Gates and Coca-Cola: What can development learn from corporations?

I finally got around to watching the talk Melinda Gates gave at TEDxChange last month (see video below). I try not to link to TED talks because, well, it’s kind of cliché. Some of them are truly amazing. Others … meh. This one is particularly meh: she draws lessons for the development industry from the private sector — specifically, Coca-Cola. The talk is worth noting (though maybe not actually watching) because it represents such a common mode of thinking about the nonprofit/social/do-gooder sector in general.

Gates starts by describing the ubiquity of Coca-Cola throughout the developing world. Developing country governments and development agencies have a relatively hard time reaching the same populations that Coca-Cola reaches. She infers from this that the development industry has lessons to learn from Coca-Cola’s distributions. She draws three lessons:

  1. Manage operations with real-time data. She noted that most development projects are only evaluated at the end. (Though this seems to confuse monitoring with evaluation.)
  2. Tap local entrepreneurial talent. Coca-Cola uses micro-distribution centers run by local entrepreneurs. As a development example, she described a project in Ethiopia to train 35,000 health care workers.
  3. Use aspirational marketing tailored to the country. She won me over by playing a clip from Wavin’ Flag by K’naan, and noting that Coca-Cola had produced bilingual mixes in over a dozen languages for the World Cup.

These are interesting principles, and if they spur some new ideas, I’m all for them. But these kinds of analogies are nothing new. Gates’ talk exemplifies this thinking, but I don’t want to single her out.

What disappoints me is how thin the analysis usually is. As with most similar commentary, Gates fails to discuss the unique constraints facing social causes. These include the difficulty of determining impact when your goal is not measured in dollars (as it is for a business) and the range of stakeholders you must be accountable to when the money comes from one place (donors) and the services/products go someplace else (beneficiaries). The challenges actually are unique. Business principles are useful and the development sector can learn from multinational corporations, but simply mimicking them is not enough. The principles have to be translated. That’s the hard part.