Innovation's Organizing Principles

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Introduction

Social Differential

Examples

• Ashoka
• Teach for America
• Acumen Fund

Observations & Opportunities

SOCIAL INNOVATION EXAMPLES
Viewed Through Lens of the Prototype Principles

"Our goal is not to give people a fish. It’s not to teach them how to fish. It’s to build a new and better fishing industry."

Bill Drayton
Founder, Ashoka: Innovators for the Public

 

Introduction

Overall, if advancing productivity of what Stephen Goldsmith has called the “social production system” is unusually difficult, it may be all the more reason that the forces for change within this system should include the most highly effective innovation methodology.

 

Thought and action leaders, including Peter Drucker and Stephen Goldsmith, have emphasized that understanding innovation’s driving concepts and methods -- in general and vis-a-vis the array of obstacles to social change -- can help circumvent the obstacles. This section is an attempt to contribute to that cause. It includes four parts:

• "Social Differential" -- Review of this key concept, linked directly to the core prototype of innovation's organizing principles
• Case study accounts -- Three successful and scaled-up examples of social innovation
• Themes -- Discussion of themes spanning the cases
• Opportunities -- Indicated opportunities

The examples, which are viewed through the lens of the prototype principles, are:

• Ashoka, Innovators for the Public
• Teach for America
• Acumen Fund

Of note, although each of these examples is relatively new (or was at the time of drafting these cases, in 2010-2011), examples could have gone further back in time, because certainly social innovation is not new as a practice. Even as a term it goes back to at least 1985 when Peter Drucker used it throughout Innovation and Entrepreneurship. J. Gregory Dees, founding director of Stanford University's Center for Social Innovation, noted that the practice is newly "visible."

 

See too examples of social innovation included within a prototype of the Online Gallery of Innovation Examples, sketched at this site's Learning Applications page. The prototype is at www.InnovationAgents.org.

 

For reference, the prototype principles:

For the purpose of catalyzing the change of more yield from the same resources (e.g., yield in terms of "profit, planet, and/or people"):

• Principle #1 -- Innovation's change catalyst is new "value," beginning with the value to practitioners of compelling purpose.
• Principle #2 -- Innovation's value is forcefully positive
• Principle #3 -- Innovation's essential creative structure is hypotheses
• Principle #4 -- Innovation's hypotheses amplify a force of integration

A. Social Innovation Differential

The concept of a "social innovation differential" is to acknowledge that social change (here addressed as offerings aiming primarily to catalyze greater yield in terms of "planet" and/or "people") often include two fundamental distinctions, which represent considerations added to the core prototype of innovation's organizing principles:

1. Resource leverage often requires that an offering catalyze sustained change in customer behavior and/or capability, beyond adoption.

This first distinction represents an amplification of the core set of organizing principles:

See at this site's home-page introduction of the prototype principles, one of the explanatory comments for principle #2 (Innovation's value is forcefully positive): Needed customer response to value can vary (e.g., need for change in behavior in addition to adoption).

Although this aspect of customer response is not unique to offerings aimed focally at "planet" or "people," it's typical of such offerings. As Drucker put it, social innovation involves “changing people.”

 

Indeed, in some cases of social innovation, the existing resources that offerings aim to leverage are the human-resource customers. This is fundamentally different from offerings proposing new value that is already fully embedded.

 

For social offerings, two fundamental types of response, or change, needed are in: behavior and/or capability. For example:

• Curbside recycling pick-up can offer the value of ease, but advancing the yield of natural resources via recycling calls for customers to change their behavior (catalyzed by the value of ease).
  
  Behavior change often is associated, too, with offerings aiming to advance customer health.


• An educational offering like the online Khan Academy may catalyze use among student customers; however, the use must be effective if the offering is to realize the Khan Academy's aim of advancing learning/capability.

For such offerings, there may need to be different positive catalysts for respective types of change (adoption, behavior, capability).

 

2. The end-customer is not always the purchasing customer.

This second distinction of the social differential comes from Stephen Goldsmith's The Power of Social Innovation. As Goldsmith has explained, the social system’s end “user,” or customer, often does not have the market-based customer’s power of choice.[2] Instead, those choosing an offering might be purchasers such as philanthropists, practitioners within public-service institutions, etc.

To compensate for this often-missing dynamic of the market, an offering's "how" hypotheses may call for attention (and creativity) that goes beyond considerations associated with commercial channels of distribution.

• "How" hypotheses associated with an offering targeted to end users may need to catalyze change for multiple customer levels or segments, often within complex systems of social service delivery:

  For example, initial offerings of food recovery -- intended to advance yield on resources toward the social goal of reduced hunger -- needed to consider fitting catalysts for change among:

  • food recipient “end” customers, plus
  • customers who have recoverable food to provide (e.g., grocers and restaurants),
  • distribution channel customers (e.g., social service agencies),
  • funding source customers, and
  • volunteer labor customers.

  As another example, an offering of instructional improvement intended to advance yield on resources toward a societal goal of student learning (and/or economic goals associated with student learning) may need to consider fitting change catalysts among:

  • student “end” customers, plus
  • teacher and school-leader customers, and
  • additional decision-making customer groups (e.g., school system, parents, and/or taxpayers).
  • the overall political system
• How hypotheses may involve alternate means to acquire end users' influence.
  

For example, one means is to involve end users in the co-creation of offerings, with the benefit of mutual learning between customer and provider.

Another example: "(B)uilding a system so low-income families can rate social service programs the way customers rate restaurants on sites like Yelp" ... "If foundations and government agencies began using customer rankings as a criteria when allocating funding to social service programs — that is, if working poor families got to shape the services they needed to get ahead — it would represent a major, and radical, step forward." [2-2]

 

In combination, these two distinctions can be viewed as a cross-section:

B. Three Cases of Social Innovation and Entrepreneurship

For this report, I drew upon the benefit of existing in-depth information about the development and implementation of the following three successful, scaled-up offerings:

 

Ashoka: Innovators for the Public – Bill Drayton established the Ashoka organization and as of 1984 launched a full-time systematic effort to find and support leading social entrepreneurs with pattern-breaking ideas as Ashoka "fellows." Based in the U.S., Ashoka’s work began in large developing countries and is presently active in the U.S. too. (In addition to the overall account of Ashoka, I incorporate two Ashoka fellows' examples of social innovation.)

 

Teach for America – Wendy Kopp established this U.S. teacher corps with the goal of shifting cultural consciousness regarding equal opportunity for quality education in the U.S.. The shift was to begin with changed consciousness among “top” college graduates who would in their post-corps experiences become U.S. leaders throughout a variety of influential professions (including but not limited to education) and catalyze a broad shift of consciousness. The corps offering is intended to catalyze a path of change toward the ultimate change of improved life opportunities for disadvantaged students via greater equity of educational opportunity.

 

Acumen Fund – Jacqueline Novogratz established the Acumen Fund and its mission of investing “patient capital” in large-scale development of co-created “critical services” for poor populations. Novogratz describes patient capital as a third way of economic development that falls between the market alone and philanthropy alone.

 

1. Ashoka: Innovators for the Public

Bill Drayton’s work via the non-profit organization, Ashoka: Innovators for the Public, may represent to social entrepreneurship something akin to what Frederick Winslow Taylor’s work represented to scientific management. It’s not that Drayton or Taylor invented the respective tools, but each saw potential for vast advances in productivity via widespread application, and each served as hands-on practitioner as well as leader and movement catalyst.

 

To begin, Drayton’s hypothesized lever for advancing social productivity was to find and support a fellowship of peers for the rare “first-class entrepreneurs” who possessed a tested “pattern-changing idea” -- estimated as one in ten million persons.[2] This was Ashoka's initial and core innovative "offering" for the social production system -- the combination of finding and supporting these rare entrepreneurs. Drayton described the goal of social entrepreneurship:

"Our goal is not to give people a fish. It’s not to teach them how to fish. It’s to build a new and better fishing industry."[3]

Further, Drayton’s conception of social entrepreneurship combined the power of innovation and entrepreneurship with the power of ethics:

Of the first type of power -- innovation and entrepreneurship:

"What is the most important ingredient in the change process – any change process? What is the most highly leveraged way that you can help speed up the change process? It’s a big new idea – a pattern-changing idea – but only, only if it’s in the hands of a really first-class entrepreneur."[4]

Drayton's notion of a first-class entrepreneur was based at least in part on his own long accumulation of first-hand experiences and a processing of those experiences. From this, he developed, or hypothesized, a deep and explicit understanding of his rare target customer's talents and psychology. (Detail is below.)

 

Of the second type of power – ethics -- Drayton related a developed understanding within his work as a consultant at McKinsey and Company. He described McKinsey's managerial consulting work as being all about change and all about ethics. Specifically, as Drayton found the work “focused on causing major change,” he observed that “no institution can be healthy, sustaining, and effective unless it is absolutely ethical.”[5] It was a “fit with Gandhi’s insight”; “I was learning about management, but it was the same thing as the rest of the world.”[6] Drayton observed:

• “You can’t be a good person in society without empathetic ethics”;
• “Gandhi always knew that all you had to do to cause change now is to get people to recognize a conflict between their behavior and this core belief. It serves as a ‘truth force’ – you dramatize the falseness of the situation and then society makes a judgment.”
• “This truth force has caused all empires to collapse. Gandhi set in motion the modern politics of change.”

Drayton notes that he “had to have the experience at McKinsey” to be ready to launch Ashoka, even as the basic idea “dated back” to his days as an undergraduate.[7] His views regarding ethics and change resemble John Gardner’s observation that U.S. society shares and understands a set of "middle-level" values that include the ideals of freedom, equality of opportunity, the conception of the worth and dignity of the individual, the idea of justice, the dream of brotherhood. In Gardner's view:

"The fact that we are not always faithful to these shared values does not indicate confusion nor a failure of the consensus. We know the values to which we are being unfaithful. This society is suffering not from confusion but from infidelity."[8]

As a social innovation, Ashoka's offering of a social entrepreneurship felllowship of peers (plus limited financial support where applicable) was to represent new value, or expanded utility, among its niche of social entrepreneur customers. If adopted, the support was to serve as a unique lever for bringing out the rare productivity potential of this human resource.

 

Drayton’s initial goal was to find and work with 50-60 “fellows.”[9] The strategy could be viewed as a fit with Steve Case’s model of “people, passion, and perseverance.” Drayton sought to bring together people who shared deeply developed intuitive sensibility for innovation as a skilled craft and who possessed passion for applying that craft (including its demand for perseverance) toward a particular pattern-changing idea for social change.

 

In 1984, when Drayton launched Ashoka, he viewed a "first-class" social entrepreneur as a human resource that was as rare, isolated, and under-tapped as Drayton believed it was potent. His offering aimed to increase the yield of these human resources: If the social entrepreneur customers adopted the fellowship offering, Drayton hypothesized that this support would bring out the potential of their talent and their commitment to a lever-based vision by encouraging their pursuit of the vision. Drayton intended the fellowship offering to expand utility among the entrepreneur customers sufficiently to affect their behavior, as Ashoka offered them enhanced permission to believe in, and act on, their lever-based visions for social change. The fellowship offering also was to catalyze learning/development, making the entrepreneur customers even more capable.

 

These three types of change spurred by Ashoka's offering -- adoption, behavior, and capability -- would spur social change by way of tapping the productivity potential of the social entrepreneur "customers." Viewed within the framework of the prototype innovation method’s social differential:

 

Beginning full-time in 1984, Drayton launched a search and selection process, which by 2006 had resulted in more than 1700 fellows from over 60 countries. Among these fellows, at the end of five years, Drayton reported:

• 88% have had other institutions copy their ideas
• 59% have achieved national policy impact
• on average each is serving 174,000 people.[10]

However, as discussed at the end of this Ashoka acount, Drayton's lever-based vision didn't stop with the social change that would result directly from the work of Ashoka fellows. He hypothesized further that the results of their work would make visible to society at large what was possible and that this demonstration would catalyze further and broader social change, beginning with broadening adoption of the practice of social entrepreneurship or versions thereof (e.g., "changemaking").

 

To an extent, social entrepreneurship would be like a new technology, and Ashoka fellows could be viewed as the "pioneer" customers within Geoffrey Moore's technology adoption framework presented in Crossing the Chasm. Altogether, Drayton hypothesized that the Ashoka offering would generate more value, or yield, from a broadening base of human resources.

 

Connecting knowledge --

Drayton's initial lever-based vision for finding and supporting first-class social entrepreneurs was rooted in a connection of knowledge that generated the interrelated conception of " what could be" (the Ashoka fellowship offering) and "how it could become" (the operational means for realizing the opportunity). One basic element of knowledge Drayton connected was that there is such a thing as a "social entrepreneur," which again Drayton understood deeply from firsthand experience. For example:

• As an Assistant Administrator at the Environmental Protection Agency in 1977, Drayton introduced the approach to pollution control called “the bubble,” which is said to have been “at the core of the Kyoto agreement.”[11] Drayton described the root of the idea: “How do you make it more attractive for business to fight pollution than to fight the EPA?”[12] The idea was to introduce the utility of a regulatory framework that freed market incentives to work.[13]


• As a law student at Yale, Drayton continued an already life-long pattern (active by grade 4) of recruiting others to support social service ideas by founding “Yale Legislative Services” with one-third of the student body (finding utility and) getting involved.[14]

Drayton also recognized in others the social entrepreneurship style of thought and action, and from time in India he observed examples of this human resource, including friends, having “a very difficult time … with no institutionalized support.”[15] Further, when he was a child, Drayton was exposed to his mother’s work of scouting for special talent – in this case, for “promising young musicians” in New York City.[16] It’s not clear if this exposure to scouting was in any way (consciously or not) a part of the knowledge that Drayton connected in arriving at the idea for Ashoka. If so, the knowledge would fit into the category of “anything and everything.” It would be similar to Steve Jobs’ account of incorporating his exposure to the skilled craft of calligraphy within development of MacIntosh fonts.

 

Altogether, Drayton’s lever-based vision and operational plan for scouting and supporting such entrepreneurs followed from a lifetime’s worth of elements of knowledge and experience and the processing of the knowledge in combination with a personal orientation to resource leverage. Relevant elements of knowledge included not only Drayton's firsthand knowledge and practice with innovation and entrepreneurship and his McKinsey experience but also academic preparation in economics, law, and management.

 

When he received a MacArthur Fellowship in 1984, Drayton took a leave of absence from his work as a McKinsey consultant and committed to full-time focus on his vision to find the entrepreneurs and their ideas for social change. He judged that he and his idea had finished their “apprenticeship.”[17] Drayton described this point as a coming-of-age benchmark for any entrepreneur:

"That is the moment when the entrepreneur knows that they have an idea that is the next big generic step for their field. Then all you want to do is go full time and run with this idea."

 

"How to's" (A complete business model) --

The pivotal “how to” element within Drayton’s lever-based vision was to find the rare social entrepreneurs possessing a tested pattern-changing idea. In the years just prior to full-time focus on Ashoka, Drayton had taken “exploratory trips” with colleagues to figure out how to design a search and selection methodology and how to test it. (This practice fits with what Siicon Valley entrepreneur educator, Steve Blank, calls "getting out of the building.")

 

Drayton wanted a system (a complete business model) that would: “with high reliability, spot major pattern-changing ideas and first-class entrepreneurs before either were proven.”[18] He described the crucial role of an entrepreneur's clear vision for action:

“'How' is the key word for entrepreneurs. We knew that if we couldn’t find a system that would do this reliably across the world, this thing wouldn’t work."[19]

The system began with the clear object of finding the individuals who, along with their ideas, had reached the benchmark of finishing their own “apprenticeship,” as Drayton had finished his. That is:

"Local entrepreneurial change agents who recognized the problems; who understood the political and cultural environment; who had a special talent for spotting opportunities, crafting solutions, and building organizations; and who were determined to pursue their work over decades."[20]

Even as these entrepreneurs and their ideas had “finished their apprenticeships” (had been tested together), Drayton describes that the utility of a fellowship can serve as a tipping point for making the change happen. The concept reflected an understanding of his customers’ psychological subtleties:

"But who are you? What is this idea? At that point, very little makes all the difference. We give you financial means to do that (a stipend level), if you need it. But beyond that, you now are part of a family of your peers."[21]

For the “search,” Drayton’s design featured a nominator and elector network within each country, peopled by likeminded volunteers. This is another example of the “people” portion of the Steve Case formula of “people, passion, and perseverance.” Drayton might have based his recruitment of these volunteers in part on their possession of an innovation/entrepreneurial “style of thought.” As a network, they implemented a search as follows:

"We would go to anyone who had a reputation for doing something innovative for the public good. And we kept asking questions: “Who in your field, as a private citizen, has caused a major change that you really respond to? How does it work? Is it new? Where do we find this person?” Then we’d go and see that person and ask the same questions and get more names. We’d turn each name into a three-by-five card, and as the weeks went by, we’d begin to get multiple cards on people. At the end we had mapped out who was doing what in the different fields."[22]

It was integral that Drayton could articulate for the nominator and elector network in much more specific terms what such a person and idea would be like. A crucial aspect of his cognitive processing had been to explicate in his own mind what he knew tacitly. Whether or not this was conscious or intentional, “explicating what is tacit” is a type of critical-creative processing that the field of knowledge management has associated with innovation.[23] Drayton led this network to scout and screen candidates according to four selection categories, each with explanatory criteria:

• social impact of the idea
• entrepreneurial quality
• ethical fiber
• creativity[24]

Addressing each of these selection categories briefly:

Social impact of the idea:
Guidelines call for knowledge and experience in support of a compelling vision-based insight (or hypothesis). The knowledge sought included "industry" and operational understanding:

"To say that something is new, one must know if the idea has been tried before. … What combination of ingredients makes the candidate’s approach more practical, scalable, or cost effective, or better-rooted politically, than prior attempts?

 

It turns out that the idea is … a product of “how-to's.” A new idea might include these considerations: How to better use local resources to solve a problem? How to overcome cultural obstacles? How to get legislation passed? How to finance an organization? How to train others to do the work? How to motivate clients and staff?

 

Such an idea does not arrive in a flash of inspiration. It takes shape over years in an iterative process of adjustments and readjustments, with new pieces continually being added and others continually being dropped.

 

Every day you’re modifying the idea. You’re seeing new opportunities. You’re seeing new nuances of problems. It’s a continuous process. But it’s hard to talk about it that way because of the way our language is constructed. Because people think about having an idea and implementing it."[25]

Entrepreneurial quality:
Described as the most rare of the four overall criteria, evidence of purpose is central to this selection criterion:

"What differentiates the entrepreneur who is going to change a pattern at the scale we’re looking for from other people? I think the heart of it is that entrepreneurs, for some reason, deep in their personality know, from the time they are little, that they are on this world to change it in a fundamental way. They will not be satisfied expressing an idea. Artists are. Scholars are. Entrepreneurs aren’t.

 

Similarly, managers, professionals, social workers are not happy just with an idea, but they are happy when they solve the problems of their particular group of people: their clients, their organizations. So they will find solutions that are idiosyncratic to a particular situation and they are delighted about that. But none of that satisfies the entrepreneur.

 

Entrepreneurs have in their heads the vision of how society will be different when their idea is at work, and they can’t stop until that idea is not only at work in one place, but is at work across the whole society. And in business, this is called marketing – going beyond the invention in the garage. The same thing is true in the social arena.[26]

 

…(W)ith the typical entrepreneur you can see the roots of the interest when they’re very young. There’s a real coherence to people’s lives."[27]

Bruner too had expressed this last point about a lifetime’s coherence: “In any man’s intellectual life, there are only a few topics, only a limited set of persistent queries and themes.”[28] But “only in retrospect does a continuity emerge.”[29]

 

Drayton’s depiction of entrepreneurial quality also features a sensitivity to, and sensibility about, resource leverage. This is reflected, for example, in “how to's” being integral to ideas. One direction to Ashoka interviewers, regarding what to look for as indicators of the entrepreneurial quality, is to “press them” on how to's:

"Take a how-to issue – “How are you going to solve this problem?” – and push them from the first to the second to the third to the fourth level of the challenge. The real entrepreneurs love that. Because that’s what they spend their time thinking about in the shower in the morning, and they don’t have anyone else they can talk to about it."[30]

Ethical fiber:
Drayton’s explication of ethical fiber spoke further to the function of the entrepreneur's purpose and the force of internal values. Ethical fiber was viewed as essential for connecting with others' values and utility. To begin:

"The trustworthiness of the social entrepreneur – their integrity – is one of their most important assets. People sense that – and if they don’t trust you, they won’t follow you. They won’t make those leaps in their own lives that are necessary."[31]

Drayton provided an example of this force at work with an Ashoka fellow:

"(W)hen Rodrigo sat across the table from the much older, powerful officials he needed to move, they were confronting not just a good idea, but deeply rooted and life-defining values: non-egoistic, kindly determination and commitment. This values-based faith is the ultimate power of the first-class entrepreneur. It is a quality others sense and trust … . (A) quiet voice tells them to trust Rodrigo and go with his vision."[32]

Creativity:

Of this fourth selection criterion for the rare, leading entrepreneur that Ashoka sought, Drayton’s main explication was that there would be a lifelong pattern.

 

 

Examples of Ashoka Fellows:

Two examples of Ashoka fellows and their work are just below, viewed through the lens of the prototype first principles. There are much fuller descriptions of the work of these and other fellows in David Bornstein’s book, How to Change the World, Social Entrepreneurs and the Power of New Ideas.[33]

a. An Ashoka Fellow – Gloria de Souza --

In describing the example of Gloria de Souza, an elementary school teacher in Bombay, India, Drayton explained:

"She was horrified that 70% of children in Bombay’s ambition was to emigrate [sic]. She saw that this must change to children growing up to be real citizens that solve problems and are able to do it. Her vision was large – continental scale. She had been through her apprenticeship; she had shown her toughness. She figured out how to make her vision practical and attractive for teachers, administrators, parents, and kids." [34]

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De Souza’s conception of a means for reducing the ambition of students to emigrate via India’s educational system began with a workshop experience on “experiential learning.” The more she had practiced the method in her own classroom, the more she had found it to advance her productivity with students and to pertain as a lever to influence the broader societal issue that concerned her. Increasingly, the method was compelling as an opportunity that de Souza saw for large and important social change:

"… If we can help children grow up learning to think rather than memorize and repeat, learning to problem solve, learning to be creative, learning to be actors rather than acted upon, we can create a generation that will be very different. And India will be very different."[35]

This hypothesis acquired a deepening hold and became a driving purpose as de Souza became increasingly convinced of the instructional method's potential to catalyze educational change as the means to broader social change. As soon as de Souza found utility in the method herself and among her students, she wanted to share the opportunity with fellow teachers. Years of failed efforts to convince them that they could do it had led her to figure out a way to meet the teachers where they were.

 

De Souza “knew” that her fellow teachers (customers) would find utility in an effective means to greater student learning; however, she knew too that this determination of utility would require belief that they could make use of the offering within their operational circumstances. De Souza understood her customers’ values and more, and belief-based perseverance led her to find a way:

"I had finally been able to show teachers how it was possible to teach this way without making it too labor intensive for them."

This unfolding seems to exemplify the mutual learning that creates customer capital: “If only you knew what your customers want, you could sell more to them. If only your customers knew what you could do, they would buy more from you.”[36] David Bornstein described the “how to” nature of this stage of de Souza’s work, which had led to her name and idea surfacing within Ashoka’s scouting:

"(H)ow to make the methods accessible to a poorly trained teacher in a public school in Bombay with sixty students in a classroom teetering on the edge of chaos?"[37] … "These questions were what Drayton called the 'how tos' – the sorts of questions that … entrepreneurs live for. De Souza was a gifted teacher, but success in this realm would demand salesmanship and resourcefulness and thick skin and a level of commitment bordering on obsession. These were the qualities Ashoka was looking for."[38]

The fellow-teacher customers at de Souza’s school did come to see the offering as new utility, sufficient to change their behavior. Further, de Souza's use of the offering to expand teachers' professional development meant, reportedly, that they used it capably enough to produce learning change. De Souza was in the process of expanding the method to a second school when Ashoka’s scouting system found her.

 

With the support of an Ashoka living stipend, de Souza quit teaching in order to devote herself to the task full time. She established an organization and within ten years, “the Indian government had incorporated (her method) into its national curriculum, making it India’s official standard of instruction in grades one through three.”[39] As a major milestone en route to this institutionalization, de Souza had “persuaded Bombay’s municipal school board to introduce (the method) in 1700 schools through a pilot program.”[40] Her work, and eventuating case for selling the method, included developing research-based evidence.[41]

 

In de Souza’s case, as with many cases of conceptions for social change, her vision involved multiple and complementary segments of population – or customers -- doing the changing. For de Souza this meant conception of an offering that provided expanded utility and more for the multiple customer segments of:

• students;
• teachers; and
• government.

For students, she had figured out firsthand, with years of practice, how the offering could expand both their customer-determined utility and also their learning. For teachers, she connected knowledge that included the instructional methodogy and knowledge of the teacher customers in arriving at a hypothesized lever for their adoption and learning. For the government, de Souza established research evidence as reason to believe that the offering could provide utility to them, and she worked a step at a time, beginning with multiple schools, then the city of Bombay, and then the nation of India. Along the way, she no doubt needed to address customer segments of parents and polity as well.

 

Viewed within the framework of the prototype social differential's main types of customer change and means to change, de Souza’s offering advanced social productivity as follows:

 

	Type of Sustained Customer Change:
	Transaction/Adoption	Behavior	Capability
	Via:	Via:	Via:
Customers:
Students	Utility		Learning
Teachers	Utility	Utility & Learning	Learning
Government	Utility

Throughout this work, de Souza found repeated operational levers by connecting her knowledge of teaching and firsthand experience with the new offering, plus knowledge of her fellow teachers, India’s students and cultural dynamics, and more. More than twenty years later, de Souza’s purposeful passion continues as “the driving force” behind the method:

"Each year she improves her curriculum, extends her work to more cities, and looks for ways to adapt the methods to different environments, such as rural and tribal areas."[42]

It is an example of an entrepreneur’s “ultimate” connection – between a driving internal value and utility to the external world.

 

b. An Ashoka Fellow: Fabio Rosa

Ashoka discovered Fabio Rosa when they expanded their social entrepreneur search and selection methodology to Brazil. Rosa was trained as an agronomic engineer and grew up in Brazil’s rural Pampas. When Ashoka learned of Rosa and his ideas, he was in the thick of identifying and acting on an opportunity, or offering, that he had conceived to develop an affordable source of electrical power that would enable farming in a rural state in which 70% of the population had no power source. By addressing this infrastructure problem, Rosa sought to reverse migration to urban shantytowns, which was “causing massive social upheaval and sending unemployment and crime rates skyrocketing.”[43]

Rosa described arriving at his overall lever-based vision for change by connecting various elements of knowledge. For example, he had learned about Louisiana rice plantations irrigated with artesian wells (pumped via electricity) and separately about an example of a mono-phase electricity distribution system, which was simpler and less expensive than Brazil’s standard three-phase system. He also understood Brazil's rural culture and customers.

 

In acting on this vision, Rosa addressed multiple segments of customers and faced and overcame an array of challenges – technical, social, political, and financial -- all while bootstrapping. He supplemented technical knowledge with general sensitivity to, and sensibility about, resource leverage, including the centrality of customer utility as a catalyst to change. He recruited the area’s rural residents to participate in the infrastructure building, including supplying trees from their properties for electric poles. For his one employee – an electrical technician – Rosa found and prepared an abandoned ambulance to serve as his official vehicle.

 

Rosa also went beyond “first-level” solutions, regularly squeezing out greater yield on limited resources. For example, from the residents’ trees, he found “a way to extend the life of the wood from three to thirty years.”[44] He also created a credit mechanism for farmers to access the new irrigation infrastructure. When irrigation meant crop weed, his design, or invention, for overcoming the weed included the added benefit of “multipl(ying) the land that each farmer could use by a factor of four.”[45]

 

Overall, “much of his time was spent persuading people to try new things.”[46] As Rosa applied his engineering knowledge to the purpose of economic development, the effect of change relied on his ability to engender trust, in addition to proposing new value for multiple customer segments (including farmers and the government). In particular, the farmers adopting Rosa's offering -- who moved back to the rural states that they had left in desperation -- did so because of seeing a compelling personal solution in Rosa’s vision before it was reality. They moved back to the rural states and co-created the solution based on faith in Rosa and his idea. They also “co-persevered” throughout regular encounters with obstacles.

 

Rosa’s most challenging and persistent persuasion task – or customer value proposition -- was political. To begin, the idea for a mono-phase system was deemed illegal, to which Rosa responded by mobilizing political support. He lobbied the state assembly, met with journalists, and much more. Support was granted but subsequently withdrawn, multiple times. This was despite the fact that in the location of the initial mono-phase power system, one-third of those served had returned from the city's shantytowns.

 

Rosa overcame the political resistance more than once with both direct and indirect action. At one point, upon expanding into other Brazilian states, he adapted by establishing a for-profit solar energy company rather than struggle to support the mono-phase electrical system directly. (With this related for-profit enterprise, Rosa found a way to make solar energy inexpensive for electric fences for cattle farming, “bringing down the price of fencing by 85 percent.”[47] He installed the systems in sixteen Brazilian states. “At night, he slept in farmhouses.”)

 

After years of Rosa’s perseverance “the government … launched a $240 million rural electrification project based on Rosa’s design.” It would provide electricity to 800,000 people.[48] Rosa’s perseverance in understanding this difficult government “customer” created openings for his work; however, the extended struggle also highlights the formidableness of vested interests as an obstacle to social change.

 

Altogether, Rosa’s work did accomplish significant, pattern-breaking change. Within it, he detected a stream of opportunities large and small, connecting one bit of knowledge after another into lever-based visions of all types and sizes, day to day and task to task. The knowledge that Rosa connected included close-up knowledge of the people he was serving, with a continual orientation to their values and needs. Engineering was a necessary starting point, but Rosa made daily connections both within his engineering knowledge and between that knowledge and “everything else” – including memory and daily observation. His work was suffused with hypotheses for resource leverage, in some cases proactive, as he would have an idea for greater utility and incorporate it, and in other cases as a way to surmount challenges – technical and other -- which were experienced one after another, day after day and year after year. Even hypotheses that were technically-based achieved adoption and results by being customer facing as well. Rosa’s entrepreneurial style of thought and instincts played out constantly.

 

Rosa filtered knowledge and observations through the “purpose” lens of advancing social productivity by creating greater value from existing resources. When he received an international award in 2001 from the Schwab Foundation, his words upon acceptance included: “I love technology. I believe it is the principal force to bring change to humanity.”[49] In fact, the force that Rosa generated involved more than technology. His knowledge (of technology and more) was integrated with sensitivity to, and sensibility about, resource leverage and its basis in customer utility. Like de Souza, Rosa realized leverage with that most powerful connection between an entrepreneur’s passionate belief in (or value for) an image of what could be and value to customers. Rosa's lever-based vision inspired co-creation with customers, including co-perseverance.

 

Viewed within the framework of the "social differential's" main types of customer change and means to change, Rosa’s economic development offering could be viewed as follows:

 

	Type of Sustained Customer Change:
	Transaction/Adoption	Behavior	Capability
	Via:	Via:	Via:
Customers:
Farmers	Utility	Utility & Learning	Utility & Learning
Government	Utility	Utility & Learning	Utility & Learning

 

 

***

Many of the social productivity advances catalyzed by Ashoka fellows would fit into the top-right quadrant of high leverage and broad scale within their field. But Drayton saw their combined effects as even larger. Together, these entrepreneurs also were to serve as first-generation role models and mentors – the start of a movement that would generate advances in all four quadrants. Drayton described a second-stage vision as “everyone a changemaker”:

"What we must do now is increase the proportion of humans who know that they can cause change. And who, like smart white blood cells coursing through society, will stop with pleasure whenever they see that something is stuck or that an opportunity is ripe to be seized. Multiplying society’s capacity to adapt and change intelligently and constructively and building the necessary underlying collaborative architecture, is the world’s most critical opportunity now. Pattern-changing, leading social entrepreneurs are the most critical single factor in catalyzing and engineering this transformation."[50]

Again, the social entrepreneurs would in one sense serve as the “pioneers” at the far left end of Geoffrey Moore’s curve of societal adoption of a new technology.[51] In another sense they would serve as the “cutting edge of the knife,” similar to Peter Drucker’s depiction of elite-knowledge entrepreneurs serving as the cutting edge of an "entrepreneurial-society" blade. Altogether, “everyone a changemaker” resembles Drucker’s notion of an entrepreneurial society.

 

In the U.S., Ashoka has recruited a number of fellows, plus organization-level educational programming in the U.S. includes “Youth Venture" and partnership with several U.S. research universities for higher education programming.

 

Overall, viewed below within the framework of the prototype social differential’s main types of customer change and means to change, Ashoka’s offering has advanced, or is designed to advance, social productivity beyond its initial customers of social entrepreneur fellows:

Finally, Drayton’s vision for Ashoka has represented, again, an example of the connection between an entrepreneur’s value and customer value. His work has been fundamentally inner-driven and other-focused.

 

2. Teach for America

Wendy Kopp’s conception and launch of a national teacher corps represents a version of the enduring fundamentals of innovation and entrepreneurship practiced as skilled craft that is as intensely concentrated as it is intensely observant. Packed into her senior year of college and the year following, it fits the full span of tenets in Peter Drucker’s primer, Innovation and Entrepreneurship, as closely as any example he used in the book.

 

(Years after I wrote this, I viewed a video of an event honoring Drucker, at which Francis Hesselbein, a Drucker protege, introduced Wendy Kopp to the audience. Hesselbein described the way she thought Drucker would have viewed Teach for America: "He would have been inspired, Wendy. He would have signed on.")

 

Kopp’s conception in her own words:

"The idea was to create a corps of top recent college graduates – people of all academic majors – who would commit two years to teach in public schools in low-income urban and rural areas. Called Teach for America, this corps would mobilize some of the most passionate, dedicated members of my generation to change the fact that where a child is born in the United States largely determines his or her chances in life."[52]

Note that Kopp wasn’t aiming for something like “changing the fact there is a shortage of teachers in high-income communities.” The shortage was key to feasibility of a teacher corps, but her objective was change that was much, much larger. She was aiming for a shift in cultural consciousness, beginning with consciousness of recent top college graduates as they would assimilate the experience of the poor into their own views.

 

A shift among these college graduates was to serve as a lever for a similar shift among the overall U.S. polity, as the graduates went on to a wide variety of leadership roles within and beyond education – as judges, physicians, congressional representatives, etc.. Kopp knew that the model required “only” one solid step at a time, and she developed deep conviction that the first step of a teacher corps could work. Her conception combined "what could be" with "how it could become."

 

The Teach for America (TFA) offering was, and is, rooted in what Drayton called a “truth force,” intended to lead in stages – one element of customer capital at a time -- to a very different expectation of schooling in the United States. Kopp's vision was U.S. schooling that would provide “equal opportunity.” It would be effective enough for poor children that it would offset, if not undo, the forceful effects of poverty.

 

One stage at time, the TFA model was to catalyze greater fidelity to the set of “middle level values” that Gardner argued are held commonly among Americans.[53] In researchers' terms, it is a “path model” design for change, with different customers and change dynamics at each stage of the path. Kopp aimed (either implicitly or explicitly) to provide the change catalyst of utility to each customer population at each stage.

 

One aspect of TFA’s truth force thus far is actions speaking louder than words. First, as it has played out, young and typically socially advantaged TFA corps members have demonstrated commitment to a social, ethical purpose purportedly held as a national value. Second, a modal finding across many evaluations is that the performance of TFA teachers in these challenging classrooms has been at least on par with credentialed teachers.

 

The combination of the commitment and results has made a statement of “this challenge can be met,” even among those who realize that many corps members commit extraordinary hours. TFA's overall actions have raised the issue of fidelity to civic values, including questions about expectations of the public schooling system and about societal responsibility. Gardner noted:

"In short, the nurturing of values that maintain society’s moral tone – or allow that moral tone to slacken – is going on everyday, for good or ill. (A)nd it communicates itself more vividly through what men do than through what they say."[55]

By the second stage of the model – with some TFA alumni remaining in the field of education and establishing charter school networks and many more initiatives – the work began to more closely resemble Ashoka’s combined levers of truth force and operations orientation. Further, TFA itself began to incorporate operations initiatives within its base teacher corps offering – e.g., initiating new approaches to math instruction. These dynamics too represent a force of actions speaking louder than words.

 

However, what Kopp might not have envisioned is the way that TFA’s contributions to cracking open the cultural aspect of public schooling could coincide with separate, ready developments in the core technology of education. For example, at the time of the 2010 decision among forty-five states to adopt Common Core State Standards, there was a set of quality standards ready for adoption, following years of development, professional debate, and piloting. The nearly nation-wide adoption represented a combined cultural-technical development, and it’s quite likely that TFA’s work was one of the cultural levers that made it possible. Thus, even education experts may have experienced utility from TFA, even as many might not have appreciated that this came from an outsider and non-expert.

 

There are many reasons to believe that TFA has contributed directly and broadly as one lever for consciousness change – a relatively mature stage within the path Kopp envisioned toward a changed educational system. At present, twenty years and twenty cohorts of corps members later, TFA has continually grown in organizational strength and in visibility, including accumulating tens of thousands of corps alumni. In 2010-11, there was an active corps of at least 10,000 working in U.S. classrooms.

 

 

Connecting Knowledge --

What made Kopp believe that recent college graduates without academic degrees in education could and would create even the first stage of this change – an engaged and effective teacher corps? Kopp’s question instead became: How could this not already be in place? -- “I was certain such a corps must already exist somewhere – it was too obvious!”[56]

 

Kopp's conviction was rooted in the idea’s grounding in knowledge, which was not about the operations or technology of teaching in low-income communities, but nonetheless involved knowledge pertinent to a hypothesis for resource leverage. The idea began with deep knowledge of:

• top college graduate “customers”
• recruitment operations of top college graduates
• the example of one end-customer (disadvantaged public school students) represented by Kopp’s college roommate.

Kopp’s perceptual and conceptual development of a teacher corps exemplifies Drucker’s invocation of the adage “only connect”; it illustrates effective paradigmatic imagination.

 

Kopp’s initial connection of knowledge “bits” took on legs during fall of her senior year at Princeton:

a. Kopp knew her peers. And she observed that, for many, the typical work pursued upon graduation was not what would offer them high “utility.”

• “Just about every Princeton senior” was applying to a two-year corporate training program, most with investment banks and management consulting firms.[57]
• Yet most of the people Kopp knew were heading to these programs because they were recruited aggressively and because “they couldn’t think of anything else to do,” not because they were “dead-set on making money or because of a deep interest in business or high finance.”[58]
• “I sensed that I was not alone – that there were thousands of other seniors like me who were searching for jobs that would offer them significance and meaning.”[59]

b. The up-close example of Kopp's “brilliant” freshman roommate, from a low-income background and school setting, had made a strong and lasting impression. Kopp observed that her roommate “struggled under the academic demands of Princeton” when she and others from advantaged public schools and generally advantaged backgrounds did not. Kopp seems to have understood this intuitively as a cultural issue, and she responded with the operations orientation of a change agent.

• “As I moved through Princeton I grew increasingly aware of students’ unequal access to the kind of educational excellence I had previously taken for granted.”[60]
• “I wanted to figure out what could be done about this problem, and so I organized a conference about the issue.”[61] (Kopp led the student-operated organization that sponsored the conference, and this conference initiative demonstrated a sense of entrepreneurial agency.)

c. The conference, occurring during fall of Kopp’s senior year, taught her more about her peers and more about public school operations.

• “Nearly all of the student participants … said that they would teach in public schools if it were possible for them to do so.”[62]
• One of the speakers “maintained that people without education degrees were frequently hired by public schools because there weren’t enough education majors interested in teaching in low-income communities.”[63]

 

Kopp describes having the initial idea of a national teacher corps as of the exchanges at the conference. That conception reflected processing of knowledge that included:

• the incongruity between Kopp’s roommate’s potential and her formative educational opportunity;
• the incongruity between the Princeton students’ career decisions and their genuine interests, or “utility”;
• Kopp's peers’ interest in teaching in public schools and the meaning that low-income schools, in particular, would represent to them;
• an expectation that these peers would apply the same talent, intensive energy, and long hours to this challenge as they did to programs in investment banking and consulting – but with the addition of passion;
• an expectation that a teacher corps could meet the challenge of these classrooms based on: (i) the model of non-education-majors going into teaching in prestigious independent K-12 schools without teaching credentials; and (ii) the belief that corps members' own experience with academic excellence would make them “relentless” in guiding their students to achieve it;
• the model of the Peace Corps;
• the gap in the supply of education majors “interested in teaching in low-income communities”;
• and more.

As Kopp connected these elements of knowledge, she diagnosed a crucial gap that a teacher corps offering could fill. Kopp hypothesized that the offering would represent new, expanded utility to her primary customers (new college graduates) and thereby catalyze adoption. Most important, an organized teacher corps could address the "how tos," or operational model, for filling the gap effectively. It could:

• overcome the incongruity of timing between graduating seniors’ need to line up plans before graduation vis-a-vis low-income public schools not knowing until the Labor Day after graduation if they would need to consider applicants without standard credentials;
• organize recruitment that could compete with investment banks and consulting firms, by matching their early, aggressive, and selective recruitment model;
• provide intensive summer training that would help ensure the corps members’ success in America’s most challenging classrooms.

Kopp hypothesized that the corps offering would provide compelling value to the new graduates in terms of a meaningful post-college experience:

"We would jump at a chance to be part of something that brought thousands of our peers together to address the inequities in our country and to assume immediate and full responsibility for the education of a class of students."[64]

She also believed and hypothesized that the two-year experience would leave a lasting impression on corps participants, reflecting her sensitivity to human and social dynamics. As Larry Brilliant put it within a talk to University of Minnesota students about working to solve the most pressing social challenges: “In doing the work of service, you will transform yourself.”[65] As Kopp saw it, this transformation would be the essential conduit to shifting cultural equilibrium as it catalyzed change in post-corps behavior. It represented the essential hypothesized lever within her vision:

"(A) national teacher corps could produce change in the very consciousness of our country. The corps members’ teaching experiences were bound to strengthen their commitment to children in low-income communities and spur their outrage at the circumstances preventing these children from fulfilling their potential. Many corps members would decide to stay in the field of education. And those who would become doctors and lawyers and businesspeople would remain advocates for social change and education reform. They would become school board members. They would become mayors and state legislators, U.S. senators, and Supreme Court justices. And they would make better decision because of their experiences teaching in public schools."[66]

 

"More How To’s" --

When Kopp’s conviction in the idea deepened to the point of making it the topic for her senior thesis, her focused and intensely hard work began. In approaching her thesis work: “I withdrew from the world – skipping whatever classes I could and talking to just about no one -- in order to research the viability of a national teacher corps.”[67]

 

The questions and answers Kopp put to this work addressed exactly the types of knowledge and understanding that Drayton described looking for as a gauge of the potential social impact of prospective Ashoka fellows’ ideas. Her research included looking into “the teacher corps that had been run by the federal government in the 1960s.”[68] And her resulting thesis included not just an argument for a national teacher corps, but an operations model and plan, including estimated costs ($2.5 million for the first year).

 

In addition to the value of meaning to the TFA corps-member customers, Kopp expected low-income school “customers” in need of teachers to receive the resource of the corps as utility. This meant the path of envisioned catalyzing forces could at least begin. However, to invoke Drayton, the idea could create pattern-breaking change: “if and only if it’s in the hands of a truly first-class entrepreneur.”[69]

 

And with this, Kopp exhibited Drayton’s criteria of a deep sense of ethical fiber and longstanding entrepreneurial purpose: “I wanted to do something that would make a real difference in the world. I just didn’t know what that was.”[70] To Kopp, making a difference was most important, not her own role in it. Before deciding that making a national teaching corps happen was going to be up to her, Kopp recommended it in a written proposal to then-President George H. W. Bush. She reported describing that presidential sponsorship seemed most hopeful as a parallel to President John F. Kennedy’s sponsorship of the Peace Corps.[71] She received a form letter response from the White House.[72]

 

As it became clear that she was going to establish the teachers corps herself, Kopp reached the point that Drayton describes as the completion of an apprenticeship: “where all you want to do is run with the idea.” The grip that this lever-based vision had on her became full. Even then, as a new college graduate, she might have met all four of Drayton’s criteria for a first-class entrepreneur with an idea ready to create pattern-breaking change, and with commitment that would be sustained for decades.

 

Kopp’s legwork between establishing a plan in support of her lever-based vision and acquiring funding and advice to improve and then begin to implement the plan – over the course of a couple of months -- is an account of focus, discernment, ingenuity, and “fortune favoring those who are prepared.” It involved a myriad of “how to's,” including the importance of careful selection of both start-up team members and corps members, even among a generally high-caliber talent pool and even among those interested.

 

TFA quickly became an example of "people, passion, and perseverance." Kopp sought out and engaged not only staff leadership who shared her passion and complemented her knowledge, but also funders and astute advisors who believed in the cause and saw value in the TFA offering

 

Selection of corps members and staff leadership addressed in part the model's idea that the corps would represent future societal leadership; however, like Drayton, Kopp also seems to have had a clear notion of what attributes were needed for the people who would engage with her in developing TFA. In the case of corps members, this included attributes that would enable typically socially advantaged young adults to be successful in low-income schools. In the case of staff and leadership team, Kopp recognized that depth of belief in, and commitment to, the vision was crucial.

 

And it was only the beginning. Kopp’s account of TFA’s first ten years included the regular test of obstacles and threats to survival for any start-up organization, featuring cash flow (which Drucker had described as a sure sign of success and one that every new venture should anticipate). She rose to the challenges based in part on regularly perceiving and acting on hypotheses for resource leverage of every shape and size. It was a way of life. Most important, however, it was all grounded in a clear lever-based vision. Kopp and TFA could adapt, collaborate, and optimize based on the traction of the core hypothesis embodied by the TFA offering.

 

Overall, the TFA offering exemplified the connection between an entrepreneur's personal value and an offering that meets customer values and needs. TFA's first level of customers was the corps, with "meaning" serving as the utility, or value for recruits. But as with many social innovation examples, the offering needed to catalyze change among multiple levels of customers.

 

 

"Schooling Behavior and Education" --

For the customers represented by the students of TFA teachers and the students' families, individual TFA corps members themselves represented the offering. And anecdotally, catalyzing change in behavior and capability for the student/family customers seems to have involved offering even more than academic instruction (typically within the most challenging types of classrooms in America). Anecdotally, there is reason to consider that classroom-level practice in some cases has involved an offering of "schooling behavior and education" (similar to "health behavior and education").

 

As one simple example, the Knowledge is Power (KIPP) charter school organization, founded by TFA alumni, is described as offering the benefit of teaching kids "how to pay attention."[74]

 

Separately, a corps member, in a videotaped conversation sponsored by the Aspen Institute, described the second year of her TFA experience: “We invested them (the students and families) with our vision.”[73]

• That vision -- a tangible "purpose" associated with academic work -- may have amounted to offering low-income students and parents the cultural perspective of high achievement. It may have offered "education" about "schooling behavior."


• Perhaps even more noteworthy, occurring in the corps member's second year, this vision as offering seemed to draw upon "customer capital" -- value-creating relationships rooted in "teaching customers about what you can do for them, as you have begun to learn about them." The vision and its resonance evolved from mutual learning.


• A vision as offering may have affected student and parent customers' subjective gauge of prospects for success ("self efficacy"), related at least in part to learning about "schooling." The combination seems similar to the "educational evangelism" described by Condoleezza Rice in her memoir, Extraordinary Ordinary People.
  

What this team of teachers could do for the students needed to involve effective instructional interactions, and the vision that this corps member described in the video was indeed grounded in perceptions of levers within that work. However, successfully "investing" both student and parent customers with a vision brings to mind the leverage dynamic of customer capital. Even as most TFA teachers would possess the perspective of high achievement and its associated behaviors in deep and concentrated form based on their own experiences, investing customers in such a vision would depend fundamentally on relationship dynamics. Customer capital depends on trust that the offering extended actually will deliver value.

 

TFA emphasizes relationship dynamics in both recruitment criteria and in programming. When I asked a member of TFA’s early 1992 cohort (someone who remains in the education field twenty years later, working as a principal and charter network developer with high-poverty schools) why so many low-income parents don’t attend parent-teacher conferences, his impassioned response reflected relationship bearings:

"You’re not going to get a response from these parents until you meet them where they are. They didn’t have good experiences in schools." [75]

Further, consistent with customer capital's relationship bearings, Kopp has described "leadership" as central to good teaching in low-income schools. Upon observing an increasing number of “exceptional” teachers in the classroom, Kopp reflected:

"As I got to know these teachers, a whole new conception of teaching formed in my head. In our country’s lowest-income areas, good teaching was, at its essence, good leadership.”[78]

 

Gardner too raised the idea of leadership's relationship-based leverage: “When faith in (followers) is present in a leader, it communicates itself with powerful effect.”[77] Gardner recounted a comment made by Martin Luther King, Jr., when Gardner was at a meeting and sitting next to King. A speaker had said of low-income, minority children, “First, teach them to read.” Gardner described King leaning over to say, “First, teach them to believe in themselves.”[76]

 

The "vision" offering above did not suggest that one element of learning -- reading or self-belief -- came before the other. However, Kopp's reflection seems consistent with Gardner’s view of leadership as a lever within the context of teaching and learning. It also fits with many of Jacqueline Novogratz’ comments, including that the psychology of poverty is complex and that “there is no conduit like trust … no catalyst like hope.”[79] (Novogratz was a student of Gardner at Stanford University's business school.) Finally, it fits with Drayton's emphasis on ethical integrity: "The trustworthiness of the social entrepreneur – their integrity – is one of their most important assets. People sense that – and if they don’t trust you, they won’t follow you."[31]

 

For societal goals, customer capital's mutual-learning source of knowledge may have a special fit in catalyzing change, on levels large and small. ("If only I knew what you wanted, I could sell more to you. If only you knew what I could do for you, you would buy more from me.")

In Sum --

Altogether, TFA’s example suggests not only a path model of change but a path model situated within a “complex system” of change, representing one of the most persistent and powerful of U.S. social challenges -- educational equity and excellence. This challenge illustrates the need for the strongest effects of innovation methodology, wielded by practitioners of many types and at multiple levels. Kopp’s recent book, A Chance to Make History,[80] speaks to her view of opportunities to build on learning from TFA’s twenty years of experience at the front line of the U.S. educational system. It speaks to hypothesized levers within a further stage of a path toward the ultimate social goal of advancing U.S. educational productivity.

 

TFA may also represent at least a partial example of "disruptive" innovation within this complext system, based on the principles proffered by Clayton Christensen. This would include the original offering of "lower quality" teachers to the "non-consumption" customers of high-poverty schools in need of teachers. Then upon its establishment, the organization has improved its offering continually to a point of some disruption of the status quo (especially by way of alumni-founded charter school networks).

 

Viewed within the framework of the prototype social differential’s main types of customer change and means to change, TFA’s offering has advanced, or is designed to advance, social productivity by realizing multiple types of change among multiple levels of customers:

3. Acumen Fund

The U.S. based Acumen Fund, founded by Jacqueline Novogratz and incorporated in 2001, provides a distinctive approach to infrastructure and economic development, conceived as a middle way between philanthropy alone or the marketplace alone. The model in a nutshell seeks to “change the development paradigm.”[81] Its overarching offering is “patient capital,” a term coined by Novogratz:

"The markets alone cannot solve the problems of poverty; nor are charity and aid enough to tackle the challenges faced by over two-thirds of the world’s population living in poverty. Patient capital is a third way that seeks to bridge the gap between the efficiency and scale of market-based approaches and the social impact of pure philanthropy. ...

 

For Acumen Fund, patient capital is understood as a debt or equity investment in an early-stage enterprise providing low-income consumers with access to healthcare, water, housing, alternative energy, or agricultural inputs. Our typical commitments of patient capital for an enterprise range from $300,000 to $2,500,000 in equity or debt with payback or exit in roughly five to seven years. The patient capital Acumen provides is accompanied by a wide range of management support services nurturing the company to scale. …

 

Building new models that provide these critical services at an affordable price – in the face of high costs, poor distribution systems, dispersed customers, limited financing options and, at times, corruption – requires imaginative business solutions and partnerships supported by investors willing to take on a risk/return profile that is unacceptable to traditional financiers."[82]

 

In Novogratz’ words, the return on investment is “change.”[83] Investments have “a goal of maximizing social, rather than financial, returns” and “any financial return is recycled into new investments.[84] Further, with the offering of patient capital, the Acumen Fund model emphasizes a goal of dignity for the poor in the form of new capability: “to enable people to solve their own problems over the long term.”

… Our aim in investing patient capital is not to seek high returns, but rather to jump-start the creation of enterprises that improve the ability of the poor to live with dignity. …

 

Poor people seek dignity, not dependence. Traditional charity often meets immediate needs but too often fails to enable people to solve their own problems over the long term.[85]

The offering of patient capital seeks both customer adoption (via expanded utility) and new customer capability (via learning). An example of the change the fund seeks:

(I)n 2004 Acumen Fund invested $600,000 in Water Health International (WHI), a company that set out to bring safe drinking water to rural Indians, something long thought nearly impossible. One year after our first investment, they had broken ground on two new water systems. Working with Acumen to modify the design of the water facility, a year later WHI had ten systems in operation, and had started to attract the interest of additional investors. Three years after Acumen’s initial investment, WHI had raised $11 million in private capital and were speaking with banks about financing an additional 20 systems.[86]

 

Knowledge Connection and "How to's" --

Within her memoir, The Blue Sweater, Novogratz provides an account of her path to the Acumen Fund conception during the 1980s and 1990s. Like Drayton and other entrepreneurs, her idea grew out of connections among her particular experiences, values, and interests – with a detectable thread of development toward a “big” idea.

 

For Novogratz, early professional experience in international banking built upon undergraduate study of economics and included exposure to both the investment industry and international cultures and economies. International interest and sensitivity led to friendships in Rwanda and to establishing a Rwandan-based micro-finance institution. As Novogratz lived and worked with her investee customers, this early initiative was, nearly by definition, a co-creation. She and the investee customers succeeded and failed together, and she processed it all actively as learning.

 

Novogratz’ memoir describes the way in which the combination of living and working with the poor in a poor country was pivotal in shaping her understanding and ideas further, including experience with what didn’t work. As she gained deep understanding of her "customers," the conception of patient capital germinated. Novogratz connected customer knowledge and the micro-finance experience with her banking knowledge and with deep convictions in the market. For example, she observed firsthand: that resources of philanthropy were not being used productively; the importance and deep meaning of – the utility of -- dignity to poor populations; and the unrealized capabilities of the poor.

 

Novogratz hypothesized that these populations would respond quite differently to an offer of funding that was based on a sound business proposal versus responses to gifts of charity. She noted: “The market is a tremendous listening device.”[87] Novogratz had also learned from experience what type of support these customers would need to make productive use of a third way of patient capital. As with Ashoka fellows, it was an instance of the empathy-infused mutual learning process that results in customer capital. Again, Novogratz observed: “There is no currency like trust … no catalyst like hope … The psychology of poverty is complex.”[88]

 

In Bill Drayton’s terms, the micro-finance experience could be viewed as one large part of Novogratz’ “apprenticeship.” The overall Rwandan experience planted the seeds for much bigger ideas and led Novogratz to Stanford University’s School of Business where exposure to faculty-member John Gardner and his ideas about leadership, innovation, and personal moral development assumed additional strong influence and expanded her knowledge base.

 

When Novogratz graduated from Stanford, she described Gardner’s influence in her decision to pause en route to what would become the Acumen Fund in order to establish programs in philanthropy and leadership at the Rockefeller Foundation. Of the Rockefeller leadership program, Novogratz said: “It focused on strengthening one’s own moral compass and building those things inside you that no one could ever take away.”[89]

 

As with every Ashoka fellow and with Kopp, social advances meant ethical advances. Increasingly, Novogratz was connecting to others who shared her deepest values, again demonstrating Steve Case's overall formula of "people, passion, and perseverance." The interpersonal connection supported Novogratz' perseverance and led increasingly to the important connection between an innovation practitioner’s values and a new offering that is received as new value by large segments of the outside world. In this case there was new value to both the philanthropist customers contributing to the patient capital fund and the recipient customers.

 

In her memoir, and reinforced in present day speaking engagements, Novogratz emphasizes “moral leadership” and “moral imagination.” She commented in her memoir: “More than any other academic subject, judgment, empathy, focus, patience, and courage should be studied and cultivated.”[90] Novogratz links the knowledge that underlies sound moral leadership to the capacity to co-create advances in social productivity:

What is needed most of all is moral leadership willing to build solutions from the perspectives of poor people themselves.

Stephen Goldsmith reinforced this stance and the functionality of co-creation when he described local U.S. examples of social innovation succeeding by “treating individuals as latent assets rather than as victims.”[91] These successes shared the practice of “listening and of up-close observation.”[92] They shared mutual learning’s result of customer capital.

 

Beginning in 2007 the Acumen Fund added to its offerings an annual one-year fellows program to develop social sector leadership in general and for economic development in particular:

The mission of the Acumen Fund Fellows Program is to build a corps of next generation social sector leaders by fusing operational and financial skills with moral imagination to create solutions to global poverty and fill the talent gap.

In five years, a total of forty-four Acumen Fund fellows have “hailed from eighteen countries.”[93] For 2011 the program received 550 applications from fourteen countries for ten positions, indicating clear utility to a customer population sharing a passion.[94] It also demonstrates the basic dynamic of talent gravitating to performance. Like Ashoka, the program seeks to cultivate leadership and a fellowship of peers. And though selection is not based on the combination of a person and idea ready to have pattern-breaking influence, C.K. Prahalad’s advice to a class of fellows reinforced the prototype principles' premise fundamental integration of pertinent knowledge and critical-creative thinking with innovation's purpose of resource leverage. One strand of his message was as follows:

If you understand the problems deeply, you will find solutions. … Don’t think outside the box; create a new box. And when you see a swamp and you imagine that it could be a theme park, build it with good engineering.[95]

Prahalad emphasized that “leadership is optimistic,” and he encouraged the fellows to see the rare intellectual opportunity within their experience:

Don’t do it … for morality only. Do it because intellectually it’s the most exciting thing you can aspire to as a young person.[96]

With these words, Prahalad may have expressed another shared fundamental between commercial and social entrepreneurs. When new utility to others accords with one’s values, it can tap intrinsic motivation that is as beneficial to the practitioner as the extrinsic effects can be beneficial to those who find new utility and capability. The constructiveness of acting on an effective diagnosis for advancing productivity makes the work unusually intellectually engaging. Whether commercial or social, the work of realizing lever-based visions for advancing productivity can be meaningful in more than one way.

 

Viewed within the framework of the prototype social differential’s main types of customer change and means to change, the Acumen Fund’s patient capital offering has advanced, or is designed to advance, social productivity as follows:

 

	Type of Sustained Customer Change:
	Transaction/Adoption	Behavior	Capability
	Via:	Via:	Via:
Customers:
Patient Capital Recipients	Utility	Utility	Learning
Acumen Fund Fellows	Utility	Learning	Learning
Philanthropist Investors (Purchasing Customer)	Utility

C. Discussion -- Themes

The following discussion focuses upon themes that span the above three successful, scaled-up cases of social innovation, plus the close correspondence between those themes and the fundamentals of innovation and entrepreneurship broadly:

1. Customer Utility --

In each case, progress toward a social goal reflected an offering that:

• multiple levels or segments of customers received as expanded utility (as a catalyst for adoption and, in some cases, behavior change);
• enabled learning/development where this was needed (as a catalyst for change in behavior, capability, and/or adoption).

These particular offerings could be classified into two categories --filling a gap and reorienting a system or paradigm. That is:

Filling a gap:

• Drayton introduced the offering of professional support, where there was none, to existing social change agents as a lever for catalyzing their work and its hundreds of cases of resource leverage;
• Ashoka fellow Rosa introduced a form of appropriate technology in support of farming as a lever for economic development, in a place where farming had been lost;
• Kopp introduced a teacher corps as a lever for civic productivity and indirectly, or longer-term, as a catalyst for educational productivity.

 

Reorienting a system or paradigm:

• Ashoka fellow de Souza introduced new curricula and associated professional development that would reorient students' experiences, as a lever for both educational productivity and for the nation's retention of youth;
• Novogratz introduced a new form of philanthropy that would reorient recipients' experiences of aid, as a lever for economic development.

 

2. Connections-based Levers --

In each case, the hypothesized lever resulted from connecting elements of knowledge pertinent to resource leverage, featuring the thematic knowledge strands of:

• deep knowledge of the subject area, or domain, including technical and operations knowledge;
• knowledge of customers;
• general human and societal dynamics;
• “anything and everything.”

Among the primary, visible knowledge elements connected:

• Drayton's connections drew upon in-depth knowledge of and experience with: innovation and entrepreneurship, ethics and change dynamics, sensitivity to human talent, economics, mainstream citizens’ ready engagement with a compelling lever-based initiative for social good, and more.
• De Souza connected a curricular offering with the motivations of youth and the needs and values of teachers and government leaders.
• Rosa connected knowledge of engineering and agriculture, rice farming methods from another country, a newscast mention of a low-cost power technology, and cultural insights from his rural upbringing.
• Kopp connected knowledge of the result of educational inequality for a capable student who was poor, national culture, staffing challenges in high poverty schools, future leaders’ potential to affect national culture, and those future leaders’ post-baccalaureate career opportunities vis-à-vis their values.
• Novogratz connected knowledge of the psychology of poverty and under-developed capabilities of poor populations with the incentives of markets, knowledge of the financial industry, and the values of philanthropists.

 

3. Turning Customer Knowledge into Customer Capital --

In these cases, each entrepreneur drew insight from a position that was “way down and close to” the operation and the customer.[97] Each knew the front line of operations well and its technical subject matter, in some cases from being a part of the system being improved. And with this, each entrepreneur turned customer knowledge and relationships into customer capital. Mutual learning and relationships of trust were integral as a means of both co-creating the offerings that represented the change catalysts of expanded customer utility and customer learning and also co-creating change. When there were multiple levels or channels of customers (e.g., teachers, students, government, and polity), there was a catalyst for change at each level.

 

The proximity to operations and customers fits with Drucker’s observation:

(T)he opportunities for innovation are found, on the whole, only way down and close to events. They are not found in the massive aggregates … but in the deviations therefrom – in the unexpected, in the incongruity, in the difference between “The glass is half full” and “The glass is half empty,” in the weak link in a process.[98]

The theme of initiative from the front line of operations is noteworthy, and it extends beyond these examples, raising questions about how the benefit of close-up perspective and customer relationships is, or could be, combined with theory and research-based knowledge. The perspective of many more examples, including those geared to this question and including those with varying degrees of success, could be instructive on this point.

 

 

4. Usability --

The examples resemble the tech industry’s learning about usability and user-based design, reinforcing the marketing “truth” that if customers cannot use the offering or are not interested in it, the problem is not with the customers. As Steve Jobs put it, "We're the ones who are stupid" if consumers can't use these devices. Usable offerings meet customers where they are in order to have the potential to take them further. In light of social innovation's frequent need for effective and productive use of offerings -- including change in behavior and capability -- social innovation may take usability to a new level.

 

In these examples and others, co-creation of offerings has been one effective means for meeting customers where they are in terms of their values, of the realities of their day to day lives and environments, and more. Also, an element of diagnosing, or hypothesizing, opportunity in the examples above involved seeing typically poor, end customers as having inherent dignity and productive potential.

 

 

5. Mastery of Fundamentals --

All of the preceding themes – related to detecting and applying an effective hypothesized lever for change – reflect the entrepreneurs' practiced attunement to fundamentals of innovation methodology.

 

For these skilled-craft practitioners, the attunement seemed tacit. They didn't follow models or frameworks. Instead, each entrepreneur actually helped to shed light on underlying fundamentals of innovation methodology as each developed and realized an overarching lever-based vision for change based on effective, day-to-day integration of: resource leverage sensitivity and sensibility (including attunement to customer utility), thematic strands of pertinent knowledge, and cognitive processing that featured evaluative-generative coupling.

 

These action leaders have exemplified the themes of innovation's fundamentals that thought leaders have explicated.

 

 

6. A “Gripping” Vision In the Hands of a Developed Practitioner --

These cases also depict the power of a values connection: between an experienced practitioner's values (including a gripping, lever-based vision) and values of the external world. With at least a general, lever-based vision in hand, each case exemplified the model of a team behind the offering that involved: “people (who share belief), passion, and perseverance.” Entire teams became inner-directed and other-focused.

In these particular examples, passion encompassed both an ethical or civic commitment and a separate disciplinary passion:

• Drayton – ethical-civic passion with innovation/entrepreneurship passion.
• De Souza – civic passion with education passion;
• Rosa – civic passion with technology (engineering) passion;
• Kopp – ethical passion with civic leadership passion;
• Novogratz – ethical passion with “market” passion.

At the same time, even as the entrepreneurs were passionately purposeful, the ethics at issue were related to what Gardner called “middle-level” societal values. The entrepreneurs were not revolutionaries, and they expressed their purpose with very practical action. But they also were not neutral. And the power of challenge was not “middle-level.” The challenges were complicated and difficult, and change resulted from meeting the power of the challenges with the power of effective innovation practice.

D. Discussion -- Indicated Opportunities

1. The Varying Power of Social Challenges Offers Training Ground --

Social challenges are not equally resistant to change; not every challenge is a "super power." For example, when the option of “texting” financial contributions was introduced within the context of the 2010 earthquake in Haiti, the response was robust and the large-scale effect meaningful both to meet the immediate need and as a precedent. In this example, an operational lever was relatively “pure” opportunity. Was it social entrepreneurship? I think Drucker would say, “Absolutely, and we need more of it. Seize all of the easier opportunities for leverage.” In fact, Drucker argued that a focus on social "problems" has included "opportunities" that "die of neglect."

 

Further, the varying power of social challenges may resemble Drucker’s classification of the seven sources of innovation, which he presented in order of readiness for realizing change (beginning with a gap in a system and ending with new knowledge). Close examination of a wide variety of examples might reveal that the varying power of social challenges aligns exactly with Drucker’s universal classification of the seven sources, or it may reveal that "social challenge" classification could be established as a complementary taxonomy. One likely additional classification would reflect cases of need for change in behavior and capabilities.

 

In the successful social innovation cases reviewed above, varying size social challenges were pertinent to the entrepreneurs’ personal trajectories of development, including Drayton’s, where mastery developed from practice and positive reinforcement with increasingly difficult change. Drayton looked for this pattern and trajectory within his Ashoka recruits, specifically those who had developed mastery within entrepreneurship “apprenticeships.”

 

With this, the varying power of social problems could provide a useful lens for considering opportunities for hands-on practice with the methodology. As one example, the field of appropriate technology represents a particularly broad domain of, relatively speaking, pure opportunity. Although design challenges can be substantial from both a human and technical standpoint, human development and difficult behavioral change often is not a prominent aspect of these particular offerings for leverage. Jeffrey Sachs has noted the increase in happiness from life with electricity versus not; offerings often are not asking customers to engage in difficult developmental or behavioral change. [99] Appropriate technology is not the only domain that includes less challenging social change. Again, the perspective of many more examples could be instructive.

 

2. Attention to the Challenge of Catalyzing Change in Behavior and Capability –

Although the examples in this report do speak to the special challenge of catalyzing change in behavior and capability, this aspect of the proposed differential for social innovation "catalyzes" curiosity. New horizons for social innovation and usability may involve the prominence of learning as a fundamental catalyst for change that is associated with societal goals. For much of the work of social innovation, it is likely that the principles of teaching and learning represent an important strand of knowledge, among others.

There may be valuable learning from considering leading successful cases of these types of levers for social progress within various types of goals (e.g., public health, economic development, public education, natural resources). With "cross-pollination" representing such a strong innovation tactic for new hypotheses throughout both the commercial and social production systems (borrowing an idea from one field and applying it to another), leading cases could provide useful fodder for borrowing and more.

For example, food thought leader, Mark Bittman, recently invoked the experience of U.S. government action regarding cigarettes with respect to present-day public health opportunities regarding unhealthful foods.[99-1] Further, the higher education model of specialized departments oriented to change in behavior and capability (e.g., "health behavior and education" and "natural resources behavior and education") might itself be borrowed fruitfully for other domains. There could be an opportunity for offerings explicitly understood as:

• "schooling behavior and education" in support of educational progress;
• "citizen behavior and education" in support of governing progress;
• "work force behavior and education" in support of economic development; and
• "innovation behavior and education" in support of progress in broadening capable innovation practice.

Similarly, as a different starting point for "borrowing" across fields, knowledge of operational considerations could provide insight regarding how offerings associated with different services (e.g., health, education, workforce development) may be received by the same target customers.

3. Connecting highly dispersed resources and interest –

Even as the innovators in the case studies of this report were situated at the front line of operations, the human and knowledge resources focused on realizing productive social change reside in many different locations. Drucker emphasized the importance of innovation within public-service institutions, including schools, health care institutions, and government. Goldsmith’s model of civic entrepreneurship speaks to the additional range of related roles and organizations situated at the front line of public services, including foundations and community- and faith-based organizations, among others. And there are still more “pods” of work and interest addressing the range of challenges within the broad social production system within the U.S. and beyond.

 

As one primary example, in U.S. higher education there are large fields of applied social science where scholarly work and the professional training of practitioners is oriented to social system productivity. In fact, within the context of a 1979 taxonomy of inputs for “social problem solving” established by Charles Lindblom and David Cohen, the work of social innovation and entrepreneurship would seem to fit under the heading of “social engineering” – defined as practitioners “pushing for specific practicable solutions to well-defined problems,” which Lindblom and Cohen associated with “applied research.”[100]

 

Since the time of Lindblom and Cohen’s publication, academic programming for applied social science – or social engineering – and its knowledge base has developed into new and large fields such as: public health, social work, public policy, education, and more. Indeed, faculty of applied social science programs broadly have represented one primary source of “practicable solutions” for change, even as the training of many (or most) may have focused on research methodology without the benefit of structured training in innovation methodology.

 

Traditional engineering and design also represents a longstanding domain of human and knowledge resources for social innovation, both as collaborators and as initiators. The model of appropriate technology is an example of direct action that has focused for decades on advancing social productivity in economically developing nations.

 

Business school students are a more recent example of interest in advancing social productivity, particularly within the work's incarnation as social innovation and entrepreneurship, including newly visible conceptions such as “social enterprise.” In fact, the business student locus of interest has been key to broadened overall visibility of the social innovation and entrepreneurship labels:

"A decade ago the term (social entrepreneur) was scarcely heard; today everyone from London to Lagos wants to be one. Social entrepreneurship conferences are invariably the best attended events for students at leading business schools."[101]

The interest of these students is a valuable addition of talent and purpose, and to some extent it is linked to changes in business schools' non-profit management offerings. However, overall, even as this new locus of interest adds the value of human resources and engagement, it also adds to the status quo dispersion of human and knowledge resources.

 

The array of interested human resources is rich. Yet, whether labeled social engineering, social innovation and entrepreneurship, or any other term, the practice of pushing for high-leverage practicable opportunities throughout the overall social production system remains widely dispersed and generally disconnected. Plus, Lindblom and Cohen’s depicted this social system context, prior to the new levels of interest, as one of society’s “major and noisiest institutions.”[102] Perhaps in response to this, resource connection is a central aspect of Stephen Goldsmith's model of "civic entrepreneurship."

 

Further, the innovation aspect of the dispersed practice remains, in Drucker’s terms, a skilled craft, even as it is linked to an array of specialized disciplines.

 

Within higher education, there may be an especially significant opportunity to connect dispersed resources, both, within university disciplines and between universities and the front line of social operations. Increasing connections could generate valuable benefits of structural capital, where structures provide for:

• rapid knowledge sharing
• collective knowledge growth
• shortened lead times
• more productive people[103]

Within higher education, the modular interface of common concepts and vocabulary of methodology could support the connection of resources for innovation, as it does for research. A valid set of innovation's first principles could help emphasize the ties that bind generally dispersed resources while also helping establish points of departure and meaningful classifications of practice. For prospective practitioners, an understanding of innovation methodology's fit within various disciplines could facilitate effective choices about how and where to engage.

 

Finally, following in the footsteps of “tech transfer” for science and the commercial system, there may be a high-potential opportunity for developing tech transfer to facilitate connections between higher education’s human and knowledge resources for innovation and the front line of the social production system. The engineer recipient of U-M’s 2010 Career Award for Invention noted in his comments that he didn’t extend his early high-potential work in the 1980s into the commercial production system due to not having a strong tech transfer office at that time. Applied social science may have substantial opportunity to catch up to other applied science. Among other benefits, such connections could support the transfer choice of organizational channel. For example, in 2010, Larry Brilliant argued for major “mergers and acquisitions” as a means to advance productivity and power beyond the status quo of “two million small, underfunded, underpowered environmental groups.”[104] Issues such as this remain largely unexamined for social innovation.