December 27, 2011

Philanthropy Buzzwords of 2011

The world has been buzzing all year about the “Arab spring,” “Occupy” movements, and the “European debt crisis.”

Similarly, people in philanthropy have their own lingo to describe their preoccupations of the past year, particularly as the government’s financial challenges and growing competition for scarce donations put ever more attention on nonprofits that produce results and know how to get their messages out to the public.

Here, then, are the 10 philanthropy buzzwords that capture the essence of 2011 for nonprofits:

10. #

The most important buzzword of the year is the Twitter hashtag. Philanthropy finally got hip to Twitter this year (as did so many people, thanks to the uprisings across the world and Twitter-enabled TV shows). One great example of how this Twitter convention has become part of the lexicon was the Case Foundation’s end-of-year #GoodSpotting campaign, born to be memorable and social-media-friendly, hashtag and all. Forget about folks fumbling to come up with “bumper sticker” statements or even sound bites. #Whatmatters­nowisthehashtag.

9. Amplify

Without a doubt, 2011 was the year of “amplifying” philanthropy. Is it a social-media thing? Have we given up on leverage? Scale? The Foundation Center held a conference called Amplify Your Impact; the Tides Foundation, a network of donor-advised funds, says it helps donors “simplify and amplify”; the Women’s Funding Network advises donors “Don’t filter, amplify”; and the Philanthropy Workshop West promises to help generous wealthy people “amplify and magnify” their work.

8. Disruption

Disruption is the new black. Clayton Christensen, a Harvard business professor, began the trend with his classic management books that outline what he labeled disruptive innovation. This is the kind of thinking that launches whole new industries rather than just “new and improved” products. He’s gone on to write books on how to “disrupt” the health-care system and elementary and secondary education. I contributed to the theme with a report, “Disrupting Philanthropy: Technology and the Future of the Social Sector.”

Others have written on disrupting homelessness, media, technology, and manufacturing. Disruption may soon replace innovation as the most overused and approaching meaningless term in philanthropy.

7. Shape-shifting

Shape-shifting is what happens when an organization changes corporate form, usually shifting from nonprofit to for-profit. In the 1990s, we saw health-care organizations and student-loan providers make this shift, spinning off philanthropic foundations.

The sale of nonprofit Jumo to the for-profit Good magazine raised the issue again in 2011. Two other recent instances of shape-shifting were the conversion from nonprofit to commercial status of the Web-site verification firm TRUSTe and the online community site CouchSurfing, both of which raised significant venture-capital investments along the way.

Shape-shifting raises valuable questions about the range of organizations that can produce social good, their relative effectiveness, and the role of both private and philanthropic capital in catalyzing these enterprises.

6. Evidence-based practice

Evidence-based practice got its start in medicine, then spread into domains such as education and nursing. The idea is to make sure good quality research, not just tradition or conventional wisdom, backs up the basics of how professionals do their jobs. Now evidence-based practice is expanding into philanthropy.

The spread of evidence-based practices seems to be in direct proportion to the growth of program-related investments, impact investing, and social-impact bonds, all tools that need external standards for success.

This is not a fly-by-night buzzword. Evidence-based is a rigorous approach to the application of research to practice, and while the approach may not have all the answers, we can expect to see more of it.

5. Infographics

The age of big data has set loose the age of infographics. Infographics include cool interactive maps, Venn diagrams of apparently unrelated events, and trend lines everywhere. Infographics are the ultimate “pictures that say 1,000 words.” Like so many buzzy things, infographics were once rare and cool and now are overhyped and overused. Let us hope that good and useful graphics become more commonplace. 

4. Charitable tax reform

2011 has seen some wild political fights. Real discussions of charitable tax reform have been included in legislative budget proposals for more than a year, starting with President Obama’s deficit commission in late 2010 and continuing through the dog days of late July, early August leading up to the debt-ceiling extension.

Through all the political fights and all the proposals for budget balancing and deficit reducing, ideas for changing how the tax system treats charitable giving have stayed on the table. Don’t expect this issue to go away anytime soon.

3. Storytelling

The more data we get, the better we get at data visualization, the more we are swamped with numbers and graphs and information in general, the more we need stories. They are the oldest way we have to make sense of things. Good storytelling is going to become ever more important. Stories and data will need each other evermore. While new whiz-bang technologies come along day after day to help us show our data, the art and science of good storytelling is what really makes the difference. This buzzword describes efforts to rediscover the tried and true among the new and shiny.

2. Collective impact

This term shows the power of a good buzzword to compel an idea. There’s nothing new about government, nonprofits, the public, and commercial businesses working together. But the phrase “collective impact,” coined by the prominent philanthropy advisers Mark Kramer and John Kania, helped focus attention and raise the idea to prominence again.

1. Social-impact bonds

This new type of financing for nonprofits comes to the United States from the UK. Through these bonds, private investors pay for a program, then, if the program meets its goals, the government repays the investors. If it fails, the government doesn’t pay anything.

It’s too soon to know how effective these bonds will be for drawing in more capital to social good. But keep an eye on this type of innovation in how to pay for services because new approaches will now take off.

Lucy Bernholz is a managing director at Arabella Advisors. She writes about trends on her blog, Philanthropy2173 and has just published “Blueprint 2012,” her philanthropy industry forecast for the year ahead.