If you have followed the emergence and spread of the Occupy Wall Street movement, you can see these trends at work – and it’s precisely the changes implied by the trends that have made this a difficult story for traditional media to cover.   How many times have you seen reports that this is a “leaderless movement?”  In a session on social change at the recent Independent Sector conference, a young woman expressed her frustration at this term, saying “The problem that people seem to have in understanding OWS is that it is, in fact, a leader-full movement.”  She makes a good point.   Those involved are sharing leadership, inviting others to engage in the movement, and they are using technology to communicate broadly and through open channels – but not necessarily the channels to which traditional media are accustomed (no one issues press releases announcing the next day’s events).

If we try to understand what is happening in the sector through applying an older framework, we are likely to end up with a conundrum like that expressed by Arthur Brisbane in the New York Times in which he says “Occupy Wall Street has proved to be a difficult sprawling story to report” and one that has generated a great deal of reader concern about the coverage.  Much of the concern seems rooted in the challenges of applying an old framework (single leader, traditional means and channels of communication, civic engagement bounded within a hierarchical institution) to an emerging new world.

Can advocacy organizations learn anything from the spread of OWS around the country and the world?

Has the media’s confusion regarding the “message” of OWS caused you to look at your communications strategy?  Which way are you going?

It strikes me that when municipal governments start looking to local nonprofits for help with public sector financial problems the end of civilization cannot be far off. What’s next, the mayor standing in line at the soup kitchen?

This phenomenon reminds me of a story I heard from a client who worked for a tech company. He claimed he could track his company’s fortunes by the prices at the soda vending machine in the lunchroom. When he first started at the company the vending machine was left open and the sodas were free. As the economy tightened a modest charge was imposed at the vending machine, basically to cover the cost of the drinks. “But,” he told me, “when they raised the prices again and I figured out that the vending machine was now being viewed as a profit center, I knew the company was in trouble.”

Viewing nonprofits as a revenue source for local government strikes me as the “vending machine as profit center” way of thinking.  The entire tax system is off, yet we look to nonprofits rather than to tax reform. The U.S. has the highest corporate tax rate in the world – yet many large companies pay nothing at all. Let’s look to close those loopholes before we start asking the local community hospital to contribute to the city’s coffers.

Prizes can be an effective tool for innovation and can also be used to identify best practices and new levels of excellence, change wider perceptions, build a more effective network of problem-solvers, and mobilize new talent or funding.  Of the organizations surveyed by McKinsey in their report And the Winner is…the majority said that their prizes had been most successful at setting standards of excellence and influencing perceptions of a field.  However, organizations found prizes were less successful in mobilizing talent from unusual sources or improving participants’ skills.  Additionally, they identified that competition for a prize may have the unwanted tendency to deter collaboration.  Nonetheless, prizes may have the capacity to promote changes in skills, outcomes, and behavior.  And with changes in technology, widespread use of the social web, and new concepts like crowdsourcing gaining in traction, we can anticipate that prizes may be able to deliver even more powerful end results.

There are several elements for developing and implementing a successful prize competition. The first and one of the most important steps is for an organization to clearly define the change it seeks.  By developing a finite and measurable statement that defines the problem and the end result desired, an organization can access if a prize is the most effective strategy.  Successful prizes must have concrete and easily measureable goals that can be translated into significant, motivational, actionable, results-focused, and time-bound objectives.  Developing clear prize criteria is also essential to testing whether a prize is a potential solution to a problem.

The right prize design is critical to any prize success. A successful prize will employ one of at least six prize mechanisms:

• Excellence: Focus attention on and/or influence a field or issue
• Best practices+: Highlight best practices, ideas or opportunities
• Network: Strengthen a community
• Innovation: Source innovation and expose additional needs in the system
• Solution: Solve a challenging, well-defined problem
• Participation: Educate & change behavior

After determining if a prize is the right strategy and choosing a mechanism, the next steps are prize and process design.  The nuts to bolts of prize design and process include many complex tasks requiring substantial investment of staff and fiscal resources.  A growing industry of prize facilitators means that some of these activities can be outsourced for a price.  However, even outsourcing still requires substantial staff investment.

There are challenges, however.  Some prizes have expended a great deal of money, but achieved little impact.  Prizes can tax both human and financial resources with high transactional costs including: research and planning, outreach and media, overall administration, coordination of evaluation and selection process (e.g., coordinating judges), and hosting an award event.  An effective prize requires significant resources in the design, process, and implementation stages.

Prizes are a powerful tool that can promote a positive result if matched to the right focus; prizes are not panacea and any mismatch in prize type to the change sought may deliver less than desired results.  Successful prizes can create a demonstration effect for organizations looking for innovations to impact a problem along with increasing visibility for the problem and potential solutions.  However, running a successful prize competition requires extensive work and expenditure of substantial financial and other resources.

Sources for this post included:

And the Winner Is…, McKinsey and Company. 2009

Federally Funded Innovation Inducement Prizes, Congressional Research Service. 2009

Prizes, Challenges and Open Grant-Making, Gail Davenport’s blog. 2010

Promoting Innovation: Prizes, Challenges and Open Grantmaking.  A report from the conference hosted by the Case Foundation, the White House Office of Science and Technology Policy, and the White House Domestic Policy Council. 2010

Citizen Centered Solutions. Lessons in Leveraging Public Participation from the Make It Your Own Awards,  The Case Foundation. 2010

Each panelist highlighted different aspects of the five trends impacting the social sector and what their organizations are doing in response to, or in some cases, as part of the trends.

For example, Matt Halperin said the Omidyar Network is sector-agnostic when it comes to their investments, for them, sector-blurring has become sector indifference.

Dee Dee Nguyen of Marin Community Foundation talked about the changing demographics of California and the challenge of engaging younger donors in giving circles.

Peter Friess of the Tech Museum of Innovation showed a footage of kids being videotaped, so that the childrens’ explanations can be used in place of signage explaining the museum’s exhibits, to make the visitor experience more meaningful for other children.

It was a lively discussion with lots of people hanging around after for more.  Special thanks to Judi Powell and Dion Ward of NCG and Janet Camarena of Foundation Center for helping make this event a success!

When I heard this today, from colleagues at a meeting, the only thing I could think to say was, “My God, it sounds like socialism!” When the laughter died down, I discovered that my work here, with UK organizations ACEVO and Capacity Builders, is being financed out of this fund. I always did love socialism.

Seriously, it is inconceivable that America would allow its government to take such an active role in supporting a large portion of the nonprofit sector economy, or is it? Until recently, it was equally inconceivable that our government would bail out the private sector’s financial institutions.

The closest thing the US has to this arrangement is the IRS oversight function. But that is really a policing responsibility, ensuring our sector is obeying the law. There is no unified federal (or state for that matter) effort to ensure the health of our nonprofits.

Walt Shill, head of the North American practice for Accenture, is quite blunt: “Strategy, as we knew it, is dead. Corporate clients decided that increased flexibility and accelerated decision making are much more important than simply predicting the future.” Corporate planners are increasingly revising their forecasts monthly, but this too is the wrong solution in my opinion. It consists of continually moving the goal posts. When you first miss your numbers, recast them. Next month, repeat.

It is great to see corporate America, and consulting giants like Accenture, beginning to see the problems with long-term static planning approaches to strategy. We identified similar problems in the nonprofit sector years ago and prescribed a better approach to strategy, our Real-Time Strategic Planning methodology, which was described in The Nonprofit Strategy Revolution in 2008. Sometimes our sector leads the way! In this work we describe an ongoing strategy process designed to anticipate and respond to challenges and opportunities as they emerge.