Global development is no longer the domain of public health experts, policy wonks, and lifelong do-gooders. It no longer prizes decades of peacekeeping experience or fluency in a nearly extinct Mayan language. That’s because “the management set” has emerged.
Forty years ago, humanitarian Ross Coggins charted the existence of “the development set” (leading to the tongue-in-cheek name of this publication). They discuss malnutrition over steaks / And plan hunger talks during coffee breaks, among other stereotypes. This group can now be expanded to include former managers, investment bankers, and consultants, who for the last decade have been flooding the ranks of large nonprofits and foundations.
The management set is similarly “bright and noble.” They come armed with Ivy League MBAs, freshly-pressed shirts, and a loose familiarity of issues like childhood malnutrition and sanitation systems. And they are fundamentally changing the way global development happens.
TThe Clinton Foundation, where I worked from 2007 to 2009, has been called the “Peace Corps for McKinsey,” referring to the management consulting firm. Nothing was more likely to get you through the applicant pool than the McKinsey stamp of approval.
Most of my colleagues were young, book smart, and wizards at Power Point. Equipped with terms like “volume-based discount” and “cost-plus pricing,” my team worked to make HIV/AIDS medicines more accessible to patients in the developing world.
This new breed of development worker is influencing global development in profound and unexpected ways. The management set is largely responsible for the growth of strategic philanthropy, an evidence-based approach to grant making. It’s the reason big data has become so popular. To an extent, it’s why technology-led solutions like mobile learning and crisis mapping have taken off.
In some organizations, even interviewing has changed. In my first interview at Clinton Foundation, for example, I was asked, “How many cars are there in the United States?” The question was cherry-picked from a traditional consulting case interview — and though it tested my ability to tackle abstract problems, it revealed nothing about my understanding of HIV/AIDS treatment or under-resourced health systems. In my second interview, I had to build an Excel model.
To be fair, business and economic principles are an important part of global development. I actually did have to build Excel models on the job. But more classic development skills — diplomacy, familiarity with local cultures, experience navigating foreign bureaucracies — almost become an afterthought.
What are the implications of this trend? To what extent can approaches tailor-made for the private sector be applied to social ills like poverty, disease, environmental degradation, and illiteracy? What can nonprofits gain by making way for the management set — and what do they lose?
BBusiness people working in nonprofits is nothing new. What is relatively new is the intensity with which they are being recruited and hired. Tighter donor purse strings during the 2008 recession — and the fact that many donors themselves made their fortunes in the private sector — led to an intense emphasis on efficiency and results. Some of the biggest players in international development, from the Gates Foundation to Habitat for Humanity, began to flood their ranks with MBAs and their boards with CEOs. (Disclaimer: The Gates Foundation funds this publication. We retain editorial independence.)
But it doesn’t always work out well. Luis Ubiñas was president of the Ford Foundation from 2008 to 2013, taking the helm at the start of the economic downturn. He had little nonprofit experience, a Harvard MBA, and nearly two decades of experience as a media consultant at — surprise! — McKinsey. Ford was facing a shrinking endowment and Ubiñas was brought on to help weather the storm. He promoted a “results-oriented culture” and took a relentlessly data driven approach to allocating resources, slashing programs and cutting staff.
Alas, it left the organization demoralized and tired, and several longtime employees left during his tenure.
Achieving social justice is not the same as overseeing a merger. For one thing, time horizons in the private sector tend to be shorter. It’s all about quick returns and immediate results. But the “get ’er done” mindset doesn’t always work in a sector in which results often come by the decade, not the quarter.
Social progress is a long, tough slog. Governments and multilateral institutions manage a staggering number of priorities, one of which may or may not be yours. That can be frustrating for people who are used to driving projects forward — and it can create tension with the people on the receiving end of that frustration.
TThere’s no doubt that the management set has encouraged a more efficient and accountable era in philanthropy. In some cases, it has helped catalyze large-scale change.
For example, in the 1990s, increasing access to HIV/AIDS treatment meant lobbying pharmaceutical companies for price reductions or outright donations. At the time, 8,500 people were becoming newly infected with the virus every day. A model that relied on corporate largesse and the sweat of AIDS activists could only achieve so much. In the early 2000s, some smart business minds analyzed the market for antiretroviral drugs and saw the opportunity to drastically lower prices, using basic economic principles of supply and demand.
Millions of people are alive in part because of this shift in thinking. And the nonprofit sector needs people with a broad range of skills, including business acumen.
Indeed, more and more MBAs have been willing to forego private sector salaries to do social impact work. Net Impact, a nonprofit network of business students and professionals working for social and environmental change, found that 83 percent of MBA students are willing to take a 15 percent pay cut to do work that makes a social or environmental difference. It’s now the norm for business schools to require students to take courses on social impact, something that wasn’t true just five years ago. The nonprofit sector is taking advantage of these trends and seeking out bright business minds, in part to counter perceptions of being inefficient, wasteful, and bureaucratic.
But I’d argue that it is seriously overcompensating.
There is something intuitively wrong when development experience is less coveted than private sector experience — for a development job. Years after my stint at Clinton, I was speaking with a Gates Foundation recruiter about an opportunity in their global health program. By then, I had a range of development experience under my belt and a Master’s degree in international affairs. My resume was short on space, and since my foray in the private sector seemed dated and less relevant, I removed it. When I told the recruiter about it in passing, she noticeably perked up — and then advised me to add it back to my resume.
Apparently, my most noteworthy experience wasn’t my work on HIV/AIDs, maternal health, or childhood pneumonia — but my stint as a business planner at a high-end makeup company.
TThere are some signs that this trend might be changing. In 2013, after a run of CEOs plucked from Microsoft, the Gates Foundation hired Sue Desmond-Hellmann, a cancer doctor and public health expert. She has said that she wants to focus on values, not processes, and to institute a culture that trusts employees to make the right choices.
The Ford Foundation has also pulled back from its highly structured, data-driven approach. Its current president, Darren Walker, has emphasized consultation with grantees and program managers over rigorous quantitative analysis. “Social change does not follow an algorithm,” he said. “It is messy. It comes in fits and starts, through feats and defeats. It unfolds in different patterns, at different paces, in different places. And because change in complex systems is unpredictable — no matter how well-intentioned and well-reasoned the model behind it — the time has come for us to set aside our adherence to a prescriptive theology that constrains how philanthropy approaches solving complex challenges.”
Translation: enough with the process maps. Development, at the end of the day, is a deeply human endeavor. Relationships are what drive impact. Boardroom sensibilities don’t always serve the interests of the rural farm worker or the child with malaria.
Happily, Walker is also trying to make Ford’s corporate culture more fun. The nonprofit sector could definitely use more of that, and maybe fewer spreadsheets.
