Why It Is Important To Invest In Leadership Of India’s Social Sector

Around ten years ago, my wife and I decided to meaningfully increase our engagement with the social sector. She had already moved into it full-time, and I was spending part of my time on boards of non-governmental organisations. But, we decided to start allocating more and more of our income towards social causes rather than personal consumption.
 
At first, we were attracted by the amazing opportunity to use both our capital and our time to help solve problems and impact lives. However, soon we ran into two problems. First, we realised that we weren’t equipped to deal with making social investments at scale. Second, it struck us that very few organisations had the absorption capacity for enhanced capital flows and the ability to deliver impact at scale.
 
We solved the first problem by working with a set of talented philanthropy advisors. Then housed in GiveIndia and now at Dasra, they helped us structure our thinking and action to be far more effective than we ever had imagined when we set out. It helped us move from being ‘cheque writers’ to actually start engaging with issues plaguing both - sectors and individual NGOs. In many cases, the heightened level of questioning irritated many, especially the NGOs subjected to it, but it did help us ramp up with those we eventually worked with.
 
The entire exercise, however, got us focused on the second issue.
 
Virtually every NGO we wanted to work with was struggling with the issue of organisational capacity building.
 
After engaging with many NGOs, we felt they needed help in creating greater impact and managing scale. Even the ones who thought they had achieved scale were indeed minuscule, given the magnitude of the problem they were addressing. We realised that they needed help to think through their strategy, based on hardcore research and diligence, which was missing 99 percent of the time, and were making conversations based on assumptions rather than facts.
 
Another factor that obstructed NGOs from implementing their strategies, was the lack of tools available to resolve any obstructions faced by them. In many cases, we also realised that NGOs reverted to replacing metrics and measurement with anecdotes, and we found ourselves on this treadmill of social squalor with some approaches.
 
While donors like us would like a greater sense of accountability, the government too, rightly so, expects transparency from NGOs. Further, talent demands a good working environment, fair compensation, and an opportunity to deal with challenges that go beyond those in a normal corporate job. However, lost in all this din somewhere, is a question.
 
Who is equipping the leadership of these NGOs with the tool kits to deal with these humongous social issues, that are easily more daunting than most corporate challenges?
 
I suspect one of the reasons we don’t ask this question is because we take our experience in the corporate sector for granted. The IITs, the IIMs and the layers below have done a reasonable job at meeting the needs of the private sector but there are only a few institutions aimed at the social sector, despite its scale and importance.
 
So what is the theory of change? India has been able to create some phenomenal corporate businesses in the last three decades. I believe this is because of great entrepreneurs who have leveraged management talent produced by institutions like IITs and IIMs that tend to attract some of our best minds. This huge pool of talent is equipped with the right tool kits and great work ethic - an unbeatable combination.
 
If we apply the same approach, that we have in building companies, towards the development sector, I believe we can make much better progress in solving India’s social sector problems, because a lack of funding is no longer the problem.
 
According to the India Philanthropy Report 2017 published by Bain & Company, total funds for the development sector have grown at a healthy rate of approximately 9 percent over the past five years, increasing from approximately Rs 1,50,000 crore to approximately Rs 2,20,000 crore. Private contributions primarily accounted for the Rs 70,000 crore five-year growth. They constituted 32 percent of total contributions to the development sector in 2016, up from a mere 15 percent in 2011.
 
With this level of financial capital available, it is imperative that we invest in human capital that is capable of handling much larger flows with greater impact and accountability.
 
Separately, just as the corporate sector has evolved over the past two-three decades with 500 or so large organisations that have shaped it and around 1,000 or so leaders leading it, our theory of change is that for India to meaningfully move the needle on solving its social sector problems over the next 10 years, we need at least 500-1,000 exceptional social sector leaders who will work with NGOs, often partnering the government and with corporate social responsibility arms of corporates helping drive that change.
 
Interestingly, the same problem – and opportunity – that India is facing today in the social sector also persisted in the United States in the early nineties. Philanthropy was not as organised as it is now and probably the best talent available was not ready to work in the social sector.
 
So what changed the game for the U.S.?
 
A legendary banker, John Whitehead, who was Chairman of Goldman Sachs and who went on to serve in the U.S. government, discovered precisely this when he started working with the sector in the early 1990s. In 1995, he made a large endowment to the Harvard Business School to set up a programme - Strategic Perspectives in Not for Profit Management - that was co-founded by renowned professor Kash Rangan. It had some of the best faculty develop special content to equip social sector leaders with tools and techniques for problem-solving. The programme has been wildly successful and has trained over 3,000 social sector leaders over two decades, largely from the U.S. but also other parts of the world.
 
We believe, today, India needs a similar approach with increasing number of NGOs, the emphasis on corporate social responsibility, and with young entrepreneurs now focusing on the social sector.
 
With this in mind, last week we launched Strategic Non-Profit Management - India (SNMI) with Harvard Business School and the Centre for Social Impact and Philanthropy at Ashoka University, in partnership with Dasra. 68 exceptional social sector leaders, including 5 from overseas, came together to spend a week with Professor Kash Rangan and Professor Vikram Gandhi, learning from case studies of NGOs in India and around the world and from each other’s experiences, as they opened up their minds to new possibilities on both strategy and execution.
 
Investment in social sector leadership can produce transformative results. Through the right networks and connections, social leaders could engage with peer philanthropists and learn from experienced ones. There is evidently a need for an educational or training programme aimed at senior management in the social sector such that it brings together a community of philanthropists and immerses them in structured learning opportunities. There is huge potential to train them to build the right structures in their organisation and formalise ways of working. They should be in a position to measure impact and showcase it to the world so as to catalyse collaboration.
 
One of the essential skills that NGOs need is in collecting, analysing, and virtualising data.
 
For instance, if an NGO helps in educating school students, its data should not merely show the number of students it reaches. The data should also talk about the quality of education and the impact it is creating in terms of probable students opting for higher education and eventually the ones who get employed. There are organisations in India who have been working in this space for the last twenty to thirty years.
 
Leaders need to train their teams to have technological support and customised solutions. Operational capabilities in recruitment and implementing technology are important. The most underrated and important skill for NGOs is to communicate to the world the work they are doing. There have been instances, where organisations work very hard to create impact but they are not able to market and communicate it. As a result, they are not able to attract the right partnerships and donors for further growth. They are working in silos and are not able to attract the right people who would willingly help them.
 
Lastly, a professionally managed organisation also works towards seamless succession planning, ensuring that the handover is easy when one of the leaders retires or decides to move on. It is time that we take the structures of philanthropic organisations seriously and create leaders who can take the development sector to the next phase of its growth trajectory. SNMI is a step in precisely that direction and is one of many investments India needs to make in order to help build a vibrant social sector that will have a shot at solving the daunting problems plaguing our country.
 
Amit Chandra is Founder and Trustee, Ashoka University; and Managing Director, Bain Capital. This is the first of a series of columns that share his philanthropic experiences.

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