I recently got a real taste of what this means as we looked at the social sector landscape in India.

As technology innovators, we are naturally excited by new ideas and, in India, my team was pushing for ground-breaking innovation in health care delivery. We wanted to integrate a new range of patient-centric home medical devices for monitoring and diagnosis using a hosted cloud-based service (built over a connected infrastructure), and to establish a centralized service for remote management. It was a rude shock to learn that while we were advocating the use of the latest cloud, M2M, and mobile technologies, the existing system had not yet applied even two-decade-old basic computing technologies. Many of the ongoing health care programs we observed still used hand-filled paper forms for data-entry and tracking. Within one organization, which ran a pre- and post-natal assessment program, it was open knowledge that data entered by community health workers was rarely monitored, compiled, or acted on.

No wonder it was not easy to measure the success or impact of the program, or to plan for improvements. Timing, resources, effort, and costs were far from optimal, and so much could change—both in quality and effectiveness—through better management of technology we already have available, such as mobile, real-time data entry applications connected to a central server or applications that extract data from central databases to create reports and dashboards.

In contrast, we also came across smaller initiatives that were using “the latest” technologies, including Mobile Alliance for Maternal Action (MAMA), which provides low-income new and expectant mothers in India, South Africa, and Bangladesh with vital health information via mobile phones using SMS and voicemail.

While immensely useful for MAMA participants, technologies like these are insufficient to radically impact the landscape. Technology is still in the hands of a limited few, and effort is needed to broaden the reach.

We are at an interesting stage of social evolution and technology maturity, and it’s time to step back and re-consider our priorities. While new technologies continue to surprise us with their vision and possibility, there is a great deal of untapped potential in consistently applying existing technologies to support, and in fact, direct social change.

Our focus needs to move away from technology innovation to technology application. We should look for solutions—tested and proven in other business sectors like finance, travel, retail, etc.—to build innovative applications for the social sector. This approach will save us from the overhead costs of introducing new technology, as well as temper the complexity and risk. However, this still requires a new outlook to service delivery and innovative business processes; more specifically, it requires a focused effort to manage and direct technology in areas that lead to effective, widespread social change.

The first step is to define a common framework for technology integration, and to apply that uniformly and consistently across all social initiatives. We should keep in mind that technology can emerge as a tool for social development only if it helps to achieve five goals for any social program—these parameters can be used to to gauge the readiness, relevance, and impact potential of new initiatives.

1. Extend reach. Access should extend beyond a limited few to millions through improved and diversified access technologies—for example, reach low-income users who have low-end feature phones with SMS and simple voice messaging, and reach smartphone users with existing apps.

2. Improve services. This can be done by driving new service delivery models that take advantage of geographical and resource gaps. For example, cloud and hosted services can deliver expertise and information to remote regions, providing accurate and otherwise unavailable diagnosis and treatment in health care.

3. Facilitate adoption. Build on convenience, and make it easier and more fun for users to employ technology anytime, anywhere; introduce easy-to-use mobile applications, one-click user interfaces, and other simply designed tools.

4. Deliver relevance. Provide targeted services that tailor to the specific needs of each group. For example, a service to remotely monitor the physiological symptoms for post-operative care reduces health care costs significantly while improving patient comfort and experience. (Note that a service like this requires an integrated arrangement between the patient and the service provider, where the needs and pain-points are well understood on both sides.)

5. Reduce cost. Introduce efficient, optimized processes. For example, use of digital forms  and implementation of real-time data mining and analytic applications can ensure timely action on data and improve the overall return on investment. Use of technology can facilitate automation and reduce overheads.

Internet communication is driving the creation of a connected society, and the growing reach of the mobile phone gives us the opportunity to integrate larger populations into our global, connected society. Together, Internet and mobile provide a platform that has the potential to drive rapid social change unlike any other in history. We can achieve far more than we have by using these technologies as an infrastrcuture to transform education, health care, energy, agriculture, and the environment.

A closing example: In a country like India, the biggest challenges to education are making skilled teachers available in remote areas, and addressing issues around geographical diversity, proximity, and access. Right now, no one is looking at creating a new education delivery channel to facilate virtual classrooms and long-distance learning—that’s despite a government initiative to put Aakash tablets (government-sponsored $50 tablets) into the hands of every one of India’s 220 million school and college students.

It is critical to ensure that we take full advantage of current technologies. It is time for us to recognize that it is in our hands to manage and make the most of existing technology to drive effective, widespread change. Simple ideas can drive local, regional, national, or even global impact on social issues.

I was a founding member of several civil society organizations and campaigns advocating change to Lebanese policies and practices in areas such as citizenship and accountability, electoral reform, women’s rights, information access, education systems, and anti-corruption. Still, reform in Lebanon remained impeded by the lack of political will among public officials and the weak capacities of Lebanon’s public sector. The impact of these organizations’ efforts was never up to our aspirations.

In 2009, a group of activists, including me, began to explore new ways of influencing change. We concluded that we were demanding change from a structure that could not do what we asked and came to the realization that three elements were necessary for successful reform: new, capable, progressive leadership; evidence-based policies and solutions; and a more responsive and inclusive public sector. With this in mind, we started a for-profit consulting firm and social business called Beyond Reform & Development, specializing in policy research, public management reform, and people development.

This move enabled us a take on a more professional, collaborative, and influential role with government institutions, political parties, and international organizations. Today, we offer policy advice, learning opportunities, and management solutions to governments in the Levant, the Gulf, and North Africa. This has allowed us, in many cases, to direct the path of reform in government institutions rather than simply demanding that someone else do it. As a business, we are more able to initiate change and provide solutions and build capacity where governments and international organizations need it. The move from non-governmental and nonprofit to a private sector, for-profit company was also a strategic choice to overcome donor reliance and agenda-driven funding.

Our business model has helped us expand and impact communities at an exceptional rate. The model invites like-minded individuals and groups to join and offer their expertise to support the work of public officials and compliment the work of international organizations. We are a social business for several reasons. First, the company is purpose-driven, and all of our projects and initiatives serve social, political, and economic development in the Arab World. Second, our consultants constitute the company's 14 legal and financial partners. All new employees have access to an incubation program through which they can own shares and contribute to the company’s growth and impact. The business is, therefore, owned by citizens who are engaged and willing to use their expertise in the service of reform and development in the Arab world. Third, our governance system is a partnership model based on equitable participation in decision-making rather than on financial equity. Fourth, our clients and beneficiaries are part of the decision-making process via internal and external consultations, and advisory board and feedback mechanisms.

Finally, 10 percent of our profit is reinvested in Lebanese social and political causes that we identify as a result of:

• Sectarian, unqualified political elite with a discriminatory discourse that can trigger civil violence
• Weak public institutions and low-quality public service
• Limited human capacities in government that are capable of providing solutions to citizen problems

I believe that social entrepreneurship in Lebanon can help overcome the government’s inability to ensure quality social and economic services for all citizens, civil society’s dependence on international funding, and the sustainability of private sector businesses threatened by economic challenges and financial crises. Our business has become increasingly involved in supporting social entrepreneurship, and now promotes the concept as a way of addressing Lebanon’s social, economic, and political challenges. Our initial motivation was our belief that any enterprise created to serve a social need deserves a fair, incentivizing, and innovative regulatory framework.

We have since embarked on a journey to identify the challenges to and opportunities for social entrepreneurship within the Lebanese context. Following two years of research and mapping, we issued a report entitled “The Social Entrepreneurship Momentum,” which contains definitions, criteria, and recommendations for understanding and enhancing social entrepreneurship within the Lebanese context (request a copy by email). There are social entrepreneurs across the country, but until recently, they did not identify themselves as such. There is currently no legal framework to categorize social enterprises, which means that social entrepreneurs are treated as any commercial business.

The report highlights focus areas for promoting social entrepreneurship in Lebanon, including:

• Regulating a new legal statute for social enterprises
• Developing tax incentives for social businesses to encourage social investments in sectors such as health, education, and the environment
• Improving the technological infrastructure and accessibility to the Internet in rural areas
• Creating collaborative platforms and networks among members of the social entrepreneurship ecosystem
• Integrating social entrepreneurship into Lebanon’s education sector

Social entrepreneurship is a new paradigm in Lebanon, and it is enabling us to shift from passively demanding to actively taking initiative and becoming part of the solution. We now work on political development, educational systems, women’s empowerment, constitutional development, Information and communication technology strategies, administrative decentralization, and local economic development in 12 Arab countries. Provided the framework, others in Lebanon will have the opportunity to take advantage of this new momentum in the region, and invite the private, public, and civil society sectors into collaborative platforms to solve economic and political challenges.

We once looked to charitable giving and philanthropy as the primary, perhaps even exclusive, sources of private money for public good. The last half-decade has seen significant growth in impact investing, a phenomenon—some would call it a movement—that is fundamentally changing capital markets for nonprofits and social enterprises. These investment dollars, which can come from endowments, venture capitalists, angel investors, private equity, and institutional asset managers are geared toward expanding the capital pool available for socially productive, financially positive endeavors. Estimates of the total assets available for impact investing vary significantly, with ten-year projections ranging from tens of billions to trillions of dollars.

Impact investors use a range of asset classes from debt to equity. The managers of these assets are increasingly visible, organizing themselves in industry-wide associations such as the Global Impact Investing Network, promoting shared standards such as the Global Impact Investing Reporting Standards, and building publicly accessible databases of managers and funds such as ImpactAssets. Impact investing includes not only a focus on expanding the pools of available capital, but expanding the range of investable enterprises as well. Three new corporate forms—benefit corporations, flexible purpose corporations, and low-profit limited liability companies (L3Cs)—have been chartered in a limited number of states across the US to help build this movement and put the investment assets to work.

Expanding the pool of private capital for social good—from the current $300 billion per year in US charitable giving to a pool that would count both charitable dollars and impact investments—is potentially game changing. Some see it as a welcome innovation in improving capital funding for organizations that produce social benefits. Others see it as a welcome response to enduring and deep state deficits and drained public coffers that will limit, for the foreseeable future, the amount of public funding for organizations that produce public good. It is fair to say that the impact investing movement, both capital and enterprises, is one of the biggest forces of change currently shaping the new social economy.

So how do we see nonprofits and philanthropy, social enterprises, and impact investing fitting together to produce the greatest public good from these private resources? A new report from The Monitor Institute and Acumen Fund (“From Blueprint to Scale”) notes that philanthropic investments are key to catalyzing both the impact investment movement and the enterprises that impact investments can scale. Similarly, the Omidyar Network has spent almost a decade learning about and improving its use of a range of investments, from grant dollars to risk-adjusted equity investments, to achieve its social mission. One possibility is the emergence of a tested sequence of investment types and opportunities along which donors, philanthropic endowments, and impact investors will array over time.

But we must also ask if, and where, these different types of capital inputs either work at cross purposes or cannot be easily sequenced. For example, are enterprise structures developed to use impact investments—such as benefit corporations or L3Cs—valuable complements to existing nonprofit structures, or does they somehow shift what we need traditional nonprofit corporations to do? Are the governance requirements that exist to protect the public purpose of these new enterprises up to the task, and are they consistent across enterprise forms? Should they be? In our dawning age of big and open data, do we have similar expectations of information sharing across enterprise forms or investment pools, and should we? Most important, are we holding each of these enterprises and investment forms to a comparable, fair, and meaningful set of outcomes and outcomes reporting? Are we tracking where the dollars invested are coming from and where they are being invested?

Some of these questions can only be answered with time. Some may be best addressed through industry norms and practices. And some may require new policies and regulations that consider the entire social economy and its contributions to public good, not just the individual segments of philanthropy and impact investments. These are the topics for discussion at the next charrette on Impact Investing, tomorrow, May 15.

All materials from and information about the project can be found at ReCoding Good and Stanford PACS. We invite you to join our email list, talk with us on Twitter (#ReCodeGood), and to share your thoughts with us.

At many universities, academic departments undergo periodic strategic assessments. Schools seek a clear-eyed look at the direction and priorities of each department so that they can assess practices and compare them to departments at other universities across the country.

The typical review includes an internal assessment conducted by a select group of internal stakeholders, which may include department coordinators, leading faculty, alumni, and administrative staff. Peers—faculty and staff from programs at other universities—then use this assessment as the basis for an external review. The external review team for a department at the University of Texas, for example, might include peers from the University of Alabama, Harvard University, Tulane, and New York University.

The external review team is recruited, reads the internal review, and then does a site visit, where they meet with a wide range of stakeholders—including students, faculty, and community members—over the course of several days. The team submits a report, which the head of the department uses to develop the strategic plan.

Coming from a nonprofit evaluation and strategic planning perspective, this seems a slow and expensive process that doesn’t necessarily focus on outcome measurement or performance metrics. But there is a nugget here that might make it a model worth considering despite the challenges.

Imagine a new nonprofit board governance practice where every three years, organizations engaged three to five leaders from peer organizations in other parts of the country to conduct an assessment of its work.

The external review team would look at all aspects of the organization, including program design, organizational structure, fundraising, and board engagement. The team members would also reflect on their own organizations’ experiences and share knowledge—what worked, what didn’t work, and what potential strategies that the organization under review might consider.

This approach could create a whole new level of accountability. Boards too often depend on the perspective of their organization’s executive director to define what is possible or effective. There are no activists yelling at them, and they rarely experience media scrutiny. Informed feedback from peer nonprofit executives would better enable boards to truly govern, and to set the vision and strategy for their organizations.

This could have some compelling secondary benefits as well. It likely would reenergize the nonprofit leaders who conduct the assessments, providing them with fresh perspective and new ideas. It would also create networks of support for these leaders and potentially lead to new partnerships.

Given the nonprofit sector’s tendency toward collaboration over competition, this approach has potential. Holding boards accountable to peers nationwide could enhance the cohesiveness of the sector as a whole, driving social progress in a more streamlined way.

Traditionally, foundations have tackled our most vexing problems primarily by making grants to organizations. Foundations are required to make annual charitable contributions of at least five percent of their total assets. These overwhelmingly are done via grants and most stay very close to the five percent minimum. The remaining 95 percent of assets are maintained in an endowment and typically invested in a diversified portfolio in order to preserve or increase value to enable continued giving in the future. The proposed rule issued by the Treasury Department and IRS would make it easier for philanthropies to make what are called Program Related Investments (PRIs).

PRIs allow foundations to put more of their resources to work to advance their charitable mission through means other than grant making—such as, equity investments, loans, loan guarantees, or other investments. Despite their flexibility, PRIs historically have not been used with much frequency because of confusion as to how they work and the high costs associated with them. For example, many foundations find it necessary to proactively seek legal counsel to confirm that an investment would qualify under the definition of charitable purpose even before using a PRI. 

To address these concerns, the Treasury Department and the IRS proposed a rule that includes updated examples of how private foundations may use PRIs to fund charitable activities, which will help foundations make these investments more easily and at a lower cost. The guidelines illustrate that organizations can use PRIs to support groups working on a diverse set of issues from preserving the environment, to furthering education and scientific research, to relieving the poor and distressed. 

This important update is the first in 40 years since PRIs were implemented in 1972.

The proposed rule also clarifies how foundations can use different methods, such as credit enhancement arrangements, to strengthen the capacity of organizations. This approach can leverage the balance sheets of foundations, enabling “capital activation” and potentially adding significantly to their capacity to drive social impact. Such methods can serve as an indicator to other institutional investors about the possibilities of deploying capital in creative ways to generate value and strengthen communities.

A PRI is an investment made by a foundation, which, although it may generate income, is made primarily to accomplish charitable purposes. PRIs are novel for several reasons.  First, they provide foundations with the flexibility to fund activities, serving charitable purposes in a variety of ways beyond conventional grants.  Second, such investments can be made to tax-exempt charities but also to social enterprises and conventional businesses. And third, unlike conventional grants, PRIs can take various forms, including equity investments and low-interest loans.

These guidelines do not cover all the potential scenarios, and public comments on the proposed rule have been requested by July 18. We hope that the proposed rule will spark a dialogue over the next two months with the philanthropic community. Through feedback on the guidelines and an exchange of ideas, we hope to update the regulations in a manner that serves the public interest. This additional guidance is expected to facilitate the ability of foundations to determine whether investment qualifies as a PRI, reducing the transaction costs, conserving a foundation’s resources for additional charitable activity, and increasing capital flows for charities and social enterprises that can create jobs and generate impact.

Some questions for SSIR readers:

If you work for a foundation that does not use PRIs, will the proposed new rules make it easier to do so—and how specifically?

If you work at a nonprofit or business that pursues charitable activities, have you benefited from PRIs? Do the new examples help you to understand how PRIs can be useful?

Please provide your comments below.

As a Minnesota-based nonprofit capacity-builder, we at MAP for Nonprofits wanted to dig into a few questions around the role of technology in nonprofit innovation: Can improved use of technology help nonprofits traverse this environment? And can nonprofits take better advantage of available technologies to improve the services they deliver without incurring significant additional expense? With the help of the ADC Foundation and our research partner Idealware (which helps nonprofits make technology decisions), we decided to do a study.

We thought our research might reveal that a certain highly effective mix of hardware and/or software was responsible for the majority of innovation in service delivery. We also hypothesized that the organizations improving their service delivery through technology would be very tech-savvy. We hoped we’d find some replicable “jet packs”—cutting-edge applications of powerful technology that were revolutionizing the service delivery.

Instead, we found remarkable examples of nonprofits unleashing innovation through everyday technology, often without big budgets. As we finalized the research last month, I was pleased to conclude that the nonprofit sector has the opportunity to innovate using technology, that even simple innovations can drive significant improvements, and that nonprofits can accomplish even more if they seek out opportunities with intention.

Our research focused on technology use among the Minnesota organizations hardest hit by increasing demands—those providing human services. We surveyed 180 Minnesota human service organizations about how they were using technology, and then interviewed more than two-dozen staff members from organizations that were using technology in effective or interesting ways. The research revealed a number of innovative approaches to service delivery that have transformed how, and how effectively, organizations meet their missions. Each had four things in common—the ability to:

1) Identify needs
2) Understand technology
3) Connect needs and technology
4) Effect change

The need identified by an organization highlighted in our report, which provides comprehensive mental health services and deploys managers to meet with families away from the office at flexible times, was access to information. Case workers in the field were frustrated by the travel time required to go into the office to pick up client files and check current schedules.

The time challenges created enough of a problem that the organization searched for a technology solution. It settled on providing 50 case workers with smartphones running Google’s Android operating system. Today, the workers can access their email, calendars, and client data from anywhere. The organization continues to look for different ways to measure the success of the implementation, including tracking and comparing the satisfaction of clients served by mobile case workers versus those not using smartphones. So far, it hasn’t been able to quantify the benefits, but importantly, field staff feel more productive and there are fewer scheduling problems and delays.

Another organization in our report replicated an innovation it learned about at a technology conference. It used software from an Atlanta nonprofit to create a Community Information Sharing System (CISS). The shared database, housed in the cloud, aimed to collect community-level information and unduplicated numbers, but its benefits soon went beyond that, allowing individual service providers to significantly reduce client intake time (the time it takes to gather a client’s personal and statistical information, which is used to ensure quality and to report data and outcomes). That replication led to innovation: The organization created photo ID cards for clients, which providers scan to gain immediate access to the CISS. The cards reduced staff and client intake time, and eliminated long wait lines at food shelves and other providers. Ongoing efforts include tracking and measuring the program’s success through various data, and all measurements point to the program’s success.

As an advocate of planning, I was surprised that many of the successful innovations we found didn’t result from an intentional process. In fact, many of the solutions didn’t come from people who were tech-savvy. The ideas resulted from the recognition of a service challenge and its intersection with a technology solution. Today, we’re moving forward with what we’ve learned, working with nonprofits in our community to intentionally pursue innovation through technology. For now, we’re using our own innovation planner cards to create a “Medici Effect,” described by Franz Johansson as the phenomenon that occurs when you combine existing concepts in new and different ways, resulting in the extraordinary. We’re hoping to create and multiply solutions, large and small.

Intentionally seeking innovation through technology won’t change the climate forces around us, but it may change the sector’s response to the climate, and help to define new and better ways to do our work.

Download the report, “Unleashing Innovation: Using Everyday Technology to Improve Nonprofits Services.”

The best visions, in turn, are rooted in a set of shared values. Those values define how we pursue the vision that our strategy is meant to achieve. I don’t mean five or six keywords in the annual report; we define our values through how we behave and by showing our constituents what we find important. In this way, strategy and leadership are intertwined.

I spend a lot of time worrying about this issue. As leaders, one of our core responsibilities is to minimize the gap between what we say is important and what we show is important. None of us is perfect—there is always a difference between what we do and say—and so our organizations aren’t perfect either.

But sometimes the gaps are glaring. I’ve worked with groups that say they value “open communication,” only to find that they won’t tolerate dissent. My own team has said to me, “We say that we value meaningful relationships, but we didn’t act that way yesterday.” As difficult as it is to hear that feedback, I know it means we’re working together to close the gap.

It was with this mindset that I read Peggy Noonan’s article, “America’s Crisis of Character,” in the Wall Street Journal. A former speechwriter for Ronald Reagan, she is, without question, a great writer.

The article opens with a recent Gallup statistic: Fewer Americans than ever—24 percent—believe “we’re on the right track as a nation.” She then recaps a week of bad news, including the recent Secret Service and GSA scandals, and concludes that our culture has become a “flat, brute, highly sexualized thing.” The crux of her piece is disturbing: “I think more and more people are worried about the American character—who we are and what kind of adults we are raising.” In her mind, we’re witnessing “a leveling or deterioration of public behavior” borne of lowering expectations so much that “people don’t decide to give you more, they give you less.”

It’s a quite powerful, and honestly, quite depressing piece of writing. Noonan doesn’t offer any help, hope, or solutions. She simply concludes: “Something seems to be going terribly wrong. Maybe we have to stop and think about this.”

Her piece had an immense impact on me. I read the article, thought about it, and then re-read it. Then I did what many of us might do, which was frenetically share it. I posted the article several places online—and waited.

I didn’t have to wait long. Comments fell into two camps: “Yes, this is disturbing, but there’s nothing we can do,” and “Yes, this is disturbing, but it’s nothing new”—basically, resigned acceptance and annoyed acceptance.

One of my friends wrote a more thoughtful reply: “All I read was a synopsis of another week’s bad news. I had hoped for a proposed solution. ‘Maybe we have to stop and think’ doesn’t seem particularly insightful or constructive.”

While true, I thought, in a time when terrible things happen routinely and no one seems to notice, “stop and think” is at least a place to start.

But I think her point is not that we don’t seem to notice, it is that we don’t seem to feel like there’s anything we can do about it. To heal pain, we must feel it. What I read from Noonan was a lament that we’ve become increasingly anesthetized to our own dissatisfaction.

Are there solutions? Of course. Treating everyone equally, regardless of background or appearance; ensuring equal access to opportunity; increasing our intolerance of hate and discrimination; and enforcing all of the above might be the right start to creating a culture where people aren’t victimized and objectified.

At a deeper level, though, there’s a point I feel compelled to make for all of us who aspire to be leaders. The solution starts with the faith that there is one, and with the willingness to believe that we might be able to achieve it.

To go back to my opening thoughts: Those of us with even limited awareness will find constant reminders of our own inadequacy throughout life. We will also encounter constant reminders of the world’s imperfection. It strikes me that the secret to both improving ourselves and changing the world is to let our own imperfections inspire us to a better way of living, and so remind us that the better world we seek is not so far from our grasp.

The truth is that we are not, unfortunately, the perfect people we want to be. And yet isn’t that the good news too? In spite of our flaws, egos, and idiosyncrasies, we each still manage to have friends who care, families who love us, and work that requires our attention. And if that is possible at the personal level, isn’t it possible at the organizational level too? And at the community level? And at the societal level?

I agree with Noonan that the world condition requires reflection. At the same time, the only pretension we no longer can tolerate is the attitude that we are powerless to change what we see around us. I don’t believe it, and neither should you, because it just isn’t true.

Our challenges? Our historic approach to planning has widened the economic and academic disparities between white and nonwhite Portlanders. In addition, and until recently, only 54 percent of our high school students graduated on time. And increasingly, global and national decisions impact our main streets as much as or more than local City Council decisions.

I believe that all cities face these challenges too, and I believe that a different approach to planning can help fix them.

Here’s what I mean: On its own, the federal government cannot move cities forward at the necessary rate of reform. The kind of strategic change this nation needs must start at the local level. Local governments are closer to our nation’s residents and businesses than state and federal governments, and better positioned to understand and address their unique challenges. Additionally, meaningful statewide strategic planning is rare, prevented by lobbyists and politicos who too often gain advantage by stoking our real and perceived societal, partisan, and geographic divides.

We need plans based less on politics and more on the facts; plans with integrated strategies and a short list of specific measures to provide public accountability for real results.

Can local government strategic planning really make a difference? Absolutely. When we plan well, we make progress on some of society’s toughest problems.

For example, Portland’s last city plan, developed more than 30 years ago, focused on limiting sprawl, facilitating urban renewal, investing in light rail (instead of highways), and helping to inspire new business sectors, including clean tech. As a result, we have lowered total carbon emissions 6 percent while the rest of the US has more than a 10 percent increase in emissions. And we’ve done it while growing our population and jobs. When I became mayor of Portland in 2008, we began the process of creating a new kind of strategic plan that adds a critical element: a new focus on the success of our people. The result of that work is the recently completed Portland Plan, which integrates actions to make Portland prosperous, educated, healthy, and equitable.

The plan, adopted unanimously by our City Council in late April, is the result of more than two years of research, 300 public events, and 20,000 comments from residents, academics, youth, workers, businesses, and nonprofits. It’s not just a plan from city government. More than 20 local and state agencies that spend an estimated $8 billion annually inside the boundaries of Portland shaped the plan’s direction and its actions. By sharing the responsibility, they also share the savings and efficiencies that flow from the plan.

Unlike most planning efforts, we didn’t wait to finish the plan before taking action. It’s still early, but we’re seeing promising results, particularly in the areas of prosperity and education. We passed the city’s first economic development strategy in 16 years. We also launched the first Metro Export Initiative in the country in conjunction with the Brookings Institution, and we now have a coordinated, regional strategy that calls on us to double our exports in five years. For the first time in decades, we are seeing increased high school graduation rates—in part due to several innovative new education programs and partnerships. We convened the Cradle to Career partnership, which has mobilized the community into a regional support network for education. We invested in innovative programs including Ninth Grade Counts, which serves as an 8th grade summer school. Another program, Summer Youth Connect, reaches the kids who are most at-risk of dropping out of high school. And, our local Future Connect Scholarships come with academic supports to help students earn a college degree.

Again, these are early actions that emerged from our “reborn” planning process, and they look promising. Since these actions (and all the areas of focus) in the Portland Plan are interconnected, success in one area is designed to improve them all. For example, increasing graduation rates also benefit the economy, which stabilizes our community and helps to level the playing field. Similarly, building sidewalks and bike lanes in underserved neighborhoods helps promote physical activity and provides better access to schools and local businesses.

Implementing this plan may sound expensive, but it’s not: It is first and foremost about doing more with the dollars we already have by embracing individual actions that have multiple benefits. By working across agencies, we can better leverage limited resources.

A plan such as this certainly helps us here in Portland, but it can also inform the state and the nation. If more locales had integrated strategic plans, they would use resources more efficiently; in turn, that might inspire state and federal government efforts so that they become more grounded, realistic, and effective.

Prosperous, educated, healthy, equitable: Taken together, these four interlocking goals of our Portland Plan are the building blocks of a self-reliant city, a Portland where people truly thrive. I hope local governments in all metropolitan regions will join us.

1. Whatever you call us, we have a hard time marketing ourselves. Aside from multiple names—nonprofit, NGO, third sector, civil society—social change leaders everywhere have a hard time unifying the needs and position of the sector to the business community, government leaders, and others.
2. From my earlier work in Trinidad and the United States, and in Northern Ireland and Australia, government is having a hard time understanding what to do or how to partner with us. The growth and changes in government regulation toward nonprofits we see in the US closely reflects what is happening in other countries.
3. The terms fundraising, governance, evaluation, and infrastructure support are used more in the US, but other countries are paying a lot of attention to our sector’s lexicon. In each country I visited, people had questions and requested resources about the “how to” of running an organization—less so about where the sector is going.

I also attended the Skoll World Forum last month and, although I found that my takeaways from the gathering do not directly apply to the majority of nonprofits in the US (small- to medium-sized organizations), seeing leading social entrepreneurs from around the world energized me.

My most valuable experiences came when I stepped off the beaten path. I was particularly inspired by visits to two organizations.

First, I had a chance to visit a homeless shelter in Belfast called the Stella Maris, run by one of Northern Ireland’s largest homeless services providers, Depaul Ireland. The Stella Maris provides 24/7 care, support, and accommodation to individuals with a history of homelessness and severe alcohol misuse, and in cases where rehabilitation may no longer be a possibility. An interesting feature of Stella Maris is that the shelter has allocated “wet areas,” where residents can consume alcohol onsite. Depaul’s CEO, Kerry Anthony, said that Stella Maris is often the only place this population can call home.

As my own father suffered from both homelessness and alcoholism, the shelter immediately became a special place to me personally. As a nonprofit practitioner, I instinctively wanted to ask about impact and what success means for a place like Stella Maris. Anthony said the organization’s first order of business was to create an environment with a “high standard of accommodation.” She said that while it would be great to find move-on opportunities for the residents, its primary purpose is to provide on-going support, including improved access to preventative health care—hugely reducing the need for emergency services—and eliminating duplication of work by other agencies.

What was most refreshing about Stella Maris is that there wasn’t a lot of discussion of impact, just people doing really good work. It was obvious that the driving force behind Stella Maris was caring support and quality service. I often feel that nonprofits I visit in the US are driven by an “impact bottom line” but that there was time when, as my mom used to say, nonprofits aimed to “do good at doing good.”

Another inspiring organization I visited was Melbourne’s Research Design Institute. As I walked along the Yarra River in Melbourne, I came across a row of oddly designed large crates sitting near the river’s edge. Two people sat in front of them, and they invited me to take a closer look. What I saw was simply amazing—the result of thirty research and design teams that came together at Australia’s RMIT Design Research Institute to design solutions to social issues. Last year, RMIT’s focus was on homelessness. Innovative designs included informational websites, a backpack bed and multifunction beds that double as seating or storage, and technical training programs.

I was most moved by how collaborative the design process was. Each innovation seemed to reflect the work of artists, designers, business folks, academics, nonprofit practitioners, and others. In 2010, RMIT focused on alleviating crime, and the top submission—a design model to prevent water theft—was the product of a graphic designer, an architect, a lawyer, a philosopher, and a puppeteer. While there is certainly cross-sector collaboration in the US, it mostly seems to happen in boardrooms, not design institutes.

Getting back to Seneca, after traveling 50,000 miles over two months, I believe I have some new vigor—as well as desire to connect and share information with others. I observed a strong willingness among nonprofit leaders I met to share information, but despite the Internet, social media tools, and all of the other technology available, they seemed unsure about how to effectively connect and share with their peers.

While I don’t like comparing the business sector to the nonprofit sector, it would appear that the business community is far better at sharing information globally than the nonprofit sector. I am sure there is some information exchange happening within specific issue areas, but I do think we are missing out on a larger discussion. What if US nonprofit leaders from organizations such as Independent Sector or Guidestar met with infrastructure groups in other countries to learn, discuss trends, and share best practices? In working with NGOs in Trinidad to create an infrastructure organization, and in conversations with leaders in other countries, I’ve seen a strong desire to connect with similar groups internationally. Here’s hoping that Seneca’s words take root on behalf our sector soon and that vigor leads to greater exchange.

Since 2004, we’ve invested more than $100 million in 26 microfinance organizations—12 for-profits and 14 nonprofits. Roughly half went to organizations working to supply credit to poor people. Another half went to build infrastructure for the industry itself—from MIX, a platform for information exchange, to MFX, an organization allowing lenders to reduce the risk of buying and selling in local currencies.

We know that grant capital was crucial to enabling microfinance to get off the ground—eventually reaching the 150 million-plus customers it has served to date. We suspect the same will also be true for the many other fields—education, health care, etc.—that impact investors work in. So we were pleased when Monitor and Acumen recently released, “From Blueprint to Scale: The Case for Philanthropy in Impact Investing.” This important report, funded by the Gates Foundation, has provoked a critical discussion for our field.

We heartily agree with the overall argument that philanthropy can be a catalyst for businesses that serve the poor. And we like many of the examples of firms—from M-Pesa to Driptech—that benefited from grant capital in early stages. But we also want to raise a few key questions not fully addressed in the report.

1. How can we distinguish between subsidies that accelerate growth and those that stymie market development?

We need to be smart about grant money to avoid distorting the very markets we hope to strengthen. The most obvious risk here is crowding out capital. Over the years, we’ve seen several strong for-profit enterprises serving the BOP that we were eager to invest in—but who ultimately found it too difficult to compete with other companies that had received large grant support from well-meaning philanthropists. Subsidies should be used only in situations when more sustainable for-profit models aren’t feasible (or can’t fully reach an underserved population)—and removed quickly when they are.

A related risk is propping up failure. Venture capitalists know that only some of their investments will pay off; they walk away from their losses quickly in search of the next win. We’re worried that enterprise philanthropists may have a harder time with this, and thus continue to provide grants to failing businesses instead of redirecting their funds to organizations that have the best chance of creating impact. As a field, we need to develop reasonable benchmarks and timeframes to evaluate early success—and develop the discipline to be able to walk away.

2. How do we coordinate limited philanthropic funds for impact investing?
 
If there’s one takeaway from the Monitor report, it’s that impact investing isn’t just about doing deals. It’s about scaling entire sectors and innovations. Such scaling up requires collaboration among policymakers, local entrepreneurs, philanthropists, and commercial funders. And it often requires a combination of grants and for-profit investments.

At present, grant funding in support of impact investing is severely constrained. That’s not likely to change in the near-term. It thus remains an open question whether impact investors can let a thousand flowers bloom—in education, agriculture, financial inclusion, and many other sectors—or whether we need to concentrate our resources in a few key verticals and geographies so as to truly move the needle. We tend to think it’s the latter.

Last year, for example, we worked with McKinsey to map the BOP market for med-tech in India. We found that coordination of market development efforts (certification bodies, consumer needs research, appropriate regulatory policy, etc.) could dramatically accelerate growth—allowing the market to reach a size of 10 billion dollars by the year 2020. Such acceleration would allow much-needed medical services to more quickly reach hundreds of millions of people in need. But it can’t happen without government, philanthropists, and impact investors deciding to concentrate on this sector—and working together in a committed fashion to move it forward.