Frustrating. Galling. This is how some of the best social sector leaders I know describe the fact that funding to intermediaries and consultants often dwarfs the support they receive for their work on real issues at the front lines. I’m not talking a small differential — the disparity is large.
Here’s a fictitious example that illustrates the disparity, based on several true stories: A well-regarded international nonprofit uses mobile technology to educate youth and bring local populations into the global economy. Say it receives a $50,000 grant to execute its programs and open a new location in India. That is terrific. But then the same funder turns around and pays $500,000 to a fancy consultancy to assess the work of this nonprofit and a number of its peers and write up a report to inform the foundation’s grant making strategy on this fast-paced, emerging field. The consultant has little experience at the nexus of new technology and developing markets and no on-the-ground expertise. Therefore, they must lean heavily on the nonprofit’s knowledge, networks and experience to gather information for its report. In another instance a well-known social entrepreneur was invited by a consulting organization to collaborate with a corporation in a “shared value” venture. The social entrepreneur was skeptical, concerned about the time the project would require and that it would take valuable time from him and the entire organization. Eventually he was convinced that the opportunity’s benefits would materialize quickly and agreed to the venture. As of today, 18 months into the process, the social entrepreneur has given his knowledge, time, and organizational resources to advance the project, with no gains to speak of. He has received no compensation for his contributions or his staff’s to the “shared value” proposition. On the other hand, the consultant is getting paid for every hour of work involved in brokering the project.
Does the tendency to compensate intermediaries more generously than the people actually doing the work bother you as much as it bothers me?
Social sector “doers” – nonprofit leaders, social entrepreneurs, and pioneering community workers – rarely get paid for the knowledge, referrals and networks that they share with consultants tasked with assessing the field. Yet capturing and synthesizing this information for broader application is critical if we want to solve complex social and environmental challenges.
Consider the daily reality of these doers. Their time is scarce and overstretched, working to tackle some of the world’s most persistent and troubling problems. But when a funder requests a report and sends in a consulting team, the doer must say “yes,” even though the conversations, meetings, and phone calls may pull a number of hours from the organization’s work to advance its mission.
The doer’s expertise, history and relationships are huge assets that the market doesn’t adequately value. And this knowledge is often the crux of any “aha” offered by consultant reports. Without the rich and grounded contributions of those working at the front lines, reports tend to lack deep data, nuances and meaningful insight.
The field has a legitimate desire and need for a third party perspective. Consultants and intermediaries can gather and aggregate data and offer a neutral, objective perspective to form broad landscape analyses that are valuable to the field. In addition, these landscapes often shed light on upcoming trends that are hard to see by only looking narrowly. These contributions are valuable.
And there is also a desire, intentional and unintentional at times, among many in the field of giving away money to shift risk — they are looking for a stamp of approval that lends credibility to their funding decisions.
Where does the money trail lead?
The problem is not that we use and compensate consultants for the valuable work that they do, but rather that we fund one (the one farther from the issues and the communities we seek to understand and serve) more than the other.
Why are we willing to pay one group of people to work at certain standards and not another? (Especially when we are talking about funds coming from the same source, whether foundations, CSR initiatives, or public dollars allocated by government programs.)
We ask social impact doers to move mountains with fewer resources. While they scrimp and stretch to address some of the most challenging dilemmas of our time, too often working from cramped quarters and with outdated tools, intermediaries are paid plenty to travel business class, work from comfortable offices, and use the best technology to do work that is more straightforward — conducting interviews, aggregating and analyzing data, and writing reports.
And the larger payments made to consultants don’t usually trickle down to the people and problems we care about. Their offices are rarely, if ever (I know of none), in the communities where they are providing expertise and consultation, whether that be in East Palo Alto in the U.S., Kibera in Kenya or the favelas in Brazil.
What does the money trail tell us about priorities?
Time is money, for everyone. If we are willing to pay for the time of one group of people but not another, this reveals that we somehow feel more entitled to the time and knowledge of the doers than that of the intermediaries. The money trail indicates a degree of distrust as opposed to empowerment of social innovation leaders. If we trust those with the most knowledge, why not give them the money and let them hire who they believe would provide the most bang for the buck to aggregate knowledge about the field?
This list includes many, though certainly not all, of the valuable assets that doers with first-hand experience contribute to our understanding of the field, often receiving no acknowledgement of their worth or offer for compensation in return.
What’s the solution?
When we ask social sector leaders, social entrepreneurs, and community-based advocates for an interview or advice, we should understand that they are juggling many mission-critical priorities. And although they are working in sectors where the market does not adequately compensate them for the tremendous value they have to offer, we should pay them more than a penny for their thoughts. Their assets are scarce, often unique, and valuable. Paying more to the intermediaries than to the doers sucks time and resources from the ones closest to the people and issues that we most care about. In the end, “time is money” for everyone. Let’s act on that fact as we invest in finding solutions to our pressing social problems.