Sunday, August 23, 2009

(How) will technology change philanthropy?

(how) will technology change philanthropy? This is a frequent topic of this blog, and also the subject of a piece of research and eventual article I've been working on for some time. The research has given me the excuse to talk to some of the most forward-looking people in tech, some skeptics, some entrepreneurs, lots of donors, lots of foundation executives, lots of people who work in nonprofits, and lots of other folks.

It is also partly responsible for the new project I seem to have launched with a blog post last week - the philanthropy policy project -(#philpo in twitterese) which will be an attempt to raise the discussion up from the weeds and tactics of metrics and online grant applications to the tree canopy and bigger vision of how the systems that shape giving and social investing can be improved. Or - as the tagline asks - can we change the rules to change the world? If you want to join in that discussion, please check out the placeholder blog, the emergent policy map (editable with a free mindmeister registration) or join us on Thursday September 3 at #SoCap09.

But let's go back to technology and philanthropy. Here's some of what my co-authors and I are working on:
  • Mutual aid, human kindness, and altruism are not technologically bound
  • Faster, global, easy access information sharing is a landscape shifter for giving, just as it has been for recording, publishing, stock trading, newsgathering, and countless other industries
  • The data-scape will change in cycles similar to industries - and the last several years of idiosyncratic innovation may be about to birth a period of consolidation. The data-scape cycles are definitely beginning to have ripple effects out from the data sources to broader markets such as analysts, information providers, intermediaries, and financial product vendors.
  • Remixing information from different sources shifts the business proposition for foundation staff, philanthropy advisors, family office staff and others (see many posts on the changing data-scape of giving)
  • New business models for institutional philanthropy - not based on asset management fees - are being created as donors manage complex giving portfolios and rely on multiple information sources.
  • Organizational charts, job titles, and professional roles in philanthropy will see a great deal of re-structuring in the next phase of innovation - managing grant portfolios will increasingly require investment-level financial analytic skills, information will be omnipresent so a market may emerge for strategy and analysis capacity, and top-notch program officers may find themselves competing to influence donor dollars across institutional boundaries, rather than simply guiding grants within a single organization. Imagine a marketplace for freelance program officers...
  • Attention and commitment to causes and institutions is harder to maintain over time, and those whose work involves generating or supporting those commitments in others are finding new ways of doing it.
  • The long tail of giving (pdf) has benefited from more dynamic technology innovation than has the head of the system, and the latter can increasingly learn from the former
  • Omnipresent online networks have made exclusive information access and face-to-face learning opportunities ever more desirable.
  • In a venn diagram drawn from acting, giving, and learning, technology has fully disrupted the two bottom circles (giving and learning). Acting (for institutional philanthropy at least) has been the slowest to change, but it too is beginning to show signs of disruption.

There is a lot more (including detail and examples!), but that is a taste of what we're finding, hypothesizing, and documenting. My colleagues at Duke University and I will be using the paper as part of a larger project engaging those who are making these changes happen to imagine where this is all leading, what might come next, and what - technology of old or technology yet to be invented - will never change. Thanks to the many readers have helped all along as I've tested ideas, tried out various hypotheses, subjected you to my terrible graphics - please keep the ideas and comments coming.

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Brad Smith said...


I am surprised nobody responded to this. Maybe there are too many ideas in it, or maybe everyone is waiting for the grand synthesis forthcoming from Duke. Maybe everyone agrees?

Your comment about "...managing grant portfolios will increasingly require investment-level financial analytic skills," may be a little off the mark. I think we will see the grant to market-rate (social) investment continuum grow such that grants become a relatively smaller portion of the pie as different forms of social investment take up a larger portion. Anything from a PRI onwards already requires and will require financial analytical skills, but I would argue that grants will and should rely on a different skill set.

We need grants as an important part of the toolkit. They can be reserved for high-risk approaches to the really tough, messy and controversial issues for which there is no readily apparent market-driven solution. Program Officers working on issues of child abuse, violence against women, protecting human rights defenders, racial justice, etc. will need lots of different skills (legal,psychological, social sciences, empathy, inter-cultural understanding, to name a few), but I would not put financial skills at the top of the list.

Great post.

Lucy Bernholz said...

Hey Brad
Well it can't possibly be that everyone agrees with me....:) I fully agree that market are not the solutions (in fact are problem causers) in many cases, but I think the American zeitgest is such that the skill set of financial analysis is going to be ever more in demand. Which raises another, more interesting point than the one I made - what happens when technology and other drivers of change make for big disconnects between existing jobs and organizations, existing and future skill sets, and the tasks at hand...?

Thanks for getting the ball rolling, Brad...
C'mon on in everyone else - I know you've got thoughts on this!


Brad Smith said...


Since we can't get anybody else to join this conversation I guess we'll just have to continue on our own.

Maybe at its heart this discussion centers on two simple words--"will" and "should." While discussing what we think philanthropy will be, to what extent do we also need to express what we think it should be. Will American philanthropy increasingly value financial analysis as a skill set for Program Officers?Yes. Should that be the most important skill set to apply to all issues, in all parts of the world,and for all types of philanthropic interventions? No.

If I am a donor convinced that I need to use my endowment for mission-related market, or semi-market rate investments, I will definitely want people with strong financial analysis skills, above all. But if I am a donor, like the California Endowment that wants to make a grant to Survivors of Torture International for a "Health Education and Advocacy Project to conduct research, education, and policy advocacy to address health-access needs of survivors of torture in San Diego County and throughout California."
I will want my program officer to have real knowledge of mental health, research, immigration policy, health policy.

Maybe what we will see is a kind of market segmentation among Program Officers (or whatever they will be called in the future), with different kinds of skill sets required for different philanthropic tools. As you can tell, while I very enthusiastic about the potential for mission-related investment, unlike some, I do not see grants as the lowest form of evolutionary life. For me, they "should" be seen as the purest, and highest-risk expression of philanthropy.

By the way, the whole notion of "free-lance" Program Officers is already much more of a reality than one might think. There are some 7000 POs in the U.S. and despite their insitutional affiliations are constantly coming up with ways to raise money from each other, join forces, find common cause, etc. Technology has the potential to take this kind of horizontal networking to an entirely new level.

Lucy Bernholz said...

I agree with you completely on the will and the should parts of this. I've been thinking about the "should" as the essence of the Philanthropy Policy Project, since I see "shoulds" as system-wide mandates. What should philanthropy do and be should guide the policy frames that influence it (I know, my naivete is - at the very least - endearing)

That said, the power of changing the industry by 1) recognizing these kinds of choices (e.g. what can and should our staff be focused on doing, good at doing, supported to do) are also potential key drivers of change across organizations (they certainly are within funding organizations). And the power of technology as a horizontal connector, used by and for funders as they can imagine and see fit, is absolutely a driver of the future as much as anything else.

20 years ago I started asking the question - are foundations connected to each other in meaningful ways that influence each other - it was then part of my quest to understand how they work, and has become part of my work in trying to understand how the whole might be improved for the better. 20 years ago the connections were few - legal code, some infrastructure such as CoF and Foundation Center, some affinity groups. Then (as now) only a tiny minority of all the foundations in existence actively connected with those infrastructure orgs. What has changed since 1990 (when I started this work) is the number and types of horizontal connectors, designed from within by actors within. OF course, there are also important other changes, some more vertical.

The "will" and the "should" are important for us all to keep in mind as we consider which we are assuming, which we are trying to influence, and where those levers are.

Tag, you're it.


rachel said...

This week I had a dinner guest who gave me pause. She's a policy thinker and an activist, and she told me about a pulling-market-levers-to-increase-malaria-drug-access program funded by the big guys. It seems to be poorly conceived, and as an utter outsider I was able to ask the hard questions of it instantly. (what about consumer education? What about enforcement?)

I'm working on a project that will create a list of international grantees. The story of the activis gave me pause. Would I, in effect, build superhighways for philanthropists to increase and diversify funding to the wrong things? It made me wonder how we can build taxonomies (and technologies!) that include broad, accessible information. Broad enough to empower/ make possible new understandings of how philanthropy can support good work.

Surfacing the crushed grass paths to people doing good work is one part. But I think I'm not trying to build superhighways from philanthropists to people doing good work. I'm trying to do something much more complex.

More on my thinking on taxonomies over here:

Lucy Bernholz said...

Thanks for pulling together two issues - tech and taxonomies, and, actually, a third - "top downedness" - How can we make sure that the 2.0 nature of our current abilities, interactive, expressive, broad production/consumption, remixability - is mirrored in the application of technology and taxonomies, not crushed by them?

I don't have the answer (by the way!) and I agree the question is critical. Perhaps it ties into Brad's point about the difference between "will" and "should"...

Thanks for jumping in (twice!)


Unknown said...

I'm really intrigued by the discussion between Brad and Lucy regarding Program Officer roles, knowledge, and skill sets. I wonder if it also comes down to the role that foundations or major donors want to play - do they want to build organizations and movements or buy services.

Which brings me to your post - technology and philanthropy. I believe philanthropy must integrate these social media tools into their work - both to remain relevant, as well as to deepen the impact of our work.

It will be very interesting to see how the Tactical Philanthropy Advisors Knowledge Network evolves. And as I commented on Sean's recent post: these tools help us shift from supporting activities to shaping and supporting movements. Social media offers the promise of greater democratic participation and local knowledge in our work, and those things are indispensable to the foundation that wants to make real serious change on the local level.

Len Bartel