40 years of DAI

Photo source: Wikimedia Commons
Sticking to the Straight and Narrow
In the 1970s, doing business—whether commerce or development—with
foreign clients had long involved a variety of
customary, but unsavory, transactions. USAID, in fact, was
the only international development donor that made a serious
effort to eradicate such problems—typically characterized
by government officials and other influentials skimming
development funds through “paper” local firms, padded
expenses, or consulting deals. In 1977, in response to some
high-profile cases of this kind in the private sector, Congress
passed the Foreign Corrupt Practices Act.
Mickelwait and Barclay went to see a lawyer for a primer on
the new law. The odds of getting caught are low, the lawyer
advised, but “the odds of going to jail if you’re caught are
very high,” he cautioned. “It’s called a felony.” That resolved
the problem. Henceforth, Mickelwait and Barclay kept an
eye out for international funding but resolved never to sign a
contract at the cost of corruption.
20
The breakneck growth of the late 1970s created some less
visible but serious cultural challenges. One was a perceived
disconnect between the ideals of development and the
imperatives of running a business. As late as the 1970s, said
Gary Kilmer, who joined DAI in 1980, most development
practitioners with academic backgrounds were deeply skeptical
of business, and viewed profit as nothing more than a
“necessary evil.” Even among DAI’s home office staff, several
of whom had begun buying stock in the late 1970s, there was
a sense, perhaps best expressed by Craig Olson, that doing
development and running a business posed a fundamental
conflict. “Are we a development company or are we a profitmaking
company?” he asked. At the time, Olson recalled,
“there was also no little bit of anxiety because as you grow
larger, you inevitably go from informality to more formality and
from no rules to some rules.”
By 1980, most of DAI’s development professionals had been
convinced that the firm could prosper without losing its “development
ethic,” and if a hint of ambivalence remained with
some, it was evident to most that a profitable company could
afford to do more of the development work that the founders
and the staff so fervently believed in, and do it better. Seen in
that light, the company’s performance in fiscal 1980 seemed
to point the way toward a bright future. In that year alone,
DAI’s revenues more than tripled from just under $2 million to
$6.5 million. The number of personnel tripled over the same
period, while profits grew from $77,000 to $202,000. Most important,
the people of DAI could see with their own eyes that
the projects they were implementing were beginning to make
a real difference, in Sudan, Indonesia, Zaire, and elsewhere.
It was a heady time, then, when in late July 1980, just a
few weeks after the close of what everyone believed to be
a remarkable fiscal year, DAI’s managers and their families