Those of us working in grassroots organizations trying to make experimental ideas gain traction have known for years what Dr. Orosz writes about foundations is true.
A couple of ideas that might work is to somehow develop either an entrepreneurial culture among foundations—something some newer foundations have tried to do within their organization—or have a group of foundations try the incubator approach to social problems many investing groups use for business ideas.
Enjoyed that. Agree with much of it. Though perhaps it sometimes depends on the sector/area a Foundation is operating. In some situations even a minimal failure or setback would be disastrous to the population/cause that the Foundation is trying to help. Also, I could understand why in the first year of operation some boards and CEOs would be understandably more cautious and conservative due to the nature of funding and the importance of gaining community support and a constituency.
Additionally, increased churn in the sector might be good. We want the top-performing and most innovative organizations to receive the funding and backing they deserve. Just a tiny bit more of Darwin’s ‘survival of the fittest’ or Schumpeter ‘creative destruction’ wouldn’t be the worst thing.
The real interesting question would be then how to construct a foundation or nonprofit board that would challenge CEO’s to be innovative and creative. What is the right mix? Inside vs. outside? What mix of backgrounds and experiences? Often Foundation board members or just good friends of the weathly namesake or people already with experience in the sector. Don’t we need more influence by people with outside ideas and different experiences?
We are having discussions about innovation and nonprofits in the UK at the moment, and the role of foundations in resourcing innovation is of course crucial. Its debateable whether or not we have the environment and conditions for innovation anymore, never mind getting to the point of scaling it up. I think there are a couple of addendums to the excellent argument made by Joel/Albert: 1. Foundations need not just fund failures, they also need to share those failures. No point failing to let others repeat them unneccesarily. 2. I worry that the near-universal focus on outcomes is partly to blame for our fear of failure. Innovative work it seems to me is most difficult to plan in terms of ‘we will achieve x outcomes. Interested to see what others think. Finally, remember the quote (sorry, dont know the origin): “I have learnt so much from my mistakes I am going to make some more.”
Karl, you might want to check out Sean Stannard-Stockton’s interview of Jim Canales, president of the James Irvine Foundation, on the issue of sharing foundation failures. You can find that interview and discussion here : http://www.tacticalphilanthropy.com/2007/07/tactical-phil-1.html
Rather than asking the people who work at foundations to behave in a way that is inconsistent with the “market forces” of embarrassment and pride, it may be more effective to create mechanisms of feedback that rewards innovation and discourages “safe” behavior (unless the situation calls for the “safe” approach).
For instance, the Slate 60 (list of the most generous philanthropists) was created specifically as an antidote to the Forbes 500 (list of wealthiest people). Ted Turner had express how his gift to the UN was going to reduce his standing on the Forbes list and so Slate created the Slate 60 to provide positive feedback to philanthropists.
I think asking people to behave in ways that is inconsistent with how they are rewarded to a tough sell. Much better to create incentives that encourage the behavior that you want. Part of the reason I interviewed Canales (and the reason I was so happy to see the NY Times mentioned the podcast) is because I’d like other foundations and philanthropists to see that Canales is being “rewarded” for he’s innovative efforts towards transparency. If we’re going to ask people to take risks and then tell us about their failures, we’d better be ready to really reward them for their behavior.
COMMENTS
BY David H. Lukenbill
ON July 26, 2007 01:31 PM
Those of us working in grassroots organizations trying to make experimental ideas gain traction have known for years what Dr. Orosz writes about foundations is true.
A couple of ideas that might work is to somehow develop either an entrepreneurial culture among foundations—something some newer foundations have tried to do within their organization—or have a group of foundations try the incubator approach to social problems many investing groups use for business ideas.
BY PAH
ON July 26, 2007 02:20 PM
Enjoyed that. Agree with much of it. Though perhaps it sometimes depends on the sector/area a Foundation is operating. In some situations even a minimal failure or setback would be disastrous to the population/cause that the Foundation is trying to help. Also, I could understand why in the first year of operation some boards and CEOs would be understandably more cautious and conservative due to the nature of funding and the importance of gaining community support and a constituency.
Additionally, increased churn in the sector might be good. We want the top-performing and most innovative organizations to receive the funding and backing they deserve. Just a tiny bit more of Darwin’s ‘survival of the fittest’ or Schumpeter ‘creative destruction’ wouldn’t be the worst thing.
BY PAH
ON July 26, 2007 02:30 PM
The real interesting question would be then how to construct a foundation or nonprofit board that would challenge CEO’s to be innovative and creative. What is the right mix? Inside vs. outside? What mix of backgrounds and experiences? Often Foundation board members or just good friends of the weathly namesake or people already with experience in the sector. Don’t we need more influence by people with outside ideas and different experiences?
BY Karl Wilding
ON July 27, 2007 02:47 AM
We are having discussions about innovation and nonprofits in the UK at the moment, and the role of foundations in resourcing innovation is of course crucial. Its debateable whether or not we have the environment and conditions for innovation anymore, never mind getting to the point of scaling it up. I think there are a couple of addendums to the excellent argument made by Joel/Albert: 1. Foundations need not just fund failures, they also need to share those failures. No point failing to let others repeat them unneccesarily. 2. I worry that the near-universal focus on outcomes is partly to blame for our fear of failure. Innovative work it seems to me is most difficult to plan in terms of ‘we will achieve x outcomes. Interested to see what others think. Finally, remember the quote (sorry, dont know the origin): “I have learnt so much from my mistakes I am going to make some more.”
BY Albert Ruesga
ON July 27, 2007 12:50 PM
Karl, you might want to check out Sean Stannard-Stockton’s interview of Jim Canales, president of the James Irvine Foundation, on the issue of sharing foundation failures. You can find that interview and discussion here : http://www.tacticalphilanthropy.com/2007/07/tactical-phil-1.html
BY Sean Stannard-Stockton
ON July 28, 2007 10:18 AM
Rather than asking the people who work at foundations to behave in a way that is inconsistent with the “market forces” of embarrassment and pride, it may be more effective to create mechanisms of feedback that rewards innovation and discourages “safe” behavior (unless the situation calls for the “safe” approach).
For instance, the Slate 60 (list of the most generous philanthropists) was created specifically as an antidote to the Forbes 500 (list of wealthiest people). Ted Turner had express how his gift to the UN was going to reduce his standing on the Forbes list and so Slate created the Slate 60 to provide positive feedback to philanthropists.
I think asking people to behave in ways that is inconsistent with how they are rewarded to a tough sell. Much better to create incentives that encourage the behavior that you want. Part of the reason I interviewed Canales (and the reason I was so happy to see the NY Times mentioned the podcast) is because I’d like other foundations and philanthropists to see that Canales is being “rewarded” for he’s innovative efforts towards transparency. If we’re going to ask people to take risks and then tell us about their failures, we’d better be ready to really reward them for their behavior.