By Rohan Malik | 19 March 2013
In the field is a feature that reports on examples of Ernst & Young’s collaboration with government teams around the world. Here, Rohan Malik reports on an innovative program that seeks to transform the livelihoods of millions of people in the Indian state of Orissa
Orissa, 2009. The ninth-largest state in India is enduring another tough year. Some 47% of its 42 million population is living below the poverty line. Terrorism, extremism and social unrest are all up. Employment, prosperity and private sector activity are all down. With the bulk of the population reliant on a nonproductive agricultural industry, the chances of Orissa’s citizens breaking free of poverty and building new, prosperous lives seem ever more remote. It was in this grim backdrop that Ernst & Young began work.
The Orissa Modernizing Economy, Governance & Administrative (OMEGA) Program has the sole objective of poverty elimination. Using funding from the UK’s Department for International Development, our teams have been working alongside the Government of Orissa to address the severe poverty rampant in the state and help build new sustainable livelihoods for its citizens. We did not lack for priorities.
Despite abundant natural resources such as mineral-rich reserves and large coastlines, Orissa had, for some years, been failing to move forward. As other Indian states experienced rapid economic growth, Orissa, by contrast, was falling further and further behind. As poverty bit ever deeper, the state’s economy struggled with out-of-date infrastructure and a private sector that was beset by challenges such as skills shortages, a lack of finance and poor productivity, among many others. So what did we do?
Our first task was to identify three key areas of focus for the program, which was scheduled to last five years. First, it was clear we had to strengthen the private sector in order to create jobs and more employment opportunities. With agriculture so dominant, our task was to create an industrial policy that would lead to a better investment climate and new growth sectors such
as IT, health, manufacturing and automotive. We wanted businesses — both domestic and international — to come and set up shop in Orissa. Other tasks we set ourselves included delivering better productivity and employment in the core sector of agriculture, as well as setting up the right enablers of infrastructure and skills so we would be able to create employment and sustainable livelihoods.
The second part of the program is about modernizing government. In today’s fast-shifting global economy, policy-makers around the world need to fully understand HR, IT, procurement, commercial tax, finance and administration, just for their countries and regions to stay competitive. So we needed to move the Government of Orissa forward, looking at the capacity and capability and really ensuring that people, processes and technologies are available for it to be a modern government. With this in mind, we are strengthening the capability and capacity of the government to undertake reforms on areas of governance, administration and operations, combining process, people and technology to design and deliver tailored services.
The third element is a ruthless focus on implementation. This is a program focused on outcomes and results, such as ensuring minimum employment of 100 days for every below-poverty-line family. In sum, the challenge of OMEGA was to transform the lives of millions of poverty-stricken people — vitally important work and not for the fainthearted.
Our approach has always been defined by a constant and laser-like focus on results. OMEGA is a program in which we have challenged ourselves and our clients — the governments of Orissa and the UK — to deliver a program that is different. A program that doesn’t rely only on desktop reports and diagnosing the problem from afar, but instead a program in which we all get ownership of fixing the problem and ownership of the outcomes.
So we put our money where our mouth is and agreed that 50% of Ernst & Young’s fees should come from delivering outcomes on the ground. Every 90 days we challenge ourselves to demonstrate changes — internally to government and externally to stakeholders and beneficiaries — so they can see momentum is building up for this transformation program. Poverty alleviation cannot be solved overnight. It is a long journey, but we are keen to break it up into 90-day chunks and demonstrate progress.
Multi-disciplinary teams, too, are important. We have between 20 and 25 staff on the ground at any one time, and they come from across our global organization. But they must talk with one voice around the challenges and issues. Before they start work we arrange for them to receive a two-day induction so they understand the context, the ways of working with government, and our internal methodologies and frameworks. We have ensured that all our people, whether they would be working in finance, tax, rural development or industries, have been able to go and see the potential beneficiaries so they could all see that they would be making a difference in these people’s lives. This helps hammer home the message that this is not about a report but about real people and real lives.
With so many people living below the poverty line, we have had beneficiaries as part of our advisory panel at every stage of policy-making. Not only do they tell us about the real, practical and pragmatic issues they face on a daily basis, but they also guide us at every step so our recommendations are based on facts and not hearsay. This, for me, makes our program unique.
And it’s working. For example, as part of the program we are training more than 100,000 rural youths every year, giving them new skills that will help them into employment. We have also established sustainable business markets for key agricultural products such as onions, mangoes and others, and in doing so creating livelihoods for 150,000 beneficiaries.
With globalization significantly impacting governments, creating greater interconnection of problems but also of ideas and solutions, governments increasingly want to apply what works internationally, learn from things that haven’t worked and then tailor the solutions to local circumstances. It is pertinent, then, to consider whether the success of this program can be replicated in other parts of the world.
As a state, Orissa has much in common with countries in Sub-Saharan Africa and other parts of the world, but OMEGA is not something that can be simply duplicated. I have total confidence, however, that what we have learned in Orissa can be replicated and customized to other local contexts — especially in the emerging markets.
After all, Orissa’s challenges of inequality, social unrest, a reliance on agriculture and youth unemployment can sadly be found in many other parts of the world. The teams that have been delivering OMEGA will be helping their colleagues in Ernst & Young understand and customize these approaches for different local circumstances. These ideas and activities can then can be deployed to other regions and countries where such a program is needed.
Rohan Malik is a partner with Ernst & Young Pvt. Ltd. in India. [email protected]
This article first appeared in the January edition of Ernst & Young's Citizen Today magazine
