In class this week one of the topics of debate was the implementation of our grant money in an organization. This is an important point because we only have a limited number of funds, and we want to be as effective as possible. In order to achieve this goal the class must decide what projects are the most effective.
The specifics of an organizations plan is very important. What is at question here is what/how the organization will use the granted money they receive. Some of the organizations we debated wanted to buy specific technologies, while others wanted to buy appliances. In class the topic was about the purchase of a washer and dryer. This discussion really stuck with me. While we all agreed the purchase of the washer and dryer were beneficial, we decided against it. I specifically made the argument that our money should be used to effect individual people (i.e. condoms, food bus, and interactive trips). To me what makes these different than a washer and dryer is the fact that they are necessary to the functioning of the non-profit organizations.
In my opinion non-profits that use their money to directly effect people are more important than purchasing equipment. I agree that in most cases proper equipment is necessary, but what I want to focus on is the potential to fund projects completely paid for that are essential to the organizations overall mission. For instance the example of the Girls Scouts' trip. This program would pay for a week long camp for inner city school girls. Obviously we don't want to dwell on an organization that isn't a finalist, but the example is key. Does a project that is completely paid for such as this, a project that is more important than purchasing a washer and dryer? In my opinion yes, although i admit this is a case specific comparison and is not the case all the time. In a more general sense, the programs I am backing seem to fall under the direct giving category. In other words our money goes to a project that is aim to directly affect people. On the other hand the washer and dryer are mechanical appliances that serve to improve a specific part of someones lives. For me this is a very difficult comparison and I hope equally as difficult for the rest of the class. The overall question for me then is, should I support non-profits who are asking for money for essential aspects of their organization that directly affect people? Or should I support organizations that want to purchase "things" in order to improve their facilities in turn improving their ability to achieve their overall goal? I am obviously having some trouble with this.
I am curious to hear other people's opinions on this matter. How do you determine one project more important than another? Are the specifics on what/how the money is used an important determining factor? If not, how would argue differently?
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ReplyDeleteThis is definitely a hard question that we are all facing. I understand your point that you would rather donate to organizations that are using money to directly affect the people, like paying for trips, instead of buying appliances. The reality is that it is not black and white, every case is different. When originally looking through the organizations I not only looked at the purpose of the organization but also what they would use the money for. However I did not automatically eliminate organizations that were buying appliances. I looked at if what they were buying/using money for was essential to their organization. For example The Children’s Home said that they would use the money to buy SMARTBoards. The mission statement of The Children’s Home is “to enhance the safety, stability, and well-being of our children, families and their communities.” I did not think that SMARTboards were really needed for their program.
ReplyDeleteOn the other hand The Binghamton Regional Sustainability Coalition (BRSC) said that they would use some of the money, but no more than 50% of whatever the received, to pay their Executive Director who has been donating his time for 3 years. In this case I did not mind giving them the money because it is important to have employees to run the organization.
I think it is hard to determine what project is more important than the other what they are using the money for can be a deciding factor. When making the decision between YWCA and the Binghamton Zoo, I used this approach. While both are good causes I ultimately decided that what the Binghamton Zoo wanted the money for would affect their organization more. The washers and dryers would be helpful for the YWCA but are not essential to the organization; there are other ways to clean clothing.
If I had read this post two weeks ago, I would have agreed with pretty much everything you said. However, since watching Dan Pallotta’s TED Talk, I have changed my views on using donations for overhead costs. I watched the talk last week when Emily posted it, and again this week as part of our weekly assignments. This blog comment will probably reiterate most of what I wrote last week, but I think that the TED Talk is equally relevant to this post.
ReplyDeleteI think that, as a class, we need to define the word “effective.” I understand that some people feel that overhead costs are not “effective” uses of money, but I would argue the opposite. How can a donation that improves the operation of an organization not be considered an effective use of money? If an organization needs a washer and a dryer to fully carry out its goals, then who are we to tell it that it has to spend the money on something more meaningful? It is nearly impossible to eliminate overhead costs, so why not help a charity to manage these costs, so any future money can be used in the way that most people feel is “effective” or “direct”?
Paying for an organization’s overhead costs is much like an investment. For an organization like the Girl Scouts, our money would have gone to paying for one summer camp and a year-long membership to the Girl Scouts. What happens when the camp is over? What happens after a year has gone by and the new Girl Scouts cannot pay for the next year’s membership? Yes, our money would have gone towards a complete project, but this project would not have had as much of a long-term impact as something as “trivial” as a washer and dryer.
Going back to the TED Talk, Pallotta encourages us not to discount the organizations with high overhead costs. He says to instead look at the “size of the pie,” or the organization’s size and impact as a whole. An organization may spend $20 million on overhead costs, but it could be using another $80 million to achieve its goal. Is this organization more or less “efficient” than a $1 million organization that spends only $100,000 on overhead costs? While the smaller organization may spend a smaller percentage of money on overhead costs, the larger organization can probably do a lot more with its larger pool of resources than the smaller organization can.
Although donating to an organization so it can take care of its overhead costs may not immediately seem “efficient,” we must realize that if the charity cannot pay its bills, any chance at having a more direct impact on a community vanishes.
I appreciate both of your perspectives on the issue. I believe as Emily has demonstrated it is a question of efficiency and necessity. How we each determine these then seems to be the question.
ReplyDeleteTo begin with efficiency, as Martha points out, is also subjective. Are overhead costs that are a necessary expenditure of an organization the most "effective" way to spend money (because these costs obviously need to be met)? The answer to this problem is in the quantification of effective spending of our grant money. I respectfully disagree with Martha that efficiency is subjective, or we cannot tell an organization how to spend its money. I think this type of consequentialism is something to be avoided. Rather we should try to define an ultimate understanding of effectiveness or an example of the most effect way to donate, whether or not this is possible is a completely different issue, even if we cannot we should still strive for this understanding. Furthermore than we should look deeper into the issues at stake when analyzing an organization's programs. For instance Martha identifies the seemingly short-term nature of a summer camp and a year long membership, in comparison to the five-ten year long duration of a washer or dryer. Once again I would argue that the overall effect on a inner-city girl's consciousness, confidence, and overall understanding of the world can be drastically altered in a positive way that can last a lifetime. In comparison to the convenience of machine-washing of clothes. So as these debates of effectiveness come up I believe in direct investments into humans rather than appliances, I am exaggerating to a degree here and understand the necessity of eventually paying overhead costs, are of the utmost importance.
Secondly this idea of necessity is an important determining factor. The reason for this is the idea that Emily laid out, the essential nature of our grant money in relation to the overall goal of an organization. In the example before the program proposed by the Girl Scouts would not exist without our money, and similarly the washer and dryer would not either. Which one is more essential to the overall mission of the organization?
This is an important comparison because together efficiency and necessity can be implemented as a successful tool to evaluate an organizations use of our grant money
I just want to begin with what stuck with me during the debate over whether to pick the YWCA or the Binghamton Zoo as a finalist. Those arguing for the YWCA argued that the organization was the only organization that took in women that we currently using heroin and was helpful to them and their families, therefore they are more worthy of the grant money which will purchase a washer and dryer for the organization. I disagreed with this argument, if the YWCA was asking for grant money to aid a program that would help the addicted women in their organization, then I would feel more inclined to pick them as a finalist. I think the debate kind of went in the wrong direction, just because someone likes what an organization does, does not mean the money the organization is asking for will aid their mission. We must not get caught up in our attachment or feelings connected to organization and make sure to pay attention to what exactly the organization is trying to use the money for. I felt that what the Binghamton Zoo would use the money for outweighed what the YWCA would use the money for, I also felt that Sarah’s argument was extremely persuasive and heartfelt.
ReplyDeleteI also agree with you Derek that the programs I am backing fall under the direct giving category. I will feel much more fulfilled at the conclusion of this class to know that we granted an organization money that will use the money to affect a large number of people. Although some argued that funding the zoo is unbeneficial because it is luxury for some to pay admission and go to the zoo, this organization reaches people of all ages. I also liked that the zoo added diversity to our array of finalists. We do not have to only support organizations that help the needy, drug addicted, disabled and poor. We can support organizations that aesthetically enhance the Broome County community and bring life to the depressed area.
It is hard to decide whether one project is more important than another when the debate arises among a class of opinionated students, and there is not necessarily one right answer or one right project to choose. However, I think we made good choices about whom the finalists should be. Each organization we choose wants to use the money differently, which is important, so we have a variety of different things to consider and different viewpoints to satisfy.
Derek, I find your blog post extremely relevant to our last course's section. You discuss a recurring issue that many of the students, including myself faced while dealing with choosing finalist organizations.
ReplyDeleteAddressing the questions you pose at the end of your blog post, I do have a reasonable method for deciphering whether an organization/project is more important than another, yet it is a completely subjective one: you must use your own judgment. I think we can all agree that we all hold varying opinions on what is and is not of importance. Thus we should respectively hold different opinions on what organization is of significance. So to answer your question the only way to determine which organization is of more importance is completely up for interpretation and should be decided on a case-by-case basis per individual.
In response to your second question, I was at first, stumped on how to approach how organizations would plan to utilize the funding. While knit picking through the 50+ organizations that signed up for a possible grant, I struggled with how much attention I should give to how the organizations planned on using the grant money. I knew that this was subject to change and thus faced such an according struggle. However, after considerate deliberation I ultimately decided that I should definitely consider the allocation of possible funds as a considering factor for deciding which organizations to give to. I feel this way as I agree with you. We should place heavy consideration on how these organizations are making an impact in their communities. This can only effectively be done when organizations are directly impacting the people that ultimately make up the greater community. Although I agree with you on this point, I disagree with another point that you address. You say that you'd rather donate to an organization that directly impacts individuals rather than contributing to the purchasing of equipment. The only problem that I have with what you state here is that purchasing of new equipment can oftentimes lead to a direct impact on individuals. For instance, ACHIEVE, an organization focused on improving the lives of the disabled, was seeking the $10,000 to create a sensory room, essentially the money was being used for purchasing equipment. In this case, the purchasing of equipment would directly make an impact on the lives of many, in this specific scenario, the disabled.
This is the only case I can successfully make against the blog post that you have provided. Other than that, I thoroughly enjoyed what you had to offer and was able to view your assessment of giving through your blog post. Well done.
I had the same view as you, Derek.
ReplyDeleteI believed there were more important uses for our money, such as the CHOW food bus that would give people food, rather than using our money to purchase washers and dryers that won't directly alter a person's life.
However, I am a strong proponent on having a minimum standard of living for all people. I believe people should have food, clothes and shelter. In this regard, the washers and dryers would be an important thing to donate our money to. If people are wearing dirty clothes for weeks at a time, it could lower their opportunities to secure a job or might just lower their morale completely.
Using your Girl Scout example, I believe that our money would be more useful to go to the washer and dryers, rather than sending fifty girls to summer camp. Although sending these girls to camp and having them make lifelong friendships is important, I think that meeting the basic need of having clean clothes, thus increasing their opportunities to find a job and make a living, is more important.
I think that all the points and arguments made on this blog post and the comments following it have been extremely important and valid. However, I want to focus a little bit more on the point that Martha makes about the necessity of defining certain key terms that we all have used in determining what organizations to give to. Effectiveness and necessity are two such terms – how do we determine whether what an organization is actually doing is effective? As investors, how much proof do we need that what an organization is doing is actually effective and necessary? This difficulty in determining necessity and effectiveness goes back to conversations that we've had over the course of the semester. Even when we're looking to solely investing in organizations that help core community needs, there are so many ways to accomplish goals to better the community and so many methods of helping people, not to mention the different community needs that need to be improved upon and the many organizations that need assistance and our help. At some point, we just have to start weighing the benefits and needs of each organization against the needs of the community. Theoretically, the more we know about each of these organizations and the more we know about the needs of the community, the easier this should become but I think that no matter how much we know and how prepared we are, when it comes to giving, so many emotions and different passions are involved that it becomes very hard to make decisions like the ones we've been making.
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