Thursday, June 11, 2009

Development in 5-star

What percentage of the global development community’s budget, I wonder, is spent on 5-star comforts? By this I mean on such items as: business class (or better) air travel; 5-star (or better) hotel accommodation; $30 (or higher) meals per head; conferences / retreats / workshops at 5-star (or better) venues; etc? I would wager: a quite significant proportion.

There is, of course, the argument which follows: to address development problems we need to attract top talent; to attract top talent we need to provide the resources and opportunities to achieve a certain minimum standard of living – or we will lose talent to other sectors.

For many ‘expat’ development practitioners, because they have been brought-up in relatively comfortable western environments, I can see how it would be very difficult to permanently adapt to a considerably tougher living environment. While many are willing to take significant pay cuts, not everyone is willing for (or cut out for) life in a village with no electricity (at least not long-term). For top ‘local’ talent, meanwhile, simply the fact that the opportunity cost of other options – given their skills and qualifications – is quite high, would see them also demand a fairly high salary to work in development.

I would offer that these arguments are reasonable and justify expenditure on good salaries and comfortable travel arrangements in the development sector.

But it is a step-up from paying someone enough (and by this I mean even as high as the 95th percentile in the local income scale) to be able to live quite comfortably while doing development work in Asia or Africa or Latin America, to spending lavishly on 5-star hotels, business class air travel and annual staff retreats.

The question is: should there be some limits? Are private sector style trappings needed in order to attract and retain talent for the development challenge? Even if not needed, do they have the effect of motivating people enough such that the cost-benefit trade-off is positive? Is it justifiable for NGOs, multilaterals, developing country governments and western government development arms to spend on these additional comforts?

I’m not sure where I stand. I would say that it needs to be evaluated on a case-by-case basis, because I’ve experienced both sides of the spectrum: instances where the value-add outweighs costs as well as instances where the cash could have been more useful had it been left as a tree. An example on the plus side: there was a retreat I once attended at a resort in Southeast Asia, where a small group of NGO managers went through a 2-3 day visioning and strategic planning exercise. While it is impossible to directly attribute cause and effect in such cases, the subsequent successes of this group of NGOs gives me comfort that the retreat was well worth the expense. For an example on the flip side, here is a direct quote from a former World Bank infrastructure finance consultant*: “On a trip to the Middle East – business class, via a rest stop at the Park Lane Sheraton in London, with an automatic upgrade to suite – I spent two weeks at the InterContinental Hotel in Amman, Jordan, ostensibly to help organize a conference on infrastructure finance. I had little to do beyond ensuring that the PowerPoint projector worked correctly. The most pressing task was composing a birthday greeting to King Abdullah on behalf of the World Bank and the senior government officials attending the conference.” Another recent example, though not directly related to development: http://www.nation.co.ke/News/-/1056/606104/-/ujr7c6/-/index.html .

I look forward to getting your comments.

* Former WB consultant and current writer, J. Maarten Troost, from his novel “The Sex Lives of Cannibals”.

1 comment:

  1. Hi Abhilash -- I read this and thought, god, i wish we could have a chat...you wouldn't believe the demands McKinsey is putting on the RGoB for their contract here. Let's just say that the "rent" in a 5-star hotel for 2 years (yes, I did say 2 years) will cost the government over $1 million. I live in the top 10% of housing stock/neighborhood in Thimphu and my rent for two years would come to a grand total of $22,000 for 6 people for 2 years.

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