What is a “Portfolio Approach”?
In these chaotic times, we are plagued by complex problems – pandemic, armed conflicts, economic recession, and climate change. With a multitude of problems, social workers and policy people are faced with a dizzying number of solutions. How and where should they begin to solve these problems?
The Portfolio Approach can be one approach in this chaotic world. This approach instills a systematic and efficient way of thinking to tackle volatile and complex modern issues. Let’s look into the COVID-19 pandemic, does it have the following characteristics?
- They are dynamic and unpredictable. Look at the rapidly mutating virus and the new developments in science.
- The root cause of the issue lacks social consensus. What should we focus on? Disease control or the economy? How much should we protect ourselves for the public good?
- The problem cannot be defined, solutions often remain elusive. It seems like we got rid of the virus, but it’s back again. How are we going to live with it?
The challenges we are facing today are “comprehensive” and “systematic”, which means that our response should also reflect these principles. The “Portfolio Approach” is an approach that helps us identify the dynamics in society that affect the issue. The methodology of the portfolio approach is to develop, test, learn, and repeat. The goal is to find the best interventions by focusing on multiple interventions and identifying comprehensive solutions that can create extensive systematic change.
Systems Thinking for Systems Transformations
Portfolio approach’s methodology consists of various toolkits. But before delving into those toolkits in future columns, we should get to know “Systems Thinking,”the idea that serves as the basis for portfolio approach.
Systems thinking is the idea that …
- Systems or societal happenings are connected – directly or indirectly.
- Systems do not progress linearly from 1-10 like we often wish they do. The causes may lead to unexpected outcomes due to various factors disrupting the process.
What does systems have to do with your expensive lunch?
To illustrate the systems connecting our society, let’s look into Pad Kaprow, this easy-to-make favorite meal for Thais is linked to various systems.
|Rice = farmers, mills, water management, climate change, warBasil leaves = farmers, water management, climate changeEggs = egg farms, livestock diseases, poultry monopolyFish sauce = …Others = …
Can you see all the factors connected to a serving of Pad Kaprow? It is clear that all systems are interconnected. Imagine a war during the climate crisis, farmers are struggling to grow rice and the prices go up. This can cause the price of Pad Kaprow to go up. When factoring in the domestic egg monopoly, the added cost of the egg also increases the price of our Pad Kaprow (with fried eggs). Thus, regulating the cost of Pad Kraprow is not easy, because we have to consider the systems linked to its production. By observing the entire system, we can identify intervention points where regulations are possible, as well as the widespread impact of each intervention.
Consequently, systems thinking is required when designing solutions. If we do not consider the systems at play and believe the decision A will lead to result B, our interventions may lead to cascading effects – unintended negative consequences. For example, an avian influenza outbreak increased the price of eggs. To help the farmers, the government offers reimbursements to farms that lost their poultry. However, when the outbreak subsided, the price did not return to normal as small scale farmers did not have enough money to continue raising their chickens. This leaves only large producers who keep the price high, directly impacting Pad Kaprow prices. Policy makers should create more comprehensive policies; in this case, monetary support to small scale farmers has to factor in the costs of restarting a poultry farm after losing all livestock.
Systems thinking for Systems Transformations
Systems Thinking is the evaluation of complex systems, the analysis of their dynamics, and harm reduction in decision making. It is an exploration on how things may change as the situation unfolds. It is finding possibilities and connections beyond the presented data or general perceptions. Thus, a systematic and comprehensive look at the issue is needed for any interventions. Systems thinking can help create efficient and accurate solutions that impact the entire system. Thinking and imagining beyond our current perceptions is the basis of portfolio approach, a tool and methodology we will further examine.