PopTech, the vaunted thought-fest that annually gathers some of the nation’s leading social innovators in the coastal hamlet of Camden, Maine, kicked off its 2010 conference two weeks ago with a strongly resonant theme in this year of economic uncertainty and political dysfunction: failure and its upside.

“There’s something really remarkably accidental about so many of the discoveries that we make,” conference curator and PopTech Executive Director Andrew Zolli said during the conference, called Brilliant Accidents, Necessary Failures and Improbable Breakthroughs.  “...But what happens when we don’t let failure happen, when we keep systems that are minimally functional in place? What has to die so the right things can live? How do we kill it?”

To underscore the importance of answering those questions in social innovation, Zolli shared the story of a massive failure of a United Nations led project in the 1950s and ‘60s to bring clean water to Bangladesh. “[The U.N.] went out and dug 500,000 wells ... but once built, nobody tested them, and it turned out that 40 percent of them were polluted with arsenic, making for the largest mass-poisoning in human history,” Zolli said. But it wasn’t just the intervention that went awry, he said. The solution—to test the wells and paint the spigots of clean ones green and polluted ones red—also failed. What happened? “Almost immediately,” Zolli said, “there was the perception in villages with red spigots that because the wells were tainted, the girls were tainted. Suddenly, many of them became unmarriageable and there was a spike in the sex trade.” Added Zolli, “We tried to solve the water problem and we created an urban prostitution problem. We did exactly the opposite of what we intended. These kinds of stories sit very heavy in our hearts but they also remind us of the enormous complexity of the problems that we are trying to solve in the world.”

Expounding on that theme, Kevin Starr, founder and director of the Mulago Foundation, said the nonprofit advocacy community sometimes deludes itself about the impact it’s having on social problem-solving. (Overly wordy, self-important and confusing mission statements, he said, are just one symptom of this behavior.)

Starr, who coaches nonprofits on how to be more effective, said he uses three questions to determine whether a nonprofit is doing the job. Do its leaders know clearly what it is trying to accomplish? “If you could only measure one thing to know if you fulfilled your mission, what would it be?” Starr asked. Do nonprofits measure the right things to determine success and do they measure them well enough? “Measuring well means taking an honest stab at understanding what change you’re creating,” he said. Is it needed? Does it work like it is supposed to? Will it get to those who need it and enough of those who do? Will people use it immediately?

Starr named three high-profile, nonprofit failures: One Laptop Per Child, the Lifestraw and PlayPumps.

In the case of the laptops, Starr said, each was made well enough but ended up costing families living on $2 a day an estimated $400 each. “If you’re a $2-a-day family, are you really going to let your kid take the most expensive thing in the household to school every day?” he asked conferees. “This was nuts,” he said—and not needed. “Where we work, there’s not a digital divide,” he said. “There’s a pencil divide. Schools are falling down and teachers don’t show up.”

In the case of the Lifestraw, Starr said, the device proved to be an excellent water filter but it cost too much and took too long to use, discouraging widespread adoption by villagers. The one study available on usage rates showed that only 13 percent of the people even claimed that they ever used it, Starr said.

PlayPumps—a simple merry-go-round that doubled as a water pump to bring clean water into villages across Africa—also missed the mark, Starr said. “This was so seductive and so wrong,” he said. “Twenty million dollars later, the party’s over and we still don’t have any idea of how many of these things are still spinning,” he said. “A lot of them broke down and there were some areas where kids would have had to push this for more than 24 hours a day to keep the water tank full” and that wasn’t happening. “We have depressing footage of women trudging in a circle,” Starr said. “This was a bad idea.” Starr said in each case, do-gooders were oblivious to on-the-ground challenges to actual usage. Accurate impact measurement, early on, could have averted some of the problems, he said. “We need to do a lot more of that.”

Another PopTech speaker on the subject, Ned Breslin, CEO of Water for People, said a lot of nonprofits and NGOs aren’t just wrong about the impact they’re having. They also sometimes mislead donors about their effectiveness. “Many will tell you that everything is good” after you donate money to clean water projects in Africa, regardless of what’s really happening on the ground, Breslin said. “They’ll show you happy kids drinking clean water, laughing,” he said. “They’ll tell you everything is good. They’ll give you a report and a picture. They’ll say, ‘Here are receipts that prove we spent your money well.’ .. But the problem? What happens when we foreigners leave, when the new water system has to run for a while? Is the system still working over time? Are girls who had to carry water from the river all day now attending school, instead? Is water still flowing?”

More often than not, Breslin said, families that had been helped with new wells now need to go back to rivers to get their water, thanks to a proliferation of broken well heads and pumps. “...Sustainability to our organization is not how many hand pumps you put in, nor how many beneficiaries we helped last year, nor how many microfinace loans we make,” he told conferees. “It is this: is the water still flowing? Africa is littered with broken technology, broken dreams and broken promises. We’ve got to turn that around and move to different outcomes.”