Charitable Donation

by Richard Veryard
In this blog, we want to discuss ways in which complex sets of services can be designed to deliver value in a highly complex and variable world, building on the concept of asymmetry in our paper on Governance. So here’s an interesting example of how, implicit in the contrasting value propositions of two different charities, different kinds of asymmetry are being addressed:

The Association for International Cancer Research
£10 will allow an eminent scientist to grow cancer cells in a test tube to further his or her understanding of how cancer cells work.
£50 pays for the analysis of a sample of cancer tissue
£100 covers the costs of a computer analysis on the structure of a new cancer drug
£1000 allows scientists to examine the structure of a cancer gene, which is vital if we are to understand how this terrible disease is to be conquered.

Oxfam
£5 can pay for two buckets that can be used in an emergency to keep water clean and keep people healthy
£10 can pay for three textbooks for schoolchildren in Zambia
£20 can feed three children in Malawi for a month
£50 can pay a trainee teacher’s salary in Kenya
£100 can pay for seven water pipes, each bringing clean safe water to the people in a village
£250 can pay for a cow for a dairy farmer in Malawi.

So what is the difference between these two charities? Well obviously there are many possible answers. But one important one is that the value offered by Oxfam relates more directly to the solutions being offered, while the value offered by Cancer Research is pretty indirect, being expressed more in terms of the internal workings of the charity. Why is this test worth a fiver, while this other test is worth ten times as much? And how exactly will these tests lead to a cure for cancer – do we just have to trust the scientists to use our money efficiently?

It is as if AICR is not distinguishing between the technology (the research procedures) and the business (the charitable enterprise). The technology is the business.

Indeed, we could perhaps regard the tests and other research deliverables as Product, and the Eminent Scientists as the (socio)technology for producing these products. The value proposition presented by the AICR tightly couples the value of a test with the eminence of the scientist who performs the test. On this interpretation, it looks as if AICR has failed to address both the first asymmetry (in which the technology underpinning the workings of the business is not taken as being the same thing as the outputs of that technology) and the second asymmetry (in which the business is not taken as being the same thing as the solution offered to the customer).

And what about the third asymmetry (i.e. that the demand from the customer for a solution is not taken as being the same thing as the experience needed by the customer)? In the case of Oxfam, it would have to be about how they were able to bring about sustainable changes in the contexts in which they intervened. But in the case of Cancer Research, we would first have to say what the second asymmetry was about – perhaps about the nature of the cancerous conditions for which they were seeking to develop cures. On this basis we could then say that the third asymmetry would be about how they were able to create effective long term treatments in the lives of individuals suffering from cancer.

Looked at in this way, we see how value propositions can tell us something about what a business pays attention to in how it creates value.

One thought on “Charitable Donation”

  1. Your post calls out the asymmetry on the consumer-side:

    Value experienced from donation Vaue perceived by donation to a particular charity

    It seems as though there is a parallel asymmetry on the supplier-side:

    Value available from donation Value proposed by donation

    Not surprisingly, this follows the canonical model of communication:

    What Party A thinks What Party A says or writes
    What Party B understands What Party A hears or reads

    In both models, potential for mismatch occurs in 3 places:

    o Within the supplier (intent vs. expression)
    o Within the consumer (understanding vs. reception)
    o Along the communication link (fidelity of transmission)

    So this seems to provide the supplier with several opportunities to better connect with potential donors:

    o On the supplier-side, more effectively communicate the actual intent as part of the value proposition (e.g. what real benefits have we delivered)

    o On the consumer-side, more effectively recognize context-dependencies and plug into them. For example, a potential donor who has a close friend or relative with cancer (or who has just passed away from the disease) is likely to be more receptive to a message, even one that lacks specificity. OTOH, potential donors who have lost someone to heart disease or stroke might be in a context that is less receptive.

    o In the communications channel itself, there may be ways to communicate the same content that are more or less effective.

    I guess that if value propositions also tell us which parts of the communication channel a business thinks contribute the most. Some businesses pay more attention to what the consumer will perceive. Others pay more attention to what they feel about what they need to say. And others stress about how the message is delivered, and less about its content or how it will be received.

    Charlie

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