A hand up, not a hand out – Helping others help themselves

As president of the Philippines Baguio Mission, 1982-85, Menlo F. Smith experienced the joy of being in the Lord's service, but he also felt frustrated by conditions he observed there.

"The thing that became overwhelming to me, apart from the dramatic growth of the Church, was the level of deprivation under which most members in the Philippines lived," he reflected. "We knew that condition was not much different from many of the other developing countries. Many Church-member families consider themselves fortunate if they are able to put one meal a day on the table."

A prominent St. Louis, Mo., businessman and a 1972 convert to the Church, President Smith identified two reasons for what he observed: the general harmful practices that pervaded the society and the need for entrepreneurial management skills among the populace.

"I knew that the Filipino people really had the potential to be good entrepreneurs," he said. "They have a strong work ethic. They are bright and well-educated and want to succeed."

The Church, he reasoned, was the only existing influence that might overcome the harmful practices, doing so by instilling gospel values in its members, who in turn become a leavening influence through business and government, fostering morality and ethics in society.

"This will provide a major beneficial influence," he predicted. "But it will require generations for fruition."

Unfortunately, he could perceive of no available solution to remedy the lack of business know-how among the people.

"With unemployment among our members somewhere between 20 and 50 percent, they are simply not able to provide adequately for their own temporal needs nor finance their own Church programs," he lamented. "In their struggle for subsistence, they are left without the time, energy and leadership resources necessary to move the Church forward and improve the quality of life for themselves and their communities."

With his responsibilities as mission president, he was not in a position to do much about the problem, although he had tried without success to find someone who could administer some kind of revolving loan fund. People from whom he sought advice discouraged him. The prevailing culture prevented that sort of thing from being successful, they said.

After he returned from his mission he expressed to others his desire to find a way to help people in the Philippines. Eventually, he was referred to Warner P. Woodworth, Ph.D., a BYU professor of organizational behavior, who seemed a natural for the project. Brother Woodworth had spent a year in Hawaii helping Filipino people there start small businesses and cooperatives. He had done similar consulting work in Latin America.

Organization's goal to provide training

During the summer of 1989, Brother Smith, Brother Woodworth and a number of graduate students and others went to the Philippines. There they met with the Church's Philippines Area presidency, other Church leaders, heads of volunteer organizations and American and Filipino business leaders to analyze the situation.

"We came up with about a 50-page analysis," Brother Woodworth recalled, "and a proposal for what we ought to do. Essentially that was to set up a non-governmental organization that would be run by Filipino leaders, would be arms-length from the Church but could serve as a resource to the Church."

The organization's goal would be to provide training in business skills, consulting and mentoring to people desiring to start or improve small businesses. Later, small business lending would be added.

"We determined we should create a foundation in the United States that would generate funding and send it to Manila," Brother Woodworth explained. "From that, we could set up one or more technical assistance centers to provide small-enterprise training, consulting, counseling and help Filipino entrepreneurs get access to credit."

The result of the work was the formation in January 1990 of Enterprise Mentors International. The name describes the function, Brother Smith said.

"Our role tends to be essentially that of mentoring these people. Of course, we administer the loan funds, but the mentoring is really the heart and substance of the work that we do."

Brother Smith became president of the foundation and currently holds the position of executive committee chairman. The board of directors and staff feature captains of industry and educational leaders from throughout the United States, all of them Church members and most returned mission presidents or others who have had involvement in developing nations.

Elder Marion D. Hanks, General Authority emeritus, agreed to be the first chairman of the board. Currently, he is honorary chairman of the board of directors. As a General Authority, he had been executive administrator of the Southeast Asia Area and knew the conditions there firsthand.

"We had lived in Hong Kong and came to know and love the Filipinos, as we had been in the Philippines often and organized stakes there," Elder Hanks reflected.

Within 60 days, the program had begun serving clients and it has grown steadily since then. It has been extended to Guatemala, Mexico and El Salvador.

"Our goal is not to directly operate these programs overseas," Brother Smith said. "Rather, we go in, find people who have an interest in the work and help them form and become members of the board of directors of a local foundation. We help them find key staff, train them, help them get established and provide ongoing training and support. They run their own program, incorporated under their own country's laws, and we are simply a partner organization. We tell them we will provide financial support up to five years, at which time we expect them to be largely self-sufficient."

Jobs created, families served

In the past 10 years, EMI has held 9,612 training seminars for 83,340 participants. Donations have helped make 11,667 loans and created 6,406 jobs. Since its inception, EMI partner foundations have loaned $3.5 million.

So far this year, EMI has served more than 6,400 families — a 75-percent increase over last year, when its six partner foundations assisted 3,654 families — 1,000 more than in 1998. In 2000, EMI created 1,761 jobs.

"Typically, the rate of repayment is 95 percent," Brother Smith noted. Without the loan program, the people's only alternative is to go to loan sharks who commonly charge interest rates of up to 20 percent a week, he said.

"We do not make the loans unless they take the training that goes with it," he said. "The training is really more important than the money, in a lot of respects."

It is based on the principle of self-help. Brother Smith explained: "We look for people who have the mentality, morality and motivation to do something about their own problems, their own needs. They have to be willing to take ownership of their problems. If they have the notion that they are victims, generally, there is not very much that we can do for them."

Starting point: make and keep promises

The starting point is to teach them to make and keep promises, he said. "If they don't have that capacity they don't belong in business."

Part of the success, Brother Woodworth feels, is that the program has a good mix of LDS and non-LDS clients. "If a program like this is too exclusive, it lacks the broad perspective of people in varying settings to give it a reality. We don't want barriers to be created by favoring members and ignoring the non-members. We'll work with anybody who is ethical; anybody who has the potential to become entrepreneurial."

The principle focus is on Church members, and as such, it complements the work of the Church in blessing the lives of the people. At the same time it provides an effective means for LDS members and others to reach out to the larger community in meaningful acts of Christian service.

Brother Smith said: "Enterprise Mentors cannot do what the Church does, nor is it within the mission of the Church to do what Enterprise Mentors does. Working together, however, we are providing essential ingredients to enable self-sufficiency for those members and others in the Philippines and Latin America who are determined to improve their condition."

Examples help tell the story:

After 20 years of working for a car upholstery and body repair company, Cipriano Bruce decided to open a car upholstery business from his home. Soon he had two employees and his wife, Flor- deliza, helping him. The couple longed to rent a shop near the highway where they would be more visible to motorists. They were taking orders by phone and working out of their home and felt that they needed a better location to improve their business. When the couple began meeting with a project officer from EMI's Cebu Partner Foundation in the Philippines, they prepared a projected sales and expense report. From July to December 1999 the couple had an average of 16 clients a month and monthly gross sales of $1,350. Their two loans were $625 and $875. In May 2000 they opened their highway shop. Between May and June 2000, the couple received 72 orders. Their gross sales amount in 45 days was $2,900 — an estimated 59 percent sales increase. The Bruces report that about 50 percent of the gross sales is profit. The couple has hired two additional employees for a total of four employees and each employee earns about $30 a week.

In May 2000, Dina Espera “za Lupez heard of a newly founded organization in El Salvador and decided that it would be a good idea to receive some guidance and support to improve her business that provided a living for herself, her 20-year-old son and her elderly mother. She wanted to expand her business and earn more, but she did not know how to start. Her consultant helped her generate ideas for expanding and improving her product line, improving the atmosphere of her small shop and attracting more customers. For example, her consultant suggested that she look into a free bread-making workshop offered by a local flour supplier.

After inquiring about the workshop and putting her ideas on paper, she created a simple action plan. She asked her son to participate in the bread-making workshop and expand her product line to include French bread. The simple plan proved effective — the French bread was a hit with her customers. By August she and her son felt confident enough in their abilities and product that she applied for a $230 loan to expand her production capacity by purchasing raw material and supplies. The results were astounding: sales multiplied fourfold, or 400 percent, from just $5.75 a day to $23 a day.

Shoe making expanded

Another example was related by Elder Hanks about a visit to the Philippines: "I went through rice fields and up hills and found this little shack, where a sister in the Church lived with her eight children. She had a picture of President Spencer W. Kimball and the Savior on the wall outside this little old house. She was in a lean-to making shoe coverings. She had been unable to borrow money except from local loan sharks who charge exorbitant interest rates."

Through the help of Enterprise Mentors International, "she now makes various kinds of shoes and slippers, packs them in attractive packages, carries them on her back all the way down that trail, takes a couple of jeepneys to the sea, crosses to the island of Negros and sells them and comes home now with enough money to feed her children. She is hiring others and is on her way. We have many, many such stories," he said.

"Brigham Young observed that a church cannot save its members spiritually if they are not saved temporally," Brother Smith said. "The Church cannot give temporal salvation to its members. This can be realized only through a hand up, not a hand out. That, in brief, is our mission."