Linking compelling social needs to the ideas of innovation creates the construct of of social innovation. Social innovation is the “holy grail” of nonprofit, philanthropic or government in search of finding new ways of creating community level solutions for social needs. As a contemporary overused buzzword, social innovation writers, consultants and scholars emphasize social innovation as the process of inventing or creating novel approaches to social change. Unfortunately, we too often hear words such as “catalytic” or “disruptive” to magnify the scale of the implied change. This “shiny new object” focus only on disruptive or catalytic social innovation distorts social innovation because it emphasizes only one point on a four point matrix.

In this blog, I want try and bring dimensions to social innovation to remove it from the abstract buzzword category. In this way, I hope to offer the starting point for strategic conversations within and across organizations about innovation.

It is not a new thought to think on innovation across two continuum (see reference 1). So if catalytic or disruptive innovation is at one end of a change continuum then the other end of the spectrum is process innovation that day-to-day work of continuous improvement for organizations. Positioning social innovation as adaptive or disruptive/catalytic is a very useful way of anchoring the basic dimensions of the social innovation concept.

Process innovation and disruptive/catalytic innovation need to be considered against the continuum of leverage or scale. For example, the Obama administration has developed a new partnership between government and philanthropy heralded under the banner of the Social Innovation Fund. The purpose is described as targeting millions of dollars in public-private funds to expand effective solutions across economic opportunity, healthy futures and, youth development and school support. The approach is to “create a catalog of proven approaches that can be replicated in communities across the country.” (see reference 2) The Social Innovation Fund clearly provides leverage by aggregating philanthropic and government dollars and uses that leverage to scale programs. However, given that the Social Innovation Fund requires grants to be based on existing programs and services that meet an “evidence-base” criteria, some have argued that true innovation is missing from the initiative. For example, one can read in various opinion blogs, statements such as this one:

“The central mission dissonance of the Social Innovation Fund has always been the question of what its real objective was. Was it meant to be a fund that really pushes an experimental agenda and deploys capital in favor of new approaches to social change that have both high risk and high reward? Or was it alternately a chance for the government to get a hand in on organizations whose models started as innovative and who were reaching an inflection point where new resources and government support could help them achieve the scale their proven model demanded.” (see reference 3)

So considering the larger context of social innovation, we can see that the two dimensions of the construct include the dimension of continuous verses discontinuous innovation and the second dimension of leverage and scale. Placing the two dimensions across each other, the concept of social innovation can be represented as four typologies as illustrated in the figure one.

The patterns and practice describing innovation that emerge when we consider the degree of change coupled with the degrees of leverage and scale can be described as follows:

Process Innovation: When the degrees of change are low (as in consistent and continuous) and the resources available for leverage and scale are inadequate, social innovation is largely consists of process improvements. This category of change is not simply trying “doing more with less,” but it is the sum total of the intentional, systematic, and strategic efforts of an agency to improve its processes largely within its existing structure, programs, and services.

Growth Innovation: When an organization is focused on innovating within its existing structure, programs, and services, in the context of collaborative relationships or increased financial resources (leverage and scale), the innovation results in program growth. Typically this growth is driven by intentional program expansion, program replication, or program dissemination. It is in this quadrant that innovation might be opening branch operations in a new geography, training others in an affiliate or dissemination model, or expanding service hours. Innovation is typically about about scaling systems to serve more people, creating value chain efficiencies, or creating rigorous evidence-base that encourages the adoption of program or service models by others.

Adaptive Innovation: Going back to an operating environment of constraints (in relationship to leverage and scale), adaptive innovators are those willing to move ahead of or beyond its existing structure, programs, and services to achieve a higher degree of social impact. Innovators in this might move out of preventive or secondary program and services and begin devoting limited resources to working upstream on policy or advocacy. In this quadrant, innovators do not simply ask “how can we improve what we are doing” but rather ask, “could we be more effective if we moved outside of our existing strategies, programs and services?

Catalytic Innovation: The final quadrant of innovation is where large-scale change is sought and is supported with ample leverage and scale. It is not seeks to grow and scale an idea but also seeks to amplify innovation by considering discontinuous ideas in addition to continuous ones. As suggested previously, Disruptive innovation is pursed as if it were the holy grail of social sector. Indeed, catalytic change can create powerful change (see reference 4) but giving disruptive innovation an unequal weight compared to the other three quadrants can skew with meaning of social innovation and actually be a disservice to the field. Disruptive innovation is the current concept with cachet and gravitas relative to the “mundane” work of systematic program improvement and hence, there is the potential that solid process, adaptive, or growth strategies might be overlooked.

The point to be underscored is this. We need to create a shared understanding of social innovation as a critical foundation for building a local perspective for social innovation. Common language is essential to creating a local social innovation approach to compelling social needs. In this overview I have proposed a more robust seed bed for considering approaches to innovation. By broadening the dimensions of social innovation, we can now turn our attention to creating a social innovation framework. It is not about catalytic innovation or adaptive innovation as if it were either/or. Rather social innovation is about both/and. The community needs the investments and strategic thinking to create catalytic innovation that disrupts business as usual. The community also needs the skills and tools to engage in process, adaptive, and growth innovation.

Thinking critically about when to focus on innovation from a process, adaptive, growth and disruptive perspective and how to combine such innovations will result in a stronger social-citizen sector addessing compelling community needs. It is my perspective that only with a broader view of innovation can nonprofits, philanthropy, and government organizations can engage individually and collectively in more thoughtful and strategic conversations about social innovation.

As always, your thoughts are welcome.

References

1. For a useful policy overview see:  “Social Innovation”: What is it? Who Does it?

2. Source: Corporation for National and Community Service – Social Innovation Fund

3. Source: The Social Innovation Fund Grants Focus on “What Works”

4. See as an excellent example: Catalytic Philanthropy

I recently read, yet one more so-called expert advice column promoting the ultimatum of “merge” or “die” as the pathway for many nonprofits. In this iteration, the ultimatum arises out of the knee jerk reaction caused by the recent economic downturn. Citing duplication of service and competition for scarce resources, some foundations, philanthropists and many in the nonprofit consulting industry are becoming almost evangelical about the merger and acquisition strategy for social sector organizations.  For example, the leader of one organization that provides training and support to Oregon nonprofits made the statement that perhaps their agency “should serve as birth control for nonprofits,” adding that there are so many nonprofits and that money is scarce.  I agree that there are a fair number of nonprofits with bad business models and that even many stronger nonprofits have been severely damaged by the economic chaos of the last couple of years.  As I have posted elsewhere, I also agree that collaboration, at some level, is appropriate an appropriate strategic conversation for many nonprofit organizations.   However, having external funding agencies, philanthropists and a consulting industry pressuring nonprofits to either merge or acquire as “birth control” is, at best, narrow and unimaginative and, at worse, self-serving and bullying behavior. We would never think of being as paternalistic to “for profit” companies as we are towards social service agencies.

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While economic concerns among nonprofits are real and there are duplicative agencies competing for scarce resources, the driver for collaboration can’t be reduced to economics alone.  Economic solvency is a lazy marker for effectiveness or impact and to impose collaboration based on economics alone is misguided. Just as in the private sector, success for social sector agencies is determined by a combination of products or services, leadership, agility and capital.  Designing a facilitation process with nonprofit agencies facing financial challenges should not begin with the condescending assertion that merger is the assumed pathway. Rather, catalytic facilitation includes a multi-dimensional exploration of capital in the context of products or services, leadership, and agility.  I would like to suggest several guiding principles for facilitating such a process.

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Sovereignty:  In working with any organization, the spirit of sovereignty must be respected and embraced in the change process. Organizations in the midst of fiscal challenges need to be empowered from the strength of their sovereignty. While I believe that empowerment is a foundation of my consulting practice, empowerment becomes the dominant frame in a process might include as an outcome a collaboration that alters an agency’s autonomy.

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Aspiration: During times of fiscal challenge many organizations default to a “circle the wagon strategy ” where decisions are made from the framework of enduring the financial assault.  Unfortunately, this is precisely when the message of “merge or die” is often introduced from some “sage” consultant. In reality, the most helpful process to an agency is not an ultimatum to merge but is a process that  that focuses on aspirations. Economic challenges should cause an organization to refocus on mission and vision.  Considering the question of “why were we called to exist” can re-energize an organization to positively rethink the foundations of strategy and social impact.  Spending time on the aspirational question of “why” is critical as a precursor to considering any pathway to cope with economic challenges.

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Catalytic Innovation: I have been doing a fair amount of reading on the concept of “catalytic change” for social service organizations (see a couple resources below).  A key question of this emerging body of literature is “how can we create a strategy that achieves measurable impact?”  Implied in that question is looking for the second and third right answer and thinking bigger. The challenges imposed by economics are really opportunities to rethink “how” the “why” is implemented.  Spending time in the space of “how we get to the why” breeds innovation. The interests of convention, power and assumption that are united to say, “merge or die”  chokes the possibility of  innovation.

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Alternative Reality: I started out this post lamenting the over-simplistic “merge or die” advice being metered out nonprofits and suggest that agencies in the midst of economic turmoil need to take the opportunity to go deep within their core competencies to find their own solution.  However, in community organizing there is the old saying that “the price of success is a constructive alternative” and so the final step of the reflection and planning process is the creation of a thoughtful alternative plan.  Intentional planning for how an organization will move forward while under economic siege requires leadership, vision and boldness as well as tactical and measurable action plans.

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The organizations of tomorrow are being born out of the economic challenges of today.  The dominant voices argue that the organizations of tomorrow are those who are merging and acquiring today. I would argue that successful organizations of tomorrow are already visioning tomorrow and allowing the economic challengesof today to temper their core competencies of leadership, agility and innovation as they create their own future.  In this context there is a need for catalytic facilitation and process to help social sector organizations, thoughtfully reflect, plan and move confidently forward to create a more civil society.

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Resources:

Disruptive Social Change

Catalytic Philanthropy

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