Microfinance Made Better
The article "In Microfinance, Clients Must Come First" (SSIR, vol. 6, no. 1, p. 38) reinforces a lot of the same information in the recently released RESULTS Education Fund USA Microcredit Summit Campaign report for 2007.
Yet the authors state, "No single MFI, to our knowledge, currently implements all of the practices we recommend," apparently unaware of the work of Jamii Bora, a microfinance institution in Kenya.
Jamii Bora was initiated when 50 street beggars were given loans in 1999. It has now grown to more than 170,000 savers and 60,000 borrowers. When borrowers were struggling to make their payments, investigation revealed that most clients had a family member in the hospital and were using their loans to make medical payments. Jamii Bora responded by starting its own health insurance, which costs a family of four $12 per year. It also introduced life insurance that pays the surviving family double the amount borrowed by the deceased member.
Jamii Bora also has a business academy, a counseling program, and a program to help alcoholics and their families. Plus, it's in the process of building its own housing community with its own utilities company. It works with its clients to ensure that no one type of business dominates. This helps everyone recognize that a diverse business community is a successful business community.
But perhaps the greatest reason the Jamii Bora model is so incredibly effective relates back to the main premise of the article: It is client-centered.
Open to Possibilities
Calgary, Alberta, Canada
The article covers many of the aspects important to microenterprise development (MED). But there are three legs to any economic stool. The first (wellknown) leg - and these are not in any particular order - is capital to make a business work The second leg is the social capital, which the article clearly deals with. The authors say they see very little to conclude about the value of MED and thus focus more on the social aspects: skill, knowledge, etc. They correcdy conclude many of the poorest of the poor are not ready to do business, as the social capital is not in place. Clearly, preparing the social capital skills of the very poorest is necessary before they can consider microenterprise. The work extends from developing at least a fifth-grade education to changing their often fatalistic view of life. I discuss these issues in more detail in my book God Is at Work: Transforming People ana Nations Through Business.
But the authors completely ignore the third, most important part of economic development: "spiritual capital," which I also discuss in my book. What is spiritual capital? Simply put, it is the fundamental fabric that makes the relations and business environment work for the good of the whole. There is no spiritual capital in the Grameen Bank's efforts in Bangladesh. As a result, while more microloans have been given per capita in Bangladesh than in any other nation, its economy, and therefore well-being, has not moved one iota in 30 years.
Sadly enough, most MED programs do not spend much time in this third area as part of their teaching. They don't even know it exists (Nobel Prize to the contrary) and fail to embrace it. When they do, however, the confusion alluded to in the article is cleared up and results begin to happen.
Living Stones Foundation Charitable Trust
Menlo Park, Calif.
First of all, I want to praise Laura Silverstein and Erin J. Maher for being brave enough to air their experience, warts and all, in their article "Evaluation Blues" (SSIR, vol. 6, no. 1, p. 23). If more folks would fess up to these kinds of problems regarding research and evaluation, perhaps more would be willing to admit that the emperor has no clothes (or is scantily clad at best).
As the evaluation coordinator for a nonprofit organization, your article struck a familiar chord. Since I guided one of the organization's projects through the national model program process, I am all too familiar with the ups and downs of the whole evidence-based practice (EBP) movement. For the most part, the EBP movement is based on principles and assumptions from basic research, including the randomized control trial design - the infamous "gold standard." Randomized control trial designs are useful in basic research, when there is a high degree of control over the variables in question. In field-based research, however, it is usually not possible to control things so tightly; different assumptions, models, and analytic tools are required. I find that most folks (including funders and EBP regulators) don't really know the difference and continue to apply basic research tools to field-based studies. For example, with randomization, one can assume a fair amount of equivalence between treatment and control groups. Without randomization, as in your study, you cannot assume this. You must use certain statistical tools to determine and adjust for these differences. These statistical techniques may require more sophistication than what is usually offered through university courses.
Another problem I often see in both field-based and basic research is that the intervention group is compared to a control group that receives no services (after-school program vs. no afterschool program). So what you may unwittingly be comparing is whether any activity after school is better, worse, or the same as no activity after school. It might make more sense to compare to a third group with some other after-school activity to really understand what's happening.
Mind Over Matter Consulting
Laura and Erin, your frustration is collective. We run an arts-based program for high-risk youth ages 12 to 24 that also provides mental health, court, and addiction support. We've experienced increasing pressure from public and government funding agencies to "prove" that these initiatives actually work for the mainstream societal goals of increased employment, better education, and overall, the perfect citizen as defined by government funders. Grassroots agencies are already financially stretched, and we are maxed out in our present grantwriting endeavors. Even if a traditional scientific evaluation were possible, there are no funds for such an evaluation, and it is questionable if the process would be effective with our population and program.
One solution that we have initiated is to work with our local university. Our youth and organization are perfect candidates to be involved in a variety of studies. We are just now embarking on a partnership with the university on our program's effectiveness. The university department is absorbing the hard costs.
We all need to tap into the private sector more and find champions who understand the reality of effective grassroots organizations because they have somehow experienced the transformation process in their own lives. Find these people and you will find your champions. Yes, we have found a few- one found us through a newspaper article and another we found through personal connections - but we are still struggling.
ihuman Youth Society
Edmonton, Alberta, Canada
Thoughtful Risk Taking
I've referenced Heather McLeod Grant and Leslie R. Crutchfield's "Creating High-Impact Nonprofits" (SSIR, vol. 5, no. 4, p. 32) in workshops and speeches before hundreds of community action agencies and coalitions around the country. The responses and discussions I've heard validate their work But in their closing, they note that "individual donors and volunteers can increase the social return on their investments by supporting those nonprofits that have the most impact, rather than those that adhere to conventional, and misguided, ideas of efficiency." I have a friendly suggestion: That outlook should apply to foundation and corporate donors as well. Thoughtful risk taking - in creative approaches to difficult problems and issues - often merits philanthropic and private sector investment.
President and CEO
Community Action Partnership
Data on Giving
I was interested to read about the refinement of the data on American giving in "The U-Shaped Giving Profile Explained" (SSIR, vol. 5, no. 4, p. 16). I would add that a government policy of encouraging giving is yet another privilege inequitably applied between the wealthy and the rest of Americans. With the greatest respect to the motives of the wealthy, it is easier to be generous when you have no fears for your own security, and when you are positively motivated by tax advisers and incentives.
To me, our failure to allow a simple tax deduction for nonitemizers not only denies the not-for-profit sector potential resources, it also denies most Americans the satisfaction of tracking and taking credit for their own philanthropy.
Director, Civic Partnerships Program
Mayor's Office of Arts & Cultural Affairs
Questia, a part of Gale, Cengage Learning. www.questia.com
Publication information: Article title: Letters. Contributors: Not available. Magazine title: Stanford Social Innovation Review. Volume: 6. Issue: 2 Publication date: Spring 2008. Page number: 6+. © Stanford University, Center for Social Innovation Winter 2009. Provided by ProQuest LLC. All Rights Reserved.
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