcomes that matter. As I understand it, the effort to differentiate outputs (something like a meal served to a hungry person) from outcomes (getting the hungry person a job so they don’t need food support) is an effort to try to focus more resources on programs that are more than a bandaid on a wound. But I think that sometimes bandaids make sense. People don’t learn skills when they’re hungry and they don’t do anything when they’re starving.

In less acute circumstances, outcomes can take a very long time to measure. For example, I’m on the board of Open Books, an outstanding literacy organization. Many Open Books programs are focussed on engendering a love of words and reading rather than purely on improving technical reading skills. I know this makes a difference in the long term, but Open Books works with very young kids and it can take a few years before the measurable results (improvements in reading level, etc.) are in. If no one supports the programs in the meantime, they won’t be able to do them. This is an example of where a focus on outcomes over outputs can stifle innovation. So for me, in this case, outputs are good enough.

More broadly, in my own giving, I’m trying to move towards more of a portfolio approach: some outputs, some outcomes. In Africa, I’ll make a donation for direct poverty relief and also make one to AHP. 

I thought I’d found a comfortable mix until I was reading the news this week and saw an article about India being (or nearly being) free of polio. It now strikes me that in addition to the two categories of outputs and outcomes there’s a third: resolutions. In some areas, there are moonshot projects that hope not just to make things better for individuals or communities, but which have the potential to eliminate problems altogether, like India’s vaccination program. Resolution focussed projects have the longest time horizons and the largest risk of failure, but beat even outcomes in terms of making things better.

By the old outcomes vs. outputs argument, that would mean that in areas where there are possible resolutions all resources should be brought to bear on finding those resolutions at the expense of any programs for relief. For example, stop worrying about AIDS prevention or education and just spend all the available dollars on finding a cure or a vaccine already!

I don’t believe that’s right, but I do believe that potential resolutions, where they do exist, definitely belong in the portfolio.

I think that if donors focus on a mix of outputs, outcomes and resolutions, we have the most ability to affect real change in the causes we care about. Unlike in a traditional market, this balance of “products” doesn’t happen naturally based on supply on demand. That’s in part because donors are the “buyers”- in that we foot the bills – but are infrequently the recipients of the “products” for which we’re paying. Using a simple filter like a portfolio may help keep resources distributed where they can do the most good. And hopefully, rather than having to choose, that boy and his father can get a meal, an education and ultimately live in a country where they can get those things without needing any more donations.

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