Investing for Impact - Start by Building Capacity

Developing relationships is a critical component
in capacity building and poverty alleviation

 This week’s Social Impact Lab created a great deal of spirited discussion prior, during and after our class meeting.  We have been working on this new method of working in the world in a more sustainable, and impacting manner for seven years and our lab group is made up of people who have varying perspectives, experiences and length of time within the think tank – so we are well-rounded and all have opinions. As well, we are willing to listen to what is being said and what is not being said because despite our variation in perspectives, we are all grounded in the vision.

The vision has shifted and changed as we have grown, learned and experienced over the years, adding partnerships, knowledge and resources. This week’s lab class gave us a framework around which to articulate some of the shifts as we shared our ideas, insights, and frustrations with charting all of the impact and outcomes that we have seen and captured. And interestingly enough it was the model case of d.light.com that brought much of the discussion to a head, and got me to my ah-ha moment.

This reflection is my own, although I have shared it with the group for feedback and clarity, and I think I am onto a critical understanding of how to articulate our greatest struggle – what are we really trying to do – what is our real impact?

It is so easy to start calculating the social impact of our investments in the roads and bridges, schools and books, water delivery systems and health centers and that is exactly what we did not want to do – invest in a top-down, project-driven, imposition of our own strategic priorities. Yet, every time we look at what is happening in the community in which we are actively engaged, we start problem solving about using those successes (outputs) to tell our story.

The leadership of El Corozo prepares for a community meeting

So backing up from the roads and bridges is the real story – how did the community get to the point where THEY were empowered to organize their community; developing their own strategic plans, building capacity to train others, learning about choices and options so that they could identify and select those choices which would most closely align with their vision. And probably most importantly develop enough confidence in their competence that they could collectively as an organized community say no to aid offered which did not fit their strategic plan (despite the good it could provide.)

In a recent response about developing capacity, there was a question related to “people development” and Acumen’s response alluded to people development not being a strategy to alleviate poverty and I had a physical reaction as did several others in the think tank with whom I am working. That response stirred me to finally be able to articulate exactly why capacity development is the most critical component to sustainable poverty alleviation strategies.

Without empowered leadership within the organization, community or group with whom you are trying to alleviate poverty, the projects (regardless of the financial return on investment) will be an imposition of someone else’s strategic priorities. Projects don’t eradicate poverty. In a recent TEDx, TEDxHoracePark, I outlined this very problem and some solutions. You can view my opinions about this by clicking here:  Kathy Stutzman - TEDxHoracePark

 Creating the environment where a community is organized, empowered and has confidence in their own competence – that is capacity building – that creates opportunities for choices and options to be identified and selected – that is where we will see a more efficient and greater return on our investment. That part of social impact investing is critical, expensive and time-consuming and that is what we are working to develop, evaluate and replicate. For purposes of this study, I am going to call this a Tier 1 Impact.

Here is my synopsis of my ah-ha moment from Lab 2 of the +Acumen Course of Investing for Social Impact:

The Assumption:

We (District 5960 Rotarians and friends) will explore and develop a process through which we could engage in creating sustainable choices and options for economic well being in a poverty-stricken community in Nicaragua, with whom we had no prior existing relationship.

The Tier 1 Impact:

Empowered, focused leadership within the community will be active and instrumental in organizing, and directing the community to discover and explore new opportunities and options and work with partners to articulate the community’s choices, not simply accepting someone else’s strategic priorities imposed upon them. (Demonstrated Readiness)

As a Result:

The community will efficiently and sustainably incorporate, and implement appropriate economic initiatives and will actively participate and be vested in the investments chosen. (Higher and more efficient returns on investments)

How we are accomplishing this is another chapter, however, as a demonstration of the impact of building capacity please view this video which was recently produced by our local NGO partners and features the leaders of the community of El Corozo. Capacity Building and Leadership in El Corozo Nicaragua

For more information about the work of our think tank, please feel free to contact me, or any of the members of our group.