This week, fellow blogger Andy and I tuned into a Google Hangout with one of my favorite authors, Paul Polak. Paul just released a new book, co-authored with Mal Warwick, titled: “The Business Solution to Poverty“. Even just the title speaks to me – but hearing about the book straight from Paul, albeit virtually, was even better. There is a lot I could say about this book, but instead I will talk about just one of the many points: zero-based design.
According to Polak and Warwick, zero-based design basically just means starting from scratch. The example they use is budgets, which was particularly relevant to me due to my previous and current jobs. In my current job, every year we adjust last year’s budget by some percentage – so we have a base budget from the previous year. In zero-based design, you don’t have the luxury of a pre-existing budget – everything is at zero, and you need to etch out just exactly what you need starting from scratch. This was the case when I worked with coffee farmers in the Peace Corps in the Dominican Republic. My farmers formed a new cooperative, and their budget was zero to start – they didn’t even have any line items. First they had to decide what to spend money on, and then that needed to be thoroughly justified. The only way to get started was by listening to each other’s needs and wants.
I would argue that the mindset in this scenario encourages different – and possibly more sustainable – behavior than for a standing organization with a traditional, incremental budget process. And not just for organizations operating in the Base of the Economic Pyramid, but for all start-ups. Figuring out how to start out can be a big obstacle when the world is your oyster, and for my coffee farmers it was no different. The ability to boil it down to the absolute necessities is an important skill. So thank you Paul and Mal for writing a book written with reality in mind, with practical guidelines derived from hours of listening to farmers just like my friends in the Dominican Republic.