Tuesday, March 13, 2007

“Life is a big shit sandwich – bite into it, or starve!!”[i]
A 2-pager by Ajit Chaudhuri

In an era of evanescent buzzwords, the concept of a ‘long tail’ may prove to be of long-term interest. The term has traditionally been used in statistics to refer to a feature of power-law distributions such as the frequency with which different words are used in the English language – a few common words used a lot and a long tail of obscure words used less often – and was brought into the limelight by Chris Anderson in 2005 in an article in Wired[ii] magazine that looked into business possibilities in the Internet age.

He says that the Internet makes previously unprofitable transactions profitable, and this enables a shift from mass to niche markets. For example, book sales! There are a small number of very popular books and a long tail of less popular ones. A real world shop can stock only so many titles, so it holds only those most likely to sell, i.e. at the head of the curve. But the money made from the sale of one book is about the same, whether it is popular or not. An on-line store with unlimited shelf space can offer a far wider range and open up new markets further down the long tail. B&N[iii] carries only 130,000 titles, and a third of Amazon’s[iv] sales are from outside its top 130,000 titles. The collective demand for obscure items is large, is growing, and can be aggregated over the Internet so that selling obscure movies, books and CDs could prove just as lucrative as selling hits.

This has implications on business and popular culture. Opening up previously unexplored niches will increase aggregate demand and shift demand away from hits. Content providers can be less discriminating – instead of guessing what people want, they can put it all out there and discover unanticipated demand. Collaborative filtering (a chain of ‘if you liked this, you could try one of these’, or ‘people who liked this also liked these’) can enable people to find content they want that is buried down the tail. Hits will be less important – companies that prosper will be those that switch out of the lowest common denominator model and figure out how to address niches. Goodbye, Britney Spears!

The Economist, in a subsequent article[v], pointed out that, though useful, the concept might not be able to break beyond books, movies, CDs and related items. I am not so sure, and feel that understanding this would be useful in spheres beyond the obvious.

In the development business in India, those of us working to support local NGOs face a few well-funded, well-managed and effective NGOs (or various combinations of these attributes) and a (very) long tail of NGOs that exist, but do not do very much. From a funding perspective, dealing with the fat cats has its advantages – they can talk and write reports in donorspeak[vi], they can absorb larger quantities of money and thereby enable you to have a smaller portfolio for the same bucks, and they can say all the right things when your bosses come visiting. But – they are few, and you and everybody else with money to hand out is running behind them. And the places in which they are operational tend to be slightly better (because of them?), with a semblance of civil society institutions, law and order and connectivity. If you are committed to working in areas of extreme backwardness, chances are that you will have to deal with the long tail.

Who are the NGOs in the long tail? A recent visit to Latehar, Garhwa and Palamu districts of Jharkhand with Satish Girija of NBJK[vii], wherein we met many of the better local NGOs, was an eye-opener for me. My notes from the visit reveal –
· Though many NGOs came up from student agitations in the 1970s, they seem to have lost their purpose and fire with age. The NGOs I met had no agenda of their own, and their main ambition was to be development contractors at the lowest end of the chain.
· Corruption levels are high. There is considerable tolerance for small-time dishonesty, which is seen as normal. Funding from the state is obtainable only upon paying bribes, and cooking up accounts (over-invoicing, paying for events such as trainings, meetings, etc., which have not happened) is seen as necessary to recoup these costs.
· NGOs are poorly governed. One person (Managing Trustee, Secretary) typically controls everything, and friends and relatives are in positions of power. Systems and structures are weak. Professionalism is absent. Staff members are insecure and unmotivated – few have employment letters formalizing their status within the organization, salaries are meager and irregular, and basic benefits non-existent.
· The boss spends most of his/her time attending meetings and trainings organized at state or district headquarters, and very little in the field with the community.
· Most NGOs are upper class/caste entities (as are their staff). They thereby have a paternalistic approach to the tribals and lower castes that they are working for/with.
· The difference between the good and bad organizations here is in the levels rather than the existence and non-existence of the above qualities.

I can hear you say ‘Well, then don’t work with them!’ But is that the answer? All three districts fall into the ‘worst-districts’ category – they are poor, they are backward, land distribution and access to whatever facilities exist are extremely skewed, food is scarce. Khurki block of Garhwa district is famous for the feudal lord having the right to the first night with the bride in all weddings within his fiefdom, a practice that was stopped only with the advent of the Maoist Communist Center. If we don’t work here, where should we work? Delhi and Mumbai? And if we work here, it has to be with these organizations.

My employers[viii] have policies in keeping with their (and my) values. We will work only with ‘good’ organizations – those that are honest and have self-formulated and implemented policies on openness and transparency. That define what they want to do based on the needs of their operational areas and their own skills and preferences, and then do it. That deal with donors as equal partners in the development process. Fine thoughts! But such organizations do not exist in Khurki, or Manika, or Daltonganj.

How do other donor-types work in these regions? My observations during the visit were –
· They eschew direct relationships with implementing NGOs and prefer to sub-contract out the jobs of identification, monitoring, training and reporting to nodal NGOs at the block/district/state levels. There are therefore usually several layers between the implementer and the donor, and also substantial expenditure on these layers.
· Programmes are centrally formulated and sharply defined. There is no space for the skills and preferences of the individual implementing NGO or the specific situation of the area in which it operates.
· There is tolerance for bad practices up to a certain level.
· The relationships between donors, nodal NGOs and implementers are not equal.

And so, ladies and gentlemen, this is my shit sandwich. Do we change our policies (and values) and work with the long tail, or do we stick to them and restrict ourselves to the head of the curve. I have no answers! Do you have any advice?
[i] Graffiti in the SRCC hostel toilet in the early 1980s
[ii] “The Long Tail” by Chris Anderson, issue 12.10 of Wired on October 2004, www.wired.com
[iii] Barnes and Noble, a popular bookstore chain
[iv] A popular internet bookstore
[v] ‘Profiting from Obscurity’, the Economist of 5th May 2005
[vi] The development business’ equivalent of bureacratese
[vii] Navbharat Jagriti Kendra, a large Hazaribagh-based NGO
[viii] The Paul Hamlyn Foundation, a UK based donor organization

No comments: