Innovation in Philanthropy is not a Hack-a-thon

Big Philanthropy is broken. Tech tycoons and mobile apps won’t fix it.


Every day, I see at least three or four articles about the increasing role of technology and innovation in the social sector. But despite an enormous volume of words written on the subject, little substantive progress is being made in tackling the world’s biggest, toughest problems. Big Philanthropy, the century-old traditional grant-making industry, still relies for the most part on a long, slow processes of annual grant-making to dispense resources. Decisions of what to fund are several degrees of separation away from what’s happening on the ground, and data bubbles up to funders months or even years after grants are issued. It is hard to imagine how innovative solutions could possibly emerge under these constraints.

Further, most of what is being funded are safe traditional projects, direct services or advocacy and awareness campaigns. Service projects do fill in the gaps where society has left its citizens forgotten on the margins, and they address immediate needs of many people to be sure. But on the whole they fail to challenge the core institutional systems that produce marginal groups in the first place, inadvertently perpetuating cycles of dependency on further philanthropic dollars. Advocacy campaigns, likewise, do matter within the constrained context of our broken electoral system, where only the loudest (and often the richest) voices are heard. But they don’t push the public to consider radical and dramatic new ideas.

Innovation requires breaking with existing paradigms of organization and funding, and working in newer, non-hierarchical and collaborative ways to foster the type of creative thinking necessary to reimagine the mundane.

Lessons learned from the disruptive innovation unleashed by the tech sector in recent decades can and should be applied to solving deeply entrenched social problems. Big Philanthropy just simply seems unfit for the job. Innovation requires breaking with existing paradigms of organization and funding, and working in newer, non-hierarchical and collaborative ways to foster the type of creative thinking necessary to reimagine the mundane. Agile and lean thinking, where product teams use a data-informed, evidence-based approach to design, with rapid prototyping and frequent iterations to continuously improve and refine, are arguably more important contributions to the world than any specific technical output from the tech sector. It’s these methodologies that can foster and support a real culture of innovation in the social sector.

Tech Tycoons Rush In…

Much of the attention paid to social innovation in the media is focused on silicon valley tycoons who, despite having little direct career experience with social work or community service, seem to believe that their success in the for-profit world can be readily transferred into success in the non-profit realm. But for all their talk of disruption, the deep-pocketed and tech-savvy entrepreneurs, who have charged into the social sector like knights on white horses, have primarily replicated the existing models of project funding, execution, and evaluation. If throwing more money at the problem was the only hinderance in solving the world’s big social issues, people like Rockefeller would have long ago put an end to hunger and poverty, and I would have grown up in an entirely different world.

If throwing more money at the problem was the only hinderance in solving the world’s big social issues, people like Rockefeller would have long ago put an end to hunger and poverty, and I would have grown up in an entirely different world.

Antiquated funding models and lack of a rapid data-driven evaluation process aren’t the only issues though. Most of the big ideas in the technology-for-social-impact space are focused either on incremental improvements to existing service models, maybe leveraging online services or mobile applications to improve cost-efficiency marginally. Or they solve only a very narrow niche problem for a small audience, often applying a technology that was already in development, and just happened to find a solution in the field.

Innovation Requires Disruption

When you look at innovation in the commercial sector, like the Ubers and AirBnBs of the world, what you see is a clear and substantive break from previous modes of thinking about transportation and accommodation. And it’s not the technology itself that is all that impressive. There is nothing ground-breaking technically under the hood of either of those products that wasn’t already lying around for a decade. What makes them different is that they created business models that stepped completely out of the existing taxi and hotel verticals, and simply used technology to leverage existing frustrations with those antiquated models and harness latent demands, to produce a new, vibrant commercial ecosystem.

It is important to note that this creative destruction is not without its social costs, and certainly there is a lot of debate around the so-called “sharing economy” and its the real or imagined, long-term economic and social benefits. My intention here is thus not to cheerlead for Uber or AirBnB per se, but rather to illustrate the kind of thinking necessary to spur real and sustained innovation in any industry.

Now, let’s imagine the same framework in the social sector, where there are equivalent long-standing traditional modes of providing resources. To find new ways of meeting human needs that disrupt those models requires both safe-to-fail experimentation and rapid feedback and iteration in the field, with clear success criteria. Such rapid development can only be accomplished by a sharp, nimble and multifaceted team of thinkers and doers who are passionate about the problem, yes, but also empowered and enabled to break a few institutional eggs on the way to the creative omelet.

I tried really hard to find an existing example of this in the social sector, apart from the Neo project I reference below, and could not find any. A hypothetical model, perhaps, would be useful then. Imagine there were a technology platform created that made labor organizing more effective, perhaps by leveraging peer networks and open data, but it ultimately cost the jobs of professional labor organizers. Would there be a backlash about those lost jobs? You bet. Would the end goal of organizing more workers more efficiently for the same amount of resources justify that loss? I think it would. You are welcome to disagree.

Agile and Lean are Proven Methods

It turns out that there are proven working models for cultivating and fostering this kind of innovative thinking and experimentation. As I mentioned above, agile and lean are probably the single greatest contribution to the world by the tech sector, far more impactful than any particular technology produced by it. Small, cross-functional teams working on tight, iterative timeframes, using an iterative data-informed methodology, can create new and disruptive solutions to big, difficult problems. They are able to do this precisely because they are unhindered by the hulking bureaucratic structures of the old guard. This is precisely why so many Fortune 500 companies are experimenting with innovation and R&D laboratories. Because they know their existing staff, structures, and processes cannot produce innovation within those constraints. Only the small, nimble teams can do it, and they can only do it if they are kept separate from, protected from even, the traditional production systems of the previous product cycle.

Yet big philanthropy still have barely experimented with this model, only trying it in a few isolated instances. Here at Neo, for example, we are working on a project for teachers funded by a forward-thinking foundation. What our client is trying to disrupt is no less than the entire US education system, and with goals and measurements developed by teachers for teachers, not by Silicon Valley hotshots who have no clue how to fix education.

Small, cross-functional teams working on tight, iterative timeframes, using an iterative data-informed methodology, can create new and disruptive solutions to big, difficult problems.

To start with, the project was funded in iterations of six-weeks at a time, each with a distinct and measurable goal. We built a small cross-functional team to tackle some of the tougher issues faced by teachers trying to raise the level of excellence in their classrooms. The team was empowered to talk directly to teachers, and incorporate their feedback into new versions of the project, released on almost a daily basis. We have iterated the design more than sixteen times in less then four months, and it’s starting to really take shape.

We have no idea whether this particular project will be successful in the long run. But what we do know is that the client and their funder have had the courage to step out of the traditional project funding models and apply agile and lean thinking to a very tough problem. And we’re proud to be invited along for the ride.

The vast majority of the social sector is still trying to tackle social problems with program and funding models that were pioneered early in the last century. Agile and lean methods hold the key to finally breaking the mold of the old, traditional model of resourcing social change initiatives. The philanthropic community should be interested in the agile and lean methods produced by the technology sector, not the money produced by it, and start reorganizing project teams and resource allocation strategies and timelines in line with this proven innovation model.

Only then we will be in a position to really innovate for social change.

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