Innovation on the Rise: Achieving Systemic Change

This article is the fourth in a series on social innovation.

July 2017 Paul Dotey
Illustration by Paul Dotey

The challenge with understanding systemic change is that it is like describing a lake in which you are currently swimming. In Part I of this reflection on Robert Couchman’s 1992 article in The Philanthropist, titled The Politics of Resistance to Change in Innovative Programming, we asked 11 leaders in the sector to comment on the current environment for innovation and systems change. A couple thought that the piece had just been written. Others noted that, in the past 25 years, philanthropic organizations have contributed to the failure of innovation by constantly demanding something new but then not supporting long term investments in approaches that worked.

Part I ended on an optimistic note with examples of current innovations that appear to be contributing to systemic change. In Part II, we expand on ways in which innovative, systemic change has impacted, and continues to impact, the social sector: new tools, a broader range of actors, ideas, and business models, funding evolutions, and a real shift from fragmentation to collaboration. Couchman predicted few, if any, of these in 1992. We cannot say that we have a better view of the way ahead than he did 25 years ago, but we can at least describe the trajectory of the swim.

Underpinning much of the systemic change in the sector over the past 25 years has been the role of technology, which has facilitated efficiency through ease of communication and access to timely information. This has enabled new ways of operating, fundraising, measurement, and even structuring and scale of organizations. So, a small non-profit like Not Far From the Tree can bring together more than 1000 volunteers to pick more than 113,000 pounds of surplus fruit and vegetables from homes across Toronto, despite a barebones staff. Nimble non-profits can quickly implement innovative approaches at the local level, and retain their ability to identify and respond to local needs even as they grow their operations and/or open-source their systems, easing collaboration and dissemination.

Anil Patel from Grantbook pointed to new ways of operating iteratively and identified the effective use of technology as a million-dollar question. In Canada, Patel led the way in using new tools for better data collection, evaluation, and transparency through Timeraiser, a charity that connects emerging artists with young professionals in exchange for volunteer time instead of money. Timeraiser tracks and reports key metrics in real-time on its website through a Google Doc that anyone can view at any time; a simple, cheap yet rare solution in the social sector (Center for Effective Philanthropy, 2015; Van Ymeren, 2015). The likes of Grantbook and Powered by Data take this work a step further with data strategies, approaches that could barely have been conceived in 1992 when information processing was much costlier. Philanthropic Foundations Canada’s Emerging Data Practices For the Philanthropic Sector report (2015) highlights some of the new solutions being used.

Another fundamental shift has been in the cast of socially-focused work over the last few decades, with a vastly expanded and interconnected universe of actors. Sara Lyons at Community Foundations of Canada pointed to the outdated nature of the government-charity-funder trifecta in Couchman’s original article; now the private sector is not just a bit-part player but major driver of social initiatives, and both non-profits and businesses actively engage with the policy world. In contrast to Couchman’s focus on the internal conversations taking place within the government bureaucracy, Lyons noted that societal shifts have driven social change in several recent examples linked to queer rights, reconciliation between Indigenous and non-Indigenous peoples, disability rights, and the Black Lives Matter movement.

A new generation of changemakers and philanthropists that is open to innovative ideas and approaches accompanies, if not drives, this institutional shift. CEE Centre for Young Black Professional’s Kofi Hope saw promise in the willingness of newer non-profits to engage with corporations. In addition, Aaron Good from Innoweave and Katherine van Kooy of the Calgary Chamber of Voluntary Organizations identified that while this new generation brings a lot of positive impetus for change, it doesn’t necessarily come from a tradition of frontline service and so has a different understanding of social issues (for both good and bad).

Social enterprise is, of course, one of the most obvious innovations to have taken root over the last two and a half decades, although it is not a new concept. Couchman would surely argue that many of his peers would fit the definition of “social entrepreneur” if it had existed in 1992. Yet a mapping of Canadian social enterprises conducted in the early 2000s by a new start-up called Social Capital Partners resulted in only a handful of organizations across Canada. Today they are ubiquitous and the once well-defined boundary between profit and charity is now packed with a rich ecosystem of hybrid models. The recent Canadian Social Enterprise Sector Survey conducted by Mount Royal University and Simon Fraser University identified more than 7000 social enterprises reporting approximately $1.2 billion in revenues.

A need for scaling good ideas, growing openness to the idea of profit, and weariness with funder constraints are three reasons for the shift towards social enterprise identified by Shaun Loney of Winnipeg’s Social Enterprise Centre (SEC) in his recent book An Army of Problem-Solvers. Over the past 10 years, the SEC has spun out 12 unique social enterprises linked to home insulation, water retrofits, geothermal projects on five Manitoba First Nations, farming in remote communities, an ethical temp agency, and even a bedbug remediation business. From the perspective of philanthropic contribution to social enterprise, Loney is quick to note that developing and running social enterprises is a team sport. SEC has benefited greatly over the last several years through an Ashoka fellowship, which has expanded the organization’s network, reach, and program replication with social enterprises such as Toronto’s Building Up, taking its lead from SEC. If all goes well, it will also play a role in federal, provincial, and municipal policy change.

Van Kooy added that the growth of social enterprise and venture philanthropy brings a new approach and skillset to the sector that is especially useful as direct social service delivery is increasingly orphaned. However, corporations and a “business-first” mentality also bring a public relations mindset that values quick and flashy wins. In addition, she noted, social work will always need some form of funding and cannot be sustained entirely through the market. Maytree’s Elizabeth McIsaac agreed, saying that while social entrepreneurship can provide financial independence that spurs innovation, it should be seen as a complement, not a panacea; we can’t find a business model for every problem. Investments are still needed for ventures where there is no hope of direct financial return.

As the sector has evolved, so too has the role, and types, of funders. While a service-delivery, transactional model persists in government funding, Good highlighted an increasing focus on outcomes, and recognition of the full cost of achieving success. Funders are more interested in the kind of change that a grantee was able to create (or the outcome) rather than just measuring what the grantee did with the money (the outputs)[1]. Van Kooy also described how government has moved to the business of purchasing mission-aligned outcomes, which albeit continues a dependency relationship.

Foundations and private funders have stepped up to fill the gaps. Patrick Johnston of Borealis noted both the rapid expansion of the community foundation movement as well as the broader set of tools used by all foundations. The growth in community foundations is one trend Couchman did not predict. According to Community Foundations of Canada tracking, in 1992 Canada had 28 community foundations with collective assets worth $500 million (Moreno & Plewes, 2007). In 2016, they numbered 191 with $4.8 billion in assets (Community Foundations of Canada, 2016). As a result, community foundations now reach 85% of Canadian communities, with a 187% increase in annual granting compared to 26 years ago. Their contribution to innovation is an entirely unique topic and deserves to be profiled on its own.

Beyond providing new funding opportunities, community foundations and the rest of the philanthropic community have carved out roles in stakeholder and community convening, networking, donor education, and outcome measurement. One example of this changing role is Vital Signs, the annual report of community health indicators, which has grown from a modest pilot at Toronto Community Foundation in 2001. Initially developed and supported by the Maytree and Laidlaw Foundations with support from the Atkinson Foundation and the Toronto Star, Vital Signs is now a major initiative and brand undertaken in communities across Canada and around the world. A Canadian social innovation success story if ever there was one.

Collaboration was a recurring theme brought up by sector leaders. Once again, Couchman would likely have argued that working together towards a common goal is by no means new; the sector has been doing this organically for generations. Old-timers will also remember many clumsy experiments of grants given and received based on forced collaboration. In this sense, though the term is relatively recent, co-creation has been in the works for a long time.

As Andre Vallillee of Metcalf Foundation noted, there seems to be a promising trend towards shared vision and intentional systems transformation. Funder networks – such as the Funders Alliance for Children Youth and Families, which brought together a wide range of funders around work in early childhood education, championed by Fraser Mustard – have become much more common. Rarely today do you see an issue or initiative in which a funder will “go it alone.” Many of these relationships are unstructured. However, groups such as the Canadian Environmental Grantmakers Network, Food Funders Alliance, and The Circle on Philanthropy and Aboriginal Peoples in Canada provide a network structure that supports learning, co-funding, and shared risk-taking: all essential elements for innovation and systems change.

At the same time, industry associations such as the Calgary Chamber of Voluntary Organizations and the Ontario Nonprofit Network have built strong connective tissue and emerged as real advocates for their members. It is equally fascinating to witness the spread of the network-building and information-sharing bugs in sub-sectors for specific purposes. For example, caterToronto is a network of more than two dozen community-based caterers from low-income neighbourhoods, providing economic opportunities and bolstering micro-entrepreneurship. Meanwhile, the Homeless Hub is a community-led initiative that marshals research to support evidence-based action, acting almost like a What Works centre (described as “centres for useful evidence,” by Huddart, 2017).

Collective impact is another specialized tri-sector approach to collaboration that has grown in popularity and demonstrated impact. McIsaac shared the history of the Toronto Region Immigrant Employment Council (TRIEC), which developed in 2003 when immigrant employment emerged as a thorny issue despite a rare moment of intergovernmental consensus. After a meeting at the Manulife office, Maytree and the Toronto City Summit Alliance (now known as Civic Action) helped the private sector realize the genuine value for businesses that could be unlocked through a sustained effort to address systemic issues. C-level executives, especially from the financial sector, provided leadership and made initial investments into specialized programming. This was combined with extensive industry and government convening to build bureaucratic buy-in, creating appetite for policy change and a willingness to take risks.

Much of this new wave of collaboration is “supercharged” by open data, in the words of Michael Lenczner of Powered by Data. Not only does open data enable greater information sharing, it transforms collaboration from being an invite-only exercise to an opportunity open to anyone interested in participating.

By many accounts, the innovation ecosystem is richer and more diverse than it was 25 years ago. Since Couchman’s piece, technology has made collaboration cheaper and easier, providing access to information and improving evaluation. Network organizations have increased learning opportunities and distributed risk; small, nimble organizations have sprung up, testing innovative approaches, and increasing systems resilience. Co-creation and social enterprise, if not new concepts, are embedded in the community psyche and the spaces between business, charity, and government, once as clearly defined as the Berlin Wall, have populated rapidly In other words, it is a good time to be an innovator.

At the same time, as discussed in Part I, humans have not changed that much since the 1990s. Many of the long-term issues that created resistance to innovation still exist. Individuals are hesitant to risk their careers, and the institutions they run, in a competitive market. Organizations are reluctant to take successful innovation past the pilot phase for fear of impact on sacred programing and the loss of core funding. For the most part, funders do not make the long-term and fulsome investments required to bring many innovations to scale and evaluate their effectiveness while contributing to essential operations. And this focus on the shiny and new has led to deteriorating support for approaches that are no longer considered innovative enough, although they may continue to work extremely well.

It’s been some time since we could consider the wheel an innovation, but we still use it.

What can we expect moving forward? As history continues to demonstrate, the unexpected will likely be the greatest driver of innovation and systems change. Events, many of them unfortunately negative, will force us into innovations that would not have been considered months earlier. Large institutions, from universities and symphonies, to media outlets and social services agencies, will innovate, or see their place taken by many smaller, nimble entities and self-organizing groups. Systems will become more resilient as organizations embrace risk and fail forward, learning, sharing, and adapting as they go.

And what can the philanthropic community do to promote and support innovation?

Couchman would likely have the same answer to that question as we have today: Jump in and start swimming. The water is fine.

 

The authors would like to thank the following individuals for taking the time to review the original 1992 article and provide reflections and input toward the themes for this piece: Shaun Loney, Aaron Good, Katherine van Kooy, Sara Lyons, Elizabeth McIsaac, Andre Vallillee, Anil Patel, Patrick Johnston, Michael Lenczner, Kofi Hope, John Mighton, and Nick Saul. 

 

References

Community Foundations of Canada. (2016). Annual Report: 2015 Year in Review. Community Foundations of Canada. Retrieved from http://communityfoundations.ca/resources/2015-year-review/

Fritz, J. (2016). Inputs, Outputs, Outcomes, Impact – What’s the Difference?. The Balance. Retrieved 22 June 2017, from https://www.thebalance.com/inputs-outputs-outcomes-impact-what-s-the-difference-2502227

Huddart, S. (2017). Seven Years On and Seven Years Out: Revisiting “Patterns, Principles and Practices in Social Innovation”. The Philanthropist. Retrieved 22 June 2017, from http://thephilanthropist.ca/2017/04/seven-years-on-and-seven-years-out-revisiting-patterns-principles-and-practices-in-social-innovation/

Loney, S. (2016). An Army of Problem Solvers. Winnipeg: McNally Robinson.

Moreno, E., & Plewes, B. (2007). Thinking Globally? Canadian Foundations and Trends in International Philanthropy. The Philanthropist. Retrieved 22 June 2017, from http://thephilanthropist.ca/2007/10/thinking-globally-canadian-foundations-and-trends-in-international-philanthropy/

Penna, R. (2011). The Nonprofit Outcomes Toolbox: A Complete Guide to Program Effectiveness, Performance Measurement, and Results. Hoboken, N.J.: Wiley.

Philanthropic Foundations Canada. (2015). Emerging Data Practices for the Philanthropic Sector. Philanthropic Foundations Canada. Retrieved from http://pfc.ca/wp-content/uploads/2015/06/pfc-digital-data-practices-june2015-en.pdf

The Center for Effective Philanthropy. (2015). Assessing to Achieve High Performance: What Nonprofits Are Doing and How Foundations Can Help. The Center for Effective Philanthropy. Retrieved from http://research.effectivephilanthropy.org/assessing-to-achieve-high-performance-what-nonprofits-are-doing-and-how-foundations-can-help

Van Ymeren, J. (2015). An Open Future: Data priorities for the not-for-profit sector. Toronto: Mowat Centre. Retrieved from https://mowatcentre.ca/wp-content/uploads/publications/107_an_open_future.pdf

[1] For a simple explanation of the difference, see this blog post by Joanna Fritz (2016); for a fuller treatment, see Robert Penna’s The Nonprofit Outcomes Toolbox (2011).

Nabeel Ahmed has been working in the not-for-profit and social enterprise sector for six years, most recently as Network Coordinator for Social Enterprise Toronto. He is currently pursing a Master of Environmental Studies at York University, specializing in urban planning.

Stephen Couchman is the son of Bob Couchman. He has been an advisor in the philanthropic sector for more than 17 years. Among other activities he is a founding member and director of The Circle on Philanthropy and Aboriginal Peoples in Canada. Stephen lives in Grey County, Ontario.

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