6/18 Vol.11 samvad Samvad in Sanskrit means dialogue

THE NEWSLETTER FROM ASHOKA UNIVERSITY

1// Why Can’t NGOs be 2// The Right Way to 3// The Elephant of Public More Businesslike Invest! Works

Ingrid Srinath, Director, CSIP, says both Shiv Puri, Founder, TVF Capital Advisors, Harshali Dalal, CMGGA, speaks of a digital businesses and NGOs have much to learn writes why a liberal arts education is solution that will reduce corruption in the from each other important in investing Panchayati Raj Department in

Why Can’t NGOs be More Businesslike?

Ingrid Srinath is Director, Centre for Social Impact and Philanthropy (CSIP) at Ashoka University

How often have you heard that non-profits need to be “more is continually held up as a model of efficiency, effectiveness, businesslike”? Or witnessed the awe that greets people who leadership and innovation to non-profits in and cross over from the private sector to an NGO? Despite the around the world. global financial meltdown, relentless reports of corporate malfeasance and catastrophic breakdowns in governance at If only, we are told, we would adopt ‘corporate best practices’ some of the most respected businesses, the corporate sector in strategy, systems, structure, skills, staffing, governance

/1 Cont’d. from previous page and, increasingly, even style, we might finally break out of ability to attract and motivate supporters on budgets that the mindsets that keep NGOs small, slow, and starving. would not cover a day’s marketing expense at a corporate? With corporate support promising volumes of new resources, NGOs across India are scrambling to acquire the Increasingly, I find the non-profit sector polarised between board members, metrics, and skills that will, they hope, those who espouse the corporate world view and those that unlock their slice of the CSR pie. reject it. Not only do these two groups seldom interact, each appears to hold the other in utter disdain. The schism It’s been almost two decades since I escaped the corporate obviates any possibility of combining forces or of cross- sector to find purpose, significance and, yes, learning on the fertilising ideas and values. non-profit side of the fence. It took me a while, and much frustration, to shed my MBA hubris and unlearn the shallow On every issue, from gender-based violence to education paradigms that a decade in the glass towers had imprinted and the arts to governance, interventions are fragmented on me. rather than seeking to combine the best of both world views. This polarisation also prevents the development Let me not discount the value of the tools, processes, of shared norms, narratives, and networks, which in turn technologies and disciplines prevalent in the corporate erodes the credibility of the sector and plays into the hands sector that the non-profit sector could benefit from. Or of those who seek to discredit it. the fact that many NGOs would be well-served by applying some hard-headed business logic to their operations. Business commands virtually unlimited financial resources. It enjoys great leverage with the mainstream media – Combining best of both through advertising as well as ownership. In an era when a nation’s performance is measured more by ‘ease of doing Non-profit is a tax status, not a business plan. Non-profits business’ and market indices, than by its progress on could also do well to emulate the ambition and agility that human development markers, big business barely needs 21st century businesses demonstrate. It is as vital, however, to exercise more direct political clout through campaign that we recognise the limitations of business thinking and contributions, lobbyists, and worse. appreciate the value of non-profit expertise. Distinctive value of social sector Take, for instance, the fusion of head and heart that is virtually a prerequisite for decision-making in the A substantial part of civil society’s role comprises non-profit sector. As businesses begin to grapple with addressing the failings of state and market and curbing customers, employees, and investors demanding values as their excesses. The ability to design and deliver unfettered much as value, the pragmatic idealism that is the hallmark by either quarterly reporting requirements or election cycles of a well-run NGO is a trait in ever greater demand. As is is, or should be, a key strength of the social sector. the ability to attract and retain staff where remuneration is not the sole or even the main source of motivation. Consider Efficiency vs justice. Programme design tailored to the potential value to businesses in the art of building 12-month reporting vs the slow, often erratic processes that consensus across diverse stakeholder groups. lead to sustained change. Inclusion and diversity vs the filter bubble that is the typical corporate boardroom. What can business learn from organisations whose only real asset is public trust and whose existence depends on their Photogenic, feel-good interventions vs defending our basic democratic rights and freedoms. Self-congratulatory donor engagement vs deep partnerships that change hearts and minds.

If we are to emulate the private sector, I wish it would be in being able to set aside competitive differences “What can business learn from to lobby for policies that benefit the sector as a whole; organisations whose only real or in seeking to rationalise the regulatory frameworks asset is public trust and whose that keep us unsustainable and vulnerable; or to work together on developing norms and standards that existence depends on their ability strengthen our collective credibility; or just to make more to attract and motivate supporters serious investments in our people, our capabilities, and on budgets that would not cover a our institutions. day’s marketing expense at If we are indeed to make a dent in the problems and a corporate?” complex issues we confront, we will have to collaborate in ways that are built on mutual respect and clear recognition of each sector’s distinctive value. We need enlightened leaders in government, civil society, and business to show the way.

/2 Engaging the Right are increasingly prone to disruption. Recently, Vijay Kumar, the Dean of the Engineering School at my alma mater, the Brain - The Right Way to University of Pennsylvania, told me, “Technology is the new liberal arts”. This means that as an investor I may not Invest! need to know the intricacies of the underlying technology (though coding is going be a critical skill) but I need to Shiv Puri is the Founder and Managing Director imagine the change that it can bring about and be willing of TVF Capital Advisors and a Founder of to rapidly learn and adapt. Investors need to be able to Ashoka University draw on a reservoir of diverse knowledge and subjects and recognise patterns across multiple areas and disciplines. Why is a liberal arts education important in the context This is fundamentally a right brain activity. of investing? It sharpens the right brain, the development of which is vital to be a successful investor. Analysing and My role model, Charlie Munger (better known as Warren drawing trends from financial data is becoming increasingly Buffet’s business partner) says, “The first rule is that you’ve commoditised. Machine learning and artificial intelligence will got to have multiple models — because if you just have one only hasten this pace. While a sound technical education helps or two that you’re using, the nature of human psychology you think analytically and gives you a better understanding of is such that you’ll torture reality so that it fits your model numbers, it also makes you extrapolate trends linearly rather and the models have to come from multiple disciplines than focusing on the disruption that lies ahead. because all the wisdom of the world is not to be found in one academic department.” Integration of diverse subjects The convergence of technologies such as blockchain, learnt in a liberal arts program is critical to developing the artificial intelligence, biotech, genetics, 3D printing, mental model that Munger speaks about. solar energy and cellular agriculture is occurring at an exponential pace. It is this convergence that will ultimately Based on the current rate of increase in computing power, disrupt business models in the near future. Yet investors our computers will be a thousand times faster in 10 years, continue to largely focus on projecting the next quarter or one million times faster in 20 years, and one billon times year, a futile exercise in a scenario where most businesses faster in 30 years! This will impact our lives in ways that are difficult to comprehend. Human history is expected to be disrupted more over the next 20 years than what has occurred in the past 20,000 years. Ray Kurzweil, Google’s Director of Engineering, says: “The future will be far more surprising than most people realise, because few observers have truly internalised the implications of the fact that the “Technology is the new liberal rate of change itself is accelerating.”1 arts. Investors may not need Most businesses are not moving fast enough. Company to know the intricacies of the managements need to recognise the transient nature of the underlying technology but need competitive advantage or moat that they have benefited to imagine the change that it can from so far, identify areas where innovation is vital and instil an organisational culture that fosters rapid execution. bring about and be willing to Whether you become an investor in these companies or rapidly learn and adapt.” work in them, a liberal arts education will be critical and I am delighted Ashoka University is rightfully characterised by the Financial Times as “Ivy League, Indian Style.”

1 Ray Kurzweil, The Singularity Is Near

/3 Cashbooks older than five years were difficult to access, as they were apparently either misplaced or destroyed. There was always a time lag between the withdrawal of funds and the update in the records. There was no mechanism to check the status of a construction activity vis-à-vis the money spent. The same road and the same drainage were being constructed again and again, drawing funds from different schemes. The entire process was manual, offline and extremely cumbersome.

Working towards a solution

We were introduced to two software applications - the Panchayat Enterprise Suite (PES) and the Village Integrated Monitoring System (VIMS). We understood the nuances of such a system by speaking to the technical officers who designed and piloted them, and the administrative officers who were meant to use them. An Elephant that VIMS (developed locally by National Informatics Centre, Seemed Impossible to ), was easy to use and tracked the live status of funds. It required a one-time entry into an automated process. Its Move biggest drawback, however, was that it was not linked to the treasury, and couldn’t track end to end transactions. On the The Chief Minister’s Good Governance Associates other hand, the PES (developed by the Union Government) (CMGGA) programme is a collaboration between was linked to the treasury. It required the Panchayat to Ashoka University and the . It upload its Development Plan online in the public domain. places young professionals in districts across the state Citizens could suggest changes or propose new projects in to implement various development schemes. Harshali their village. Each project would be geo-mapped and each Dalal, posted in Hisar, writes about her experience in transaction visible on the portal. However, PES had 11 the Development and Panchayati Raj Department. modules with multiple data entry points, making it tedious for the Panchayat to use.

Public works, especially in rural areas, is often accused Our assessment of both systems was presented to the CM and of being riddled with corruption. It is no different in senior officials from the department. Despite its high utility, Haryana. This is seen in the rising number of complaints there was much skepticism regarding the implementation on CM Window, the state’s grievance redressal portal, and of PES, as it would require commitment and training. An countless RTI applications filed against siphoning of funds officer described it as “an elephant impossible to move, let by Panchayats, poor quality of infrastructure in villages and alone ride”. After much discussion, a consensus was reached. manipulation of records by officers. The state would concentrate on implementing three of the 11 modules—uploading village development plans, listing The objective actionable components of the plan, and mapping financial transactions against every project. Effective monitoring and accountability are the most challenging yet indispensable aspects of successful public Pilot in Yamunanagar District work projects. The Haryana government was seeking to turn the state into a model state for fiscal management. An IT lab was set up at the district headquarters. Data from This would require maintaining and preserving detailed more than 30 Panchayats was uploaded daily. Meetings records of the government’s expenditure at the most were held with banks and political representatives in order fundamental level, the village—in real time and in a publicly to align them with this vision. Withdrawals by Panchayats accessible manner. Manish Jaiswal, CMGGA Bhiwani, and was stopped unless the data was uploaded. This initially I were asked to work on a monitoring system in the state’s caused a hue and cry in the district, but was ultimately Development and Panchayati Raj Department. a success. Within five months of implementation it was decided that the pilot would be scaled up to the entire state. Diving into the problem The challenges encountered and surmounted Over the course of a month, we (the Associates), conducted extensive primary and secondary research. We gathered data The Sarpanches felt stifled and the lower level officials to understand the nature and magnitude of the problem. overloaded with work. They marched to Chandigarh to meet We interviewed government officials ranging from those at with the CM. While some demands were dismissed, others the apex to those on the field, documenting their insights, were accommodated, and the implementation timelines challenges and apprehensions. We visited construction sites were relaxed. Today, the department has taken complete to witness the quality of material used. We also conducted ownership of PES. The Government of India has appreciated discussions with the Panchayat and the villagers. Haryana’s efforts and is accommodating the feedback.

/4 For further information, contact Nandini Vaish: [email protected]