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Using resources in a targeted manner
Resources are always limited in humanitarian work – but needs are never limited. That is precisely why the question of how available funds are used is one of the most important of all. Not every euro that goes into a project has the same impact. Those who allocate funds in a targeted manner think before they act, set priorities deliberately and ensure that every expenditure makes a demonstrable contribution to the intended goal. This may sound obvious – but in practice it is one of the most challenging tasks facing aid organisations. After all, the targeted allocation of funds requires not only good planning, but also a willingness to make difficult decisions and to clearly define priorities.
What the targeted use of resources really means
Using resources wisely does not mean spending as little as possible. It means achieving the best possible outcome with the resources available – for the people who stand to benefit from the work. This distinction is important. An organisation that cuts costs in the wrong areas jeopardises the quality of its work. One that invests wisely multiplies its impact.
In practice, the targeted use of resources means making decisions based on facts, not on habit or gut feeling. It means regularly checking whether the resources deployed are actually achieving the desired effect – and being prepared to make adjustments if this is not the case. And it means communicating transparently about how resources are used, so that supporters can see the impact of their donations.
For organisations that rely on donations, this transparency is not an option but a duty. Anyone who asks people to donate to help children has a responsibility to ensure that these funds are used in a way that truly makes a difference – in the lives of real people, not just in administrative reports.
Setting priorities and justifying decisions
The first step towards the targeted use of resources is conscious prioritisation. Not everything can be supported at the same time – and anyone who tries to meet all needs simultaneously runs the risk of failing to make a real difference anywhere.
Analysing and comparing requirements
Before funds are allocated, a thorough analysis of actual needs is required. Which problems are the most pressing? Which target groups are most severely affected? And where can an intervention make the biggest difference with the available resources? These questions cannot always be answered unequivocally – but attempting to address them carefully leads to better decisions than allocating funds based on gut feeling or historical habits.
In doing so, data and lessons learnt from project work should be taken into account, as should the perspectives of the target groups themselves. Children living in poverty, for example, have needs that are often perceived differently from the outside than from the inside. Those who listen before making decisions can make more targeted choices – and avoid the common mistake of channelling well-intentioned resources into measures that fail to address the actual needs.
Impact-based planning and resource allocation
Impact-based resource allocation asks not only what should be done with the available resources, but also what is to be achieved with them – and how this can be measured. Clear impact objectives and measurable indicators ensure that decisions on resource allocation are not made in a vacuum, but are based on a solid foundation.
In practical terms, this means that for every major expenditure, it should be clear how it contributes to the overall objective. Training for local staff enhances the quality of the project work. A water well project improves health conditions within a community. The purchase of a vehicle enables supplies to be delivered to remote villages. Those who can clearly articulate these links make better decisions – and can also justify them convincingly to funding bodies and donors.
The following principles help to ensure that resources are allocated in a way that maximises impact:
- It should be possible to link every major expenditure to a clearly defined project objective
- Funding should be allocated as a priority to areas where the effectiveness has been proven
- New approaches should first be tested on a smaller scale before larger sums are invested
- Regular monitoring of how funds are used enables prompt corrective action to be taken if expenditure does not achieve the expected impact
Conserving resources without compromising on quality
Targeted use of resources also means conserving them – without compromising the quality of the work. This requires a keen sense of where savings make sense and where they come at the expense of effectiveness.
Administrative costs, for example, are necessary and legitimate – but they should be proportionate to direct project expenditure. Organisations that take the proportion of direct project expenditure seriously as a key performance indicator create an internal incentive to keep overheads to a minimum without jeopardising the organisation’s ability to function effectively. At the same time, this indicator should not become the sole measure of quality – because an organisation that invests so little in administration that it results in errors, a loss of control or staff burnout ultimately does more harm than good to its impact.
The yardstick is the impact
Ultimately, there is only one truly convincing yardstick for determining whether resources have been used effectively: the impact. Has the investment improved the lives of the target group? Have the set objectives been achieved? And can this be demonstrated in a transparent manner? Organisations that consistently ask these questions and answer them honestly develop, over time, a culture of targeted action – one that not only makes them more efficient, but also more credible.