Foreign Policy Blogs

The Chicken & Egg Debate: High Performance vs. High Impact

When the FP Article,  A $9 Trillion Question: Did the World Get Muhammad Yunus Wrong?, came across my Twitter feed this morning my first thought was, blasphemy!  The praise and attention that Yunus and Soto have received over the past few years – collecting fans and converts of their teachings – make it hard to imagine that someone would write such a title, such a critique.

And yet, there is merit in what Peter Schaefer writes. 

As of 2004, loans provided by microfinance organizations amounted to just $17 billion worldwide. This is a pittance compared with the potential credit requirements of de Soto’s 4 billion poor, most of whom are small-scale entrepreneurs. All capitalists need capital — but the current system will never provide an adequate amount.

Yes!  We need to change the system 1) so that more capital is available to those who need it and 2) so that these programs can achieve widespread change.  But does a overarching need “to change the system” automatically debunk the accolades these men have received?


The article blends well into a conversation happening on Tactical Philanthropy – high performance vs. high impact.  In a number of blog postings, folks have debated whether focus should be on 1) creating high performing organizations – organizations with strong capacity, strong operations or 2) on creating high impact organization – organizations achieving their missions at a large enough scale to achieve change.

The answer is not one or the other – it is both.  The journey to get to both high performance and high impact is not linear – it is riddled with starts, stops, successes, and failures.  Shaefer may be right to question the quantitative metrics of how these interventions are doing, but it is unfair to count the interventions out.  In defense, he offers us a solution that could further the work of Yunus and Soto – micromortages – that *could* reach many, many more folks.  It is an interesting idea.

Time shows us what works and what would work better.   We strive for that holy grail – the miraclous intersection of high performace and high impact.  Yet in reality, we stand on the shoulders of what came before us and we should hope that their foundations were built well – so that we might achieve greater impact.