Goals and Analysis for Permaculture Diploma Project 3 – Open Book Management Financial Game with Rak Tamachat Permaculture Centre in Central Thailand

Goals

• Flex many of the skills within my diploma skills flex
• Adapt Open Book Management to a community living situation
• Gain more experience with Game Design and Game Theory for the benefit of permacultural development and education
• Develop a holistic financial plan for Rak Tamachat that demonstrates the strength of community engagement
  • Provide a pathway toward financial self-sufficiency within a 18 month timeline
  • Use incentive programs to build community engagement around financial goals
  • Encourage and engage financial awareness and involvement in fun and interactive ways
  • Remove the fear and apprehension around financial systems that limit growth and abundance

Analysis

This is my analysis of the financial goals of Rak Tamachat as well as an analysis of personal observations that lead to the design of the “Rak The Budget Board” – Rak Tamachat’s financial scoreboard, goals, rewards and rules.

ARRIVAL

I arrived at Rak Tamachat in January of 2012 not knowing what I might expect from the property, the community or any other aspect of the situation. I came equipped only with my past experiences and an ambitious Master Plan designed by Terra Genesis International prior to our arrival. Our first weeks on site were spent establishing community systems, digging trenches for water and weathering a series of unseasonable storms. You can read more about this time in Rak’s development in my publication on the Permaculture Research Institute’s website here: My First Week at Thailand’s Newest Permaculture Farm.

Within those first weeks we quickly established a rudimentary system for tracking financial income and spending. At this time, our community was entirely dependent upon the financial support of the project owner. As per arrangements established between the project owner and TGI, the community would receive a flat rate each month to pay for food, basic supplies and a small manager stipend. For large projects that required additional funding we were required to write and submit a proposal to show what moneys the project would require and how they would be spent.

Because of my previous experience working with financial systems and my excitement to share my experience with Open Book Management, I was soon delegated the task of managing the financial systems of the project and community. Before I could begin designing a system that would accomplish the goals I’ve listed above and/or the goals of the project/community, I first had to have a functioning system of tracking income and spending. Next, I had to analyze where we were, where we wanted to go and how things were likely to change or develop over time.

This process took several months to reach any real basis for design. Many challenges arose during the course of this analysis and shifting goals and priorities made designing a working model difficult but, in the end, resulted in a more robust design that met many challenges and showed surprising potential to overcome even unforeseen challenges.

EARLY ANALYSIS

Our early financial system was a simplified variant of single-entry bookkeeping. This practice, although functional, proved to be very challenging in a community setting for various reasons.

Firstly, we had many community members who needed access to funds to make purchases of food, materials and tools for projects. We established a petty cash drawer and ledger book to provide access while maintaining spending records. Because many community members had little or no experience with any system of accounting and each had a different method of recording spending and income the challenges of this practice only increased the complexity of overall management.

Using this system, It took a significant amount of time and energy for maintaining a balanced and accurate report. Every couple weeks the ledger book would be recorded into a spreadsheet and balanced against the amounts received for that same time period. Because there were many different methods of record keeping, many different people taking and returning money into the petty cash drawer, and many inaccuracies, the process of balancing the spreadsheets quickly became very cumbersome and required many hours trying to track down little bits of money here and there that often amounted to large sums when taken as a whole.

Lastly, this system, in a community setting, promoted confusion and a lack of responsibility. Our community was thankfully very honest and generous which helped to prevent serious issues with this financial management system, but the potential for both mistakes and abuse were dangerously high. There was also no clear understanding of where the money was coming from and what the intentions were for how it should be spent. This knowledge gap created additional confusion and increased the complexities of community engagement on many levels.

FURTHER ANALYSIS

Upon observing the challenges with our early accounting methods I began looking at ways we might be able to overcome these challenges and build an engaging and goal oriented system of financial management. It was clear to me from my past experiences that an Open Book Management system would radically shift the dynamics of community understanding and engagement around financial and even physical (land management based) goals.

With this knowledge and a firm understanding of what was lacking from our current financial management systems I began designing a system that would engage the community in understanding where the money was coming from and were it was going based on our present methods of record keeping. This, although effective at clearing up questions about the amounts and the intentions and uses of the money that we received, did not clear up many of the challenges of record and money handling through our current methods of petty cash and ledger book accounting.

The early design system, which is detailed in the design section of this project, also did not move us in the direction of any financial goal and therefore did not provide incentive or any form of challenge for the community to strive to improve financial understanding, handling or spending. The “game” had not yet materialize as no “goal” had been established and therefore no concept of “winning” was apparent.

It was clear that deeper analysis was necessary.

ANALYZING GOALS

After analyzing this early design it became clear that the goals of the system were not soundly established or understood. In addition, many challenges with receiving funding at the expected times and in the expected amounts caused increasing levels of complexity with our current management system. Money was having to be stretched and moved into different areas to make sure the community had what it needed to continue daily operations. For many months, managers sacrificed their personal pay to keep the community running.

From very early on it became clear that the project goals themselves were hazy. We had our Master Plan document, we had our managers, and we had a group of excited and motivated interns ready to dig whatever trenches (physical and figurative) that might be needed to move toward a successful project. But we did not exactly have a picture of what a successful project looked like. The Master Plan seemed little more than a list of project ideas yet provided little direction and no timeline for completion. The project owner seemed to have goals that shifted farther and farther away from those listed in the master plan everyday. Additionally, the project owner’s goals seemed to fluctuate randomly and rapidly depending on where he was and who he was talking to. This is not brought up with the intention of passing blame in any direction, simply as critical analysis of the situation as it developed.

In the early weeks and months of the project the financial system seemed fairly well centered and agreed upon. Whereby, the project owner would pay the flat rate of agreed financial support (105,000 THB) monthly for at least the first year to TGI and the management team would then determine the most appropriate way to invest that money to create the desired conditions stated in the Master Plan. This system began to rapidly unravel as the goals become more fluid and funding strained.

I knew that, in order for any financial management system to be effective it would have to account for this unstable environment and still inspire people to move toward goals that everybody could understand and agree to. I knew that, with a solid enough goal set, Open Book Management would resolve many of the challenges that were becoming more and more apparent. And so the challenge became designing a set of goals that a scoreboard and game could then be framed around.

Determining these goals became a large part of the design process and will therefore be listed in the design section of this project outline.