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Humanitarian Aid on the move # 17, special issue: The World Humanitarian Summit

Disintermediation - the future of Aid in a Digital world?
Ian Gray

The upcoming World Humanitarian Summit is an attempt to bring change to the humanitarian system. However, with or without the WHS, the foundations for disruptive change are already being laid. What are these foundations, and how will they change the current models of humanitarian response?

 What is Disruptive Digital Disintermediation?

I recently received a tweeted picture of a presentation that was being given by IBM to Humanitarian Aid workers. It listed a number of businesses that were disrupting and digitally disintermediating different industries. It listed Uber (Taxi industry), AirBnB (Hotel industry), Skype (Telco industry), Alibaba (Retail industry), Netflix (Cinema) amongst others. The inference was that the humanitarian industry itself could be disrupted and disintermediated. But can it?

So what is disintermediation? It is effectively about ‘cutting out the middlemen;’ the intermediaries in a value chain. Humanitarian Organisations are invariably ‘middlemen,’ transferring value from one entity (donors and supporters) to another (Disaster Affected Communities). This is most often in the form of money, but it is also in ‘know how,’ access to networks and knowledge and brokering. Digital disintermediation is cutting out the ‘middlemen’ through the use of digital technologies.

And what of ‘Disruption?’ The use of the term ‘disruption’ in the private sector was brought to the world’s consciousness by Clayton Christensen of Harvard Business School. He advanced the term in a seminal article ‘Disruptive technologies: Catching the wave’ in the Harvard Business Review in 1995 [1], which was followed by his book called ‘The Innovator’s Dilemma’ in 1997 [2]. In these works, Christensen outlined a theory based on examples of new innovative businesses that have disrupted the more traditional players in each industry. The question that remains is whether the Humanitarian sector is one of those traditional ‘industries’ that is likely to see disruptive innovation, particularly in the form of digital disintermediation; what we will refer to as D3 (Disruptive Digital Disintermediation).

I often use the phrase ‘If you can digitise it, you can disintermediate it,’ and although overly simplistic, it is a good rule of thumb. An equally simplistic heuristic is to view humanitarian response as covering three areas; People, Things and Money. It can therefore be useful to use this oversimplification in order to highlight how the building blocks of D3 are already being built for each of these areas.

[1] Bower, J. L. and Christensen, C. L. (1995) ‘Disruptive Technologies: Catching the Wave,’ Harvard Business Review, January-February Edition 1995, Harvard Business School Publishing, Boston, Massachusetts

[2] Christensen, C. L. (1997) The Innovators Dilemma: When New Technologies Cause Great Firms to Fail, Harvard Business Review Press, Boston, Massachusetts