Philanthropic leadership and the tensions of change

This is a 15 second time-lapse video of the aurora borealis from space. It's beautiful, fast, multi-dimensional, and both inexplicable and well understood.



(Source: http://www.youtube.com/watch?feature=youtu.be&v=uiheRnGQGYI)

I'm preparing a seminar on philanthropic leadership in our time. It is nowhere near as profound as the aurora, but the video struck me as an enticing lead-in anyway.

  • The changes that are underway across our global society are profound and numerous.
  • How we see these changes and forces depends on our viewing point and our time horizon.
  • Each of us is lucky if we can understand a few of them, let alone be smart about one or two.
  • No single force of change - demographic shifts, wealth disparities, religious and geopolitical tensions, technological prowess, data deluges, resource scarcities, planetary health - will be the defining shaper of our present our future. What always matters is the interactions between them.
So here is my proposed thought experiment for emerging leaders:

Several of the primary forces reshaping philanthropy are in real tension with each other. For example:
  • Technological advances are pushing to make data cheap. Commercial and business model priorities (mostly) want to make data expensive.
  • Philanthropy has tremendous freedom in what it funds and how it operates, yet most foundations and funders build remarkably similar looking organizations regardless of mission or reach. At the same time, interesting crowdsourced change efforts - such as Ushahidi and CrisisCommons - are starting outside the realm of traditional nonprofit structures and funding streams.
  • Transparency is important and there are many efforts underway to make philanthropic institutions more "see through." Increased transparency may also make people less willing to take risks, speak out against the majority, or "follow their gut."
  • Social goods have typically been seen as the purview of nonprofit organizations and public agencies. Now, more and more enterprises are producing social goods as well as financial returns.
Given this context, what would you do if you had a blank slate from which to create a philanthropic funding enterprise?

What might you say in the seminar? Share your thoughts in the comments and I'll share them with the seminar participants. With their permission I'll share their ideas back here later next week.

(OK, I'll admit, I included the video just because I liked it. I can't really weave it into this theme much better than I've done above. Can you?)

21 comments:

Bradford Smith said...

Well said and on target, mostly. The part I don't agree with is that transparency may make people less willing to take risks. A colleague in the sector who took enormous risks as a grantmaker was always very open about what he was funding and said that his philosophy was to "hide in plain sight." There is a very small portion of philanthropic activity that requires careful handling and less than full disclosure because of ethical concerns over the safety of the recipients of the funding. Living donors have very real concerns about their own privacy and that of their families but that is a somewhat different matter. In a digital age with more an more open information and better and better search technology, transparency is a given. Donors need to think proactively about how to control information on their giving and what to make public, but some degree of transparency is inevitable. Here are more of my thoughts on philanthropic freedom, risk taking and transparency http://pndblog.typepad.com/pndblog/2010/09/george-soros-takes-a-risk.html

brad

Rick Schoff said...

Lucy - Thanks yet again for some important discussion-starters. I worked many years in the sector, largely in information management. And so it struck me forcefully that there’s value in presenting different dimensions of your first bullet point, as early in the philanthropic leadership discussions as you can. Expanding on your first bullet point could help focus answers to the question, “What would you do if you had a blank slate from which to create a philanthropic funding enterprise?”

Technological advances have made distributing data cheap. And yes, there are commercial interests that want to make cheap data expensive for the user. Over the years, various commercial interests have sought to exploit philanthropic data. Many of these no longer exist. The inexorable commercial logic? Presumably, it wasn’t cost-effective.

Data doesn’t have to be expensive, but useful data is not costless. Somewhere in the creation-to-distribution chain, someone has to invest resources. Ideally, it would be at the information source, where technological advances are used to make the creation of data cheap(er). Distribution choices – because they are almost costless – become a matter of policy (and this relates to Bradford Smith’s comments above about transparency).

In whatever context or sphere – institutional, interinstitutional, industry-wide, etc. – useful data needs to be consistent, with a modicum of completeness. This requires creation of data standards (and/or consistent cross-walks between similar standards) and their adoption. These standards need to be supported editorially over time, with whatever degree of automation (i.e., diminishing costs) is possible. But, initially at least, putting systems in place requires resources.

Investment of resources requires commitment. It may be that working in an environment where “investment” is seen only as “expense” precludes any real commitment. But without commitment, discussion of hows and wherefores is moot.

To those in the sector involved with investment, the lack of broad commitment to the creation of useful data is probably well understood. They may simply be living with their own Catch-22, with which I can sympathize. However, it does seem inexplicable to the larger audience, particularly during a time when transparency and accountability are such hot topics.

- Rick Schoff

Rick Schoff said...

Lucy - Thanks yet again for some important discussion-starters. I worked many years in the sector, largely in information management. And so it struck me forcefully that there’s value in presenting different dimensions of your first bullet point, as early in the philanthropic leadership discussions as you can. Expanding on your first bullet point could help focus answers to the question, “What would you do if you had a blank slate from which to create a philanthropic funding enterprise?”

Technological advances have made distributing data cheap. And yes, there are commercial interests that want to make cheap data expensive for the user. Over the years, various commercial interests have sought to exploit philanthropic data. Many of these no longer exist. The inexorable commercial logic? Presumably, it wasn’t cost-effective.

Data doesn’t have to be expensive, but useful data is not costless. Somewhere in the creation-to-distribution chain, someone has to invest resources. Ideally, it would be at the information source, where technological advances are used to make the creation of data cheap(er). Distribution choices – because they are almost costless – become a matter of policy (and this relates to Bradford Smith’s comments above about transparency).

In whatever context or sphere – institutional, interinstitutional, industry-wide, etc. – useful data needs to be consistent, with a modicum of completeness. This requires creation of data standards (and/or consistent cross-walks between similar standards) and their adoption. These standards need to be supported editorially over time, with whatever degree of automation (i.e., diminishing costs) is possible. But, initially at least, putting systems in place requires resources.

Investment of resources requires commitment. It may be that working in an environment where “investment” is seen only as “expense” precludes any real commitment. But without commitment, discussion of hows and wherefores is moot.

To those in the sector involved with investment, the lack of broad commitment to the creation of useful data is probably well understood. They may simply be living with their own Catch-22, with which I can sympathize. However, it does seem inexplicable to the larger audience, particularly during a time when transparency and accountability are such hot topics.

- Rick Schoff

Lucy Bernholz said...

Brad

Thank you Thank you for adding to this discussion. One of the challenges of showing the tensions is the danger of oversimplification and you - rightly - caught me here and called me out. I think your comments on recipient safety and donor privacy are important elements of the limits of transparency. Your comment - and your wonderful blog posts on the subject of risk and transparency which I highly recommend

(http://pndblog.typepad.com/pndblog/2010/09/george-soros-takes-a-risk.html)

cover these nuances well.

One way of parsing the question more carefully is to think about transparency around what, why and/or how?

Also, what are the risks from the lack of transparency?

Lucy

Lucy Bernholz said...

Rick

Thanks for your thoughts. I think you dove right in and dug out some of the key issues in these independent, but linked, forces - how do we reconcile what technology facilitates with what old business models don't support? The "revolution" of data will (has already) run directly into the resistance of established institutions - its a regular element of the business innovation cycle. As organizational leaders, understanding exactly the tensions you highlight - the costs of good data, who will pay them, how they will be shared - are absolutely critical.
Thanks for adding your thoughts.
Lucy

edbice said...

I would hope that philanthropists come to a point where they stop thinking risk v. transparency and instead recognize the 'risk' inherent in lack of transparency. Transparency should be understood by foundations as an opportunity to share the thinking (or lack thereof) around their individual investments/theories of change/metrics/ and to create learning for both funders and non-profits working in similar spaces.

Don Quixote said...

For the seminar: Technological advances aren’t only making data cheap, they’re also changing our expectations for whether people and organizations carefully analyze data, polish what we want to do and say in private, and then take our reaction or plans public at a strategic time; or whether we respond to something almost instantly, while the words and ideas can’t help but be rough-hewn, and then adjust what we’ve put forward in the ensuing conversation with others. Transparency, risk-taking, and following your gut become less fraught when the cultural norm is to discuss and modify (not defend) whatever statement you’ve made or action you’ve taken. Of course the dynamics that apply in the board room show up in social media, too: some people overreact, some make nice at the expense of frankness, some put forward stunningly bad ideas and others are way smarter than we are. Seeking consensus can kill innovation fast, by extracting every controversial element from an initiative until all that’s left is the lowest common denominator. Strong leaders will always need the clarity to take risks and then distill—not dilute—their strategy based on what they hear, whether it’s cheap data, a crowd, or their board of directors talking.

Hmmmm, for the Northern Lights video, how about: Step outside and let brilliance and color wash over you; you’ll still walk away knowing who you are, but you’ll be improved and energized in the process.

Laura said...

Risk, transparency, and useful shared data - they all have to come together and be acknowledged as best practices IMO.

The risks from lack of transparency are not being able to learn from mistakes, and not being able to show how valuable learning from mistakes can be!

Let's look at some typical service areas - say teen pregnancy prevention, or mentoring at-risk youth to help them finish school or stay out of prison. Foundations typically require outcome reporting, but both the service organization and the foundation carefully guard and craft that data - they want it to show the best possible outcome to attract more donors to continue more programs, etc.

What if people openly acknowledged that shared valid data on consistent measures across all programs working in these areas, no matter how they are funded, across all research projects in these areas, no matter how they were funded, is a good thing to have and may be a critical thing to have, in order to tease out new solutions to persistent problems?

What if foundations were willing to fund new programs with new models, to give them a chance to show their stuff, and even if the new programs "failed", to process and share the lessons learned?

What if foundations, or other public or private institutions were willing to put in that investment (that Rick points out is so key) in creating valid data structures and repositories?

It seems that this type of risk-taking, data sharing, transparency, and new emphases on where to put resources would move the sector forward fast.

Lucy Bernholz said...

Ed
I fully agree - careful considerations of the real risks of transparency are much needed. A Berkman Center report on foundations and Creative Commons licenses (which I'll use as a mushy proxy for sharing in this context) found that few foundations understood it, the reasons they gave for not using these licenses were all easily counterargued, and the lack of use of them was not strategic so much as a status quo decision.

Lucy

Lucy Bernholz said...

"Don"

Thanks for you great comments on risk, transparency and data and for attempting to weave the Aurora into the conversation. And thanks for pointing out that transparency requires conviction and a willingness to be disagreed with - I couldn't agree more.

But I also think we need to be clear that all transparency is not equal - let me sharpen the question for everyone: Should all donors to all causes and all organizations be revealed? When and when not? Why and why not?

Lucy

Lucy Bernholz said...

Laura
Thanks for mixing all three things back together - as I started the post the effort to separate them is a narrative trick, not one that can be done in reality (Maybe that's why I liked the Aurora video!?) The pieces - data, risk, transparency - all blur together, making our new expectations.

Hey THANK YOU ALL - we've got a nice little online seminar going here -

Lucy

Karl Stauber said...

Lucy--
Thanks for asking thoughtful and challenging questions. The aurora is a great metaphor for much philanthropy--it can be beautiful, distant, and unpredictable.

Here is my addition to the tensions--if it doesn't get to the ground, does it matter? As one who has worked at many levels of philanthropy, I want to see progress that improves lives on the ground. I want us to get smarter about what progress is and how we help communities achieve it. How do we make sure that philanthropy, unlike the aurora, actually gets to the ground as effectively and efficiently as possible? I often find people struggling with the negative impacts of change missing in many of our discussions. To often getting to scale seems to focus on national solutions. From where I stand, we need to get to scale and impact. And impact occurs on the ground, in helping people to improve their lives in their terms.

Karl Stauber,
Danville, VA

bradford smith said...

Lucy,Rick, everybody...this is getting to be fun! Who needs a seminar? Yes, what are the risks of not being transparent? Try the Cox Congressional hearings in 1952 and the Reese hearings in 1955 to investigate foundation for alleged support of "un-american" activities. The response of visionary foundation leaders was to create the Foundation Center, which opened its doors in 1956 with 7,000 documents stuffed in file cabinets for public inspection to show that foundations had nothing to hide. Not to mention the good points made by others about the tremendous loss of potential and impact when foundations don't share information openly so as to facilitate greater collaboration on solving the world's problems. When is too much transparency dangerous? For starters, whenever it threatens the life of a human rights defender, or reveals the location of a safe house for battered women, or threatens the very survival of an organization working under repressive conditions. Some foundations engaged in public policy advocacy being perceived as crossing the line into "lobbying." But it is a minority of America's 75,000+ foundations that support this kind of work. When it comes to privacy and safety of their families donors have to make difficult personal decisions that are getting more difficult by the day because of technology.

Lots of good points made about the quality and consistency of data. Data may be more and more available, often for free, but data are not born clean, and someone, somewhere must pay for the cost of making data usable in meaningful ways. Lucy, on your point about the resistance of established institutions, how do you see Google--revolutionary or established institution?
Brad

Lucy Bernholz said...

Thank you, Karl and Brad and everyone for jumping in - again!

Karl - I agree with you about the need for impact on people - I'm not sure what the other end of the dynamic is? Is it the talk about metrics? The focus on process? Organizational self-preservation? Or just how darn hard it is to "show" impact?

Brad - I love that line "Data are not born clean" - I might get a T-shirt made. And the question of who covers the costs of cleaning the data - of making them useful - is a key element of the new economics of information. I'm no expert, but really smart people like Yocahi Benkler and David Bollier and the Nobel Prize winning economist Elinor Ostrom are. And they are very convincing on the point that identifying those costs and having them paid in a way that benefits the commons, not the corporation (I'm oversimplfying, of course) is the great political question of the day.

Who wants to have a reading group on Ostrom, Bollier, Benkler and civic good? (And who wants to lead it?)

As for Google, amazing that a 12 year old (I think that's right - someone fact check me) company could raise that question. Perhaps its not a matter of age but of reach - scope of influence? In which case, Google is IMHO, as established as they get. I'd point to their siding with the telecomms over net neutrality as an example of the kinds of behavior that "established" institutions assert in the face of change. Mobile threatens Google's business model, Mobile is where the innovation is, therefore Google reaches out to influence legislation to drive Mobile innovation in the direction it favors. That's the kind of interaction I'm really talking about.

I meant to stay offline all weekend - now look what you've gone and done to me. I'll be back - but not till Monday....(Smile).

Lucy

Lucy Bernholz said...

Oh - and before I go - the risks of nontransparency are EXACTLY the way I think we should be having this discussion. Thanks to all who helped me see that more clearly (pun intended).

Lucy

Bradford Smith said...

An another thing Lucy. Your point about philanthropists funded similar looking organizations is quite true. I just took a look at the the grants made by 25,000+ of the largest U.S. foundations since 2003 and a total of 2,204,812 grants went to 179,560 recipients. This was possible through www.philanthropyinsight.org which, incidentally, was the brainchild of one of your commentators, Rick. 4013 of these went to Standford University, 4551 to Harvard University, etc. Meanwhile, the Praire Learning Center in North Dakota got just 4 grants (2 each from the Bush Foundation and the Otto Bremmer Foundation). The Salmmah Women Resource Centre in the Sudan got only one grantand that was from The Ford Foundation.

Lucy Bernholz said...

Brad
That is a great use of the philanthropyinsight data - thanks for sharing. Here's a practical question it seems like the data could be used to answer - in Disrupting Philanthropy on pages 11 and 12 we have a graphic of the long tail of giving and the long tail of receiving. We tried our best to draw these curves accurately with the data we had access to. It seems we could try again (hear that Barry and Ed!!) with these data -

Here are the graphics -

http://www.scribd.com/doc/31178075/Disrupting-Philanthropy-FINAL

Anonymous said...

Brad Smith, to your point about the number of grants awarded to Harvard, Stanford, and the Prairie Learning Center in ND. Harvard and Stanford are two of the greatest research universities in the world. They get grants for stem-cell research, climate change work, archival preservation work, buildings and lab upgrades, scholarships, etc. etc. etc. Prairie Learning Center, a fine organization with the mission "to provide each student (where?) with the opportunity to develop a core of basic life skills," works in a much more focused way in a much smaller geographical area. Apples and oranges, no?

Philanthropy, it seems to me, is an incredibly varied activity in this country, and the fact that Harvard and Stanford attract a lot of philanthropic dollars in no way disproves that point.

Barry Varela said...

Try again?! If you say so, Lucy!

Lucy Bernholz said...

Anonymous

I'll leave it Brad to respond regarding his analysis of the data. Here's what I think is interesting - Brad presented a set of numbers. He seemed to imply (my read of his comment) that the data show lots of funders fund the same thing. I took his inclusion of this point to be in response to my comment on an earlier post about the Seattle Foundation's listing of "similar organizations." My point was the opposite one to Brad's (Sort of) - I was extolling the idea that in providing links to one organization the Seattle Foundation is also essentially "here are some others to think about." I take it you read his comments as a criticism of the number of funders who fund certain organizations, e.g. Harvard.

One set of data - 3 rather different interpretations. That matters. Along with our ability to have a respectful discussion of the different interpretations.

Thanks for writing in.

Lucy

Lucy Bernholz said...

Barry

Yep - may already be time for round 2!

Lucy