Wednesday 13 November 2013

Why picking the right KPI is so important

In a recent post on SSIR Christina Triantaphyllis and Matthew Forti talk about the problem with focussing on the overhead vs. impact ratio when assessing charitable work. For me, this is just another step along the chain (donor -> charity -> local NGO) where the use of incorrect KPIs leads to exactly the opposite of the desired behaviour.

During my time working in rural India I was struck by the extent to which NGOs tailored their activities not to those actions that had the highest impact, but that would tick the most funding boxes. During the course of the year I came to understand the problem - funding is so difficult to come by that NGOs have to fight tooth and nail in order to secure finances. They cannot be picky about the sources of that income, nor can they afford to let an opportunity pass, therefore if a donor organisation says a particular report / action is required, that is what the NGO provides.

In the extreme, this results in very peculiar behaviour. NGOs recording the number of attendees of workshops, but not the results of any learning. Photographic evidence being required of meetings, rather than documented minutes / actions.

The source of this insanity? The laziness of the funding organisations. Measuring true impact takes effort. It costs money. It may show that your initial approach was wrong. That money has been badly spent. That the hypothesis was wrong.

If an analogy is needed, here is my best attempt: You start in London and need to travel to Manchester. You research before hand and learn that it is 200 miles. You can travel at 50mph, so you know you need to travel for 4 hrs. You set off in what you think is the right direction and, without checking a map, GPS or roadsigns, travel for 4 hrs, with the only monitoring being a regular check that you are, in fact, travelling at 50 mph. You assume that as long as you continue taking this action you will arrive at your destination.

The flaw in this argument is obvious. You need continuous assessment (measurement) that you are travelling in the right direction. Taking action does not automatically result in the right result. While there is some truth in the maxim "some action is better than none", it is not true that any action is always the best one.

Measuring charities on their overhead vs programmes spend is the wrong thing to measure. In the same way that measuring the number of workshops run is not the right KPI for field work. However, in a competitive market, the only action open to organisations looking for funding is to fall in line and do the best they can.

The only way this changes is with the first step in the chain...

Monday 11 November 2013

International Development - a change of direction

It's been a while since I've been on here. It happens a lot. I write for a bit and then stop. Write a bit then stop. This time though, I've got a massive incentive to keep it up....I've started a Masters degree in International Development!

I'm realising very quickly that I need to keep writing my thoughts down so that I articulate myself properly and ensure I properly understand a topic. While I've coped with my first assignment, I recognised too late that I didn't know my subject area in enough depth to be able to argue it reasonably. That's not good enough, so from now on I'm going to try and post once or twice a week, whether it's on topics to do with my latest reading for my masters, or a topic I've found on a blog. Hopefully this will really get me involved in my subject, draw me into the Blogosphere again and (ultimately) get me the grades I need!

So without further ado, let's get started :-)

Tuesday 9 April 2013

Why SIB's won't work

I was reading Kyle McKay's article on Goldman Sachs new SIB programme and while I agree with the majority of his points, I think that the fundamental point is missed here...

Myth 3 for McKay is that "The government pays only for success" - McKay is concerned that it will be difficult to decide whether a programme is a success due to the contractual difficulties in defining success and that the government will therefore end up paying for projects that have not "succeeded".

This misses the point that the project developers will be incentivised to produce projects that are at least perceived to have "succeeded". This in itself would not appear to be a problem until you consider that a project that has succeeded in its fundamental aims, versus one that succeeds as per a written contract are two very different things.

As soon as a project is designed specifically with the aim of improving a measurable outcome, rather than with the fundamental outcome in mind, it runs the risk of becoming a self-fulfilling prophecy. Focus shifts away from the aims of the project and onto improving the KPIs. The key word there is "Indicator". A positive shift in a KPI does not reveal a project that is working, in the same way that a negative (or zero) shift would tarnish a project as failing.

SIBs could result in the government paying for programmes that are not effective. That's a true statement. It could also result in far more projects being run that are not effective at all. That is the issue here.

Taking a new direction

In what is becoming a fairly regular(?) occurrence for me, I'm going to make a bit of a change to the focus of this blog. It's been almost two years since I last posted on here, but a lot has changed. I'm back from India and planning the next phase in my life.

The work I did with VSO (see my other blog for more details) had a profound impact on my life and left me wanting to do more than just moon-light in the development sector. Unfortunately, on my return there was a mortgage to pay and it was far too easy to just go back to my old job...

Times have changed, however. I've been back for over 18 months now and while I don't quite have the itchy feet to grab the passport yet, I'm definitely looking at my options. So first step - I've applied to do a Masters in International Development. It's a part-time, distance learning course, which should provide me with a bit of flexibility at least.

Step two - starting this blog. I'm going to try and start commenting on the blogs I'm reading and just giving my general thoughts on what they're saying - join the conversation! We'll see how it goes - it might be that I can't do this as regularly as I'd like, but I'm going to make a conscious effort!

So there you go - new direction in life, new direction for the blog. It's a nice symmetry, right? :-)

Saturday 16 July 2011

F-Commerce - Facebook Shopping

FreshNetworks have an interesting Infographic on the rise of Facebook commerce. Unsurprisingly, people are finding that personal recommendations lead to higher purchase rates and that the numbers for purchases made via Facebook are on an upwards trend.

A few years ago I had an idea about how to take advantage of these behaviours, which I still haven't seen anyone attempt in quite the same way - rewarding recommendations, but doing so in a way that encourages targeted recommendations...

At the moment, through things like affiliated links, etc. I can post links to Amazon and other sites on my blog and as such I am "recommending" products. On other sites, such as TripAdvisor, I can leave general recommendations for places and products I've been to and used. People who trust me can use these links and if they do, I earn money (this has never actually happened to me btw - I'm talking theory here!).

There are other services out there that encourage the sharing of links to products and work like a kind of pyramid scheme. The more people you share with, the more likelihood you have of someone buying and you get a cut of that from the vendor. The problem is that this encourages spammy behaviour, which decreases the value of these recommendations and makes it more likely that people will click-thru, destroying the usefulness of the system.

In my mind, the reward to the user making the recommendation needs to be tied to the percentage of people who buy, not the number. So if you send a link to the new Matt Nathanson album to 10 people and one person buys, you get significantly less reward than if you only send to one person and they buy. It forces the recommender to really consider who will actually like/want a product. This makes the recommendations far more valuable to the vendor as well as the person receiving the recommendation. Everyone wins!

Until someone cracks this recommendation problem, we're probably not going to see the full value of social networks in e-commerce. Which is why I like the way Google is moving with Circles. They are trying to encourage more sharing, while also making it more relevant to the people receiving the links. If that really takes off (and I personally think it will) then it will naturally expand into e-commerce.

So that's going to be G-Commerce then....? ;-)

Thursday 14 July 2011

Will opening in the US help Spotify become Prime Time?

So, after what feels like years of arguing, fighting and "almost" launches, it looks like Spotify is finally about to launch in the US. So will this be the moment when Spotify crashes into the public consciousness, or will it, after so much hype, die a sad and slow death?

First off, I love Spotify. I think it's an absolutely amazing service. Yes, there are frustrations over some music not being available (Arcade Fire!), but in general, if you want it, it's on there. It's stunningly quick. The offline functionality makes it perfect for me out here in India - I can swap my music around as and when I have Internet connectivity. It's legal. And the mobile app (when I'm back in the UK) means that I can't see me replacing my Creative Zen (which has sadly kicked the bucket).

So I'm a fanboy. There are, of course, some things it could improve on. The social aspect still needs work. The obvious one here is a tie-in with Facebook. That's what I'm hoping for. I think that is what will push the service into the mainstream proper.

Obviously the US market is important, but I don't imagine that the US launch is going to be a launch-pad for further success in Europe. I have friends in the US, but just because they use a service doesn't mean I use it. For most people in the UK and Europe, the US launch isn't going to change anything. One or two more friends will start using the system. So far, so meh....

Which means that the service as it is at the moment isn't enough for some people. They need that additional incentive to use it. It needs to be tied to Facebook.

Let me clarify on this. The last thing I want is the integration the way it is at the moment. I don't want my Facebook stream bombarded with single tracks shared from Spotify. That would be noise for noise's sake. What I want is to have a "music" section of Facebook, which people can link their Spotify account to. I want to be able to see what people are listening to right now. What's popular amongst my friends. Who is recommending what. Group playlists. All in one place.

So, yes, it's great news for Spotify that they're finally launching in the US. For one thing, it gives them the ability to finally focus on something else and everyone can stop wondering when this will finally happen! I'm just hoping that the next "something else" they focus on is integrating with Facebook....

Wednesday 13 July 2011

Google+ isn't going to kill Facebook

Yep, I'm calling it. Google+ is not a Facebook killer. You can all stop your arguments and forget about reading any other posts on it. The thing is - I don't think that's what Google is aiming for here. Twitter on the other hand, could definitely be in trouble. Let me explain....

I've only had access to G+ for a couple of days, but from what I've seen of how others are using it (and my initial instincts), the way it's being used is far more akin to Twitter than Facebook.

For me, Facebook is where I find follow the actual lives of people I know. Very few people share links on Facebook among my friends (granted, that's a sample of ~200 people, but still), most of the stuff is along the lines of "here's a loads of pics of my holiday", "I'm hungover", etc. Twitter on the other hand, is where I go to see what other people are reading and sharing. The number of personal comments is far lower.

G+ seems to fit much closer to this link sharing idea. What's more, the ability to focus who you are sharing with means that in theory the items appearing in my stream should be much more applicable to me. Just as an example using the sort of stories I share:
1. Tech news
2. Sport
3. Social Enterprise / Volunteering / Charity Sector

Those are three very, very different areas. At the moment, if you follow me on Twitter, you get everything. If you're only interested in one of those areas, you might get fed up with having to sort through the noise and find the applicable tweets. You unfollow me. With G+ that doesn't happen. I know who is interested in football, who is interested in tech, etc. So they go in those circles and voila! Now I can share more stories, because I don't think I'll annoy people who aren't interested in those things, plus the click-through rate should be higher for each link shared as it is more targeted. As Google tracks who is clicking on what, they build a social graph that is surely more valuable than knowing that X likes to look at Y's photos!

I think Google is happy for Facebook to become the social network for drunk party photos and inane updates about what people's rabbits did just now. They want to control the network for sharing stories and links....and that's why I don't think G+ will kill Facebook, however much people want to put the two in a head-to-head.