June 16, 2013

Open Debate, Not Politeness, Is What Drives Nonprofit Innovation

Everybody in the nonprofit world talks these days about innovation, but not about what drives change: open debate and critical thinking.

In science, technology, business, academe, and elsewhere, people are encouraged—and are given forums—to express opinions and disagree with each other publicly. But nonprofits and foundations continue to embrace a culture of silence and politeness that gets in the way of their growth and vitality. Yet it’s impossible to change the world unless we create more opportunities for people to regularly call into question whether a nonprofit’s or foundation’s activities are effective, ethical, and strategic.

We don’t need to dive into the pool of vitriol and incivility that marks the current state of public discourse. But we can pursue a middle ground by building a culture that encourages healthy skepticism.

The peril of not taking this approach is that we risk wasting money, time, and other resources that are already stretched too thin.

We all know of nonprofits with high-profile brands, savvy marketing skills, or charismatic leaders that receive tons of foundation money even though the evidence shows they’re not achieving their missions.

Rather than raise questions about this publicly, however, we usually hunker down and complain behind closed doors, in between conference sessions. That practice, though, has a cost: The money keeps going in that direction, making it harder for organizations that are getting results to attract support.

The same thing happens when nonprofits are held up as exemplars of innovation even though they’re really just recycling ideas that others have tried or been doing for years. Rewarding them with grants and publicity sends a message that being an effective organization doesn’t really matter; what matters more is how it’s packaged. 

It’s tempting to blame the lack of critical thinking on the “power imbalance” between grant makers and nonprofits. While that may be one cause, it’s not the only reason: Nonprofits themselves are reluctant to engage in healthy public discussions about whether what their peers are doing makes sense.

That silence is understandable, but it can be unhealthy and ultimately self-defeating—for both nonprofits and grant makers. Nonprofits aren’t given the chance to have thoughtful and open conversations about the findings in ways that could help them strengthen their own activities. And philanthropists don’t have the benefit of getting honest, first-hand perspectives from a broad array of organizations with expertise.

The irony is that we live in an era in which institutions in other domains are embracing transparency by inviting public feedback and critique, due to the proliferation of new technologies that demand it.

But that same technology can have a downside. It can lead to echo chambers—areas of cyberspace where ideas that may be implausible are repeated, overheard, and repeated again (often in exaggerated form) by like-minded people.

That can and does happen in the nonprofit world when everyone listens to the same anointed sources and what they say becomes our form of reality. (And if you have any doubt, just scroll through the Twitter feeds of prominent organizations and people in philanthropy.)

Fortunately, a small but growing cadre of critical thinkers is trying to change things by starting to ask tough questions and demanding honest answers from grant makers, their peers, and their constituents. But what questions should we grapple with as we confront tough issues? 

Here are some to consider before racing to pronounce the “next big new important thing.”

Is what’s being touted as “new” really new or is it just something old with different packaging? If it’s not new, then it’s important to know whether the approach worked in the past. If it didn’t, understanding why might help to point out fixes that will allow it to succeed next time. One example is what used to be referred to as “cross-sector collaboration,” which has since become “collective impact.” 

Program and mission-related investments, which have been around for a long time, are now promoted as essential components of “impact investing.” Both are important concepts, but we don’t yet know how well they work.

Is there evidence to show that the idea has promise? If an idea has been tried, proof about its worthiness should be available, based on a rigorous methodology—one that goes beyond self-reports, marketing language, small case studies, or biased samples.

Take social-impact bonds, for example. The results are not in yet from a rigorous study now under way in the U.K., so nobody knows yet whether this idea works; yet it hasn’t stopped nonprofits, donors, and governments in the U.S. from pouring hundreds of millions of dollars into the approach.

Who’s behind the idea? It’s important to know whether someone or some organization benefits from marketing an idea as new. Ask what experience the group has in adopting the idea to work in the places where it leaders want to try it next. And always find out whether they are eager to make an idea broadly accessible if it turns out to be successful or whether they are hoping to keep it to themselves so it can become part of the group’s image and brand (therefore making it easier for the group to get more money). 

Even worse is if the idea is being plugged by “important people or foundations” that point to other “important people or foundations” also supporting it. That’s not proof that something works; it’s an echo chamber.   

Is the idea pitched in jargon-laden hype that suggests it can solve every problem? Few ideas can really do as much as their promoters say. Even the most exciting hypothesis may not yet be proven and may not work in every situation.

What realistic potential does the idea have of being expanded to other places? Too often people race to suggest that an idea should be copied elsewhere without understanding that what may work in one place may not work in another. 

Does the idea take nonprofits away from their missions? Does it help them or simply or divert their resources into building expensive systems that this new thing requires? Nonprofits often forget that when they get a new infusion of money for a program, they may have to pay for a whole new set of expenses. If the expenses outweigh the new grant, it’s probably time to look elsewhere.

Has the idea been designed with suggestions from the people it’s supposed to help? So often new ideas, like microfinance or impact investing, are deployed before anyone has listened to the people the approach is supposed to benefit or asked them to get involved in developing a new approach. 

Is the goal to help an entire community? Or is it mainly to increase revenue for one group? Many new ideas touted for nonprofits are mostly about changing where the revenue comes from: for example, in the case of social-impact bonds, private investors rather than government. But as Kate Barr, executive director of the Nonprofit Assistance Fund, says, the real question should be: “Will it result in better outcomes for people?” 

Getting the answers to such questions is a first step to encouraging vigorous critical thinking, discussion, and analysis.

Nonprofits need more, however. It’s time to create public forums and spaces that encourage critical thinking and questioning. And we need all of our organizations and leaders to value and practice strong critical thinking, rather than suggesting that it’s an attempt to impugn the good intentions behind nonprofits’ work.

Such changes would mean that money would be used well, fewer opportunities for change would be missed, and every nonprofit and donor would do better in meeting our duty to society. That would be one goal nobody would need to debate.

Cynthia Gibson is a consultant to nonprofits and foundations.