Design Your Life, Change the World

Transcription

Design Your Life, Change the World:
Your Path as a Social Entrepreneur
[ A GUIDE FOR CHANGEMAKERS ]
Professor Michael Gordon
University of Michigan
© 2011-2012 Michael Gordon, All Rights Reserved
1
WHO SHOULD READ THIS BOOK
This book is for changemakers - the people and organizations that want to make a difference in
the world.
I hope to show you, as I hope to show my students each day, that you don't have to make a choice
between making a living and making the world a better place. The same applies to organizations
and business.
I wrote this book for you.
ABOUT THE BOOK
For at least a decade, I’ve thought about two questions:
•
How can organizations best address important societal problems such as poverty,
inadequate health care, sub-par education, and an unhealthy planet?
•
What’s the best advice I can give to the dozens, if not hundreds, of students I talk to
who want to address these issues and live lives of relative comfort?
Almost all of my teaching at the Ross School of Business at the University of Michigan has
been focused on the first question. The essence of my teaching has been to expose my students to
remarkable organizations that make headway where most others fail.
2
The more I thought about the question of how organizations can address societal problems, the
more I realized that an organizations-only focus was too limited. It's vitally important to look at the
people who started those organizations, or grew them, or shaped them. Remarkable organizations
are pretty closely linked to remarkable people—people whose clear vision, passion, and
skills at getting things done give life to ideas that truly make a difference. So, I began to focus
my teaching on some of these difference makers, too.
I wrote this book to help you find your place in changing society by working for or alongside, or
even starting, new kinds of organizations that don’t employ starched shirts and don’t deploy smokestacks.
I’ve tried to do so with many, many examples, including examples of the paths that others “just like you”
have traveled, even as I’ve tried to make this a “business” book that takes a radically different view of what
businesses should be like, and a you-can-do-it book for “students” of any agewho have doubts about what
one person can do in the face of so many societal problems, needing to pay back their loans, wanting to
make a difference, and enjoying lattes, even though I know—and I think they do, too—that they can
unlock their potential and live a life of meaning and fulfillment that is beyond anything that most people
ever dream about.
This book aims to be about people, organizations, and fixing the world. Here’s how:
Chapter 1 >>
How to Change the World
introduces the major themes of this book including the topic of "societal hybrids."
Chapter 2 >>
Interviews With Changemakers: Contemplating, Becoming, and Being
gives us insights into the lives of five change makers. All are accomplished in their own right, but they
occupy different positions on the spectrum of experience, from “starting out,” to “starting to make things
happen,” to “game changer.” Yet each of them is human and, despite their accomplishments, I think you
will find lots of similarities between their musings about their lives and your own. Here are their stories:
•
•
•
•
•
Gina Valo: a beauty queen who works at Google.org
Cynthia Koenig: an anthropologist-photographer-conservationist and her efforts to take Hippo
Rollers global
Patrick Donohue: a systems engineer who turns his attention to social good
Sachin Rao: a consultant who renounces the corporate world to serve the poor
Steve Mariotti: an automobile industry expert who teaches inner-city kids about entrepreneurship
Chapter 3 >>
The Nature Of Sustainable Societal Hybrids
expands on the notion of hybrid organizations, which borrow from business and nonprofits to address
societal problems and do so in a sustainable fashion.
Chapter 4 >>
Enterprise For A Sustainable World and The BoP Protocol
is the “organizations section.” It begins with a description of a particular approach to developing new
kinds of businesses at the economic base of the pyramid—the Base of the Pyramid Protocol.
Chapter 5 >>
In Depth: Enterprise For A Sustainable World
draws broader lessons from Chapter 4 that pertain to any organization striving to produce powerful
changes in society.
Chapter 6 >>
Healthy: The Institute For Oneworld Health
3
shows how these lessons are applied in organizations working on attacking diseases in the developing
world.
Chapter 7 >>
Wealthy: Kickstart
creating economic opportunity in Kenya
Chapter 8 >>
Wise: National Foundation For Teaching Entrepreneurship
creating career-building educational opportunities for young people from poor communities, mostly in
the United States
Chapter 9 >>
Green: Home Depot, Ikea, & The Forest Stewardship Council
protecting the world’s forests, and with them, the planet’s ability to sustain us.
Chapter 10 >>
Anatomy Of A (R)Evolution
explains how all systems evolve—whether natural systems of plants or animals, or man-made systems
such as the system of organizations that we’ve created.
Chapter 11 >>
Big Levers + Evolution
builds on this insight so that we learn how to identify societal solutions offering the potential for dramatic
change, understand how we can improve on their potential and keep testing them until they become
better still, and can spread their benefits to as many people as possible.
Chapter 12 >>
Building Blocks For Your Future: The Changemaker's Cube
provides “exercises for the interested reader” and outlines a step-by-step methodology for anyone
interested in creating a life of meaning and fulfillment using the Changemaker's Cube, a tool developed
for building your skills and aptitude.
BONUS >>
FAQ: The Practitioner’s Guide To Becoming a Changemaker
is an FAQ where I carry on a little dialog - answering questions I get asked most often by students and
entrepreneurs, in short, people just like you.
INTRODUCTION
As I stated previously, the more I thought about the question of how organizations can address
societal problems, the more I realized that an organizations-only focus was too limited. It was vitally
important as well to look at the people who started those organizations, or grew them, or shaped them.
Remarkable organizations are pretty closely linked to remarkable people—people whose
clear vision, passion, and skills at getting things done give life to ideas that truly make a
difference. So, I began to focus my teaching on some of these difference makers, too.
But something else was going on. None of the organizations I admired was working in isolation.
The set of organizations aiming to improve educational opportunities for the poor, as an example, might
cooperate or compete with each other—or ignore each other altogether—but collectively their efforts
would determine how well these students’ educational needs were served. I felt that if I was to be teaching
about how to address society’s vexing problems, I had to consider how to have influence at this higher
(perhaps you like the word broader) level, too. In other words, what are some of the forces that propel
organizationS (plural) forward, and how can we use them to shape the paths that organizations follow? I
began teaching a bit about “complex adaptive systems,” though I usually use such a fancy phrase only
4
when I’m trying to impress. I simply wanted to show my students, again mostly by example—and by
examples whose lessons could be applied—that systems often exhibit noticeable behavior at the collective
level, even when no one is in charge, and that they also adapt or evolve in ways that we can understand,
influence, and take advantage of. And one such system is the collection of businesses and other
organizations.
The second question that I thought about—What advice should I give to students who want
to “make a difference” and set up their lives with enough security so that they can
comfortably raise a family, travel, buy toys they desire, … and retire?—was mostly a practical
question. I’d teach courses in which I’d describe businesses intent on inventing manufacturing processes
that don’t pollute, or hospitals providing amazing heart care to the poor for free, or taking kids on the
edge of dropping out—not only of school, but the formal economy—and turning them into successful
entrepreneurs, and a large number of students wanted to meet with me to ask, “How can I do something
like that?” My advice usually resembled something like this: “Follow your passion and then ‘just do it.’
Don’t wait until everything seems ‘perfect’ because it never will be.” I think many students thought that
advice was just a bunch of words, even though it was sound, since I’d studied lots of successful people who
all said something similar. In fact, in many cases, former students have reappeared in my life as successful
“social entrepreneurs,” telling me how, only after they’d followed that advice, they’d seen the wisdom in it.
(Not my wisdom; the wisdom borne of others’ experiences.) In any case, I wrote this book as a more
extended answer to these students’ questions and to anyone else grappling with these kinds of questions.
This book, then, is an exploration of what some world-changing organizations are doing in the
areas of poverty alleviation, health care, education, and the environment. It also discusses the activities of
dozens of change agents who are leading the way, as well as delves into the lives of five individuals—from
those just starting to “change the world” to a remarkable man who has been doing it for decades—so that
you can see the very human side of these individuals as they make decisions, overcome their fears, and
keep moving ahead even when circumstances change. And then I will tell you how we can create influence
at the “society” level by harnessing, of all things, biological evolution.
So, in many ways this book is a hybrid, and so am I. A little about me first: Along the way, I’ve
studied psychology, computer science, music, artificial intelligence, personal development, and economic
development. I’ve developed search engines, uncovered medical discoveries by having a computer “read”
the medical literature, written a novel, and been inspired by creative innovators around the world. If you
had a window onto one of my typical days, you might see me reading a book by Muhammad Yunus,
watching World Cup soccer, creating a cool teaching simulation, riding my bike, or playing with a gadget
that offers computing power to children in the developing world or advice to shoppers who truly want to
“buy green.”
Somehow, all these different interests have influenced me as a professor and shaped my curiosity
and deep passion for understanding how to use business and related approaches to make the world a
better place: we are all hybrids. And so is this book. When I decided to devote my teaching and
scholarship to “base of the pyramid” business development and other innovative approaches for
producing a better world, I imagined I was making a break with my past. I never suspected that my
undergraduate studies in psychology would lead me to think about human drives—which, after all, we
should understand to create change. Nor did I think that studying genetic algorithms as a graduate
student in computer science would have any relevance to changing the world; but, as you’ll see, it presents
a robust and profoundly useful perspective on how to accelerate and amplify societal change.
5
WHO SHOULD READ THIS BOOK
This book is for changemakers - the people and organizations that want to make a difference in
the world.
I hope to show you, as I hope to show my students each day, that you don't have to make a choice
between making a living and making the world a better place. The same applies to organizations
and business.
I wrote this book for you.
ABOUT THE BOOK
For at least a decade, I’ve thought about two questions:
•
How can organizations best address important societal problems such as poverty,
inadequate health care, sub-par education, and an unhealthy planet?
•
What’s the best advice I can give to the dozens, if not hundreds, of students I talk to
who want to address these issues and live lives of relative comfort?
Almost all of my teaching at the Ross School of Business at the University of Michigan has
been focused on the first question. The essence of my teaching has been to expose my students to
remarkable organizations that make headway where most others fail.
The more I thought about the question of how organizations can address societal problems, the
more I realized that an organizations-only focus was too limited. It's vitally important to look at the
people who started those organizations, or grew them, or shaped them. Remarkable organizations
are pretty closely linked to remarkable people—people whose clear vision, passion, and
skills at getting things done give life to ideas that truly make a difference. So, I began to focus
my teaching on some of these difference makers, too.
I wrote this book to help you find your place in changing society by working for or alongside, or
even starting, new kinds of organizations that don’t employ starched shirts and don’t deploy smokestacks.
I’ve tried to do so with many, many examples, including examples of the paths that others “just like you”
have traveled, even as I’ve tried to make this a “business” book that takes a radically different view of what
businesses should be like, and a you-can-do-it book for “students” of any agewho have doubts about what
one person can do in the face of so many societal problems, needing to pay back their loans, wanting to
make a difference, and enjoying lattes, even though I know—and I think they do, too—that they can
unlock their potential and live a life of meaning and fulfillment that is beyond anything that most people
ever dream about.
This book aims to be about people, organizations, and fixing the world. Here’s how:
Chapter 1 >>
introduces the major themes of this book including the topic of "societal hybrids."
Chapter 2 >>
Interviews With Changemakers: Contemplating, Becoming, and Being
gives us insights into the lives of five change makers. All are accomplished in their own right, but they
6
occupy different positions on the spectrum of experience, from “starting out,” to “starting to make things
happen,” to “game changer.” Yet each of them is human and, despite their accomplishments, I think you
will find lots of similarities between their musings about their lives and your own. Here are their stories:
•
•
•
•
•
Gina Valo: a beauty queen who works at Google.org
Cynthia Koenig: an anthropologist-photographer-conservationist and her efforts to take Hippo
Rollers global
Patrick Donohue: a systems engineer who turns his attention to social good
Sachin Rao: a consultant who renounces the corporate world to serve the poor
Steve Mariotti: an automobile industry expert who teaches inner-city kids about entrepreneurship
Chapter 3 >>
expands on the notion of hybrid organizations, which borrow from business and nonprofits to address
societal problems and do so in a sustainable fashion.
Chapter 4 >>
Enterprise For A Sustainable World and The BoP Protocol
is the “organizations section.” It begins with a description of a particular approach to developing new
kinds of businesses at the economic base of the pyramid—the Base of the Pyramid Protocol.
Chapter 5 >>
draws broader lessons from Chapter 4 that pertain to any organization striving to produce powerful
changes in society.
Chapter 6 >>
shows how these lessons are applied in organizations working on attacking diseases in the developing
world.
Chapter 7 >>
Wealthy: Kickstart
creating economic opportunity in Kenya
Chapter 8 >>
creating career-building educational opportunities for young people from poor communities, mostly in
the United States
Chapter 9 >>
Green: Home Depot, Ikea, & The Forest Stewardship Council
protecting the world’s forests, and with them, the planet’s ability to sustain us.
Chapter 10 >>
explains how all systems evolve—whether natural systems of plants or animals, or man-made systems
such as the system of organizations that we’ve created.
Chapter 11 >>
builds on this insight so that we learn how to identify societal solutions offering the potential for dramatic
change, understand how we can improve on their potential and keep testing them until they become
better still, and can spread their benefits to as many people as possible.
7
Chapter 12 >>
Building Blocks For Your Future: The Changemaker's Cube
provides “exercises for the interested reader” and outlines a step-by-step methodology for anyone
interested in creating a life of meaning and fulfillment using the Changemaker's Cube, a tool developed
for building your skills and aptitude.
BONUS >>
FAQ: The Practitioner’s Guide To Becoming a Changemaker
is an FAQ where I carry on a little dialog - answering questions I get asked most often by students and
entrepreneurs, in short, people just like you.
INTRODUCTION
As I stated previously, the more I thought about the question of how organizations can address
societal problems, the more I realized that an organizations-only focus was too limited. It was vitally
important as well to look at the people who started those organizations, or grew them, or shaped them.
Remarkable organizations are pretty closely linked to remarkable people—people whose
clear vision, passion, and skills at getting things done give life to ideas that truly make a
difference. So, I began to focus my teaching on some of these difference makers, too.
But something else was going on. None of the organizations I admired was working in isolation.
The set of organizations aiming to improve educational opportunities for the poor, as an example, might
cooperate or compete with each other—or ignore each other altogether—but collectively their efforts
would determine how well these students’ educational needs were served. I felt that if I was to be teaching
about how to address society’s vexing problems, I had to consider how to have influence at this higher
(perhaps you like the word broader) level, too. In other words, what are some of the forces that propel
organizationS (plural) forward, and how can we use them to shape the paths that organizations follow? I
began teaching a bit about “complex adaptive systems,” though I usually use such a fancy phrase only
when I’m trying to impress. I simply wanted to show my students, again mostly by example—and by
examples whose lessons could be applied—that systems often exhibit noticeable behavior at the collective
level, even when no one is in charge, and that they also adapt or evolve in ways that we can understand,
influence, and take advantage of. And one such system is the collection of businesses and other
organizations.
The second question that I thought about—What advice should I give to students who want
to “make a difference” and set up their lives with enough security so that they can
comfortably raise a family, travel, buy toys they desire, … and retire?—was mostly a practical
question. I’d teach courses in which I’d describe businesses intent on inventing manufacturing processes
that don’t pollute, or hospitals providing amazing heart care to the poor for free, or taking kids on the
edge of dropping out—not only of school, but the formal economy—and turning them into successful
entrepreneurs, and a large number of students wanted to meet with me to ask, “How can I do something
like that?” My advice usually resembled something like this: “Follow your passion and then ‘just do it.’
Don’t wait until everything seems ‘perfect’ because it never will be.” I think many students thought that
advice was just a bunch of words, even though it was sound, since I’d studied lots of successful people who
all said something similar. In fact, in many cases, former students have reappeared in my life as successful
“social entrepreneurs,” telling me how, only after they’d followed that advice, they’d seen the wisdom in it.
(Not my wisdom; the wisdom borne of others’ experiences.) In any case, I wrote this book as a more
extended answer to these students’ questions and to anyone else grappling with these kinds of questions.
This book, then, is an exploration of what some world-changing organizations are doing in the
areas of poverty alleviation, health care, education, and the environment. It also discusses the activities of
dozens of change agents who are leading the way, as well as delves into the lives of five individuals—from
those just starting to “change the world” to a remarkable man who has been doing it for decades—so that
you can see the very human side of these individuals as they make decisions, overcome their fears, and
8
keep moving ahead even when circumstances change. And then I will tell you how we can create influence
at the “society” level by harnessing, of all things, biological evolution.
So, in many ways this book is a hybrid, and so am I. A little about me first: Along the way, I’ve
studied psychology, computer science, music, artificial intelligence, personal development, and economic
development. I’ve developed search engines, uncovered medical discoveries by having a computer “read”
the medical literature, written a novel, and been inspired by creative innovators around the world. If you
had a window onto one of my typical days, you might see me reading a book by Muhammad Yunus,
watching World Cup soccer, creating a cool teaching simulation, riding my bike, or playing with a gadget
that offers computing power to children in the developing world or advice to shoppers who truly want to
“buy green.”
Somehow, all these different interests have influenced me as a professor and shaped my curiosity
and deep passion for understanding how to use business and related approaches to make the world a
better place: we are all hybrids. And so is this book. When I decided to devote my teaching and
scholarship to “base of the pyramid” business development and other innovative approaches for
producing a better world, I imagined I was making a break with my past. I never suspected that my
undergraduate studies in psychology would lead me to think about human drives—which, after all, we
should understand to create change. Nor did I think that studying genetic algorithms as a graduate
student in computer science would have any relevance to changing the world; but, as you’ll see, it presents
a robust and profoundly useful perspective on how to accelerate and amplify societal change.
9
CHAPTER ONE
"Imagination is more important than knowledge." — Albert Einstein
Want to have lunch with Einstein? (He died in 1955, you know.)
But let’s let him guide us through a buffet line where, by using our imagination, we see how we can
select some of this, some of that, and end up with a meal—no, make that a life—that meets all our needs.
Along the way, we’ll begin to learn about how we can change the world.
Are you torn between making a living and making a difference? Earning money and finding
meaning? Paying the bills and changing the world?
You don’t have to choose one way or the other. Your choices in life mean everything, so why not
choose the life you crave?
Let’s do a thought experiment. Einstein did these mental experiments throughout his career to
make profound discoveries (such as his famous special theory of relativity, which shows that the faster
you travel, the more time slows down). So let your hair down for a minute (or maybe comb it straight up)
and let’s pretend we’re Einstein. Read the following descriptions and notice your reaction to each:
You're on fire with passion. You’ve been working for a
grassroots organization that is promoting a new conception of
manufacturing where companies produce only goods that are
nontoxic and designed never to see a landfill. You are working
with other committed individuals who share your inspiration
for respecting the environment and promoting prosperity. You
feel a connection to a cause that is beyond anything you could
have dreamed possible. Yet you can’t save because you barely
make any money. And a lack of job security has led you to
reconsider your long-term future. Sometimes, when your head
hits the pillow, you begin to dream that …
You’re a success! Money is not a problem. It’s great to have all
those loans behind you, and at the end of every month you can
put something away for your retirement or your kids’ college.
You just bought a house, and ten weeks from now you’ll be
skiing for six days. You’ve got a good job as assistant technical
liaison, which puts you in line for promotion to associate
creative affiliate. But climbing the corporate ladder is a grind.
Work seems to be sapping your energy, and it’s gobbling up
more and more time. You’re beginning to question what you are
doing with your life. Sometimes, when your head hits the pillow,
you begin to dream that ...
Did you connect to any part of the first description? If you didn’t quite relate to working to create
an economy without waste or pollution, how about living in a developing-world village and helping
provide opportunities for subsistence farmers to sell crops for a profit? Or saving the oceans and the
10
marine life in them? Or maybe working toward everyone having access to a decent education right here at
home?
But didn’t the second description talk to you a bit, too? Wouldn’t it be nice not to worry about
money? To be confident that your bills will always be paid? To have freedom to travel? To be saving for
whatever future you want to create? To handle all the financial curves on the road ahead?
Perhaps you’re having your own fork-in-the-road moment right now like the poet Robert Frost
described nearly a century ago:
Two roads diverged in a yellow wood,
And sorry I could not travel both
And be one traveler, long I stood
And looked down one as far as I could . . .
Then . . .
. . . knowing how way leads on to way
I doubted if I should ever come back.
...
I took the one less traveled by,
And that has made all the difference.
With apologies to the great poet, what if Frost had described the choices at a modern buffet:
I looked down one line as far as I could
For salmon planked on cedar wood . . .
And the other, as just as fair,
Vegetables, salads, and desserts of pear . . .
And I, knowing these were all among my favorites,
Took some of each . . . and that made all the difference.
So, Frost might have only won three Pulitzer Prizes for penning those lines—not four—but we’d
have been reminded that we can choose what we want, even if we have to stand in two lines to get it.
And that brings us to a second thought experiment. Again, read these words and note your reaction:
The promotion you just got feels great. Yeah, you’ve been
working too hard, but it’s hard not to when work is so engaging
and you’re a part of such an amazing—and effective—program
teaching inner-city kids. Having your own staff now provides
an opportunity for you to create even greater impact by
multiplying your own efforts. The recognition, the nice raise:
They you know that you’ve found a place where you fit in, are
valued, and can deliver for the long haul.
Does this feel more like you’ve gone through the buffet line as many times as you like?
11
How about a second helping of salad, this time with more carrots, a hot and cold entrée, a splash of
fruit juice in your iced tea, and a little taste of three desserts?—a meal designed by you, for you, made with
all the things that you like.
Can’t we build our lives with two entrées, one that makes the world a better place, and one that
makes sure that we are well fed and provided for? It won’t automatically happen by following an already
existing path. But we can create our own path, not by splitting the difference or settling, but by choosing
those elements that we feel are most important to our own well-being and seeking—or creating—
opportunities to use them.
The Benefits of a Hybrid Organization
Let’s stop and think about this for a moment. Doesn’t it stand to reason that we can build
organizations in new ways, creating hybrids from elements not typically combined, just as you could make
that amazingly satisfying “hybrid” meal?
Let me give you an example. Have you ever heard of Google.org? No, not that one. Google.org is a
charity, and we all know what charities are, right? Except Google.org is a for-profit charity that focuses on
problems such as pandemics and climate change.
But wait a minute. For-profits are companies whose goals are to make lots of money, aren’t they—
like pharmacies? Well, yes and no. Take OneWorld Health. It’s a pharmacy, but it’s a nonprofit.
These two examples illustrate hybrid organizations that defy the typical rules. Rather than sticking
to a formula, they chose elements from the buffet that they needed and discarded the rest. Google.org—
the charity—forfeited nonprofit status for the opportunity to build products (and businesses) that serve
society, to generate profits to fuel its growth and increase its impact, and to lobby Congress. OneWorld
Health—a pharmacy—sought nonprofit status in order to receive donations of out-of-fashion drugs from
other pharmacies as a replacement for massive investments in drug research.
Hybrid organizations offer the possibility of getting “unstuck” when it comes to dealing with
societal problems. Unstuck, because such organizations seek results rather than standing on precedent.
Hybrid organizations are shameless about stealing ideas that work and applying them to new situations.
McDonald’s had some ingenious ideas about making hamburgers efficiently when they began one of the
world’s most successful franchises. The world’s largest eye hospital—Aravind Eye Hospital in India—has
applied these principles to perform cataract surgery. Ever notice that children eagerly jump into new
situations without the need for any kind of instruction? Sugata Mitra, an educator and information
technologist, noticed, so he stuck computers in “holes in the wall” around the world so that children who
would not otherwise have access to computers could begin to explore the Internet.
It is human nature to be ever evolving, even in the world of business. In 2002, two business
professors at the University of Michigan, C. K. Prahalad and Stuart Hart, described the business and
societal benefits of doing business with the billions of people at the “bottom (or base) of the pyramid”
rather than following the standard business principle of focusing on those occupying the pyramid’s
wealthiest tip. Introducing this concept has motivated companies around the world to serve and work
alongside these people and to create new products and services, new forms of delivery, and entirely new
business models that break down the distinction between a company-selling-to-a-community, and a
community-as-partner-of-a-company.
Hybrid organizations can produce results that others can’t because they recognize and capitalize on
some of the greatest strengths of both businesses and nonprofits. They strive to incorporate business
elements such as skill at execution, a strong focus on results, and financial might necessary for long-term
sustainability. Hybrids adopt the strengths of nonprofits and similar organizations, too: a grassroots
orientation, a commitment to people, and an eye for identifying what needs to be done on behalf of the
needy.
12
Combining these strengths, hybrids resemble nonprofits by working on some of the most
demanding problems of the day:
•
•
•
•
•
Eradicating poverty
Improving both the access to and quality of education
Eliminating treatable but often neglected diseases
Improving access to basic health care
Providing sustainable, economically sound solutions to environmental crises
But, acting like for-profits, hybrid organizations can produce revenues and profits to ensure that
their efforts continue over time and attract the necessary resources when they wish to grow.
But hybrids that combine the advantages of for-profits and nonprofits illustrate only one way that
strengths can be combined. Large, multinational companies can partner with tiny micro-enterprises
overseas to create community-based businesses with the heft of a corporation. Social networks that span
geography, income, and personal relationships become vehicles for sharing ideas, loaning money, and
providing educational opportunities. Companies seeking to make a splash with “green products” in the
West may find that they can best tune these products in the developing world first.
And these examples give only a small taste of what is possible when one good idea is combined with
another.
1 Good Idea + 1 Good Idea = 1 Great Idea
Something Old, Something New
I’ve been talking about hybrids as if they’re brand new. In fact, they’re not new at all. As we will see
throughout this book, growth and change has always occurred through borrowing, copying, and adapting
ideas from elsewhere. But something is different in terms of the types of hybrids that are being created
today to address social problems (Let's use the terms social and societal interchangeably to modify
problems, hybrids, and other words and phrases.).
First, certain events are having an impact on everyone in the world, even if they affect us all
differently. One of the best examples of this phenomenon is global warming and climate change. In the
developed world, citizens and companies are realizing that the ways that we’ve always done things cannot
be extended into the future. There’s just not enough planet left. On the other hand, those in the
developing world are beginning to bear the brunt of an energy-hungry world most dramatically in the
forms of droughts, water shortages, and famine.
Until recently, our separate worlds rarely bumped into each other. Now, they’re bumping into each
other all the time. The Western world’s search for crops that can be used as replacements for fossil fuels is
aggravating food shortages in Africa. So is China’s new appetite for meat, which reduces the caloric
effectiveness of agricultural land by nearly 85 percent. Brazil’s response to climate change has been to
produce sugar ethanol, but that has worsened, not helped, the situation by promoting deforestation. This
all affects climate change, which leaves the hungry hungrier and increasingly desperate.
As we realize how small and interconnected the world is, we are pressed to look for new approaches
to doing business that address societal ills. We begin to understand that saving the Amazon is not just a
frill to benefit ecotourism. By helping offset the carbon we’re putting into the air, protecting the Amazon
may allow us to keep cars on the road and keep our economy moving. In fact, new markets are appearing
that allow companies in the West to buy credits stemming from avoiding deforestation of the Amazon or
from installing solar, wind, or other “green” technologies halfway around the world.
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In the same spirit, finding sustainable livelihoods for the poor provides increased security for wealthier
citizens who cower behind gates, walls, and fences in various cities in parts of Latin America and Africa.
Thus, creating good jobs and the education necessary for those jobs in places where business is ordinarily
reluctant to go makes a lot of business sense.
Are these efforts altruistic? Not at all. Systems linking companies, nonprofits, and people
throughout the world can benefit all parties. If the wealthy benefit and so do the poor, if we preserve the
rain forests and clear the atmosphere, and this allows us to maintain a growing economy, then we have
the recipe for success. Everyone has skin in the game, everyone wins, so everyone wants to keep playing.
In fact, we can also let into the game those sitting on the sidelines who are now far too poor to play.
Something else is accelerating the pace of development of hybrid solutions to societal problems—
new technologies, especially new information and communication technologies. Just a few years ago, the
“crazies” promised that tiny, remote African villages would be able to provide all their children with
powerful, Internet-connected computers (never mind that these villages don’t have electricity); that two
people anywhere in the world could talk to and see each other over their computers—for free; and that
someone from Toledo would be able to make a microloan to someone in Tanzania and later get her money
back while never leaving her computer.
Not only were the “crazies” right, but today they are very wealthy. All by taking advantage of
continually plummeting prices for increasingly sophisticated computing and communication
technologies.
All this can be dizzying but also exciting. As soon as we realize that One Laptop Per Child,
Skype, or Kiva are real, we see someone else already creating a new extension or a related technology
inspired by these now “tried-and-true” technologies. Although the Internet may seem like it has been
around forever, we are only in our first (human) generation of experiencing what this technology can do.
Just as the first, ancient cell phones, which cost nearly $100,000, seem to bear little resemblance to
today’s devices—did you know that cell phones are being adopted more quickly in Africa than anywhere
else?—it’s hard to imagine what “new” technologies will be used throughout the world tomorrow. But we
can be sure that they’ll be in the hands of more people, making the world even closer, creating better
awareness of each other, and creating new opportunities for us to work together.
Finally, the acceleration in adopting hybrid forms to improve society comes from the fact that we
are bumping up against boundaries everywhere. Companies face intense competition, they have sold all
the whatchamacallits they possibly can to affluent consumers, and they know they must “go green”
eventually. There is almost a magnet pulling them to parts of the world where there are four to five billion
new customers and where they can explore new, clean technologies without the competitive pressures
from old, dirty, but still cheap alternatives. Nonprofits, in turn, are tiring of being completely dependent
on donations and contributions. They correctly perceive that they have knowledge and other skills that
can be converted into revenue-producing products and services. Governments and multilateral
institutions, too, are seeking fresh new ways they can produce more powerful benefits for citizens rather
than providing only handouts and aid.
This trend toward experimentation is happening around the world. In India, we see poor farmers
linked by the Internet to local markets and to the Chicago Board of Trade. We also see the most
completely electronic elections anywhere in the world. Argentina, even after its devastating financial
setback, is trying to connect its entire national school system to the Internet and create a self-financing
program, allowing students, teachers, and others to share educational content and teaching ideas and
provide mutual support throughout the country. In Kenya, the Base of the Pyramid Protocol, or BoP
Protocol, has brought together slum dwellers and a large American multinational company to jointly
create a new business that benefits both sides.
Here’s a smattering of other exciting initiatives:
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•
•
•
•
Microloans, micro-insurance, and micro-equity (shares of stock in tiny companies) in Africa
World-class heart care and telemedicine for the poor in India
State-of-the-art educational tutoring linking the skills and needs of those in Singapore, England,
India, and the United States
New worldwide markets for organic produce, fair trade products, and even clean skies and water
that are supported by “green” certifiers and auditors
Advances in alleviating poverty and creating wealth, improvements in quality and access to health
care, better educational opportunities, and efforts to create a healthier planet are taking place everywhere
around the world. Still, this is the tip of the iceberg. By presenting some of the things that are happening
and providing a lens through which to examine them, I hope we can move more and more of this iceberg
above the surface.
A Preview: Creating Cross-Sector Hybrid Organizations
I have used the term hybrid frequently and with intention. In the natural world, hybrids combine
desirable traits of different organisms within or between species. Cockapoos and Labradoodles are hybrid
dogs that humans have designed and bred (and inartistically named). Want a cocker spaniel without the
shedding? Or an easily trained (almost) Labrador that is less likely to cause an allergic reaction? Then
there’s a dog for you.
Technological hybrids—such as hybrid electric vehicles that use internal combustion engines plus
electric motors for power—follow similar principles of hybridization. These principles apply, too, when we
cross for-profits with nonprofits to create organizations that can adeptly address societal problems. I call
these “cross-sector hybrid organizations.” (Here, too, I use various terms, sometimes just referring to
hybrids, societal hybrids, social hybrids, or other terms that I’m sure you’ll understand in context. )
In this book, I will explain how cross-sector hybrid organizations can be designed to address
societal problems in powerful new ways. I will also explain how evolutionary mechanisms can ensure that
they become better adapted to these tasks.
Let me “unpack” the last paragraph a little bit. Any organization can be described by a set of
features. This holds for organizations in the for-profit, nonprofit, governmental, and multilateral
institution “sectors.” Hybrids “cross” sectors by adopting some features from the for-profit world and
others from the nonprofit world. These cross-sector hybrids can powerfully address societal problems by
being less rigid about adhering to “the way things have always been done.”
Evolution plays an important role in making sure these new institutions are strong and vibrant.
Just as different animals and plants differ in their ability to thrive, organizations differ in their “fitness,”
too. And just as living organisms have genetic traits that can be passed on to their progeny, organizations
can be described by a set of features, and we can substitute one feature for another or interchange the
features from two different organizations to create new organizations. Sometimes such changes will be a
bust; other times, the resulting organization may produce more powerful societal solutions than before.
Finally, if the fitness measure used to compare organizations is a truly robust, broad-based gauge, it will
reflect one organization’s ability to out-survive another, “weaker” one.
If cross-sector hybrids can produce powerful solutions for addressing societal ills, then we might
want to know how they come about. Must we wait for a Labrador to be smitten by a Poodle for
“Labradoodle magic” to take place? As a matter of fact, there is so much intermingling of features among
organizations already that we barely notice it. For instance, paying “proper attention to detail” usually
demands that any insurance claim be examined with a microscope (and s-l-o-w-l-y), though some
insurers are adopting the mantra of speed found in other industries and pay all claims as fast as they can.
In addition, more and more companies are turning over key aspects of design to their customers—creating
entirely new meanings for concepts such as customer loyalty and new product development.
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But we don’t have to wait for a slow drift of features to change companies’ behavior, especially if a
drift produces homogenization rather than vital innovations. By looking at organizations in evolutionary
terms, we begin to see them as an expression of their “genes” and “chromosomes.” By understanding that
an organization’s fitness and genetics are intimately bound together, we can study both more closely and
deliberately create hybrids with more societal impact. By understanding the power of selection in
evolution, we can accelerate the rate of societal evolution or change.
Some day “ages and ages hence,” you may look back with pride and satisfaction that the hybrid path
that you’ve created was the road “less traveled [but] has made all the difference.”
Creating a better life and a better world—that’s what this book is about. I think Robert Frost would
approve.
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CHAPTER TWO
Interviews With Changemakers:
Contemplating, Becoming, and Being
TRUST YOUR CAPE
Eight years old with a flour sack cape
Tied all around his neck
He climbed up on the garage
Figurin’ what the heck
He screwed his courage up so tight
The whole thing came unwound
He got a runnin’ start and bless his heart
He headed for the ground
Chorus
He’s one of those who knows that life
Is just a leap of faith
Spread your arms and hold your breath
And always trust your cape
All grown up with a flour sack cape
Tied all around his dreams
He’s full of piss and vinegar
He’s bustin at the seams
He licked his finger and checked the wind
It’s gonna be do or die
He wasn’t scared of nothin’, boys
He was pretty sure he could fly
Chorus
Old and grey with a flour sack cape
Tied all around his head
He’s still jumpin’ off the garage
And will be till he’s dead
All these years the people said
He’s actin like a kid
He did not know he could not fly
So he did
Chorus
“The Cape”
Lyrics by Guy and Susanna Clark; sung by Eric Bibb
Choosing a path in life is always challenging, even more so if you need a machete to clear your way
forward without the benefit of a well-worn trail to follow. But even if a thick undergrowth obscures their
footsteps, others have gone before you, overcoming uncertainties to design—and live—lives that fill them
with purpose and create opportunity throughout all they do.
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What follows is a series of interviews with five people whose paths we can take a look at. Each is at
a different point on his or her journey and, of course, their journeys are all different. Let’s see how they
spread their arms, hold their breath, and leap.
Gina Valo: Congratulations! You Did Not Win
“And the winner is …”
Gina Valo is a twenty-five-year-old woman with the world ahead of her. Two roads diverged in a
yellow wood? It may seem at times that there are two million.
Graduating with a degree in organization studies (“the softer side of business,” as she calls it), and
fresh off giving the student commencement address at her graduation, the question was, What’s next?
So, as any recent graduate might, she decided that the job she wanted was to be Miss Michigan
(yes, that Miss Michigan). Competing (and succeeding) in pageants runs in Gina’s family. Her mom had
been Miss Wisconsin World (which launched her career), her sister had competed, and her family was
generally tied in with the Miss America system, which Gina respects for the opportunity it gives
contestants to have a platform for their personal social cause. “We’d watch Miss America. It was like our
Super Bowl,” she says.
She had already been the second runner-up for Miss Michigan as a college student. So another half year or
so of grinding workouts in the gym, making food choices with the care of a crime scene investigator,
becoming a fixture at public speaking and volunteer events, and polishing her musical performance
skills—it all seemed to make sense.
So, she competed again … and came in second: first runner-up.
Again, the question became, What’s next? Get a job? Compete one last time?
As if by magic—the kind of “magic” that happens more often when you consistently apply yourself
and approach life with passion—a job dropped in Gina’s lap. Google was about to open a branch office in
Ann Arbor, Michigan. She was one of the first eight people hired at the site. Realizing that competing
again might put her job in jeopardy, Gina quickly composed a letter stating her intention to withdraw her
application from the next pageant she would need to compete in if she wanted to become Miss Michigan.
Google is considered a very “cool” company for smart, energetic young people to work at. And
extremely competitive in terms of landing a position. And why not? You get to exercise your brain, work
with cool technologies and alongside other talented people, and receive a handsome paycheck. Oh: there’s
also the lava lamps, the exercise balls, the free gourmet lunches, and the massage stations.
But to Gina, what stands out the most is the opportunity to do good: “I work for a socially
conscious company. That to me is what I’m most proud of about working at Google … [even though other]
people cling to things they’ve seen on the news about how great it is to work there.” (Author’s note: Oops.
Guilty as charged.)
A company whose motto is “Don’t be evil” would seem like a good place to do work that improves
society. But you must internalize that message, make it fit you, and work to extend its range of
application.
Gina’s official job—working with customers to help them develop effective AdWord campaigns
(AdWords trigger those Google links that try to sell you products when you are searching)—wouldn’t seem
to be a good fit for someone with her focus on social consciousness. But she found a way to create
meaning from her work:
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I’ve had the opportunity to work with a lot of small businesses that [have] built their business online.
[One] woman that I work with makes handmade bath products, organic natural bath products. It’s a
livelihood based out of her home [and she’s] doing the majority of her business online because Google
AdWords brings her customers at an affordable rate with a good return on investment. And it’s my job
to figure out that formula. That’s really satisfying because I know that I’m helping the small guy and
that’s really fun. … What I love about Google AdWords is that it democratizes the advertising industry
and it lets people compete based on what they offer, how good their websites are, and how good their
businesses are—rather than how much money they have.
In addition to helping small businesses survive—and thrive—by working with them to help them
create effective online advertising campaigns, Gina gets satisfaction knowing that her efforts help fund
Google’s charity efforts. Google contributes 1 percent of its annual profit and equity to its Google.org forprofit charity. “I look at some of the big deals that I bring in and that I help up-sell and say, ‘That’s huge,
that’s big money for Google.org,’” she says. “I don’t think everyone necessarily thinks of things that way,
but I definitely do. I’m conscious of that and excited about it. When I look at our revenue numbers I think,
‘Ooh, that was a lot.’”
Gina creates as much social impact from her unofficial Google duties. “I’m very much a ‘yes person’
when it comes to community work,” she explains. And “yes people” are not too hard to locate when there’s
a job to be done.
Gina co-founded the local chapter of Google Cares, an employee-driven effort to make it effortless
for Google employees to find and participate in volunteer activities. She also developed Donate a Dollar,
which helps coordinate the myriad fund-raising activities of her 250-plus office peers so that each effort
receives concentrated support (plus a Google match), thus ensuring a decent donation for the cause and
providing convenience for both the fund-raiser and the contributors.
Gina’s social intrapreneurial efforts are providing her the opportunity to learn important lessons of
a social entrepreneur. Donate a Dollar “has caught on like wildfire across other offices”—the fondest
dream of one implementing a social change program—in part by Gina’s participation in a global network
of Google employees sharing ideas and best practices to create the largest impact from Google’s
involvement in communities.
Gina also inherited Ann Arbor’s Google 101 initiative when a colleague left the office. Google 101
trains nonprofits and small businesses to become more tech-savvy and better Internet marketers by
effectively taking advantage of free, income-creating Google products. The training also covers the use of
AdWords (for which for-profits pay but nonprofits can receive grants). Gina then helped craft a more
scalable version of Google 101 by developing a “train the trainers” model. Rather than reaching
organizations in need one by one (as had been done), Google 101 now achieves leverage by working
through other organizations that already support nonprofits and small businesses in their daily course of
events.
As with Donate a Dollar, Google 101 is being adopted throughout the Google network. The results
have already been an “incredible … scalable solution to the number of people and organizations we
wanted to reach.” Next step: organize all training materials for more convenient use by “train the trainers”
everywhere, an aim certainly in keeping with a company whose mission is to organize the world’s
information. To get these materials to those who may need them—even if they don’t know they exist—
Gina is working with people in Google headquarters, various Google data centers, and the “charitable forprofit,” Google.org.
Pretty good “leadership training” for someone with the ambition to have impact on local
communities, and next the world.
So, what’s next?
Down the road, Gina would love to be serving society in a larger, more direct way. Perhaps through
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Google.org, perhaps through organizations like the Bill and Melinda Gates Foundation or the Clinton
Foundation, or perhaps in some other way. She has special interests in community development, public
health, and global poverty.
Yet, she has her doubts. She wonders: Does she have what it takes—the right education? The right
skills? The “it” that defines the upper 1 percent of the upper 1 percent? Can she come up with her own
powerful, original idea for changing the world? Maybe she’s just too old: “[There are those people who
have already done such incredible things at such a young age” (remember she’s twenty-five). And how
about giving up a Google paycheck—that would be difficult, too.
But maybe there’s also a lesson for each of us in Gina’s uncertainty about how to get from “here” to a
more socially directed “there.” Among their greatest fears, people often list public speaking and being
judged by others. If Gina—who addressed her university community as a commencement speaker, and
who strutted her stuff in front of a panel of judges (where “stuff” = playing her violin and “stuff” = walking
onstage in a swimsuit and high heels)—has insecurities … then isn’t uncertainty something we all feel
(and must deal with)?
Gina’s way of dealing with uncertainty is by practicing what we might call “patient impatience”:
loving her company, even though things can get mundane day-to-day and she itches for more. Working to
make the most of the opportunity she has, even as she creates openings for something unknown and new.
She is laying the foundation for what lies ahead, even if she can’t picture it perfectly. Through her paid
and her unpaid work at Google, she is gaining experience, becoming a leader, learning more clearly what
drives her, and noticing where she is resisting.
She also trusts her internal compass. That letter that Gina wrote the pageant organizers, asking
them to withdraw her application? She accidentally deleted it from her computer, and in the flurry of life’s
events never got around to redoing it and sending it in—and all for the good: With newfound enthusiasm
for competing, she again hit the weight room. In the studio, she created violin arrangements that
accentuated her skills and hid her musical deficiencies, and practiced them until they sounded amazing.
And then she competed, one last time.
And once again, she came in … second (a strangely proud and crushing experience).
And yet she didn’t feel like it was over. “It wasn’t supposed to end this way,” she says. “It didn’t feel
right, but what choice did I have (the results were in)? My only choice was to accept what happened
knowing I gave it my all and move on with my life.”
Then, six months later, she was watching the Miss America contest. The young woman who had recently
defeated her to become Miss Michigan made the cut to the final fifteen, the top ten, the top eight … And
when she became Miss America, Gina suddenly became Miss Michigan. Sitting in a friend’s living room,
in jeans and a sweatshirt.
Her friend—herself a former Miss Michigan—crowned Gina, tears of joy and surprise streaming
down her face. It was a fulfillment of a lifetime dream: winning at a “sport for the well-rounded person …
of being a ‘good you.’”
And then, adds Gina, “Every time you’re so bold and so fierce in chasing a dream and it finally comes
true … there also comes the moment you say, ‘Oh, crap, I actually have to do this. … I actually have to do
something.’”
Could it be any other way?
Cynthia Koenig: Rolling Forward
How do you begin to change the world? Cynthia Koenig’s journey reminds us that by taking a step at a
time, your path may become clear.
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Cynthia, thirty-one, has a Bachelor’s degree in anthropology and a Master’s degree in
environmental studies. She thought her future might be as a conservationist, returning to Latin America
where she had trained guides to speak English and given them interpretive nature skills so that they could
conduct nature tours. Or that it might be in photography.
But a post-graduation fellowship gave her the opportunity to spend several months in South Africa,
where she lived in a rural community and learned about the challenges people faced on a daily basis.
Economic opportunities were few and far between. With an unemployment rate hovering around 80%,
many families survived on the pension of a single family member.
Rural areas, especially, often lack basic services like health care, higher education, electricity, and
physical infrastructure. The community Cynthia lived in was typical—only a few water taps served the
population, so access to clean water was very limited. Each family had two days per week when it could
visit the tap—provided it was in working condition. Typically, one child from the family would line up with
his or her containers early in the morning, and the other siblings and their mother would arrive later in
the day to carry the containers home. On non-tap days, women and children collected water from open
water sources that were shared with animals and often contaminated. During the dry season, surface
water was harder to find, and even the wells ran dry as the water table dropped.
“Around the world,” Cynthia explained, “an estimated one billion people lack readily accessible,
clean drinking water. Many of them, usually women, trek for up to eight hours a day to a water source to
fill water containers to provide for their families. Indoor plumbing, of course, is out of the question.
Community water taps often don’t exist, are broken, or don’t reach down to the level of the water table
during the dry season—sometimes eight months. So, they can drink nearby, dirty, disease-carrying water,
as many do; or walk, and walk, and walk ….”
It was in South Africa that Cynthia first learned about the concept of “rolling water.” Two
businesses in the country manufacture and distribute 12 to 25 gallon drums that literally allow you to roll
water as an alternative to carrying smaller quantities on your head. Rolling water eases the back-breaking
work of transporting water, usually done by young girls and women, sparing them from spinal injuries
and freeing them for other pursuits including attending school and contributing to the family’s livelihood.
Cynthia was immediately intrigued.
Conventional wisdom led her to believe that people needed products and services only to disinfect
their water. Certainly this is the approach taken by the vast majority of the organizations that are focused
on global water issues. However, people in South Africa repeatedly told her that they knew how to make
their water safe enough to drink; what they wanted was more water. Cynthia saw the evidence of this
firsthand. Even with several family members collecting water, it was difficult to provide five gallons per
person each day, the UN minimum for maintaining a basic level of health.
Several years before, Cynthia had lived in remote parts of Latin America. She had seen young
children fetch water from a lagoon. They had to walk in far enough to get past the algae—far enough that
they were encroaching on crocodiles’ territory. “You never knew when you’d come upon one,” Cynthia
remarked.
But it was during her experience in South Africa that something “clicked.”
“By the time I left South Africa,” Cynthia explained, “I was convinced that the concept of rolling water had
the potential to make a positive impact on a global scale. However, existing efforts to distribute such tools
were very localized and donor-dependent. I had a few ideas about what a business model should look like
for this type of product, but not much confidence to back up my vision.”
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Cynthia was committed to making a difference in the lives of those living without such a basic
necessity as water and addressing the root causes of a problem that has impact on more than a billion
people worldwide. But where to start?
“I launched Wello as a way for me to stay focused and motivated. It was also a result of advice I had
been given by a professor who teaches a course on social entrepreneurship at [my university]. As my
graduation neared, I asked him if he knew of any job opportunities in the field. I expected him to help me
brainstorm a list of potential employers. Instead, he encouraged me to follow my North Star, and work
to address an issue I really cared about. At the time, I didn’t think it was very helpful advice. Although I
cared about a lot of issues, I didn’t feel as though I had the solutions to any of them. In fact, I realized
later, when I launched Wello, how practical this advice was. No one launches a venture with a perfect
concept. Most of the time, it’s just a vague idea, and, little by little, you do what it takes to keep moving it
forward.”
Once she returned to the United States, she began the lengthy process to establish a 501(c)3 nonprofit organization that could offer tax exemptions for charitable contributions from individuals or
foundations. She was falling back on skills she already had from a few years of experience in the nonprofit
sector.
“I wasn’t sure that nonprofit status was the right choice, but it offered the best access to patient capital.
In retrospect, I’ve realized that you never have all the answers. I made a lot of mistakes early on, and
learned so much as a result. Yes, it’s probably taken longer to get where I am today, but the lessons I’ve
learned along the way have been so valuable. In retrospect, I wouldn’t change a thing.”
Cynthia’s efforts started out small but snowballed into a much larger project very quickly. Initially,
she envisioned raising money to improve living conditions in water-scarce communities. But before she
felt comfortable launching a fundraising campaign, she felt it was important that her fledgling
organization have a professional-looking website. But with no web design skills, and nothing in the bank,
Cynthia was at a loss. After a few false starts, she was introduced to Freeworld Media, an Atlanta-based
design and marketing firm that took on the task of website design.
In an attempt to grow her organization, she also used her web presence to attract those who wanted
to support Wello by donating their time and talents instead of cash. To her surprise, responses came
pouring in. However, she also quickly learned that pro bono support, although always well intentioned,
sometimes created more problems than it solved. For example, she found that volunteers came and went,
sometimes even in the middle of a project.
Eventually, Cynthia began to consider how she could more sustainably provide water to those in
need, instead of exclusively relying on charitable donations. She explored a business model where Wello
would purchase water transport devices from existing manufacturers and then work with communitybased organizations to educate end users to employ these WaterWheels to generate revenue. However,
exorbitant shipping costs on top of already high manufacturing costs for these products made Cynthia
reconsider the viability of this approach. “Shipping is one of the major costs of water rollers. It’s
astronomical to move them around.”
To overcome this difficultly, Cynthia did research to see where there was both a great need for
rolling water devices and an appropriate infrastructure to manufacture them. She concluded that it was
India. She also did what any anthropologist-photographer-conservationist with no background in
engineering would do: She began thinking about how to re-design the WaterWheel. An ardent
environmentalist, Cynthia hoped to manufacture WaterWheels from recycled plastic litter.
“In most parts of the developing world, recycling and trash collection isn’t available. As a result, there is
a tremendous amount of waste everywhere. Plastic bottles, like the kind soft drinks come in, are
especially prevalent. People often reuse them several times, but once cracked or broken, they end up
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littering the streets. I had this crazy idea that we could have people gather up this trash, then bring it to
a mobile manufacturing unit where we would mold a WaterWheel for them on the spot.”
She recruited a team of volunteer engineers and designers to investigate the possibility. As it turns
out, it isn’t possible to reengineer soda bottles in this way, but the idea of manufacturing and distributing
an improved water transport device stuck with her. She continued to work with these volunteers to
optimize the design of the WaterWheel.
“Ultimately, my lack of engineering expertise was a good thing, because it meant that I often asked silly
questions that the designers weren’t asking themselves. So while I often drove the designers crazy by
insisting on things that weren’t technically possible, there were a few instances where my insistence led
to great breakthroughs. People all over the world were writing to me to ask about how they could get
WaterWheels. I knew that if we could make an affordable, durable, high-quality product, we could meet
this need and have a tremendous impact on the health and well-being of millions of girls and women
and others in their communities.”
In truth, not only was Cynthia not an engineer, but there was little in her academic or work
background to suggest that she might one day become a social entrepreneur. But she did have the
temperament.
“I think the ability to stay committed in the start-up phase is a good test of the viability of the business,
and of yourself. Creativity, adaptability and patience are important skills early on. Of course, this
changes. You can’t stay patient for too long, otherwise you never make any progress! Getting started
was the hardest part for me. Wello didn’t have any funding—or even any real funding prospects. In
order to cover my travel expenses and our state filing fees, I took advantage of a promotion my bank
was running—$250 for each new account you opened… I opened several.”
Cynthia throws herself into her work with the Wello, typically spending 25-45 hours a week without
any compensation. (She also works full time and is now pursuing a business degree in the evening.) She
is far busier than at any other point in her life, but finds her life invigorating.
“If it wasn’t enjoyable, that’s when I would question [my investment of time in Wello]. At the end of the
day I’m learning so much—including how to start a non-profit company, how to create a board of
directors, how to network, how to raise funds, and how to motivate an international cast of volunteers.
I’m getting so much out of it personally. It’s been pretty fantastic.”
The woman who as a young girl loved her lemonade stand is quite entrepreneurial again. “Even six
months ago,” she explained, “I wouldn’t have said I was a ‘social entrepreneur.’ Now that I’m going off in
new directions, really taking more control, and seeing more of the business opportunity, I feel the term
does apply.”
The rewards are as exciting to Cynthia as when she made herself a small fortune from the lemonade
she mixed herself.
“It’s amazing to see people come out and be so excited about rolling water. I visited a community that
was not a very easy place to live at all. Their water situation was horrible. People were collecting
rainwater from muddy puddles and bringing it home. … Wello opens up all these possibilities that were
never there before. For a lot of people who are living in complete poverty, with no hope of that ever
changing, I think that glimmer of ‘Wait a minute, maybe something can be better, things can be
different’ is amazing. It blows me away.”
And to those who are teetering, sticking a toe in the social entrepreneurship waters, not sure how to
go forward or even if they should? Cynthia would like to tell them:
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“If you had told me six months ago what I’d be doing right now I wouldn’t have believed it. A year ago I
certainly wouldn’t have believed that I would be doing any of this.
“You just have to go and do it. It really helped me to just jump in with both feet and learn about
something. I didn’t really have a sense of where I was going or what I wanted to accomplish. Even now
I tend to think really short-term with this because otherwise I might miss some of the shorter-term
possibilities, and I think I need to be really agile. I don’t want to commit to anything that would prevent
me from seeing opportunities.
“I was just reading about this woman who wanted to see wildflowers in the Bushwick neighborhood of
Brooklyn and wrote about it in her blog. [She attracted] about 100 to 150 people on this rainy day a
couple weekends ago to start throwing seeds and planting seeds everywhere. Now it’s become this thing
that everyone’s talking about and [nearby neighborhoods want to imitate]. If her idea had been that
half of Brooklyn should be planted with flowers, she probably wouldn’t have gotten anywhere. The fact
was that she just said one day ‘I want to see some flowers.’ You never know where you’re going to end
up.”
Patrick Donohue: Solving Problems
Patrick Donohue is a problem solver—an inventor in the broad sense of the term.
Now thirty-five, his first job out of college was as a software engineer working for organizations
including Apple Computer, Rockwell International, and NASA. He developed solutions to problems such
as making planes safer by creating cutting-edge artificial intelligence software.
His interest waned when corporate pressures began to steer software development away from wellcrafted, elegant solutions toward garden variety, just-get-it-done-quickly development. The kicker was
that the “beautiful” solutions he had developed also weren’t being widely deployed. “I was driven by a
desire to start having an impact and to work on problems that were a little outside of the realm of
computer science,” he says.
Patrick wasn’t the kind of guy who had stayed up late at night thinking about how to solve society’s
problems.
I thought for example that most environmentalists were tremendously impractical. Of course they
wanted to save the planet, but were they having an impact? … Were their activities going to have any
impact on business? Why would business ever listen to them unless they were forced to?
But when I started seeing how business could start being an ally or a driver on some of this, I got really
interested in it because it seemed more practical to me, and more within my reach, because I wasn’t
going to chain myself to a tree.
He changed career directions, returning to school to learn how business could contribute to
sustainability and society.
Patrick had also been deeply affected by his first visit to Vietnam, his mother’s birthplace. He saw
the type of deep poverty he hadn’t seen in the United States. There, and elsewhere as he continued to
travel, he noticed poor children creating soccer fields from any unoccupied (or lightly occupied) patch of
earth or stretch of pavement; making soccer goals out of bedsheets, milk cans, or light posts; and playing
with every kind of soccer “ball,” including those they’d make out of discarded twine or plastic bags. They
were equally creative in creating their own toys.
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While he was living in Brazil, he thought about how he could tap into children’s ingenuity, at once
working with them and somehow also partnering with large toy manufacturing companies that “were
stagnating in terms of innovation, waiting for the next movie to come along before they launched an old
toy with a new name.”
He started a company called Brinq—a shortening of the Portuguese word brinquedo, meaning
“toy.” In trying to grow Brinq into a viable business, he began feeling that he lacked “corporate cred” with
the companies he would want to attract as partners, and “street cred” with those children in the
communities he saw as central to his efforts.
He got what he was looking for with Enterprise for a Sustainable World (ESW), a nonprofit
that was implementing the Base of the Pyramid (BoP) Protocol (about which you will read much
more in an upcoming chapter).
Brinq was an interesting idea. But I didn’t think I had what was necessary to do some of the things that
I wanted to do. I was looking for a vehicle that could build up [my entrepreneurial background and]
especially my experience in poor communities. When I considered the BoP Protocol and ESW, it was an
opportunity to have some of those experiences and build not only my capability but my reputation as a
pioneer.
It was an opportunity that sent him to Kenya, India, and later Flint, Michigan. In each instance, he
gained more experience and more responsibility. In Kenya Patrick was a member of an on-the-ground
team whose job it was to improvise a set of methods to understand, in ways that companies truly hadn’t
before, the lives and worldviews of the very poor; to gain their trust; and to teach them the rudiments of
business so that they could become business partners with an innovative corporation.
Patrick found the experience exhilarating. Long days, sure. Uncertainty, everywhere. But a way to
learn and grown. To begin to create practical methods to address poverty alleviation through business,
practical methods that others could use in the future. And he found deep engagement with the
community.
In India, Patrick took on additional responsibility, helping train a new group of individuals,
working in slums and the countryside, to understand, extend, and apply the same methods whose
development he helped shape in Kenya.
As his involvement in India was winding down, Enterprise for a Sustainable World offered him a
bigger opportunity: to lead a new effort in applying the Protocol—this time in Flint, Michigan, a poor
community—where the ideas that had been created and tested in the developing world could be adapted
for the United States and adopted in an effort to improve health. In Flint, Patrick’s responsibilities ranged
across almost every aspect of the project—from helping propose the project to the sponsoring
organization, to helping identify and train a new team, helping find local partners, and shaping all aspects
of business development on the ground.
Patrick’s experiences trying to invent new kinds of businesses that can serve society—especially
while living in Brazil, Kenya, and India—are the envy of some of his former classmates. His advice to
others who would like to follow a similar path: create your own opportunities and confirm your
passion.
The key to getting somewhere—even if you don’t know exactly where it is—is to always be producing.
Find opportunities, whether it’s doing some research, coming up with little reports, or starting a blog. It
might mean volunteering. It could mean going out and trying things on your own. You’ll see if you
really are interested in them, and you’ll start developing a body of work [that will help you take your
next steps]. Know what you’re really passionate about because that will sustain you.
You have to create your own opportunities, but [recognize that] it’s step by step. Break up your vision
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into different pieces. You may not get [to your ideal position] directly. Ask yourself what vehicle you can
use you to build the skills and credibility that you need.
Patrick heeds his own advice. He thrives on “looking around the corner just to learn things. And
even better to be creating something that hasn’t been there before.”
Having worked in for-profit and nonprofit companies, big organizations and small, he understands
the strengths of each, and is now looking at how they might be combined to create something better.
The major business opportunities from moving in a direction [to address societal problems] are of a
size that match smaller organizations right now. [Large] multinational companies, by nature, need larger
opportunities whereas an entrepreneur or a small nonprofit will be able to grow along with a small
opportunity. For sustainability, for the base of the pyramid, [and for similar efforts] it’s early enough that
the opportunities are still small.
Yet large businesses are equipped to act on a large scale—something that is crucial in effecting
significant change. Patrick wonders how their advantages can be exploited by smaller entrepreneurial or
nonprofit efforts.
I have tremendous respect and admiration for the systems [large businesses] put in place. Often when
you’re working in a large company you take for granted what’s there, but someone had to build it up in
the first place. Now, small organizations are looking at these types of issues because they have to if they
want to grow.
I’ve been helping ESW try to build some of the internal systems that are necessary for it to be able to
apply the type of experiences we have had in implementing [a few projects] to a much larger set of
projects. The greatest impact we can have is to enable more of them.
As a freshman at Stanford, Patrick was an avid participant in the Big Game bonfire, a century-long
tradition aimed at igniting students’ passions the night before the football game against Stanford’s
archrival, Cal-Berkeley. Despite the threat the gigantic blaze posed to the rare California tiger salamander,
“All I cared about was crushing Cal.”
And now? “I’m pretty sure I’d be on the side of the salamander.”
And what of the software engineer who was frustrated by the demands of producing everyday,
“production” software, and who craved impact?
He now sees himself designing systems embracing the most intricate and important of details—
social systems with the potential for altering people’s lives.
[Capturing and applying] knowledge and capability will determine if a business is going to be a vehicle
[for societal impact]. You need on-the-ground knowledge and you must turn it into a kind of business
system.
That’s a fascinating and difficult challenge.
Sachin Rao: It's Fun to Serve
Sachin Rao, like Patrick, is in the process of finding where he fits best. Born and educated in Bombay,
India, Sachin’s biography illustrates how we are a part of our upbringing and yet retain our freedom to
make pivotal choices about our lives.
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Now thirty-five, Sachin received a degree in software engineering as India was emerging from many
years of a socialist tradition. The sum of his technical skills, the demand for talent by the emerging Indian
software industry, and the opportunity for security and prestige led to a predictable outcome: a job as an
entry-level software engineer, with ample opportunity to advance.
When I graduated, it was the first year of really big campus recruiting [by the Indian software
industry]. They called all of us “accidents of time.” We were pretty much absorbed into the software
industry’s very large human resource requirements.
We were all children of a “scarcity mentality,” which means job security and income security were
really big in our lives. [We were offered] a salary that was obscene—$800 a month. During the scarcity
mentality, India also really respected going abroad and traveling to other nations, because it was
considered a huge symbol of status. You were considered a “big man,” which added glamour to the
whole thing.
Sachin worked in the software industry in offices around the world—first in Asia, then New
Zealand, and finally the United States. His responsibilities increased from basic software development, to
leading projects, to specialized work with new software technologies. “The first three years were really
amazing. I was this twenty-one-year-old kid coming out of college, and I couldn’t ask for anything more—
to be put on planes to different parts of the world, earning and spending money. A lot of prestige and a lot
of financial return. All of it was just a daze, not much thought in it. All that was good.”
Good for seven years, until it became dissatisfying in a variety of ways—especially Sachin’s sense
that his life really wasn’t what he wanted. “I was just caught in the current,” he says. “I was doing what
circumstances dictated. And I just stopped and wondered why. … I decided that I needed … to get out of
this flowing stream that I was part of, and figure out what I really wanted to do.”
He went to business school—not simply to study business, but because it was one of the biggest
ways he could imagine shaking up his life.
I needed a really big change. … I was brought up in a conservative family. The MBA was the most
accessible instrument of exploration to me. For me to have gone back to school to receive a degree in
psychology or sociology or social work [or something else that might be deemed less practical] was not
as accessible from the point of view of my life’s situation. To do something absolutely “crazy” like that
would have rocked the boat too much at that point of time. And I don’t personally think I was ready for
it.
In his two years of business study, he began to experience more authentically what made him
happy and began his quest to design a life built from those elements. “I broke out of my little cocoon and
asked myself what made me tick, what really satisfied me. I unshackled a lot of preconceived notions that
my upbringing and circumstances had [created]. I was willing to really look at myself and answer the
tough question about what would make me happy.” He also expanded his awareness of what was
occurring in the world around him. As part of a business school project, he traveled to a part of India with
which he was not familiar, studying how poor Indian farmers’ lives were being improved by giving them
access, over the Internet, to the market price of the produce they were growing. He gained minor fame by
recording the comments of village farmers who expressed disappointment that local sanchalaks—who
are, more or less, information brokers—were not connected to the highly sophisticated Chicago Board of
Trade. “I realized that the world of making lives better, contributing to humanity, is not just a bunch of
people working in slums giving vaccinations; it’s much larger. It incorporates a number of people, a
number of domains, and it’s truly a rich discipline. A lot of things can be done to help the world, and a lot
of things can be done to satisfy oneself.”
Sachin landed a highly coveted consulting job in the United States with the firm Booz Allen upon
receiving his MBA. But he knew that someday he wanted to return to India to explore the world of
contribution to which he had been exposed. “Literally, on the first day I graduated, I pulled out my ‘Indian
Rolodex.’ I called [everyone on it] and said, ‘Listen I’m graduating and going into [consulting] for
27
financial reasons, but I plan to come back given the right kind of opportunity. Please keep me in mind,
keep me posted, and let’s stay connected.’ That’s actually the first thing I did when I finished business
school.”
In a year’s time, he returned to India—turning away the riches and perks that a consulting path
held in store for him for the intellectual and heartfelt wealth he knew was available in India.
He spent one year with a nonprofit think tank, officially supporting their education mission, and
less officially journeying to rural India and into inner-city slums to better understand those environments
and to study different for-profit, nonprofit, and government-led efforts at serving them. “What I really
wanted at that point in time was to influence lives of people in a very large way, and I was sold on the
argument of BoP businesses,” he says. He explored several opportunities for creating entrepreneurial, forprofit businesses that offered increased dignity to the poor by providing essential services such as
affordable housing and sanitation. “After a year [of exploration] I had thought I had figured it out.”
But, as Sachin discovered, even when you design your life, your life continues to present new
options to consider.
I got an opportunity, a very interesting opportunity, from the office of a young Parliamentarian in
India. He asked me if I wanted to join him and help do [economic] developmental work in his
constituency. So I joined him at that point in time, doing grassroots developmental work in a Northern
Indian state. That transition eventually led to political organization work. And these days I’m helping
with restructuring political organizations for youth to make them more accessible to the people of India.
What has guided Sachin’s decisions to fluidly move from one opportunity to the next?
It sounds a little silly, but a big deal for me is to have fun. I just ask myself, “Is what I’m doing fun?” And
there is a huge amount of fun in what I’m doing right now. Part of that is simply the BoP [approach].
You’re taking a brand new way of looking at a problem [of serving the poor] and designing a whole,
brand new solution for a space where no one even talked about innovating before.
[I enjoy] thinking innovatively, thinking differently, thinking with a stronger moral fiber about some of
the things that we do. Is there a more dignified way of doing something? A less corrupt way to do it? A
more transparent way? Is there something that preserves human dignity a whole lot better?
[Another] level of fun is going to un-served people—people who have never been served [by businesses,
nonprofits, or governmental institutions] before. [That] sense of service really drives me. The focus on
service comes from my need, not from any sense of patronage or altruism. [It’s] service for the joy it
brings me. It’s a very big [motivator of] what I do today.
Sachin used to describe his motivation in terms of acting with a sense of relevance, with a desire to
impact millions of people. Though he no longer chooses this description—now focusing instead on the
enjoyment he gets from his deep involvement—in the most fundamental ways, nothing has changed:
You may not even be able to articulate what you really like and want. I [had an answer to] this question
when I graduated business school. You asked me this question again today, and I gave you another
answer. Believe me, in five years’ time it’s probably going to be a completely different answer. But
intuitively that answer has never actually changed for me. The way I have learned to articulate it, what
I have learned about my answer, has evolved. But the answer to me has not changed, and I hope it
doesn’t.
Yet change is a constant in our lives in other respects, and must be embraced. Staying true to your
roots doesn’t mean rooting yourself in one place forever:
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You’ve got to be willing to change [according to] what you discover about yourself—to face what you
enjoy doing, and have the courage to go after it. [But] don’t ever grow attached to a vehicle. Booz [the
consulting agency for which Sachin worked] was a vehicle. My current position is a vehicle. It’s a blast.
[But if it turns out that this is] not an appropriate vehicle or an appropriate position, I will shake hands
and, with my head held high, walk away. You can’t ever forget to do that. The moment you do that is
when you stop in your path: when your current position becomes too good for you to follow your
calling.
Frankly, [walking away] is not easy. I’ve been through this two or three times, and it’s a difficult
challenge. Make sure your conscience is clear, but when the time comes, have the courage to move on.
And I don’t think it ever ends. The moment in which you demonstrate courage is nothing if you don’t
demonstrate it in the next moment that comes. There is really no substitute for that.
And remember: “Nothing is bigger than a sense of fun.” Even if it’s our life’s work to find it.
Steve Mariotti: A World of Entrepreneurs
Steve Mariotti has taken a twisty, sometimes difficult path to end up exactly where he belongs.
Born in Flint, Michigan, the birthplace of General Motors and the subject of the film Roger & Me,
Steve wrote his ticket for the business fast track, earning a business degree at the University of Michigan
and landing a key position at Ford Motor Company before founding his own successful import/export
business.
Then, about three decades ago, his path took a sharp turn when he was mugged while jogging. The
experience forced him to confront his own fears and made him want to understand the mentality of
people like the poor young men who had mugged him because he wasn’t carrying the ten dollars they
demanded: he turned to teaching.
Not just any teaching—teaching in the worst inner-city school in New York City—and possibly
anywhere. It was the location he requested.
To pretend that Steve taught “happily ever after” would miss his story’s arc completely. Steve’s
teaching was anything but happy at the start, and it seemed destined for anything but “ever after.” Steve
had worked for one future Nobel Laureate, Milton Friedman, and studied with another, F. A. Hayek.
Which counted for exactly nothing with his students, who called him a “midget” to his face and locked him
out of his own classroom.
But an entrepreneur by nature, Steve’s response was to view this as a problem to solve—and one
clearly worth the effort. His approach? Getting his students to hunger for learning. His vehicle? Teaching
his students how to run a business.
Students did become interested. And as their interest increased, Steve created more meaningful
learning experiences for them. Not only did he teach them business principles, but he also had them read
the Wall Street Journal, pick stocks, and, finally, start their own businesses.
Yet his success created its own difficulties. Administrators frowned on his emphasis on business
over “real” academics. They complained that his class discussions were “too money oriented,” that in class
there was too much role-playing. Never mind that attendance in his classes was soaring, as was academic
performance.
Steve was also picking up all the out-of-pocket expenses that went along with his unconventional
teaching style. “I was paying all my classroom costs because the program doesn’t really work if the kid
doesn’t have some money to buy things to sell,” he says. “So I funded that. I don’t know how teachers do
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it, because the school never funds [creative expenses]. … I was suffering the last four years of high school
teaching.”
After six years of public school teaching, Steve started a nonprofit organization, the National
Foundation for Teaching Entrepreneurship (NFTE), to gain control over the educational
experience he was providing students and to relieve some of the financial pressures. Still, it was a tough
decision to leave: “It was scary. I had a tenured position, I was engaged, and I was scared. But I’m so glad
I did it.”
Steve’s educational philosophy was shifting, too. He had begun teaching about business because
that was the only thing he could talk about that students would listen to, and he was there to make them
learn.
Yet, he began to feel that business, especially entrepreneurship, represented something more. He
saw the uncanny fit between extreme poverty and entrepreneurship. Both were surrounded by
uncertainty, risk, and ambiguity. “It became clear to me that my mission was not just to teach in the inner
cities, but to teach entrepreneurship there. I came to believe, very strongly, that entrepreneurship was a
more promising way out of the economic dead end of these neighborhoods than entry-level jobs, or more
welfare, or other wasteful and unproductive government spending.”
Yet NFTE—Steve’s own entrepreneurial effort—wasn’t doing too well financially itself. “We’d gone
insolvent. I remember lying awake one night and thinking, ‘Oh my, God, you failed.’ How would I explain
that I wasn’t going to be able to pay [my debts]? … I was going to have to pay, and that would have totally
wiped me out.”
Happily, NFTE and Steve got through it because of the generosity of a donor. It wasn’t the last time
that NFTE faced financial difficulties.
Throughout his career, Steve has always paid close attention to his intuition. More than once, his
gut told him he was doing his life’s work.
His abilities at Ford, where he was known as “Stevie Wonder” for his finance skills, had been
noticed by others. Several times while he was teaching, he received offers to return to the automotive
industry, some for more than three times the salary he was making when he left. He could have left
teaching in a heartbeat and become quite wealthy. “I remember thinking about [one offer] for a couple of
days, and my inner voice said, ‘Don’t do it. Stay where you are.’“
As his conviction to help people out of poverty through his educational programs deepened, his
ideas about how his programs worked their magic kept evolving. He now views entrepreneurship as a
means for the poor to gain control of their lives, and as a stimulus to get them to view their lives
differently.
We try to raise the consciousness level of children in poverty toward the skills and habits of thought that
create the potential for owning. Everything we really do is aimed at helping someone control how they
will spend their time in the future. … NFTE’s business really is activating the subconscious minds of
children that are having a tough go of it. [Through business] we awaken their subconscious minds to
potentially think, “I can go in this direction and actually have a big impact on where I’m going to be.” …
Helping someone be aware of markets and their role in markets—“Am I a consumer, seller, owning part
of the profits, or providing labor?”—is [how we do that]. … I like to say that NFTE’s work, like the great
theorists who awakened society to the role of women in society, or great civil rights leaders who talked
about the role of different minority groups, is bringing global attention to the issue of poverty and
youth, and how it can, at least in part, be alleviated by people thinking how [to take more ownership].
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Steve explains that the same forces that he hopes to influence in the students he reaches have
shaped his own life and career:
All my dreams are coming true. I always wanted to have a career that I loved. I always wanted to be
able to travel around the world, and I always wanted to feel that what I was doing had a greater good
socially.
Subconsciously I believe that where you are at a moment is based on your prior subconscious thoughts.
Somehow my subconscious saw [the kind of opportunity that NFTE could provide] and created the
world that I now live in. … When your subconscious gets aligned with what you really want to do
consciously, almost every [dream] comes true. That has been my experience.
Steve has won numerous awards for his work at NFTE, including America’s Top High School
Business Teacher, Entrepreneur of the Year, and Social Entrepreneur of the Year.
Details of NFTE’s approach to education are covered in an upcoming chapter.
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CHAPTER THREE
I’m assuming …
•
•
you’ve begun to see how items from the Hybrid Buffet can be combined to help you create a life
that’s quite extraordinary, and
you were inspired by the hybrid lives that at least a few of the people I interviewed are leading
… so now it’s time to take look more closely at hybrid organizations.
They have some exceptional qualities, too, and can play a vital role in effectively and creatively addressing
societal problems.
What are the characteristics of successful cross-sector hybrids? And how do we grow them?
Such an organization should, of course, help address societal problems. By combining the traits of
different organizations, hybrid organizations can compensate for the flaws or deficits in each, and build
on their strengths. In nature, such resulting improvements are sometimes described as exhibiting “hybrid
vigor.” If this happens in nature, why not in organizations?
Such improvements are often robust and long lasting. Hybrid corn is more “vigorous” than nonhybrid corn by having superior yields and responding better to modern farming practices. Try to find
nonhybrid corn or wheat in the United States or other countries with modern agriculture: they’re
exceptionally rare.
Hybrids that address societal problems come in many forms. Some are for-profit organizations
with certain traits that typically are found in nonprofits. Others are nonprofits that have adopted a forprofit orientation or other characteristics common in the business world. Nonprofits may resemble forprofits in their legal or organizational structure or by the processes they follow to get their work done, and
vice versa. In addition, both for-profit and nonprofit organizations may develop hybrid products or
services aimed at bettering the world that otherwise might not be brought to market.
Cross-sector hybrids typically focus on basic human needs such as adequate food, clean water,
clean air, shelter, and sanitation. Other areas include livelihood, access to medical care, education,
training, and a healthier environment.
Why do social hybrids emphasize these needs? For one, these needs are enduring, and a decent
quality of life is impossible without meeting them. But, unfortunately, for large portions of the world these
needs remain unmet. As a society, we’re stuck: these vast problems don’t have easy solutions, and the
solutions that might be available often fall in the cracks between the for-profit and nonprofit worlds.
Consider the case of clean drinking water. In the Philippines (and elsewhere and in the
underdeveloped world), the government has struggled to provide clean water to its people and handed off
this responsibility to private businesses. Manila Water won the contract to provide water for a portion
of the Filipino capital city. But it, too, faced a host of problems. Water supply lines were old and decrepit,
with up to 50 percent or more of the water leaving the treatment plant leaking out of the system. And
much of the water that didn’t leak was stolen by squatters and others whose residences supply lines did
not reach. On top of these physical problems were business difficulties, including the high costs associated
with billing, collecting payments, and monitoring water usage for the many residents of Manila living
without legal title to their property but still needing access to clean water. Compounding these issues was
the question of whether water was a right (poor citizens’ perspective) or a product that one should pay for
like any other (the business perspective).
The hybrid solution that Manila Water hit upon had to work for both the “business” and “society”
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sides of the equation. The utility agreed to supply water to those who would otherwise pilfer it, buy
canned water, or obtain it in some other (expensive and inconvenient) way. Citizens, in turn, took on
responsibilities similar to agents of the company. By banding into clusters of forty to fifty households
each, with shared plumbing infrastructure and a single meter, citizens made it that much easier for the
utility to acquire new customers. But perhaps more important, each cluster is given a single bill that it is
responsible for paying. If the bill isn’t paid, the entire cluster loses access, regardless of whether the
problem originated with you or your neighbors, even though each of you is “sub-metered.” Such peer
monitoring and peer accountability—an approach that bears remarkable similarity to peer lending
common in microfinance—has led to a 100 percent collection rate.
As this example illustrates, when progress bogs down on societal problems that defy customary
solutions, pairing elements of different approaches can get us moving again. Manila Water recognized the
incomparable power and knowledge of the local community and used it to full effect in co-designing a new
solution for water delivery. They also realized that the “water problem” involved educating citizens and
providing the community with other services they needed. Residents had to be educated about the cost
savings from piped water (something foreign to people accustomed only to paying for small amounts of
water at a time, if at all). They also had to be convinced that it was in their interest not to pilfer water so as
to avoid a loss of service. Manila Water complemented their water-to-the-home efforts with water delivery
to highly visible locales such as schools, hospitals, and public markets. They clinched the deal by creating
a livelihood program that created more than fifteen thousand jobs, including delivering water bills and
laying water pipelines.
In short, the Manila Water example shows how we can address enduring social problems by
acknowledging both the needs of businesses and the needs of a community and, once we understand those
needs, how we can combine the skills and strengths of both sides to produce a creative solution with
incentives that both sides find attractive.
Companies, nonprofits, and communities can benefit by following what I call the “Rule of Co-”—banding
together rather than going it alone. Co-identifying problems, co-identifying community and
organizational resources, co-designing appropriate solutions, and co-implementing them with suitable
incentives create the prescription for generating impressive societal change. Co-everything almost always
trumps “my way or the highway,” an imperialistic view that can be lethal for companies, nonprofits, or
government organizations to hold.
But hybrid organizations do more than merely coming to the rescue when society is in the lurch.
Hybrids embrace an efficient, robust, and sustainable design process by recognizing that the resources to
develop novel solutions are everywhere. A certain product may not be quite right, a design may have a
flaw, or a concept may fit only imperfectly, but this does not represent imperfection with no value. Quite
the opposite. A hybrid approach to design recognizes that the seed of a great idea may be found among
ideas that could easily be overlooked.
This is especially true when it comes to poor communities. For example, when conventional banks
make loans, there are certain preconditions. They must know who you are, therefore requiring you to
produce a driver’s license, a utility bill, payroll stubs, or other forms of documentation. And they have the
right to repossess your car or your home in case you don’t make good on your payments.
So how can loans be made in the developing world where people live on a dollar a day? Answer: by
looking at the resources already in the community. Women have long banded together to form informal
ROtating Savings and Credit Associations (ROSCAs) that lend each other money when one member has
an unusual financial need such as a wedding, funeral, or other expense. This legacy of women supporting
each other has become the foundation of microlending. When lending institutions, both for-profits and
nonprofits, began to make loans to groups of women, there was no longer a need to know what the loan
was to be used for or the identity of the borrower. Lenders realized that though an individual could hide, a
group couldn’t. And so the entire group could be made accountable for repaying the loan with the
stipulation that future loans would be denied if the group defaulted. They came to understand that, in
poor communities, social collateral was more effective than physical collateral.
This approach of capitalizing on already established behavior and translating it into a formalized
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means of lending shows the power of keeping your eyes open, looking for useful problem-solving
“building blocks,” and combining them in unique ways. There is no need to reinvent the wheel, but the
wheel can just as easily be used to push a cart, steer a car, or throw a pot. Context—combining the right
elements for a specific situation—matters.
Tweaking and expanding building blocks, whether physical or conceptual, speeds up the search for
better ideas, but there is more here than a simple search for best practices. A bank borrowing ideas from
another bank, or a hospital borrowing ideas from a restaurant (both, these days, give you beepers that let
you leave the premises until it is your turn) does so to improve its functioning. But thorny social
problems—the kinds in which society really gets stuck—can demand more innovative, fundamental
change. Fortunately, recombining existing elements, even if recombination simply means considering one
element in a new context, can sometimes create a positive jolt—much more than could be expected if the
elements were considered one at a time. These jolting “combination” effects have many names. In
mathematics, they are called nonlinear; in statistics, they suggest statistical independence; and in
genetics they are known as epistasis. We might call them pbj effects: peanut butter, okay; jelly, ditto; pb
+ j = delicious.
Let’s think about microfinance again. The same essential idea of giving tiny amounts to poor
women, often well below $100, has been combined with many additional elements. In its initial context,
women formed their own solidarity group, or self-help group. Later, nonprofit non-governmental
organizations (NGOs) began to raise and distribute money to similar groups. Despite all the apparent
drawbacks of microfinance—high overhead rates, small loans, and customers of dubious credit
worthiness—microfinance has proven to be exceedingly profitable. We now see major financial
institutions such as Deutsche Bank and Citigroup making small loans and providing other financial
services to the poor. Each of these steps in the evolution of microfinance has dramatically increased the
amount of capital available to help poor people lift themselves out of poverty by investing in small
businesses, their children’s education, and so on.
But perhaps none can compare in terms of potential reach with organizations such as Kiva.org.
Kiva created a new, web-based context for microfinance to flourish by allowing individuals to make loans
to poor citizens around the world (and receive repayment) by connecting donors to trusted, on-theground microfinance institutions over the Internet.
The historical trajectory of microlending shows its rise from its informal, grassroots beginnings to
its growing adoption by powerful banking institutions and now “virtual bankers” sitting at computers
anywhere around the world. Despite its humble beginnings in which local women “rotated” their meager
savings among themselves, large banks are now supporting microfinance to the tune of up to $1.4 billion.
In each case, the core idea of making small loans to poor people has been combined with different
supporting elements. As the circumstances around “lending to the poor” change, we see the increased
opportunity in this apparent contradiction: a proven idea can have dramatically greater impact when
combined with other building blocks and placed in a new context. Remember the pbj effect?
Sustainable Hybrids
To compete successfully, a hybrid organization must have the right combination of elements. Some
combinations produce hybrids that are powerful successes, while others flame out in a blaze of glory.
Biology confronts this uncertainty by letting things play out in nature: we all know the adage “survival of
the fittest.” Businesses, too, can be more or less fit.
The trick for creating successful societal hybrids is to have a system that is both generative and
evaluative. Generative, in the sense of continually exploring new combinations. Evaluative, by testing
them to determine which are, indeed, best.
For now, let us consider the evaluative aspects of such a system. Economists may argue that profits or
revenues are the appropriate means of evaluating businesses, but such scorekeeping provides incomplete
and biased feedback. (Quick example: think of pollution-emitting companies that don’t pay financial
penalties for their behavior, thereby receiving “scores” (financial results) that are much too high.)
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Organizations that aim to address society’s ills require a more appropriate system of evaluation. To
sort out winners from losers, it is imperative to consider a fuller, more complex account of the
environment in which societal hybrids operate. (In our quick example, a finance-results-only environment
is much less complete than one that also considers a business’s effects on air and water quality.)
Proper evaluation will identify winning societal hybrids: sustainable organizations that are robust in the
face of various forces and varying conditions. Just as hybrid wheat and corn has so successfully caught on,
so can these sustainable social hybrids. But what exactly does sustainability mean?
John Elkington first described the “triple bottom line” as an evaluation system that goes beyond
sheer financial success to include social and environmental concerns as well. Some have characterized the
triple bottom line as focusing on the three Ps: people, profit, and the planet. Others describe its focus as
the three Es: equity, economics, and the environment. These criteria can be applied to any type of
organization—for-profit or not.
Social sustainability means that all stakeholders are treated equitably.
Everyone—employees, community members, suppliers, and customers, not just stockholders—
must feel they’re getting a fair shake. This does not necessarily mean a perfectly even split. Employees, for
instance, may be happy that their efforts are making money for their company hand over fist. After all, a
financially sound company is one that will endure. Still, they must perceive that what they themselves are
getting is fair, too.
Financial sustainability means that an organization is economically viable. It can pay its bills,
make appropriate investments, and otherwise keep its operations going. Typically, this means generating
enough revenue to cover expenses, though a large endowment or a highly successful fund-raising
campaign may keep an organization financially afloat, too.
Last but not least is environmental sustainability. This simply means that the earth’s land, water,
and skies are left in a condition that can support our future needs. Ideally, they are left even better than
before.
Earning high marks for triple bottom line sustainability is a relatively new concept for businesses.
It can also be hard to achieve. For instance, corn ethanol was recently hailed as a non-petroleum-based
fuel source, and thus a way to reduce carbon emissions. Though this sounds good at first, let’s take a
closer look.
An estimated 30 percent of the corn crop in the United States is being diverted from food to
ethanol. This situation could have dire consequences for people around the world already suffering food
shortages (P = people). In addition, although large, industrial agro-fuel producers could stand to make a
bundle from ethanol production, there are serious questions about its economic impact on others. Ethanol
production relies on $.50 per gallon subsidies, an attractive situation for states such as Iowa and
Nebraska, which produce several billion gallons of ethanol a year. But by artificially depressing prices, this
makes other “green technologies” relatively more expensive, making them less able to compete on the
market, no matter how effective they are in improving fuel efficiency or reducing carbon emissions are (P
= profit). Finally, enormous tracts of rain forest, or carbon “sinks,” in the Amazon are being cut down to
plant corn, thus destroying critical resources to fight global warming. Ethanol production and transport
both require energy and release emissions into the atmosphere. Certain fertilizers damage the climate on
top of environmental concerns about crop spraying. So overall the climate-friendly effects of ethanol may
be vastly exaggerated (P = planet).
My intention is not to rail against ethanol. I simply want to point out that with so few P’s
supporting its production, it does not appear to be a sustainable alternative for producing cleaner fuels.
Sustainable solutions will result only when we get all of our P’s in order. (Ideally, we can take the right
“cues.”) This requires a careful understanding of the situation, appropriate vigilance and communication
by citizens, and the political will to do what is necessary.
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Becoming Hybrid
“Becoming hybrid” means embracing imitnovationship. Or immitation + innovation + entrepreneurship.
Societally focused hybrid organizations look at other firms, other industries, and other sectors—
and imitate them. For-profits seek the advantages of nonprofits, and nonprofits seek the advantages of
for-profits. Societally focused hybrids parlay what they observe into new combinations of ideas that work.
The world is their research and development department, and keeping their eyes open is paramount to
fostering innovation. By their nature, hybrid organizations are entrepreneurial—scratching, clawing, and
tinkering to become more powerful agents for societal change, reinventing themselves to become more
effective.
Nonprofits Imitating Businesses
This is another term that is in keeping with our discussion. It connotes firms that combine societal- and
revenue-producing ends. They can be for- or nonprofit.
In what ways might nonprofit “social enterprises” begin to resemble a typical for-profit? For one,
they can complement what they do with revenue-generating activities. Both giant and small nonprofits
have come to this same conclusion.
For instance, CARE International has typically relied on donations to support disaster relief. But as
typhoons, tsunamis, earthquakes, and other tragic occurrences draw donors to help those whose lives are
suddenly turned upside down, CARE’s other, more fundamental, mission may suffer: eliminating the
underlying causes of poverty. In tough economic times, people may still open their wallets to respond to a
disaster (though even these donations are vulnerable to individuals’ belt-tightening), but giving “extra”
money so that CARE can undertake non-disaster-related activities such as supporting agriculture or
education may be something they are reluctant to do, or do less generously than in better times.
Thus CARE has begun exploring revenue-generating enterprises as a means to support its services
and to generate funds it can use at its discretion. For instance, CARE Bangladesh has partnered with large
companies, including Unilever, BATA Shoe Company, and Grameen Phone, to create jobs for
marginalized women by linking them to markets. These jobs create not only income but often a sense of
empowerment by giving women a voice in how the businesses are run. This new direction does not come
naturally for CARE, an organization whose charity-only work is well known throughout the world. At this
stage, these efforts represent CARE’s foray into business-oriented approaches to expanding its influence.
Similar initiatives are taking place in many local nonprofits that are seeking to turn their knowledge
and resources into an expanded funding base. For instance, a Detroit-based nonprofit that serves gang
members has realized that its skills and knowledge in dealing with these groups has commercial value to
other social service agencies, as well as those in the legal profession and law enforcement.
Nonprofit social enterprises also imitate for-profits by striving to increase their market share. Just
as Kellogg profits from selling more cereal, hospitals that serve more patients may be able to afford more
effective and expensive medical technology, since the cost can be spread more easily among an expanded
patient population. This is precisely what happens at the Aravind Eye Hospital in India, the largest eye
hospital in the world, which serves vast numbers of very poor patients.
Nonprofits may also borrow from business in quite sophisticated ways. For instance, mortgage
companies create a pool of mortgages from the mortgages they’ve issued and then resell the rights to
collect income from them to someone else. When done judiciously, such bundling protects the company
from a few bad mortgages and allows them to offer mortgages to additional deserving customers. Similar
things are done by insurance companies and in other industries. This sophisticated idea is being
undertaken by microfinance institutions, as well, to help them raise more money from worldwide capital
markets, lend it out, and operate with less risk.
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For-Profits Imitating Nonprofits
Just as nonprofit social enterprises adopt ideas from business, businesses can benefit from acting more
like nonprofits. Consider Google.org. It describes itself as “a hybrid philanthropy that uses a range of
approaches to help advance solutions within our . . . initiatives [including efforts to protect the
environment, contain infectious diseases, provide needed public services, and develop small- and
medium-scale local businesses].” Google.org provides grants to partner organizations as a traditional
charity would, but it also invests in for-profits, especially those developing disruptive “green”
technologies. Its for-profit status allows it to retain earnings, profit from its investments, and lobby
lawmakers in support of its goals.
Another way that business can adopt ideas from nonprofits is by understanding and responding to
people’s passions. At first, recycling involved only the most hard-core environmentalists who hauled their
waste to nonprofit community recycling centers. The increase in popularity of recycling from curbside
pickup changed the behaviors of many more people and spurred interest in the environment. Many
companies have begun to ride the environmental wave. The for-profit company Zipcar provides carsharing services to those who prefer to reduce the damage they cause to the environment by driving only
occasionally while avoiding the hassle of renting and the expense of car ownership. Terracycle sees true
value in waste. In fact, they will pay you for old containers, candy wrappers, and other commonly
discarded items. They fill these discards with their products, which are often waste products. Their “worm
poop” fertilizer fertilizes lawns with . . . you guessed it. Their “Drink Pouch” tote bags are made entirely
from used drink pouches like those used by CapriSun.
An Idea That’s in the Air
Let’s do another thought experiment by trying to imagine what the future of social hybrids might look
like. Do you envision hybrids becoming much more common? Do you see roles for many more people as
hybrids evolve?
History shows that certain ideas, including many major ideas, were “waiting to happen.” Take the
telephone. We all know that Alexander Graham Bell invented it, right? But how many of us know that
Elisha Gray and Bell filed patents for the telephone on the very same day? Or consider Charles Darwin’s
crowning scientific achievement explaining how evolution arises through natural selection. Alfred Russel
Wallace made a simultaneous discovery. These are just a few examples.
If you remember anything about calculus (including the dread it may have caused you), you know it
could not just have appeared out of thin air. (By the way, calculus was independently discovered by Sir
Isaac Newton and Gottfried Wilhelm Leibniz.) It has a subtle and highly developed structure, borrowing
ideas such as slopes of lines and rates of change that arise in relatively elementary mathematics courses.
But calculus changed everything by dealing with the infinitesimally small as well as the infinitely large,
not just ordinary numbers.
So how could calculus have been discovered—or invented—by two geniuses working separately?
Because they had similar backgrounds, had similar training, and were working toward a common end.
I would argue that hybrid social enterprises are now “in the air” in the same way. Hybrids spawn
other hybrids. But you don’t have to be a genius like Newton to identify them, understand them, or create
them. In creating a “hybrid stew,” good ingredients can come from anywhere. And adding the right
ingredient doesn’t just change the recipe slightly. It gives it a jolt to make it something truly special.
Once a social hybrid takes off, there may be no end to the satellite hybrids that revolve around it.
Think of the iPod. Now think of all the ways to accessorize it: covers, socks, armbands, docks, athletic
feedback sensors, and on and on—or using its design as the basis for the iPad. Why should social hybrids
be any different?
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Consider once again Muhammad Yunus, the man and now Nobel Prize winner who brought
microfinance to center stage. Yunus’s experience with microfinance through Grameen Bank got him
thinking that there must be other businesses, like his, that wanted to be financially sustainable but desired
to do societal good even more. This idea has given rise to a whole new class of businesses called social
business enterprises—which strive to maximize societal benefit, not profits—as well as social stock
exchanges devoted to nonprofit businesses. The hybrid mind-set underlying social business enterprises
has even given rise to laws that grant special rights to a brand new type of hybrid: low-profit limited
liability companies (L3Cs), which offer certain advantages and protections of both the for-profit and
nonprofit worlds. Jolting pbj effects.
Continuing our thought experiment: Can you imagine a world where social hybrids produce results
that are ever improving and beneficial for society? And how might they involve ordinary people, not only
as customers but even as creators of societal benefits?
You may know about Linux, a computer operating system with extraordinary power developed
entirely through volunteer effort. Users spot bugs, fix them, and propose and add new features. Though a
governing body recognizes the current version of Linux, no one owns it. You can take an older version,
change it to your heart’s content, and run it on your own computer if you’d like. Though the governing
body provides certain boundaries, there is incredible flexibility, too, for those who desire it.
But such ever-improving, open-source efforts don’t involve only software. The Massachusetts
Institute of Technology and other universities around the world have begun an open courseware effort.
Though the idea is implemented differently at different institutions, MIT’s version illustrates the power of
the idea. All educational material is put online: professors’ PowerPoint presentations, videotaped lectures,
study guides, quizzes, exams, answer sheets—everything. All this material is available not only to MIT
students, but to students anywhere in the world with an Internet connection. And it’s entirely free.
Though MIT was the originator of OpenCourseWare, the idea has been picked up by universities
throughout the world who allow sharing and, with permission, the changing of content to benefit students
everywhere. The spirit of keeping content open to improvement is exemplified by efforts at the University
of Michigan Medical School, which aims to provide an online curriculum for U.S. students and then help
customize it for use in Africa, where diseases, technology, and customs may all be quite different. Though
content will be made available for free, revenue from ancillary services will keep the effort afloat.
But we’re getting a little ahead of ourselves. In the next part of this book, we will look at how to
approach creating hybrid organizations that address deeply entrenched societal problems. We’ll return to
the idea of “open” approaches for addressing these same kinds of problems in the last part of the book.
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CHAPTER FOUR
Enterprise For A Sustainable World
and the Base Of The Pyramid Protocol
I met Sammy Gitau on the shores of Lake Michigan in Racine, Wisconsin, on a windy day in November
2004. Sammy had never been to Wisconsin before or to the United States. In fact, Sammy had never been
out of Africa. To be even more precise, he had spent his entire life in Kibera, a slum in Kenya. (Note:
Details in this chapter have been changed slightly, but not materially.)
Kibera is the second-largest slum in Africa after Soweto. Its one million inhabitants occupy an area
about three-fourths the size of New York’s Central Park. To put this in perspective, that’s a population
density equivalent to nearly eighty games of football (or futbol) taking place at once on a regulation-size
field.
Because it has been considered an illegal settlement for the last forty years, the Kenyan government
has tried to overlook Kibera entirely, although it is home to one-third of the people of Nairobi, the Kenyan
capital. Kibera lacks essentials such as sewage pipes, paved roads, and title deeds to homes and property.
The government provides no water, schools, or hospitals either.
Kibera is made up of ramshackle houses with corrugated metal roofs, rivers of mud, and open
sewage. And yet it has shops, restaurants, and a vibrancy that attract the few people able to afford to
escape the squalor and dangerous environment.
Sammy was an energetic young man in his early twenties with an easy smile and lively eyes. He
used to carry a plate, a fork, and cup throughout the Kiberan slum because he was never sure where he
might get a meal or where he might sleep for the night. By day, Sammy organized a community resource
center in Kibera. The centerpiece of the resource center was its library, a small, hot room inside what was
once a wooden shipping container. Sammy took great pride in his efforts to provide books, educational
guidance, and even an opportunity to use computers to help slum children stay and succeed in school.
What was he doing in Racine, Wisconsin, on that blustery November day?
The Base of the Pyramid Protocol
A year before, Enterprise for a Sustainable World (ESW) had convened forty individuals
from around the world (including me) for a four-day gathering to develop a “Base of the Pyramid
(BoP) Protocol.” The hopes for the protocol were simple. For the past few years, ESW, a
nonprofit group led by Stuart Hart, had been hosting meetings with companies and other organizations
from around the world to explore the opportunities that lay at the base of the pyramid. But no one was
really sure how to take advantage of them. Those in attendance at the protocol meeting hoped to produce
a clear path forward.
The protocol meeting took place at Wingspread, a set of buildings designed and inspired by Frank
Lloyd Wright now used by the Johnson Foundation as an international educational conference facility.
The Johnson Foundation has progressive instincts. With keen interests in sustainable development and
the environment, its aims were quite consistent with developing a protocol.
Those attending the protocol meeting were from the for-profit, nonprofit, and governmental
sectors. They were academics, businessmen and businesswomen, and members of international relief
organizations. There were North Americans as well as representatives from Latin America, Africa, Asia,
Europe, and Australia. Some were steeped in a market- and business-oriented ethos, and others were
highly mistrustful of business.
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What united the attendees was a common passion for improving the lives of the poor coupled with
experience in addressing the issues. Finding common ground among the widely diverging perspectives
that people brought to the meeting would not be easy—but that was the point. In this diverse mix was the
promise of broadly informed, powerful ideas about alleviating poverty.
The Johnson Foundation supported the invitation-only protocol development meeting in the spirit
of promoting “thoughtful inquiry … in an atmosphere of candor and purpose.” At times, candor and
purpose nearly erupted into chaos and mudslinging. The diversity of perspectives proved to be a
combustive mix. The invitation to attend Wingspread said that participants would together create
guidelines for creating new businesses at the base of the pyramid that drew on each participant’s expertise
and techniques, where appropriate.
Rarely, of course, did anyone feel that techniques and skills that they had spent their careers
acquiring were less than perfectly relevant and appropriate—no matter what others thought. Yet
consultants differed in thought, appearance, and custom from international development professionals
who had spent years in the field. A sociologist favored businesses focused on socially responsible growth,
especially those supporting the very poor and the self-employed who owned tiny businesses in the
“informal” economy. A business executive preferred businesses on a much larger scale, desiring growth
through market-based opportunities above all else, even while operating responsibly and ethically. Some
felt that political and gender issues had to be addressed before any headway could be created in alleviating
poverty through enterprise. Others felt it was time to just jump in with both feet and learn by doing,
despite all the disagreements.
Slowly, the hissing and spitting of the first couple of days died down as Hart and co-facilitator
Gordon Enk led teams through a series of exercises. By the meeting’s close on the fourth day, with
participants having begun early and worked late into the night each of the previous three days, the
principles of protocol and the code of conduct governing its use had been outlined. More impressively,
every one of the Wingspread participants had agreed to sign off on the document, providing a ringing
endorsement of a new means of business development.
So when I met Sammy Gitau on the shores of Lake Michigan in November 2005, one year had
already passed since the Wingspread meeting had taken place. Or I should say Wingspread I, since he and
I were now chatting during a break in Wingspread II.
In the year between the two Wingspread meetings, the protocol had been drafted and had begun to
be put to the test. Enterprise for a Sustainable World led its implementation in the field. The SC Johnson
Company sponsored the effort and would reap the benefits.
Logic at the Base of the Pyramid
The SC Johnson Co. has had a long-standing commitment to responsible business. As the manufacturer
of Raid, Pledge, and many other spray products, SC Johnson was the first company to remove ozonedepleting chlorofluorocarbons (CFCs) from its product line worldwide. It did so voluntarily, unilaterally,
and before all the scientific data were in—for one reason: because it was the right thing to do to protect the
planet. Three years later, all U.S. companies were required to follow suit. SC Johnson is also one of the
funding sources for the Johnson Foundation, with which it has an arm’s-length relationship.
Over the past several years, SC Johnson has been in the vanguard of companies that understood the
logic and opportunities at the base of the pyramid. Its leaders feel that doing business at the base of the
pyramid is not only the right thing to do socially, but the right thing, too, as a long-term growth strategy
for their business. The BoP lead at SC Johnson was Scott Johnson, vice president of Global Environment
and Safety, but no relation to the SC Johnson family that runs the business.
To understand what SC Johnson and ESW were trying to do, a bit of a history lesson is in order. In
2002, after years of being turned down by other journals and magazines, C. K. Prahalad and Stuart
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Hart published an article titled The Fortune at the Bottom of the Pyramid in the magazine
Strategy + Business, put out by the consulting firm Booz, Allen, and Hamilton. It has since become a
business classic.
As the article’s title provocatively suggests, the world’s poor, in aggregate, control a lot of money.
The world’s population today is between six and seven billion people, and approximately four billion of
them have incomes below four dollars a day (in terms of what that amount of money could buy in the
United States). Plainly and simply, about two-thirds of the world is extremely poor.
Though these four billion people have tiny incomes, together they have $5 trillion of purchasing
power, more than the gross national income of the world’s second-largest economy, Japan. On top of this,
residents of the base of the pyramid often have small, untitled real estate holdings and microbusinesses
that are part of the informal economy. When estimated, the combined value of these was approximately
$9 trillion, an amount equal to owning every share of stock of every company listed on the main stock
exchanges in the world’s twenty largest countries. And an amount that is only slightly less than the gross
domestic product of the United States.
Large companies would be foolish to overlook these opportunities, Prahalad and Hart pointed out.
Or, should I say, potential opportunities, because the business conditions at the base of the pyramid are so
vastly different from those in the developed world. The challenges include not only a need for new and
different kinds of products and services, but new ways of making them, delivering them, and financing
them—all of which must often be done in the context of extremely limited infrastructure, harsh physical
conditions, rural populations far from city centers, and people who lack not only money but skills in
literacy and numeracy as well. And people who may never have made a formal business transaction in
their lives.
Yet in their article, Prahalad and Hart offered the logic for large companies beginning to serve these
markets. For instance, citizens at the base of the pyramid are often charged very high rates for products—
everything from food and water to loans and everyday sundries—even when the quality of these goods and
services is substandard. So companies that can reduce prices, especially when they raise quality, would
have a vast, new potential market. This is welcome news for large companies that have saturated the
developed world with shoes and purses, microwave dinners and bottled waters, gels for your hair, and
tonics for your soul: these companies have experienced flat business growth among the approximately
half billion relatively affluent people in the world (living on more than $15,000 annually) so new markets
with more than ten times the number of people look quite attractive.
Writing separately after the publication of their article, Prahalad and Hart each made another key
observation, one that I believe is even more important than the sheer opportunity of selling to the poor.
They argued that the citizens of the base of the pyramid could hold the key to creating the new kinds of
businesses that their communities needed.
Prahalad emphasized that the meager conditions of those living at the base of the pyramid required
them to create innovative solutions to deal with the circumstances of their lives. The same imperative for
innovation characterized hospitals, banks, and other kinds of institutions and companies that catered to
the poor. For instance, the Aravind Eye Hospital performs eye surgeries every bit as successfully as any
hospital in the West but at only one-thirtieth the cost (and fifty times the volume of large hospitals).
Hart wrote that creating base of the pyramid businesses requires companies to turn their thinking
inside out. Rather than selling their existing line of products or services to the poor, or even customizing
them to make them more suitable, companies would do best by joining with the poor communities they
would serve in the creation of new businesses. Instead of “selling” to the poor (and such “selling” can too
often have the connotation of selling a bill of goods), companies needed to live alongside the poor, partner
with them, and together create new opportunities that would benefit them both.
Hart began exploring this line of thinking with companies that participated in the Base of the
Pyramid Laboratory meetings he held. These ideas seemed to pass the “smell test.” In other words, even
though this way of doing business was inside out—and maybe upside down and sideways, too—companies
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resonated to the idea that this new way of thinking about creating businesses was inclusive: businesses
would be accepted into the community rather than being rejected as foreign antibodies, and the financial
and other benefits that the businesses generated would surely include the poor.
But you don’t run a business by smell. Companies wanted to know how to put these ideas into
practice—thus was born the idea of developing the BoP Protocol.
Implementing the Base of the Pyramid Protocol in Kenya
After Wingspread I, a group of us took a large set of documents produced by participants there and,
guided by the general agreements all participants had made about what the protocol should entail, made
multiple passes at fleshing out version one of a formal protocol document. The document was then
circulated among all Wingspread participants, who suggested additional modifications. Finally, after
several months of work, the first version of the protocol was produced and put on the Web. The document
was created to be open source in the sense that it would not only guide efforts in the field but be modified
and informed by them.
By spring 2005, SC Johnson decided it wanted to implement the protocol in the Kenyan slum of
Kibera. The company already had a small business presence there, but one that in no way catered to the
base of the pyramid. The company mostly hawked its traditional product line to whoever could afford it,
and the extent to which their products ended up in Kibera was more a matter of happenstance than part of
any base of the pyramid strategy. With this knowledge and with the completed protocol document, ESW
began its work with SC Johnson.
In version one, the protocol was long on principle and philosophy but short on practical guidance.
This was intentional because the protocol was designed to be applicable to any product or service—from
any company, any industry, anywhere in the world. Yet even with such broad applicability, the protocol
described the stages that any project would pass through. And, of vital importance, it defined the code of
conduct for responsibly engaging a community that companies were to promise to follow.
The ESW team was split between an on-the-ground field team and an advisory team who provided
strategic guidance and support. The field team comprised two business students from Cornell (where Hart
teaches), Justin DeKoszmovsky and Catherine Burnett; one business student from Michigan (where I
teach), Nyokabi (Kabi) Kiarie; an anthropologist, Tatiana Thieme; a business consultant, Patrick
Donohue; and a PhD student whose studies focused on the base of the pyramid, Erik Simanis. The
advisers were Stuart Hart, Gordon Enk, and I.
The first order of business was to train those who would be active in the field. The field team’s
training took place in the United States over several months preceding members’ departure for Kenya.
The purpose was to ready the field team to undertake a new kind of business development in Kibera.
Business school training would be insufficient for what the team was supposed to do. Business schools,
not surprisingly, define a model of business development with a business always at the center that has
strong ideas about what kinds of products or services it wants to create. The team in Kibera, on the other
hand, would go to the Kenyan community to create deep partnerships and only then co-create new
business opportunities.
The training was led by Erik Simanis, the field team leader, who held weekly teleconference
meetings on a set of assigned readings. The topics of these sessions included the following:
•
•
•
The rationale for Western companies to engage with the base of the pyramid
Business development that puts the perspectives of a local community ahead of those of a
business
Social science methods useful for helping team members take stock of the community they would
be dealing with “with fresh eyes”
42
•
•
Methods of facilitating workshops to promote active, “participatory” community engagement to
support business co-creation
Ecological, sociological, cultural, and political dimensions of Kenya and Kibera
Much of the training included practical methods that have long-standing application in other
disciplines. For instance, many interventions to promote rural and agricultural development demand that
their team members develop similar community-based, participatory perspectives. The team borrowed
from these liberally, and adapted them as appropriate.
The protocol defined three phases that base of the pyramid business development must pass
through:
1. Opening up
2. Building a business ecosystem
3. Enterprise creation
The first of these phases lowers the barriers between the team and the community. By the end of
this phase, a broadly conceived business idea has been generated. The next phase is devoted to translating
this business idea into more concrete terms and implementing a small prototype. The final phase aims to
make this a more permanent business that is embedded in the local community and is understood well
enough that it can, potentially, be replicated elsewhere.
The field team arrived in Kenya late in the spring of 2005. Their charge was to conduct the
“opening up” phase of the protocol. Even though one of the team members had grown up in Kenya, the
team recognized the importance of being affiliated with others who had a significant local presence in
Kibera. A local nonprofit organization in Nairobi, Carolina for Kibera (CFK), filled this role. Carolina for
Kibera was engaged in community-based development to address poverty and prevent violence. It played
the essential role of introducing the team into the community by means of its own well-established
relationships and the trust in the community that it had earned.
Carolina for Kibera introduced the team to various “youth groups,” a term euphemistically applied
to what we might call gangs. They also introduced the team to Sammy Gitau, who was intent on providing
opportunities for youth group members.
Even before this, CFK helped arrange community homestays. Modeled on a process used by the
Peace Corps and others, a homestay allows a team member to live with an individual or family who is part
of the community. For a period of two weeks, each team member lived the life of a local community
member. Living apart from each other, members were immersed in situations that encouraged them to
develop trusting relationships with their hosts. Living together, working together, eating together,
sleeping together (sometimes in the same bed when a dwelling had only one), both host and team member
began to open up, reveal themselves, and create a meaningful bond with the other.
Homestays were not the time for conducting interviews or taking surveys. They were certainly not
meant to convey the idea that a team member was in Kibera to “save,” “improve,” or “rescue” the host. As
impossible as it is to do so, homestays were an attempt for Westerners, who ultimately wanted to create a
new business, to lay aside the mental models of the world they had acquired over a lifetime and to
perceive, through African eyes, an equally valid reality.
When the homestay had been completed, the team returned to living together but still near their
hosts. The relationships they had forged during their homestays remained important for identifying and
building a new business and for demonstrating a genuine commitment to provide value to the community.
After the homestays, the ground team participated in a series of activities that led to the
development of a broad business concept. These activities helped them better understand Kibera and
43
answer questions such as What do citizens want? need? value? What resources, even if hidden at first
from Western eyes, might become building blocks of a new business?
Of course none of these questions could be answered by the on-the-ground team acting alone.
Using further introductions from CFK, their homestay hosts, Sammy Gitau, and others, the team
recruited a set of community members to help them explore these questions and others pertinent to
creating a new business. This group represented a cross section of the community who appreciated the
possibility of co-creating a new business and committed to doing so. These recruits together with the onthe-ground field team from ESW made up an extended Project Team. Though the ESW members of the
Project Team remained fixed, there was some fluidity in the membership from the community over time.
To imagine the enormity of the task before the Project Team as it embarked on co-creating a new
business, imagine the following. You are a lifelong resident of Kibera. You have never made a direct
purchase from a Western company. Everyone that you have ever known is black. The thought of starting a
formal business is the furthest thing from your mind. And now, a group of mostly white foreigners, from a
place you don’t know, representing a company you’ve never heard of, is suggesting that you become their
partner to potentially make money for them, your community, and yourself.
In fact, I have conducted a variation on this exercise with groups of homeless individuals in the
United States with whom I have employed the protocol. Without fail, and despite their typically desperate
financial situation, the participants in these exercises say that they wouldn’t accept such an offer without
knowing a lot more: Who is the company? Why would they want to do this? Do they have a track record?
Who can vouch for them? How do we know that this will not be just another “bill of goods?” Just for
starters.
But by working through such issues, these individuals can become valuable business collaborators.
In Kibera, local Project Team members were just as uncertain about the project at first as were the
homeless individuals in the United States whose skepticism I just described. And, like their counterparts
in the United States, they became key collaborators during the opening-up phase of business
development.
Co-creating a new business concept required effectively blending the skills and perspectives of
Western outsiders with local Kiberans. This required a repertoire of methods designed to bridge the
differences between both groups and build upon each side’s strengths.
Participatory rural appraisal (PRA) describes a set of established and to-be-invented methods to
help local people understand and improve their lot. Two of the words in the phrase participatory rural
appraisal can be misleading. Participatory rural appraisal can be applied in urban settings (although its
roots are in agriculture). And PRA aims to change a situation for the better, not just appraise it.
But PRA is certainly “participatory”—in the sense that it allows the voice of the “underdog” to be
loudly heard. Participatory methods are based on the conviction (proven by evidence and experience) that
the poor and marginalized have more than adequate capabilities for understanding, planning, and acting
to improve their lives, and then evaluating their efforts. PRA methods foster an environment that enables
communities, and PRA practitioners themselves help bring selected members of the community together
and facilitate the community’s understanding and progress toward its goals.
Participatory rural appraisal and other methods from anthropology and the social sciences such as
Rapid Assessment Process (RAP) often guided the interactions between the ESW and community
members who contributed to the project. The ESW members facilitated; the Kiberan residents
“participated.”
It is important to recognize that even though business development was taking place in Kenya, on
Kiberan’s “home turf,” the ESW team could be viewed as having the upper hand in terms of power. Locals
44
perceived them (with some exaggeration) as foreigners from the West, extraordinarily well educated and
extremely wealthy, able to return home whenever they pleased. Not your average Kiberan.
Thus many of the PRA activities aimed to neutralize and even reverse these perceived power
imbalances. For instance, having Kiberans lead walking tours throughout the community (“transects”) to
identify local resources, problems, and opportunities put them in the role of “teacher” and ESW members
in the role of “student.” Similarly, PRA teaches the importance of “the passing the stick”—or in many
cases, marking pen, chalk, or camera—to allow local citizens to draw, diagram, photograph, and otherwise
depict critical aspects of their lives and important relationships among them. These activities generated
important information as well as increasing the trust necessary for a co-created business to even be
possible.
Early on, these methods were especially useful in helping identify individuals to support the
project, either as part of the Project Team or as key informants. Later, participatory workshops were
generally focused on business creation. For instance, the partnership between SC Johnson and Kibera was
based on creating “mutual value.” Thus a topic that became ripe for exploration was the value and
benefits that both sides hoped to achieve to make the partnership work. More subtly, a discussion of
mutual value reinforced the idea that both sides had to win for the partnership to succeed over time, and
each side would benefit from viewing the other partner’s success as linked to their own. Other workshops
focused on such business fundamentals as creating value for customers (rather than partners) and the
business “value chain” through which a company obtains raw materials, transforms them into products or
services for sale, and delivers these goods or services along with appropriate customer service.
As outsiders, the ESW Project Team members ran the risk of receiving a biased sense of Kibera—its
needs, opportunities, strengths, and weakness—by relying on information furnished by a too limited
number of individuals. To prevent this, the team took pains to examine and compare the information it
gleaned from a variety of sources: conversations with local community members, of course, but also the
drawings, diagrams, and photographs they produced, information gathered from walking tours, and their
experience of more or less trying to “live life” in Kibera. By finding common threads among these sources
of evidence about life in Kibera, as well as considering subtler and less frequently reported information,
the team was able to quickly gain a rather informed understanding of the community. Such RAP inquiries
allowed for cycles of ever-deepening understanding of the community and the business opportunities
there.
With this critical, preliminary work completed, the Project Team began its most important task: coming
up with the concept for a new business. Employing a process used in many modern businesses (and still
using PRA and RAP as appropriate), the ESW Project Team members used breakout sessions with
relatively small groups of community members to promote the divergent thinking useful for generating
new and “unfiltered” ideas. These became input for larger community-based meetings focused more on
critical analysis and convergent thinking to help refine them.
Over a period of several weeks, the Project Team engaged in several rounds of divergent-convergent
thinking, each time trying to advance the discussion in the direction of a new business possibility. Finally,
they identified a business concept attractive to SC Johnson, the community of Kibera, and various
individuals affiliated with the project. That idea, left intentionally broad to allow the next phase of the
protocol to explore different implementation possibilities, was to create a new business providing
community residents with more hygienic, pest-free homes. For the first time ever, SC Johnson would be
engaged in a service business. Even though their products would be used to support cleaning and insectcontrol services, this was quite a departure for a company that, throughout its entire history, had only sold
products to consumers. This time, they would join with local Kiberan entrepreneurs and provide them
with industrial-sized containers of relevant products (another first for a company whose history was in
selling small cans and packages of their goods) that they would use to sanitize homes and rid them of
mosquitoes and other disease-carrying insects. Thus was begun a partnership from which SC Johnson
hoped to learn much—and profit eventually. The community stood to gain immediately, from new jobs
and better living conditions. The opening-up phase of the protocol had successfully come to a close.
45
The six-person ESW team left Kibera after about a three-month stay. They had completed their
main mission: to generate, with the community, a concept for a new business in which SC Johnson could
participate. But they had also paved the way for Phase 2 of the protocol, the chief aim of which was to
build an ecosystem of business partners to carry out and explore the new business idea. During their stay,
Carolina for Kibera (the local community-based organization supporting the project) had introduced ESW
to several “youth groups” who were taking part in a program they had launched called Taka Ni Pato
(Trash Is Cash). These youth groups (or what we’d call gangs, if you remember) had created minibusinesses in which they first collected residents’ trash for a fee and then combed through it looking for
items they might sell as recyclables or composting material.
The ESW team had met the youth group members—where else?—over an open sewer as team
members were participating in a community cleanup just after their arrival. (You can’t expect anything to
be “business as usual” at the base of the pyramid.) They used rakes and shovels to immerse themselves in
Kibera and, on this occasion, the Kiberan waste that happened to be floating by. By the end of Phase 1, it
was clear that youth groups could play a key role in the new business. They were young, hardworking, and
entrepreneurial, knew the community, and had an established base of customers. When ESW returned to
the United States, several of these youth groups were selected to work with SC Johnson’s Kenyan office
and Carolina for Kibera to start the new business.
Sammy Gitau, with whom I was speaking on the shores of Lake Michigan in Racine, Wisconsin, had
established a community resource center to support these youth groups. Sammy and I were planning a
project that I would eventually work on with students from the University of Michigan business school to
outfit the center’s makeshift library with additional books, a few new computers, and more reliable power.
If you recall, Sammy was in Racine for Wingspread II, a meeting that took place approximately
three months after the ESW team had left Kibera. He had a digital camera with him and was taking
pictures of Lake Michigan, the striking Frank Lloyd Wright buildings at Wingspread, and its magnificent
grounds—things that other Kiberans would find difficult to believe existed, even with pictures. And he
would join the ESW team in describing to the Wingspread attendees his life experience in Kibera and the
status of the SC Johnson–Kibera business at the six-month mark after the ESW team first set foot in
Kenya. To anyone wedded to the idea of “traditional business,” what he was describing would be no less
surprising than the photographs he would show back home.
When Sammy returned to Kibera, the protocol-led development was entering Phase 2. Phase 2 was
deliberately designed for learning by doing. In the place of careful forecasts and business planning,
business ideas were quickly tried and evaluated to see what worked.
These pilot endeavors revealed several unanticipated developments, as was expected. First, it
became important to organize each cleaning and insect-prevention mini-business around an individual
rather than a youth group to create a stronger sense of ownership. But these individuals had no savings to
draw upon as they built businesses that could not yet generate incomes sufficient for their living expenses.
Thus SC Johnson had to subsidize them financially at the outset. And even though these entrepreneurs
had previously hauled trash from residences in Kibera, their efforts to hire themselves out to provide inhome cleaning and insect-prevention services to new clients were met with mistrust and suspicion. This
caused the business to shift its focus to common areas, such as latrines, where no one’s individual
property was at risk.
The SC Johnson–Kibera Community Cleaning Services business is now several years old. More
than 120 entrepreneurs have received training in public sanitation and in business, and they sell their
community toilet-cleaning services to poor communities desiring more sanitary public toilets, the only
type of toilets available to many Kenyans. The business, which began in Kibera, has expanded to other
Kenyan slums, including Mathare, Mitumba, and Dagoretti. SC Johnson hopes that what it started in
Kenya may take root elsewhere in Africa, and even on other continents.
Postscript: Happy Ending Despite the Odds
The story already has a remarkable postscript. When he was thirteen, Sammy Gitau’s father was
46
beaten to death by a mob as Sammy watched. Sammy began to steal to support his family, got involved in
drugs, and ended up living on a garbage dump. After surviving a drug overdose near the age of twenty, he
turned his life around and started his community resource center in the slums to help others kick drugs.
Built from old cargo containers, the center offers skills training, provides a library, and exposes its
members to opportunities such as Cash for Trash, where they salvage items of value from garbage and sell
them.At the garbage dump Sammy himself found treasure in the form of a flyer from the University of
Manchester in the United Kingdom. It was an advertisement for a master’s degree program from their
Institute for Development Policy and Management.
He wanted to attend to share what he had done and to learn from others, but there were a few
obstacles. His formal education had ended in high school, and he didn’t have the money. Fortunately, the
institute waived its admissions requirements, allowing Sammy’s grant writing and other means of
demonstrating his intelligence to substitute for a college degree. They also provided a scholarship for
Sammy to attend.
In December 2007, two years after our conversation in Wisconsin, Sammy received his master of
science degree in Management and Implementation of Development Projects, with Honors.
The BBC noticed this accomplishment. In a web-plus-video presentation, it traced his arc from
homeless individual, to creator of a community center serving more than twenty thousand people, to
holder of an advanced degree. Interviewing him just before he received his diploma, a BBC reporter asked
if the odds were impossibly long for others hoping to follow a similar path. He responded that they
weren’t if poor people were willing to stick with it and work hard enough:
As I’m waiting to graduate, [I want to] tell them: “Don’t be afraid of expecting too much from life. Don’t
be afraid of taking a huge dream [or] expectation. Take it, work hard at it, and be ready.” Because
wishing and really taking it [are different] things. What I’ve learned from my studies is it takes a lot of
time and hard work. If one is not ready to put the time and energy that it demands, it can be quite
difficult.
And what has become of the on-the-ground team that ESW sent to Kibera to launch the protocol?
•
•
•
•
•
•
Erik Simanis continued on the Kibera project, traveling back and forth to Kenya in a supervisory
role during its last two phases. He continues to play a key role in creating businesses at the base of
the pyramid.
Patrick Donahue continued with the Kibera BoP Protocol effort and similar ventures, including
ESW’s Protocol effort in Flint, Michigan, for Ascension Health directed at providing better health
care and wellness outcomes for that community.
Justin DeKoszmovsky joined SC Johnson’s London office, which oversees its business activities in
Africa, and is specializing in base of the pyramid business development.
Tatiana Thieme continued to work with ESW on several other BoP projects and is researching
enterprise-based approaches to alleviating poverty.
Catherine Burnett is a program officer at a charitable trust.
Nyokabi (Kabi) Kiarie is now a financial consultant.
As for the Advisory Team:
•
•
•
Gordon Enk continues to work with ESW on various BoP projects.
Stuart Hart and ESW continue to play a seminal role in shaping how businesses think about
the base of the pyramid and how to use the protocol to create businesses that serve poor
communities.
And me? I’ve continued my project work, too, and, of course, have written this book, which I
hope you’re enjoying.
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CHAPTER FIVE
In the last chapter, we saw how Stuart Hart and his Enterprise for a Sustainable World (ESW)
developed and employed the Base of the Pyramid Protocol. In this chapter, we’re going go in-depth to
gain a deeper understanding of exactly what ESW is doing.
ESW’s approach to business co-creation and the outcomes that the protocol produces embody the
concept of a social hybrid in three respects:
First, ESW configures various organizations into hybrid constellations. Enterprise for a
Sustainable World becomes the nonprofit glue that binds together a for-profit corporation
and a poor, distant community and affiliated nonprofit community-based organizations.
Second, its approach to business development is nothing if not pragmatic and eclectic. In ESW’s
view, traditional approaches to business development resemble too much a scientific formula and not
enough an art to be successfully used at the base of the pyramid. Thus, ESW borrows a healthy dose of
anthropology and social science to mix in with the business fundamentals that form its core. In a similar
spirit, it often “passes the business-creation stick” to community members, which shuffles the roles of
corporation and consumers considerably.
Finally, the protocol produces outcomes that are intended to work despite precedents pointing in
other directions. SC Johnson has always been a product company? Well, other companies sell services, so
let SCJ try that in Kibera. But what about SC Johnson producing only products in household-sized
containers and packages? Not a big deal: let them produce industrial-sized containers to better support
the needs of local entrepreneurs.
Although the ESW/protocol approach to creating societal (or social) hybrids is different from what
other organizations are doing to create them, there are important similarities, too. To understand the
creation of societal hybrids in a broader context, let’s allow our view of ESW to go slightly out of focus.
We’ll still see ESW, but we’ll see its broader contours rather than its finer details. This will provide a
useful framework for us to look at other social hybrid organizations, which we do in Part 6 of the book.
Examining ESW and the protocol reveals the four key ideas we encountered in the last chapter.
•
•
•
•
Big Picture Design
Making It Appropriate
Making It Stick
Making It Bigger
Big Picture Design
Big Picture Design is key in creating societal hybrids. In serving the poor, especially overseas,
nothing can be taken for granted. You want to sell a product? Fine. But you likely will need to design new
relationships within the community to get the raw materials you need to make it. The way you
manufacture can’t follow Western processes either, because the resources available to you are so different.
But you can design manufacturing systems to take advantage of plentiful, inexpensive labor—or design
training programs and industrial machinery that fit the local context. And how do you get products to
customers? You can’t just take roads and transport for granted. Again, in the big picture, you must design
everything.
Big Picture Design takes advantage of any means possible to succeed. Is someone else already doing
something similar that works? Imitate it. Can you identify un- or under-utilized resources within the
48
community? Take advantage of them. Can you look to indigenous and grassroots solutions? Big Picture
Design not only considers the complete range of activities that must be given attention but looks broadly
for ways to make them successful.
Steal shamelessly when you can, invent a new approach when you must.
In every aspect of Big Picture Design, the emphasis must also be on Making It Appropriate. But what’s the
“It” that we want to make Appropriate, and what does Appropriate mean? As in Big Picture Design, “It”
covers everything. Making It “Appropriate” counts for everything—if you want to succeed.
Using the protocol, ESW tried to Make It Appropriate by opening wide the window of possibility in
front of them. Through the light of this fully open window, ESW could deeply explore Kibera’s needs. ESW
did not attempt to simply drum up demand for SC Johnson’s existing products. Nor did it do market
research using typical Western techniques such as focus groups. Such approaches generally produce a
shallow understanding of a vastly underserved community, giving power to the company that presents
various alternative choices, and reducing the community’s role to reacting to business ideas rather than
helping to create them.
In its code of conduct, the protocol says that it is necessary to suspend disbelief about the
community you are entering, the people you will be dealing with, the resources at their disposal, and their
wants and aspirations. Suspending disbelief rests on an attempt to drop your own model of the world and
adopt another’s. Homestays, Participatory Rural Appraisal (PRA), Rapid Assessment Process (RAP), and
a focus on building trusting relationships were key to the way ESW went about suspending disbelief and
understanding the wants and needs of the community of Kibera.
Making It Appropriate requires paying great attention to context. When ESW began its work, it
suspected it might be working on new ways to manufacture an antimalarial product from local crops. But
in the broad planning context of business creation workshops, the idea of home cleaning and sanitation
services emerged instead.
In actually bringing an idea to life, Making It Appropriate to the context can’t be emphasized
enough. To begin with, the physical aspects of a product must conform to the community’s needs and
customs. This may require adding features, toning them down, or combining features of different
products. A product may need to be more durable, lighter weight, or less power-hungry than a comparable
product in the West. For instance, computers used in schools in the developing world may require a crank
for power and a hardened shell to withstand being dropped, but must still be light enough for children to
carry. Ergonomic features, too, matter just as much at the base of the pyramid, though people in some
parts of the world often interact quite differently with products than we do. (Millions of women carry
containers with up to forty pounds of water on their head to meet their families’ basic needs for
consumption and sanitation, something most of us cannot even fathom.)
The “softer” side of a product or service must obey context, too. Cultural, religious, and sexual
norms can be strong influences. For instance, in Bangladesh, Nobel Prize winner Muhammad Yunus’s
Grameen Telecom enables micro-entrepreneurs to obtain cell phones, which they then allow other rural
villagers to use for a fee. But in that part of the world, women overwhelmingly prefer to use a phone
owned and operated by another woman, whereas the opposite is true for men.
Making It Appropriate means ensuring that what is being offered is relevant and perceived as being
relevant. When the large Indian company Hindustan Lever, Limited, wanted to bring soap to market for
poor Indian consumers, it slammed into this problem like a brick wall. Yes, citizens often suffered from
diarrhea, sometimes severely. But they didn’t believe that washing with soap could make any difference.
They couldn’t see the “germs” that Hindustan Lever was talking about, and if they couldn’t see them, how
could they be causing a problem? Hindustan Lever ultimately made people perceive that soap was
relevant with a strong social marketing campaign. Among other tactics, it taught schoolchildren about the
49
importance of killing germs (thus indirectly reaching their parents). Sometimes they covered the
children’s hands with fine chalk, had them wash with water alone until their hands looked clean, and then
used black lights to show them that their hands were still chalky.
The BoP Protcol’s guidelines helped SC Johnson Make It Appropriate in several ways. First, it
helped the company consider a broad range of business opportunities and back away from the notion that
Kibera should be involved in an improved means of manufacturing an antimalarial insecticide made from
a local plant—the idea that had sparked SCJ’s interest in doing business in Kibera in the first place. Next,
SC Johnson came to realize that, in the context of this African slum, any products it might sell would be
too expensive for the intended audience, even if sold in small consumer-sized cans or packages. So it
made a first-time-ever shift from selling a product to selling a service so that customers could obtain the
use of small amounts of product, packaged in large, economical containers, when they hired the service.
Through the protocol process, SC Johnson also came to understand that what was “appropriate” in Kibera
was a service that could deliver improved sanitation and hygiene as well as protection from mosquitoes
and other pests. Plus, to be even more “appropriate,” these services needed to be directed at common
areas, such as community latrines. Finally, the protocol process took advantage of the fit between the
unpleasant, unattractive work that this entailed and the entrepreneurial ambitions and capabilities of
local youth groups who were already accustomed to sorting through garbage and trash.
Making It Stick
Big Picture Design and Making It Appropriate are an important start in establishing a base of the pyramid
business, but they’re only a start. Everything can seem right, but you must still Make It Stick. A business
foisted upon the community may be able to sell its products—temporarily. But without deeper
connections, it is vulnerable to new competitors, especially if their products are cheaper or shinier.
To Make It Stick, a business should become deeply woven into the fabric of the local economy and
the community. SC Johnson accomplished this by placing its service-delivery ecosystem on the backs of
entrepreneurial youth group members who knew Kibera and had standing in the community. Good
business for them was good business for Kibera and SC Johnson as well.
Embedding a business in the local community actually begins long before a new product or service
is launched. The partnership between SC Johnson and various youth groups was part of a broader
partnership involving Carolina for Kibera. Carolina for Kibera was instrumental in the very first efforts to
encourage the community to accept outsiders who wanted to establish a business there. In developing
social hybrid businesses, there is often a critical role for such partnering organizations to play—not only in
Making It Stick but in Big Picture Design and Making It Appropriate.
Naturally, Making It Stick is impossible if you can’t even get your business started. Once going, a
business might generate sufficient revenues to keep afloat. Before that, though, various approaches can be
used to get the business launched, including charitable donations, government or corporate subsidies, or
viewing the effort as part of corporate research and development and taking advantage of the R&D
budget. These, too, can be essential to Make It Stick.
Making It Bigger
If all goes well, Big Picture Design has been all encompassing, taking into consideration any potential
roadblock. Each important detail has been addressed in a contextually “appropriate” way. And the
business has successfully “stuck” in the community. The next challenge, then, is to Make It Bigger.
Part of Making It Bigger means doing more within the community where the business began:
increasing the base of customers, increasing the range of products or services offered, and producing
more jobs. Making It Bigger can mean looking for a new balance between adopting local means of
production and striving for greater efficiency. It can involve leaving behind improved infrastructure so
that other businesses may follow in your footsteps, and even influencing new policies and regulations that
50
assist in the creation of new enterprises. Ultimately, it means using the company’s success as a
springboard to strike out into new locations and find success elsewhere.
Making It Bigger is not a matter of will or determination alone. To expand a company’s presence in
the community means being attentive to the processes and outcomes of that business and making
adjustments as necessary. Conducting “business tests” and obtaining feedback is important for any
business. It is especially so for companies embarking upon a new business orientation, and more so still
for companies hoping to achieve enormous business and societal gains by reaching a tipping point at the
base of the pyramid.
SC Johnson is still in Kibera, where it has helped fund an eco-friendly medical clinic that provides
affordable inpatient and outpatient services seven days a week. And it has expanded its operations to nine
other Nairobi slums as well. Many of the lessons learned in Kibera made entering these new territories
that much easier. The new businesses are all service business, rather than businesses created to sell
products. Each business is led by a member of the Coalition of Youth Entrepreneurs (a “gang member”),
who uses his knowledge to train and guide others to provide sanitation services in their own communities.
For their efforts, Community Cleaning Service employees earn up to four times the minimum wage.
Where will all this lead? The more SC Johnson considers Big Picture Design in a continual quest to
create a stronger business, the greater its effort to make all aspects of its business appropriate, and the
more it emphasizes Making It Stick, the larger the opportunity.
SC Johnson’s efforts in Kenya have prepared it to undertake a new base of the pyramid activity in
Rwanda. Rwanda is a source of pyrethrum, a key natural ingredient in insecticides that the company sells.
SC Johnson is working with Rwandan farmers to produce more pyrethrum, of higher quality, and then to
harvest it at the right time and dry it correctly so that it is most valuable to the company and most
profitable for the farmers who grow and process it.
As SC Johnson’s efforts become bigger, so does its potential to learn by doing and to use that
feedback as a cornerstone for doing base of the pyramid around the world.
Healthy, Wealthy, Wise, and Green
So what do we need to fix most in the world?
On a planet with 6.5 billion people spread across 195 countries on seven continents spanning 24
time zones, this is a big question. Big not only because of these numbers and the vast scale and reach of
humanity that they represent, but big because this is a key question that helps us focus if we are
concerned with social justice.
The question has been given much thought. The United Nations’ answer to this question is
contained in the Millennium Development Goals, a framework for addressing the most severe problems in
the world, signed by all U.N. member nations. This blueprint includes eight overarching goals to be
achieved by 2015:
1.
2.
3.
4.
5.
6.
7.
8.
Reducing child mortality
Improving maternal health
Combating HIV/AIDS, malaria, and other diseases
Eradicating extreme poverty and hunger
Achieving universal primary education
Ensuring environmental sustainability
Promoting gender equality and empowering women
Developing a global partnership for development
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Or, making the world Healthy (Goals 1–3), Wealthy (4), and Wise (5)—and Green (6).
The seventh goal in my list (which is a reordering of the U.N.’s list to show groupings of goals)—
promoting gender equality and empowering women—is central to successful development efforts around
the world, according to many experts. Women’s self-help groups, sometimes called solidarity groups, have
been key in industries such as microfinance. Women’s social bonds are a vital means of mutual support
and education, but the strength of these bonds also allows banks or other lending institutions to make
loans, with no collateral, to groups of women who become jointly responsible for their repayment.
Women are also more likely than men to pay attention to their children’s needs, even ahead of their own,
making them key links in programs aimed at keeping children in school, providing them with
vaccinations, and other activities requiring the cooperation of a parent. In these ways and more, support
for women often accompanies efforts to support health, education, and poverty alleviation.
The last goal in the list, developing a global development partnership, offers a means of achieving
the other goals.
The Millennium Development Goals define ambitions for the developing world, and though the
West does not face malaria (as we once did), we certainly have problems in the areas of health care and
wellness. Similarly, poverty may be different in the West than in India, but it remains powerful and
pervasive here. Likewise for educational challenges. And we all share the same planet, so major problems
such as climate change and global warming affect us all (even though the poorest are likely to bear the
brunt of the problem).
So let’s consider the refrain of the next part of the book to be “Healthy, Wealthy, and Wise—and
Green” as we look at how organizations other than ESW produce societal hybrids in each of these areas.
Naturally, we will be viewing only a few examples. Still, from the organizations that we observe, we will
once again see the importance of the same four principles:
•
•
•
•
Big Picture Design
Making It Stick
Making It Bigger
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CHAPTER SIX
Talk about social hybrids!
Ask people to list big, profit-hungry businesses, and you’ll likely hear the names of firms within the
pharmaceutical industry. Worldwide, we spend approximately two-thirds of $1 trillion on prescription
drugs every year, with the United States accounting for nearly half that amount. Watch television for a few
hours, and the commercials that bombard you will let you know what drug companies seem to say we
need most: drugs with attractive colors (especially if taken while dancing in a field of flowers) and drugs
that can enhance your, ahem, physiology.
Then along comes the Institute for OneWorld Health, the world’s first nonprofit pharmaceutical
company, focusing on neglected infectious and parasitic diseases that affect the poorest parts of the world.
OneWorld Health is redefining the pharmaceutical industry’s beliefs about how these conditions can be
addressed. By adopting Big Picture Design—very Big Picture Design—it has come up with various drug
“discovery” methods that can put tropical diseases primarily affecting the world’s poor within the sights of
the industry. OneWorld Health’s intention is to get badly needed medicine to large numbers of people
with serious illnesses who have never been able to afford it.
If you were looking to climb mountains, you’d be much better off going to Switzerland than Kansas: that’s
where mountains are. And, of course, climbers do flock to the Alps. So, if you are looking to fight diseases,
why not go where the most critical diseases are? Sadly, health care dollars rarely make it there.
Consider the Disability Adjusted Life Year, which measures the loss of productive life because of
premature death and disability to compute a measure of overall health burden. By this measure, 90
percent of the burden is in the developing world, yet only 10 percent of all health dollars are spent there.
In all, one-half of the people in the poorest regions of Africa and Asia have no access to essential
medicines.
New and affordable medicines are certainly called for to treat the diseases that afflict such regions. Yet in
the twenty-five-year period ending in 1999, less than 1 percent of the nearly 1,400 new drugs developed
were targeted at tropical diseases that wreak havoc on the lives of the poor.
Of course, the explanation for these lopsided statistics is that health care follows the money, rather than
disease. “Of course”—but only if pharmaceutical companies are consumed by the idea of making a big
profit.
But they don’t have to be. That’s what Victoria Hale concluded when she founded OneWorld Health.
Instead, it is possible for a pharmaceutical company to make improving health its dominant focus. By
Picturing the Design of the organization she wanted to build in this Enormous (not just Big) way, Hale
threw off the shackles that restrict the ways that ordinary pharmaceutical companies approach business.
Hale, with a PhD in pharmaceutical chemistry, and stints in industry and the Food and Drug
Administration’s Center for Drug Evaluation and Research, was intimately acquainted with conventional
drug development. She had worked in biotechnology and knew of its promise for drug discovery. She also
knew that the bill for modern drug development comes to $800 million per drug. And that only one in
100,000 drugs makes it to market, most proving to be ineffective in clinical trials. Even then, 70 percentof
the drugs that reach the market never recoup their investment.
It might be rational for pharmaceutical companies that are focused on making stockholders wealthy to
strive only to develop blockbuster drugs, whether they appeal to our vanity or address serious health
concerns such as diabetes or heart disease. Despite the cold, hard numbers, Hale still felt outraged that
almost no effort was being made to address the tragic illnesses associated with being desperately poor.
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But what could she do?
Big Picture Design
Hale founded the Institute for OneWorld Health to focus on furnishing affordable drugs to extremely poor
people suffering from infectious, parasitic, or tropical diseases. She designed OneWorld Health to be a
nonprofit so that it can operate with an entirely different set of business processes than a traditional drug
company. But rather than basing its efforts on a bankroll of hundreds of millions of dollars, OneWorld
Health relies on other resources: brains, partnerships, and the stuff in people’s attics.
Well, not their attics exactly. But just as old trombones, prom dresses, and vinyl LPs that you just know
you’re going to listen to again—someday—end up in the attic, drugs that don’t make it to market, go out of
patent, and make it only partway through clinical trials end up somewhere musty, too. For Hale,
discarded drugs can be attic treasures.
The first drug for which OneWorld Health obtained regulatory approval was an injectable antibiotic called
Paromomycin IM for the disease visceral leishmaniasis. VL or “black fever” is the second-most deadly
parasitic disease in the world and is fatal, killing 300,000 people a year. By the time OneWorld Health
came on the scene, the VL parasite had become resistant to the active element in the most common drug,
another treatment required inpatient hospitalization, and a third cost $100 per treatment. None of these
was an acceptable option.
OneWorld Health found Paromomycin in the attic of the World Health Organization. Was Paromomycin
untested, ineffective, or unsafe? Did it produce debilitating side effects? No, no, no, and no. The injectable
drug had been developed in the 1970s by Pharmacia, a drug company that merged with the drug giant
Pfizer in 2003. Paromomycin had proven to be an effective antibiotic but was shelved by Pharmacia when
more convenient oral antibiotics became available. The World Health Organization (WHO) obtained the
rights to the drug and began considering using it to treat VL, against which it was highly effective. The
WHO even conducted midstage clinical trials but then abandoned its effort to bring the drug to market for
budgetary reasons.
OneWorld Health obtained a joint license for the drug from WHO. Because much of the clinical effort
(and expense) had already been borne by WHO, the demands on OneWorld Health to get the drug to
market were greatly reduced.
OneWorld Health designed and conducted late-stage clinical trials of Paromomycin in Bihar, India, an
extremely poor region where 100 million people are at risk for VL. Clinical trials took four years, and in
August 2006, the injectable antibiotic received regulatory approval from the Indian government.
There is a vast warehouse of discarded drugs because of expired patents, their side effects, and, simply,
better alternatives. Although these discards are attractive to OneWorld Health, they present a nice
opportunity for pharmaceutical companies, too, who can license them to OneWorld Health and receive
tax deductions based on their future revenues.
But scouring others’ attics is not the only means OneWorld Health uses to find drugs that can treat
orphan diseases. Remember, OneWorld Health is a master at Big Picture Design, which includes using
any means possible to make societal advances. And OneWorld Health has two other key resources at its
disposal: brains and partnerships.
OneWorld Health is in the process of combining one of the world’s oldest approaches for treating malaria
with cutting-edge science and bioengineering. Malaria is a scourge of the developing world, especially in
sub-Saharan Africa but also in India, elsewhere in Asia, and in Latin America. Malaria is an infectious
disease transmitted by mosquitoes, which can cause severe illness or death if not treated. Children and
pregnant women are highly susceptible to the disease. Someone dies of malaria every thirty seconds.
54
Two thousand years ago, Chinese healers discovered the herb sweet wormwood could be used to treat
malaria. In the 1970s, Chinese scientists discovered the active ingredient in this herb: artemisinin. Lowcost, commonly used drugs to treat malaria have lost their effectiveness as the parasite that causes the
disease has mutated to gain resistance to these drugs. But artemisinin, in combination with other drugs, is
quite effective. What’s more, because the drugs are used in combination, drug resistance is less likely. But
artemisinin combination therapy is still too costly for most patients, although it costs only $2.20 to treat
one bout of malaria.
Artemisinin costs $900 per kilogram, contributing more to the cost of artemisinin combination therapy
than any other factor. Further, artemisinin grows only in certain locations, takes time to grow, and is
affected by the weather. It is also time-consuming to extract the proper chemical ingredients from the
plant. These factors affect its availability, reliability, and purity.
In 2004, OneWorld Health set out to produce artemisinin more reliably, with greater consistency, and at
a far lower cost by using synthetic biology. A partnership between OneWorld Health, the University of
California, and the drug company Amyris Biotechnologies successfully determined how to extract the
appropriate genes from the sweet wormwood plant and insert them into the bacteria E. coli. to cause a
chain reaction of chemical processes that produces artemisinic acid. This acid is then obtained from the
bacteria and converted into artemisinin using a novel chemical process. This process takes days compared
with months for artemisinin to be grown, harvested, and extracted from plants.
At present, the scientists working on the Artemisinin Project have shown that the synthetic biology
approach can work. What is still needed is further refinement to optimize the approach to ensure that it
can be employed on a commercial scale. They must also demonstrate that synthetic artemisinin is as
effective as artemisinin harvested from plants; if so, they can forgo clinical trials and can begin to use it in
the field.
In 2008, the pharmaceutical company Sanofi-aventis became a member of the Artemisinin Project. Its
chemical process expertise is fundamental to producing synthetic artemisinin in commercial quantities.
Hopes are that synthetic artemisinin will become widely available by 2012, eventually treating up to 200
million malaria patients a year (approximately 40 percent of demand), with a reduction in artemisinin
combination therapy costs possibly reaching 90 percent.
By scouring the attic to find a drug for VL as well as using state-of-the-art biology and chemistry to
develop a way to attack malaria, OneWorld Health clearly demonstrated its adherence to one of the main
principles of Big Picture Design: looking anywhere and everywhere for ideas that work and then stealing
shamelessly. But another tenet of Big Picture Design is ensuring that all aspects of a societally beneficial
business are taken into design consideration. Nothing should be left to pure chance. In this way, too,
OneWorld Health exhibited Big Picture Design. Although it is a pharmaceutical company, OneWorld
Health has no laboratories, nor does it have the capability to manufacture drugs or deliver them to where
they are needed. But just as collaborations were essential in the “discovery” of synthetic artemisinin,
partnerships are the force behind OneWorld Health making drugs and getting them to patients.
OneWorld Health partnered with the U.S. firm Odyssey Research to conduct its last-stage clinical trials
for the VL drug Paromomycin. And it partnered with Gland Pharma, a firm in Hyderabad, India, with
expertise in injectable drugs, to produce Paromomycin for the market. Gland agreed to make the drug at
cost, approximately ten dollars for a lifetime cure for this fatal disease.
A VL patient being treated with Paromomycin requires one injection a day for three weeks. That would be
a very tall order for someone in the United States who has a car and a health facility nearby. How do you
manage this in desperately poor places such as rural Bihar, India, where traveling to the nearest health
facility can be a long, arduous journey, often made on foot, and made worse by the fact that the people
who undertake it are so sick?
OneWorld Health partnered with the Indian organization Janani, a nonprofit that harnesses market
forces to bring reproductive health and family planning services to the rural poor in Bihar. Janani has
established a series of 620 franchised health clinics and 31,000 health shops in the region that are
55
connected to its central clinic, thereby creating a dense health-delivery network. In each of these for-profit
clinics and shops, Janani provides appropriate training and financial incentives for rural health providers
to deliver reproductive and family planning services and products and to make referrals to doctors for
more advanced clinical services.
OneWorld Health is piggybacking on this rural medical infrastructure to make sure that those needing
Paromomycin can get it. Rural health providers are being trained to diagnose VL and provide injections.
But, there is still the problem of compliance: patients need injections twenty-one days in a row for the
treatment to be effective. How do you make sure patients show up for their required treatments?
In the West, the informational aspects of this problem would not be too difficult. A database in a doctor’s
office or clinic could track patient compliance (or lack thereof), easily monitoring patients’ injections. But
a Janani health center may be run out of someone’s home or be part of a lean-to “store” where the chance
of using computerized medical record keeping is as unlikely as finding a four-star restaurant.
OneWorld Health approached another social hybrid, Voxiva, seeking help for its data-tracking needs.
Voxiva has a suite of technologies that can be used to track epidemics in real-time, even when there is
extremely limited access to information and communications technology infrastructure. In its support of
OneWorld Health, Voxiva established a system of text-message alerts to help monitor compliance. Rural
health centers send a text message to Voxiva every time a patient receives an injection, letting Voxiva
know the patient’s identity. Voxiva, in turn, records and compiles this information and sends textmessage alerts to centers, letting them know which of their patients are due for injections on a given day.
This allows the centers to contact any patients who fail to show up and follow up. In this way, centers can
deal with the informational complexities of treating many patients for VL, each of whom is at a different
point on the twenty-one-day treatment schedule. And, as important as it is for patients to receive all their
injections for treatment to be effective, ensuring this behavior and recording the results is also vital for the
last-stage clinical trials in the field to demonstrate the efficacy of the injectable antibiotic Paromomycin.
Clearly, OneWorld Health places a premium on Making It Appropriate. The essence of Making It
Appropriate is being certain that the right combination of factors—the right context—is in place. Looking
through inventories of discarded or out-of-patent drugs for those that might be used in the developing
world is, really, nothing more than trying to find another context in which they might be useful.
Even a drug’s side effects are a matter of context. Rogaine was introduced as a blood pressure medication.
But voilà, when scientists noted it produced a common side effect—hair growth—this became its main
effect when it was reintroduced as a product for baldness. Viagra was initially introduced as a heart
medicine. Medicine that is thrown in a Western drug company’s attic because it makes patients sleepy
may be perfectly acceptable in the context of treating a serious disease in the developing world.
Inappropriate often means too costly or inaccessible. As we have already seen, much of OneWorld
Health’s attention to design is aimed at preventing such possibilities. That is what its mission is all about.
Making It Stick
Even when you have thought expansively by using Big Picture Design and have tried to do all you can to
Make It Appropriate, there is still your acid-test, rubber-meets-the-road, moment of truth: Will your
product or service be accepted? In other words, will it stick?
OneWorld Health aimed to ensure it would, by many of the decisions it made. The selection of Bihar,
India, as the site for introducing Paromomycin could be justified on the grounds that visceral
leishmaniasis was rampant there. But just as important was that the vast number of Indians without
access to health care made it possible to more quickly recruit large numbers of subjects for clinical trials
and get regulatory approval.
the idea that getting regulatory approval from the Indian government, rather than another, might hasten
the process of getting the new antibiotic into wide-scale use. But gaining governmental approval and a
community’s acceptance are very different matters.
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Victoria Hale described the “Constant Gardener” factor in Bihar when OneWorld Health went there to
conduct its clinical trials. The phrase refers to the film The Constant Gardener, which depicts how an
unscrupulous drug company takes advantage of the poor people of Kibera (the Nairobi slum that, I hope
you recall, was the location for Enterprise for a Sustainable World’s work with SC Johnson on the Base of
the Pyramid Protocol). The people of Bihar were wary of OneWorld Health. Would they be exploited?
What did the company really want to accomplish in Bihar? By making its health-focused mission 100
percent clear and working continually to build trust, OneWorld Health was eventually able to get a
toehold in the region. This trust was an essential first step in Making It Stick.
The hub-and-spoke health delivery model of Janani was equally vital to create lasting success. (The
nonprofit Janani served as the “hub” that provided substantial business benefits for the thousands of
small for-profit clinics and health shops connected to it by “spokes.”) By partnering with Janani and
embedding its efforts in the Janani network, OneWorld Health created the means for Paromomycin to be
safely administered over the long course.
Even OneWorld Health’s financial decisions contributed to its efforts taking off. OneWorld Health chose
to pay the development costs associated with the first batches of Paromomycin in agreement for its
partner, Gland Pharma, producing and selling Paromomycin at cost.
Making It Bigger
Upon its founding, when OneWorld Health sought nonprofit status, the Internal Revenue Service resisted.
To the IRS, the equation
nonprofit + pharmaceutical company = new hybrid form
didn’t make sense. Today, the idea not only makes sense but its impact is spreading.
In 2007, the Paromomycin IM injection was put on the World Health Organization’s Model List of
Essential Medicines. Essential medicines are those that address the most important public health needs of
the population. The Model List is based on a drug’s quality, efficacy, and safety. The WHO declared that
Paromomycin was “most cost effective among all available alternatives,” thus adding it to its Model List.
By its inclusion on the Model List, Paromomycin is intended to be made available by health agencies in
regions where VL is prevalent and by agencies such as UNICEF that address health care needs worldwide.
OneWorld Health is Making It Bigger in other ways, too. Seeing what OneWorld Health has accomplished
has begun to make other institutions rethink their own roles as well. Hale has received more than a
hundred proposals from pharmaceutical companies and academics wanting to get involved, thus greatly
expanding OneWorld Health’s resource base of brains and partners.
New types of institutions are being contemplated to complement the kinds of efforts that OneWorld
Health makes. For instance, the Tropical Disease Initiative was established in an effort to create an “opensource” approach for drug development. Working collaboratively over the Internet and using
computational methods that are beginning to replace the “wet science” of the biological lab, volunteer
scientists address problems related to neglected tropical diseases, share data, and begin to suggest new
solutions. This kind of effort could become an attractive pipeline for OneWorld Health in its attempt to
select the best of these and bring them to market.
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CHAPTER SEVEN
Wealthy: Kickstart
Can a carpenter and an engineer lift Africa out of poverty?
Judging by the actions of Martin Fisher (who has a PhD in engineering) and Nick Moon (a former
carpenter), that question can be answered with a resounding yes. The organization they founded,
KickStart, helps design and implement business systems that allow rural Africans, for the first time ever,
to rise above subsistence levels of income.
Mechanical engineers design and carpenters build, so it would be natural to guess that KickStart’s focus is
on designing and building things that rural Africans could use. In fact, Fisher and Moon met each other
doing just that. Working at a nonprofit in Kenya for five years, they helped design wells, build dams, and
provide better farming equipment. The charity conducted workshops and training efforts to ensure that
local citizens could put the infrastructure to good use.
But it didn’t work.
The pair discovered that technology, even when effectively used, is not enough. It has the potential to
transform lives, but only as a building block in a much more encompassing approach—one that requires
Big Picture Design.
In 1991, Fisher and Moon founded KickStart. It operates on a deceptively simple premise: poor people
need more money. Simple, because of course poor people need more money. Deceptive, because there are
many wrongheaded ways to try to make the poor wealthier.
Giving money directly would seem to have its merits, and certainly there are cases in which financial
contributions have been quite successful. But the history of foreign aid, especially to Africa, shows that it
has not lived up to its promise at all. Regions that are continually at war, that fill their coffers by selling
their natural resources, that are ruled by greedy despots, or that are closed off from world markets
because they are entirely landlocked—regions like these have problems that development aid, all alone,
cannot address.
Educating schoolchildren would seem to be another no-brainer in combating poverty. And, in fact, much
data support the relationship between a country’s average level of educational attainment and its wealth.
But improving education is something that occurs over the long term. Unfortunately, it is not an
immediate remedy for families struggling to find a meal tomorrow. Plus, providing improved education at
a grand level is exceptionally challenging in its own right.
What about improving a region’s infrastructure? Once again, there is some merit here but not enough. For
example, roads allow the rural poor to migrate to larger cities where there may be better opportunities.
This provides an escape route for rural Chinese peasants, for example. But their exodus only improves the
rural communities they came from because of the money they remit from better jobs they find in urban
factories. The opportunities for relatively well-paying employment in cities, however, are not nearly as
available for rural Africans. Plus remittances, though they provide a source of income to those left behind,
do nothing to directly improve their capabilities and opportunities.
Maybe, then, making improvements in more local infrastructure could be the key to rural wealth: a
community well, or tools for creating dwellings or other buildings, or machinery to make farming more
productive. This is what Fisher and Moon were doing before they started KickStart. And it wasn’t working.
Why?
Because no matter how valuable these improvements were, they were still simply physical technologies. In
their design and manufacture, a critical element had been overlooked: they didn’t create opportunities for
people to make money.
58
A dam or well might have been part of a system for providing water to a village, but because it belonged to
the community, it effectively belonged to no one. People don’t wash rental cars, and rural African farmers
wouldn’t maintain and repair a community-owned dam or well. It wasn’t “theirs.” And so the dam or well
would fall into disrepair and eventually fail, no matter the value it provided.
Fisher and Moon took these lessons to heart. If the problem was that poor people needed more money,
KickStart’s solution would be a market-based approach to development. In short, it would create
technologies that entrepreneurs could use to make money.
Big Picture Design
Now, when they go to the drawing board, Fisher and Moon realize that they have to design much more
than great technologies. They have to design business-delivery systems in which everyone makes money.
And everything has to be taken into account.
KickStart’s design work begins by identifying profitable business opportunities for others—the rural
entrepreneurs who can make money from running small-scale businesses. KickStart personnel then
design the technology that these entrepreneurs will need to make a go of their business, plus the
technology and manufacturing processes necessary to produce the technology for the entrepreneurs.
KickStart also designs the processes it thinks best for obtaining the raw materials it uses to manufacture
its new technology, and for distributing these items to its customers. Often these methods create new
business opportunities for local citizens at various points along the chain of supply and distribution.
But KickStart’s design work does not stop there. Even with superior products and effective ways to
manufacture and deliver them, KickStart faces a major challenge: its customers-to-be don’t understand its
technologies, because they may have never seen anything similar; they don’t perceive the opportunity to
make money from using them; and even if they do, they don’t think they can afford them. So the most
critical design work that KickStart performs is market development, which addresses each of these key
issues.
The technology for which KickStart is best known may well be its micro-irrigation MoneyMaker pumps.
Most rural Kenyan farmers live on farms not much bigger than a backyard in a suburban U.S. town. These
farms are barely adequate for families to eke out a meager living.
But KickStart’s pumps have helped turn these farms into small businesses. Using a MoneyMaker, a farmer
can obtain water from a stream or pond or obtain groundwater from beneath the surface (without
drawing down the valuable water table) and pump it onto his farm. The reliability of a water source other
than rainwater combined with the efficiency of the pump greatly improves the farm’s productivity.
Farmers can now grow crops year-round, feeding their own families and selling the bulk of their crop to
others. With irrigation, farmers can take advantage of market forces by growing water-hungry but highvalue produce, as well as by bringing their crops to market in the off-season, when they fetch the highest
prices. KickStart estimates that farmers can increase their earnings tenfold.
KickStart has designed other technologies (but please remember, its work is much more than making
physical devices), including oilseed presses to produce cooking oil, low-cost construction technologies for
producing construction building blocks and roofing tiles, and manufacturing technologies to make latrine
caps to improve public health and sanitation.
In addition to its all-encompassing approach to design, KickStart follows the principle of Big Picture
Design in other ways: looking widely for appropriate technologies, modifying them as necessary, and
coming up with brand new ideas when necessary. (Remember: steal shamelessly when you can, invent a
new approach when you must.) The MoneyMaker pump is a case in point, illustrating how each of these
efforts can lead to a suitable design.
The MoneyMaker was inspired by an American design that had been used for micro-irrigation in
Bangladesh for ten years. The farmer operates the pump by standing on two treadles. If you are crafts-y,
59
you may be familiar with treadle-powered weaving looms. If you’re into fitness, think of what you do on a
StairMaster.
Fisher and Moon modified this design to make it better suited for Kenya. The original Bangladeshi pump
was “suction only,” drawing water from the ground and emptying it into an irrigation channel. The much
hillier Kenyan landscape demanded a pumping technology so that water could be sprayed uphill. Thus
was born the Super-MoneyMaker, a pump that could pressurize and then spray water to heights of up to
fifty feet. This more powerful pump allowed farmers to irrigate a wider area more quickly.
But just as some people with aching knees find a StairMaster too taxing, a number of Kenyan farmers
couldn’t operate the MoneyMaker treadles easily enough. So KickStart designed a new technology, a hip
pump. This model allows a farmer to swing her hips and throw more of her torso into the pumping action
(many farmers are women), making the pump easier to use.
Of course, these variations in design reflect another of the principles we saw with Enterprise for a
Sustainable Design: Making It Appropriate.
Though the pumps were expensive for poor rural farmers, costing between $35 and $100, depending on
the model, they were still within reach of many. And because they were human-powered, there was no
need to pay for gas or electricity to drive them. Their expected payback of three to four months made them
that much more financially attractive.
Still, because a pump would likely be the most expensive possession a farmer had ever owned, it had to be
strong and durable to ensure that those who purchased it got value from it over time. Because the pumps
weren’t being sold by Home Depot or any kind of store remotely able to offer delivery, they had to be light
and portable, too, and small enough to be easily stored.
The technology was also built to be ergonomic, with both treadle- and hip-powered models designed to
use larger muscles so that the pump could be operated without injury and for long periods of time.
Thought was also given to making the pumps culturally appropriate. Because more than half the pumps
would be operated by women entrepreneurs, treadles were designed as low to the ground as possible so
that any provocative, rocking hip motion was not on display.
Making It Stick
Imagine someone trying to sell you an item you’ve never heard of before and don’t even understand, with
the promise that it will make your life immeasurably better. It is, however, exorbitantly expensive. You
have little money, and you’re extremely reluctant to risk what you have. What is more, when you research
this product, you can’t find any information about it. And even if you decide you want it, you have to
travel many hours to obtain it. Would you buy it?
This is more or less the situation KickStart faced when it began to sell its MoneyMaker line of pumps.
The very first hurdle in making the MoneyMaker stick was generating some initial sales. KickStart
discovered that traveling demonstrations were vital to introducing the product. Seeing water sprayed from
a pump may look like magic, but it is magic that sells: farmers can start to comprehend the advantages of
this technology when they see it being used. When they try it themselves (would you buy an expensive
new car without giving it a test drive?), they inch closer to a purchase. Making these demonstrations into
festive events, even contests, enhances the pumps’ allure.
The Masai musician Mr. Ebbo even wrote and performed a rap video for KickStart titled “Don’t Wait for
the Rain” that extols the virtues of MoneyMakers. Because KickStart already uses pickup trucks to
import entertainment (demos, “pump-off” competitions, and actors who playfully promote products), the
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same rolling technology—a truck, outfitted with video projection capability—can allow Mr. Ebbo’s work to
reach villagers who already enjoy rap music (really). You can see the video, with English subtitles, on
YouTube. Lyrics include:
Stop complaining about rain shortages every day.
Nowadays the rains are no longer reliable.
Why wait for the rain when your crops are drying up?
(Refrain):
Don’t wait for the rain.
There’s a pump called MoneyMaker.
It’s the best tool to end poverty.
It’s such a good pump that others try to copy it.
So take care when you buy one.
Make sure it has a serial number and
It comes with a one-year guarantee.
(I imagine it’s catchier in Swahili.)
KickStart also used other mechanisms to help smooth the risk of making such a major purchase. First,
unlike an I-gotta-have-it iPhone or iPod, for instance, which cost a small fortune when they were
introduced, the first MoneyMakers sold were no more expensive than the ones sold later. Second, pumps
come with a one-year, money-back guarantee.
KickStart makes its products stick in another way, too, by embedding its business model firmly in the
community. Not only do customers feel more comfortable buying from those they know, but KickStart
wants to be sure that it can leave behind the right business infrastructure to sell its technology when it
leaves a community.
KickStart is a nonprofit organization at the center of a web of for-profit activity, which it orchestrates. It
designs the MoneyMakers and the tooling to produce them for mass production. Ordinarily, it provides
this tooling to the best local factories, whose employees it then trains and supervises to make the pumps.
KickStart initiates the distribution of pumps to consumers by buying the pumps from the factory, acting
as a wholesaler, and then placing them in small retail shops. In other instances, it uses existing
wholesalers. KickStart carefully chooses and develops the shops that are part of this supply chain.
A built-in aspect of this supply chain model is that everyone must make money on every sale, including
KickStart. Small retail shops make a 20 percent profit on every pump they sell to farmers. KickStart (and
wholesalers) have a similar profit margin on their sales to retailers. Factories have a 20 percent profit
margin on every item they produce and sell for wholesale. For its part, KickStart uses part of its profit to
help retailers finance the pumps they need to buy for their inventory.
The system rests on the principle that poor people need money, including the retailers and even
wholesalers operating out of tiny “stores.” And, in this system, everyone makes money. Everyone values
the opportunity. In these ways, the web of activity in distributing pumps was designed and successfully
implemented to “Make It Stick.”
Making It Bigger
KickStart’s goal is to leave behind a profit-creating manufacturing and distribution infrastructure that
provides technology to help lift vast numbers of rural farmers out of poverty. Its criteria for deciding what
technologies to design and manufacture are that its goods appeal to thousands of rural farmers, that they
be used locally, and that they cost at most a few hundred dollars with a three- to six-month payback. As a
result, KickStart expects rapid market acceptance leading to wide-scale adoption.
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To compensate for otherwise irregular inputs to production, KickStart developed manufacturing
processes to ensure products were high quality, easy to assemble, durable, and easily maintained (pumps
use no bolts, nuts, or other items that could rust and compromise the product’s integrity). It uses mass
production in the best medium to large local factories to produce the quantities needed to hold down costs
so that as many people can purchase and benefit from the pumps as possible. It is also exploring the
benefits of manufacturing products more cheaply in China, and already does some manufacturing for
export within Africa.
As we have already seen, KickStart added a more powerful pressurized pump and a less powerful, but less
expensive, hip pump to its product line. Both of these variations were made in an effort to spread
technology to a wider customer base with different needs and desires.
But probably the most important aspect of KickStart Making It Bigger is creating momentum for
purchases, even at the outset. KickStart uses its nonprofit status to attract donor funds, which it uses to
subsidize its own expenses in developing products. It then sells these products for affordable prices, even
when they are not selling at volume when they are first introduced. (KickStart determines the selling price
of items.) KickStart knows that after the market overcomes its initial hesitation, it will ultimately “tip” in
favor of wide-scale acceptance and consumption, at which point subsidies will no longer be needed,
KickStart having done the job it intended to do.
What KickStart most wants to “make bigger” is the impact it is having on people’s lives, something that it
monitors continually. Its efforts at making, selling, and developing a supply chain for its micro-irrigation
pumps have produced impressive results:
•
•
•
•
more than 150,000 pumps sold, most supporting profitable new businesses
more than 95,000 new enterprises created, including more than 400 retailers who sell pumps and
related supplies
nearly half a million people moved out of poverty
almost $100 million in annual new profits and wages
In all, KickStart proves that being a social hybrid can produce robust results. This nonprofit organization
cultivates and deeply depends on relationships with for-profit firms for its success. Its fundamental
philosophy rests on creating healthy local markets, but it also acknowledges market failures and uses
subsidies to overcome them. It works in undeveloped, low-tech environments where it combines local
labor and resources with advanced design and manufacturing capabilities. It stresses the importance of
generating income for locals in rural Africa, but it is willing to do manufacturing in China, where costs
may be lower.
How can all these apparent contradictions result in anything coherent, let alone produce success? That is
the strength of hybrids. And KickStart’s results speak for themselves.
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CHAPTER EIGHT
What would you do if you were an ineffective teacher of inner-city kids, students much like the teenagers
who had recently mugged you for just a few dollars?
If you were Steve Mariotti, you’d soon be giving them money to create small businesses and turn their
lives around.
We live in a knowledge economy, in which it’s more and more necessary to get education beyond high
school just to have a shot at a decent job. Despite that, too many students are not even making it through
high school. In 2008, the state of California released figures saying that one in three students in the Los
Angeles public school system never completed high school. For blacks, the figure was 42 percent. High
school graduation rates were increasing by 9 percent, dropout rates by more than 80 percent.
The situation was much the same in 1981 when Steve Mariotti began to teach at New York’s Boys and
Girls High School, an inner-city school populated by low-income, at-risk students. Mariotti entered
teaching and asked for such a tough assignment in an effort to overcome the fears he had developed after
being mugged. He had previously been in business at Ford Motor Company and, after that, had operated
his own import-export business.
Mariotti’s educational debut was far from auspicious. He was teaching nearly sixty students, twenty of
whom lacked chairs and textbooks. He was on the students’ turf, which they felt gave them the right to bar
him from his classroom, disregard what he was teaching when they did let him in, and carry on rituals like
setting each other’s clothes on fire.
They were bored out of their minds. Mariotti had not earned their respect, and they felt he had nothing to
teach them. Who needs to know math and English? To those students, what Mariotti was offering wasn’t
relevant.
This all changed when he began to teach these same students about starting their own businesses.
Suddenly, reading was a window revealing opportunity, and grammar and punctuation became useful
when students had to write a business plan. Financial return-on-investment? A key business concept that
they wouldn’t understand without math and percentages.
Suddenly, what Mariotti was teaching had mass appeal—even to students given an ultimatum to take
Mariotti’s course on entrepreneurship or be kicked out of school. Take it—and succeed—they did.
In 1987, Mariotti used his experience teaching business concepts to inner-city students to help found the
nonprofit National Foundation for Teaching Entrepreneurship (NFTE; pronounced “nifty.” The
organization has retained its initials but recently became known as the Network For Teaching
Entrepreneurship). Its mission: to promote entrepreneurial literacy to highly at-risk and
disadvantaged youth in inner cities to help them start their own businesses.
Big Picture Design
But NFTE was actually something more. To achieve entrepreneurial literacy, a student had to excel at
bedrock academic skills. Motivating students to acquire those skills required entrepreneurial literacy. The
situation was similar to M. C. Escher’s famous 1948 lithograph Drawing Hands, depicting a right hand
sketching a left hand, which is sketching the very same right hand. It is impossible to tell which comes
first or has priority.
Mariotti stole shamelessly from his knowledge and experience in business and as an entrepreneur, using
these “right-hand” ideas to draw a foundation for what he was teaching. This was a highly innovative way
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to motivate students, especially students whom the system might otherwise have labeled hopeless,
remedial, or just too much trouble to teach.
But the “left hand” of traditional education was drawing, too. Whereas entrepreneurship is typically a
course taught in business schools to college students, Mariotti had to present business concepts in a
powerful, accurate, and applicable way using high school students’ more limited academic repertoire.
Traditional educators wouldn’t recognize his approach to instruction because of the way it was founded on
teaching business. Business educators wouldn’t recognize it either, because it was also teaching reading,
math, and other high school subjects. Mariotti borrowed liberally from each side to enhance the other. In
this way, he was practicing double Big Picture Design.
When Mariotti was teaching entrepreneurship in high school, he held all the cards. He knew about
business, he had educational objectives he wanted to achieve, and he was at the front of the classroom
making it all work. In founding NFTE, however, he knew he could have an impact beyond his students.
This required design of a larger system.
Education, like any other industry, has a “value chain” turning inputs into outputs. Among the most
important inputs for NFTE was a curriculum. Mariotti took great care to design this, making sure all the
topics he wanted to cover in both business and academics were included and that they built upon each
other in an appropriate sequence.
In the beginning, NFTE custom designed curricula, for instance creating one variation on the curriculum
for an inmate program at Rikers Island jail and a slightly different curriculum to support other
institutions. Eventually, however, to offer the NFTE program as widely as possible, such custom offerings
were eliminated in favor of a few standard curriculum designs. These can be used within a school or as
part of an extracurricular program; they can occupy a single semester or last an entire year; and they can
be used with children as young as middle-school age, through high school, or even beyond.
The educational value chain also depended on teachers being able to effectively deliver the curriculum. It
was one thing for a teacher to know how to teach math, reading, or writing, and another altogether to
understand business in enough detail to turn out real student-entrepreneurs after they had completed the
program. To bridge the gap, NFTE designed intensive training programs. Today, training is offered as part
of NFTE-University, which offers a four-day entrepreneurship training program in partnership with
leading universities in the United States and Europe.
The National Foundation for Teaching Entrepreneurship makes education sneaky by confronting students
who might not “want” to learn math or better English skills with situations in which they must learn them
if they want to succeed. And they do want to succeed.
Still, learning in the classroom goes only so far, especially for students trying to learn to be successful in
business when they have no role models or other relevant experiences to lean on. This is where hands-on
learning becomes so effective.
For instance, a topic that NFTE stresses early is “Opportunity Recognition.” The trading game, which
Mariotti first used in high school, furnishes students with inexpensive items from a Dollar Store. Students
attempt to buy and sell, haggling over price, learning the critical difference between having an item for
sale and having an item that is attractive in the marketplace. The game naturally leads to a conversation
about business ideas that might fly where students live and how to make those genuine, attractive
opportunities. It also allows students to understand what they see when they take a field trip to a
wholesale district where the same “game” is being played—but for keeps.
Nothing drives home the idea of entrepreneurship like making money. But after his students had come up
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with a business idea, written a business plan, filled out forms, and registered their business, what more
could Mariotti do? He staked them working capital to get their businesses off the ground.
Making It Stick
NFTE is changing lives. It has been studied by researchers at Harvard University, Brandeis University,
and the David H. Koch Foundation. Students in New York City, Boston, Washington, D.C., and California
have been evaluated.
And the results? When NFTE students began their training, they were less likely than a comparison group
(selected to have stronger academic interest) to want to go to college. By the end of their NFTE
experience, the percentage of NFTE students expressing a desire to go to college had doubled, pulling
them ahead of the comparison group. In fact, 70 percent of nearly one thousand NFTE alums in one study
had gone on to college or other postsecondary programs. Students also developed stronger habits of
independent reading, again overtaking the others.
Similarly, their NFTE experience began to change students’ aspirations. As a result of their involvement,
the NFTE group strived to obtain jobs requiring significantly more education than when they began the
program. They were aiming higher.
NFTE students grew emotionally, too. They began to believe that control of their lives lay within
themselves—something quite different from wondering if you will make it to your twentieth birthday and
believing that any success you might have is caused by luck or other circumstances outside your control.
In the same way, NFTE students showed more initiative and more often took on responsibilities
demonstrating their leadership.
And what about the long-term effects after the program was over? A study followed 250 young adults in
New York City who had participated in NFTE. Three-fourths of them saw entrepreneurship as a realistic
way out of poverty, and more than one-third had started businesses of their own. Nearly everyone in the
group felt that NFTE had prepared them for business.
In a fascinating book called Gang Leader for a Day, Sudhir Venkatesh, then a student, describes how he
became accepted by a gang and its leader in Chicago’s South Side. Over a period of nearly a decade, he
documented the economic customs and behavior of dozens of people in that inner-city community in
considerable detail. Most worked by “hustling.” This does not necessarily mean doing anything criminal,
though there was certainly some of that, but things like fixing a car on a rundown street in exchange for
some broken appliances that they might later resell—and paying “rent” to the local gang for that privilege.
This economic network of off-the-books activity reached everywhere within the large neighborhood that
Venkatesh observed and involved grandmothers, unwed moms, clergy, and social service providers.
Everyone. Though many felt stress associated with what they were doing—hustling means uncertain
income, danger if you encroach on someone else’s business “turf,” and being subject to the whims of local
gang leaders—they also felt like there was little recourse. The situation in Chicago gives a pretty good idea
of what life is like in other tough, urban settings.
All of which makes it more amazing that NFTE students and graduates could start legitimate businesses
and pay themselves a salary each month.
Making It Bigger
Mariotti knew from the beginning that NFTE was a diamond, a gem with great value. But NFTE was also a
sword, sharp and hard enough to cut through the limiting beliefs in people’s heads and the obstacles in
their path. The world needs more swords like this one.
To reach more students, Mariotti had transplanted the teaching of entrepreneurship from the school
where he had been teaching to NFTE. To reach even more students, he needed to entrust his diamond to
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others.
When NFTE began, it taught entrepreneurship only in the New York City area. In the 1990s, it began
offering programs outside New York through branch offices that it operates. Today it has eleven offices
scattered around metropolitan areas throughout the United States. But to fuel its growth even more,
NFTE began licensing its programs to a group of select partners.
The National Foundation for Teaching Entrepreneurship has six partners in the United States and ten
more overseas. Partners include school systems, well-established nonprofit organizations, and
government agencies. Partners make commitments to:
•
•
•
•
•
Find at least five low-income schools in their area that agree to incorporate NFTE into their
teaching
Fund and staff the effort for at least two years
Offer programs that effectively deliver NFTE content and provide a “NFTE experience”
Work with students from low-income communities
Use entrepreneurship as a means to promote education
E CITY is a typical NFTE partner. It is a Cleveland-based nonprofit dedicated to “empower[ing] urban
youth to be responsible for their own economic future . . . by teaching and modeling entrepreneurship and
life skills.” E CITY has taught the NFTE curriculum in more than twenty-five middle and high schools, in
most more than once. The students participating in the program are nominated by their schools.
Programs may be offered during school hours or after school, last two to four months, and are paid for by
the schools. E CITY is reaching out to other schools and community-based organizations to provide
opportunities to other students.
NFTE helps its partners plan and launch their programs. Of course, NFTE shares its diamonds with its
partners by providing its award-winning curriculum, training teachers in NFTE-University, and
supporting them afterward.
To date, NFTE has taught nearly 280,000 students. It has certified more than 3,500 teachers capable of
delivering its programs, more than 1,000 of whom are now doing so. These men and women promise to
expand NFTE’s reach in the future even more.
But Mariotti and NFTE understand that there are ripple effects beyond what takes place in a NFTE
classroom. Every student who completes the curriculum has made an emphatic, affirmative statement.
She has mastered rigorous material. His experience may lead to a college education, providing a path out
of poverty. Or she may start a business and hire others. But more than that, NFTE graduates are someone
to look up to—by their brothers and sisters, their aunts and uncles, their friends, and even their enemies.
“If they can do it, if they can wield the sword to slash through mental barriers and cut down physical
obstacles,” they may ask, “why can’t I?”
Higher AIMS Around the World
Often, when the time is right, a powerful idea suddenly “shows up” somewhere as if by some mysterious
force. Although it has no formal link to NFTE, the African Institute for Mathematical Sciences (AIMS)
illustrates this concept.
Like inner-city children in the United States whose educational opportunities often appear limited, even
the most talented African students often find it difficult to receive advanced education for lack of money,
lack of opportunities, and other deficiencies. This handicaps the distressed continent’s efforts in
addressing poverty, managing its land and water, and providing affordable, clean energy.
Then along came University of Cambridge scientist Neil Turok, who founded AIMS—the African Institute
for Mathematical Sciences—a graduate-level program for students who otherwise never would have
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received a graduate education. Focusing on math, science, and computer modeling, the program aims to
develop a cadre of highly trained scientists capable of addressing Africa’s critical needs as well as making
fundamental contributions to research on par with scientists anywhere in the world.
As Turok explains, the pent-up intellectual energy among Africans that, when it is released, the next
Einstein can—and should—come from Africa. As a Rwandan student in AIMS said, “Poverty is the only
challenge we face in becoming African Einsteins. Otherwise we have everything else needed to become
so.”
Such a proclamation would make Steve Mariotti proud.
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CHAPTER NINE
Green: Home Depot, Ikea,
& The Forest Stewardship Council
Is it possible that the chair you’re sitting on could save the planet? Maybe, maybe not.
As nearly everyone acknowledges, the physical health of the earth is threatened. Industrial processes and
other activities associated with our furious lifestyle pour pollutants into the air, fouling our skies and
water and dangerously raising the temperature of the planet. If we don’t act quickly to turn things around,
we could be cooked (or at least lightly sautéed).
Yet part of what we need to keep the world healthy and green is here already. And it’s already healthy and
green—and huge: our forests. As pretty and restful as they appear, our forests are hard at work. The trees,
undergrowth, and soil in a forest ecosystem absorb carbon dioxide, the main greenhouse gas contributing
to global warming. They contribute to the recycling of nutrients and help maintain our water quality. Rain
forests are especially important, growing plants that inspire some of our most potent medicines. These
essential services are valued in the trillions (with a t) of dollars. In addition, forests provide homes to
indigenous communities living in nature, largely undisturbed by modern society. Ninety percent of the
very poorest people in the world depend on forests for their survival.
But forests are under siege. There are fourteen million hectares of forests being cut down every year—the
same area as the state of New York, and more than twice the landmass of Greece. In the last half century,
there has been more damage to the forest ecosystem than during the rest of human history. As countries
develop, they demand more natural resources, including wood. Brazil, China, and Indonesia satisfy their
strong appetites for forest products by endangering rare habitats. (The United States, Canada, and Russia
are major producers of wood, but they generally log in less environmentally sensitive areas.) Illegal
logging and unsustainable forestry practices are responsible for approximately 25 percent of the world’s
greenhouse gases. In the next fifty years, the world’s population will increase by 50 percent, yet there will
be no new forests.
Now ask yourself: Which organizations want to ensure that our forests are well protected? Certainly proenvironment groups with interests rooted in Mother Earth and the health of the planet, but also large
companies banking on healthy forests for their future profitability. In what follows, we’ll look at three
organizations that are linked by a network of interactions directed at promoting sustainable forests. Two,
Home Depot and IKEA, are for-profit companies attempting to increase the supply and demand of
sustainably harvested wood. The third, the nonprofit Forest Stewardship Council, plays an important role
in guaranteeing that the word sustainable does not become a vacuous green-marketing buzzword.
Separately, each organization exhibits traits of a societal hybrid. Home Depot and IKEA take measures
that you might think were devised by environmentalists. The Forest Stewardship Council works through
for-profits to enact its nonprofit agenda of protecting our forests. We can also envision these three
organizations as a network organization—one where an overall aim (protecting our forests) is undertaken
by a group of organizations with different roles and responsibilities. Even in concert, the three cannot
guarantee that our forests are sustainable: forest management is complex in ways environmental,
financial, and emotional. But, as a group, the three organizations can be viewed as a kind of
interdependent, “networked” social hybrid: a trio, with both overlapping and differing ambitions, whose
work together exceeds what any of them could do alone.
FOREST STEWARDSHIP COUNCIL
So how might a chair help save the world?
You’ve probably noticed that today everything seems to carry a label. My shirt says, “Boyne City.” My
coffee says, “Fair Trade.” A bumper sticker on my car reads, “No, my daughter can’t stay out past
midnight.” (Actually not, and she would disown me if it did. But you get the idea.)
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So why not a label on your chair saying that on its journey from tree to furniture it was treated in the most
forest-friendly way possible. That is what the Forest Stewardship Council (FSC) has been trying to do
since 1993. Formed by advocates for the environment, local communities affected by logging, and the
logging industry, FSC has issued principles for sustainable forestry and standards that define and regulate
behavior.
The Forest Stewardship Council hopes to rein in unregulated logging that converts forests to pastures,
farmland, or urban use, or simply badly degrades it without converting it to other uses at all. Such
deforestation decreases biodiversity, disrupts local economies, and hastens climate change. Instead, FSC
hopes to promote responsible, sustainable forestry practices based on the basic notion a five-year-old
child could understand: if you want cookies for dinner, don’t eat them all at lunch unless you know your
mom is bringing home more. In forestry terms: remove trees only at the rate at which the forest can
restore them, and no compromising the soil, watershed, or seed sources for future generations or other
organisms.
Maybe Dave Mason, one of my favorite musicians, said it best:
Shouldn’t have took more than you gave
Then we wouldn’t be in this mess today
I know we’ve all got different ways
But the dues we’ve got to pay are still the same
The Forest Stewardship Council has developed 10 Principles (spelled out in more detail in 57 Criteria)
covering all aspects of well-managed forests around the world. These cover the ecological integrity of a
forest and written plans for managing it, as well as the legal use of the forest; the well-being of indigenous
people, forest workers, and local communities dependent on the forest; the economic viability of
harvesting a forest; and monitoring all aspects of the forest’s use and management.
The Forest Stewardship Council provides three levels of certification. First, forest managers can pass
voluntary inspections to demonstrate they are following FSC principles and criteria of forest management.
Second, FSC’s “chain of custody” is important for companies that sell lumber or finished wood products to
consumers. Chain of custody certification indicates that the item you are looking at has FSC’s highestlevel seal of approval, meaning that it originated in an FSC-certified forest and has been tracked and well
managed in ways that FSC approves of right up to the moment that you are looking at it. Finally, FSC
Controlled Wood certification indicates wood that falls short of full certification but is still acceptable in
“mixed source” uses. All certification is conducted by independent certification bodies.
An international non-governmental organization with offices in forty-five countries, FSC is widely
accepted as the most credible certification agency. Taking into account the sometimes conflicting views of
environmentalists, human rights activists, the timber industry, and the forestry profession, FSC’s
principles and standards are viewed by many as the most stringent, too. (They certainly don’t face the
same charges of doublespeak as the timber industry’s own certification program, the Sustainable Forestry
Initiative.)
The Forest Stewardship Council’s efforts are certainly a step, but a step toward what? All FSC can do is
issue its seal, the squiggly outline of a tree whose foliage creates a checkmark. (Disclosure: before I knew
what it was, I had looked at FSC documents and web pages for hours and hours, noticing this “logo”
everywhere, thinking it was only a funky picture of a tree.) How does its seal save a forest?
The Forest Stewardship Council provides certification in an effort to change the market for forest
products. It believes that if people want to buy sustainably harvested wood products, timber companies
will take notice and that large enough demand for these products will persuade these companies to follow
sustainable forestry practices. It is unlikely we would see the same effects from environmentalists
chaining themselves to trees or local, indigenous communities protesting the destruction of their living
places.
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HOME DEPOT
Home Depot is the largest home-improvement retail chain in the United States and second-largest retailer
overall (yes, Wal-Mart), operating more than 2,150 big-box stores. Home Depot enjoys a reputation for
being forest-friendly green. But as recently as the late 1990s, environmental groups including Greenpeace
and the Rainforest Action Network protested its use of wood from tropical rain forests, even mockingly
offering free “rain forest tours” through Home Depot stores.
By 1999, Home Depot had changed its wood-purchasing policy to align with FSC standards. It pledged to
“give preference to wood … from forests managed in a responsible way and to eliminate wood purchases
from endangered regions of the world by 2002.” It now also promises to promote more efficient and
responsible use of wood and wood products, including alternatives when available. And it expects its
suppliers and their suppliers—all parties along Home Depot’s chain of custody—to act legally and
responsibly, too. Home Depot now sells the most FSC-certified wood in America and has influenced more
suppliers to become FSC-compliant than any other retailer.
Home Depot’s stance in favor of sustainable forestry practices is having some impact. In Chile, Home
Depot was instrumental in getting the country’s two largest wood producers (and two of the world’s
largest) to change their practices to protect Chile’s native forests. In Indonesia, Home Depot discovered
that its main supplier was razing huge swaths of rain forests and stopped doing business with that
supplier, who had been supplying 90 percent of the wood Home Depot received from that country. It
acted similarly in Gabon, Africa, against a supplier whose forestry practices were destroying the habitat of
endangered lowland gorillas. (Neither of the latter two suppliers has agreed to alter its behavior to win
back contracts with Home Depot—but they still may.)
But Home Depot is waging the war on a potentially bigger front, too: with consumers. Home Depot has
created its Eco Options program to showcase energy efficiency and environmental sustainability. As the
name suggests, Eco Options gives consumers a choice as they scan the aisles: regular light bulbs or more
efficient compact fluorescents; ordinary thermostats or those you can program for energy savings;
uncertified wood (products) or those bearing the FSC “Tree Checkmark.”
Home Depot’s staff helps educate consumers about these options. Yes, a compact fluorescent might be
more expensive, but not when you consider the reduced energy it draws and the longer life of the bulb.
The appeal of FSC-certified wood products is different, though. The products don’t last longer, and they
don’t save you money. There is a whiff of fair trade about them, in which consumers pay a bit more for a
more societally responsible product. In contrast to fair trade coffee, though, which tries to shift economic
power to small, poor coffee producers, many FSC-certified forests are owned by large private companies
and logged by large timber companies.
In fact, customers seem to be willing to pay for FSC products. And builders are eager to use more FSCcertified lumber, especially because wood products usually account for no more than 5 percent of
construction costs. Even when there is a premium for FSC wood products, it can be minimal, adding just a
percent or two to a product’s price.
But Home Depot cannot obtain all the FSC-certified wood it desires, even though it has a strong
preference for FSC products. There just isn’t enough on the market. All told, less than 10 percent of the
world’s largest lumber retailer’s wood purchases are FSC certified, despite its hunger for more.
IKEA
IKEA: the Swedish company that makes you say, “This stuff is really cool and affordable, but who writes
those @&%+!! instructions for putting things together?”
Still, maybe someday you’ll puff, “This chair I’m sitting on from IKEA . . . it’s helping me save the planet.”
(Finally, the world-saving chair!)
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One of the world’s largest home furnishings retailers, IKEA, like Home Depot, has some clout in the world
of forestry. But it uses its clout in a very different way. Whereas Home Depot makes its FSC appeal to
consumers, trying to create stronger demand that will “pull” more certified wood through the supply
chain, IKEA seeks change mainly by acting through its suppliers.
IKEA’s agreement with its suppliers is simple: “IWAY or the highway” (“or the highway”: mine).
To become a supplier to IKEA, a company must meet certain minimum standards spelled out in their
“IWAY” (IKEA Way) guidelines. These standards become more rigorous the longer a company remains a
supplier. Standards focus on well-managed forests and on labor rights. By imposing its standards, IKEA
hopes ultimately to obtain all its wood from verifiably well-managed forests.
IKEA uses a staircase model to describe its increasing expectations. The bottom step requires that none of
a supplier’s wood come from “Intact Natural Forests” or “High Conservation Value Forests,” which are
especially important ecosystems. (There are exceptions made if the source is FSC certified as well
managed.) The first step simply gets a supplier into the game, but it won’t keep the supplier there.
The supplier must then produce an action plan with a timetable showing how it can at least climb to Step
2:
•
•
•
•
Reporting the region within a country where the wood it supplies was cut
Ensuring that no wood comes from national parks, nature reserves, or other protected areas
Obtaining FSC certification for any tropical tree species supplied
Complying with applicable regional and national forestry laws and regulations
Step 2 represents the minimum requirements to remain a supplier—at least for a while.
The next two steps represent IKEA’s true aspirations. Step 3 requires that suppliers have procurement
routines that meet IKEA’s internal 4Wood forestry standards. Step 4 requires full compliance with FSC’s
chain of custody standard.
IKEA’s purchasing team and forestry specialists examine the wood-producing behavior of potential
suppliers even before beginning to do business with them. Once suppliers have signed contracts, they are
reviewed annually on paper. IKEA also conducts on-site audits of suppliers to ensure none of them has
slipped below IKEA’s Step 2 standard and to make sure that each supplier has developed effective
sourcing and monitoring routines. The audits are conducted by IKEA’s forestry department or by
independent third parties. In a recent year, ninety audits were conducted, covering 2.1 million of the 6.3
million cubic meters of wood used in IKEA products.
IKEA’s goal is to help each of its suppliers reach Step 4. IKEA will continue to do business with suppliers
at the lower steps of the staircase, but only if they demonstrate and then act on a plan for making
improvements. This creates a strong incentive for suppliers who want to continue doing business with
IKEA. IKEA can use its experience dealing with other suppliers to help a struggling supplier climb the
staircase. In fact, its Step 3 “4Wood” standard was developed as a means to help suppliers make the
difficult journey from Step 2 to Step 4, full chain of custody compliance—not as an excuse for IKEA
executives to conduct business on the golf course.
For some suppliers, it really is IWAY or the highway. Repeat offenders and those who don’t create a
convincing plan to climb the staircase face losing IKEA’s business. Recently, IKEA severed its
relationships with six suppliers because of IWAY violations and reduced its business with twenty-one
others. IKEA has also been stepping up its monitoring practices to set a higher standard. Since 2000, the
percentage of IKEA’s suppliers in compliance with Step 2 actually declined (while still remaining above 90
percent)—something IKEA points to proudly as an indication of its serious commitment to well-managed
forests.
Big Picture Design
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No single organization can protect our forests. The Forest Stewardship Council, Home Depot, and IKEA
are just three players in a very large international network of for-profit, nonprofit, and governmental
institutions attempting to do so. In this network, there are different roles for various organizations, even if
none of them has created—or controls—the overall network design.
The strength of FSC absolutely depends on the involvement of companies such as Home Depot and IKEA.
It works the other way, too. Both companies’ attempts to protect forests (their most critical resource)
depend on the critical verification and certification work of FSC. Part of the wisdom of FSC at the outset
was its understanding that, to protect forests, it needed to represent the views of the logging industry,
consumers of forest products, and local people affected by forestry practices—not just environmentalists.
The ways that Home Depot and IKEA use the standards and network that FSC has set up create a nice
complement: Home Depot’s consumer education tries to create more demand for well-managed forests.
IKEA’s work with suppliers tries to create more supply. Strengthening both ends of the supply-demand
push-pull continuum is vital to forests’ wellbeing. The Forest Stewardship Council (as a certification
agency) and Home Depot and IKEA (as retailers dependent on wood) understand, too, that a chain is only
as strong as its weakest link. These organizations create leverage to change other organizations’ behavior
by harnessing the power of markets via chain of custody certification (FSC), tracking wood back to its
origin (both companies), and holding suppliers’ suppliers responsible for sustainable forestry (IKEA).
Both producing wood and selling wood products to consumers are very scattered activities. For example,
Home Depot, as the world’s largest lumber retailer, still purchases only 1 percent of the lumber in the
world. Ninety-five percent of its wood comes from North America. In contrast, IKEA obtains most of its
wood from Russia, Poland, China, Romania, and Sweden. Noticeably absent from both companies’ largecountry providers are countries in the tropics, where the need to protect and manage forests may be the
greatest.
There are enormous differences from country to country in the age, condition, and content of forests, the
stage of development of logging companies, and governmental regulations among other factors. To
account for these differences, FSC’s standards differ from region to region. Though not as perfect as
insisting that all regions obey identical, absolutely rigorous standards, such an approach embodies the
principle that the perfect can be the enemy of the good.
Making It Stick
The essence of Making It Stick is being able to determine that things are working as well on the ground (or
in the forest and then throughout the supply chain) as they were when they were in drawn up near the
clouds in a seventy-ninth-floor boardroom. The Forest Stewardship Council has not been perfect in this
regard. The giant Indonesian paper company Asia Pulp and Paper, for example, received a chain of
custody certification, which FSC subsequently had to revoke because of the company’s destruction of
forests.
Yet, FSC’s authority comes from its ability to accurately assess whether forests are well managed and
whether companies are behaving in a forest-friendly manner. Despite some embarrassing and damaging
mistakes, FSC is still regarded as the gold standard in these matters—even by most environmentalists.
Other certification organizations would love to have its clout.
Making It Bigger
By themselves, and even in combination, the efforts of FSC, Home Depot, and IKEA are small and only a
beginning. Their effects are growing, but some question by what means.
Although FSC is the premier certification agency, it is not without competitors. Ninety other organizations
provide forest-related certification, many to companies that fail to meet FSC standards. The more the
others issue such certificates—even “easy” certificates—the less FSC is able to say that it is the only
certification body that matters. This makes it more difficult to promote its “brand” to create a bigger
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market for products coming from truly sustainable sources.
In fact, FSC has almost been “forced” to water down its standards. In 1993, companies could gain FSC
certification only if 100 percent of the wood in their products was from well-managed, sustainable forests.
Now, only 50 percent must be from well-managed, sustainable forests; the rest just has to be harvested
legally. Why? Because under the initial policy, only three companies met the standard. Today, some 230
million acres of forests in seventy-six countries have been certified by FSC. The market for FSC-certified
products is approximately $5 billion a year. FSC has now issued more than six thousand certificates.
Some environmental groups fret that FSC’s rush to provide certification has been damaging to forests.
There are now even watchdog agencies, such as FSC-Watch, which monitor FSC’s behavior to assure that
it acts as an effective steward of the environment.
If the annual harvest from the world’s forest could be represented as a checkerboard, Home Depot and
IKEA combined would control about half of one square. And almost all of that would be non-FSC certified
wood, largely because of their inability to obtain more. But these businesses are having an impact.
Educating customers about the need for sustainable forestry is the first step toward increasing demand for
products from sustainable forests, even if efforts like Home Depot’s Eco Options take a while to stimulate
more production. Other retailers are taking notice, too. Eager to ride the “green wave,” Lowe’s, the
number two home improvement chain, has begun its own program, with an ultimate goal of selling only
wood products that originate in well-managed, non-endangered forests.
Many countries newly intent on economic growth such as Brazil, China, and Indonesia harvest their
forests recklessly. And in most Asian countries the market for sustainably harvested wood products is
close to nil. Environmental groups are working in these regions to curtail illegal logging, institute tracking
systems from forest to sales floor, and establish FSC compliance. We must hope that these efforts are
enough, and take place soon enough to ensure that the planet retains one of its most life-giving
resources—its forests.
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CHAPTER TEN
You say you want a revolution
Well, you know
We all want to change the world
You tell me that it’s evolution
Well, you know
We all want to change the world
…
You say you’ve got a real solution
Well, you know
We’d all love to see the plan
You ask me for a contribution
Well, you know
We are doing what we can
…
Don’t you know it’s gonna be
All right?
All right?
All right?
“Revolution,”
John Lennon
If you’ve read to this point, well, you know: We all want to change the world. All right?
But how?
Big subjects generally don’t have tidy, easy answers. And changing the world qualifies as a big, Big, BIG
subject if anything does. But we’ve already seen some of the moving parts underlying societal change—
organizations and people.
We have considered organizations bent on “fixing” poverty, health care, education, and the environment.
Working alone or in partnership, such organizations draw a bead on a problem and attack it. Though the
details of their approaches vary, we have noted important similarities among them. Big Picture Design
helps ensure that their focus does not narrow to the point that they lose sight of the large set of
interlocking factors that must be addressed to succeed. It encourages a healthy (but legal) dose of stealing
ideas as well, to build upon the experience of others. Making It Appropriate avoids cookie cutter solutions
when what is required is a social pastry created to meet the nuanced needs of a particular problem.
Making It Stick takes into account the difficulty of implementing a new idea—even one that can provide
undisputed societal benefits. Much like a catalyst, Making It Stick can help a nascent solution get over the
hump and then help embed it among the people or society it is aiming to serve. Making It Bigger means
serving more people, more communities, in more ways.
If organizations drive societal change, what drives organizations? Certainly, a big part of the answer is
people. In an earlier chapter, we peeked at snapshots of the lives of five individuals. Each of these change
agents/social entrepreneurs/world beaters—it doesn’t matter what we call them, and they probably
simply think of themselves as “people”—is like a gear that meshes with other people to create the kind of
organizations that we’ve been talking about. Or look at it this way: People plan, take action, evaluate and
do all the other things necessary for “stuff” to get done. And, by their actions, bigger stuff gets done at
another level, the level of the organization. Companies don’t decide, people do. Schools don’t teach,
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teachers do. Pharmaceutical companies don’t discover new drugs—that comes from human effort. Yet,
companies, schools, and pharmaceutical companies surely exist, and they get (big) stuff done.
Is this sleight of hand or mumbo jumbo? No: it means that things happen at different levels of
aggregation. Individuals do; their actions in aggregate define the larger outcomes of organizations. But
what about organizations? Is there a way to view their activities in aggregate, interacting to produce even
grander outcomes?
We turn to that question and answer yes. If we want a positive societal “revolution,” at rock bottom it will
require concerted action by people whose efforts are channeled through the right businesses and other
organizations. In turn, certain organizations play a role in a larger “dance” where movement, at first, may
be harder to notice, but once you do, you see a massive tango among interacting organizations—rich and
complex footwork and legwork, combined in rhythm to form a powerful pattern of societal change. Or,
using the language of “complex systems” we can describe the situation this way: the behavior of a beehive
is emergent rather than being the simple sum of individual bees’ behavior. This means that things that
happen at the level of the hive (such as dances telling other bees where to find food) are of a different from
what happens with an individual bee and serve a different, higher-level purpose. So, too, can we view
organizations’ behavior as being emergent from the actions of individual workers. And, large-scale
societal revolution can emerge from the actions of different organizations—again producing effects at a
scale that is different from what any single organization would be able to.
One more thing:
You say you want a revolution and
You want to change the world?
I’ll tell you that it’s evolution
Stay tuned:I'll explain how evolutionary processes can produce emergent, revolutionary changes
in society.
What do ligers, seedless watermelons, and YouTube have in common?
Each represents a kind of genetic “mash-up.” A liger is the interspecies offspring of a male lion and a
female tiger. (Switch the relationship sexually, and you get a tigon.) Crossbreed two incompatible varieties
of watermelon, and the result is a melon without seeds. And as we’ve seen already, just like mammals and
fruit, organizations can be hybrids, too. It is just as possible for one organization to borrow traits from
another organization as it is for a lion to “borrow” traits from a tiger. Consider YouTube, which strongly
embraces elements of a hybrid: it borrows from nonprofits the trait of engaging a vast army of volunteers,
who then create, evaluate, and market YouTube’s content for free—an idea borrowed, it seems, from Tom
Sawyer whitewashing a fence. Yet YouTube is a for-profit company (which Google purchased for more
than $1.5 billion).
In this chapter, we put nature under a microscope and look at just what traits and borrowing mean. A
quick genetics lesson will help us understand that identical concepts pertain to both hybrid organisms and
organizations, and that a common evolutionary process governs both biological change and organizational
change. Then, in the next chapter, we look in more detail at the processes by which evolution wages a
competition to winnow more fit from less fit organisms—whether those organisms are plants, animals, or
organizations. This will help us understand how we can create large-scale change at the societal level.
Putting Nature Under the Microscope
Entities in nature—plants and animals, wheat and corn, ligers and llamas—share a basic genetic
architecture: a genome. But for every kind of entity, the genome is different. For instance, there are
different genomes for bacteria, viruses, dogs, cats, birds, bees, and every type of plant.
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It may be useful to think of each genome as a long string of information. This string is divided into major
subunits, called chromosomes. Along the entire length of the string are various codes, or genes. Two
horses will share the same structure. Their strings will be the same length, divided into identical
chromosomes. And, position for position along this string, there will be the same genes.
In actuality, the situation is a bit more complicated. (And even what I’m about to write is far from the
complete story.) First, the genome for most entities is actually a pair of strings with identical structure. At
identical positions along these two strings lie the same genes. For a particular horse, a specific gene that
controls its color may be a code for “black tail only” on one of these strings but “black pigment
everywhere” on the other. It is the combination of these two different “alleles”—or forms of the gene—that
give the horse its actual color.
Finally, the string that I have described as being unbroken from end to end is, in fact, broken into separate
chromosomes. In the case of the horse, there are thirty-two paired chromosomes, or sixty-four in all. But
the same genes will appear at the same position on both members of a pair, exactly as we described for a
single unbroken string.
Genes are made up of the hereditary material DNA. DNA is itself made up of four chemical building
blocks. Thus the genome of an organism can be thought of as its complete set of genes, or its complete set
of DNA, in a particular sequence.
Though there is a specific genome for one type of plant or animal, individual plants (or animals) of that
type will differ. Some people have blue eyes, others are bald, some need glasses, and others need braces.
These differences, as we’ve seen, depend on which specific alleles, or form of a gene, that individual has:
genes for blue or brown eye color, a gene for baldness or hair, and so on.
Let’s think for a moment about how genes might change. Suppose one of your friends has the gene for
“knock-your-socks-off-itis,” a condition where his socks won’t stay on no matter what he does. Teeth
chattering during the winter, he expresses the desire for his children to be free of this condition (that is, if
he overcomes his “cold feet” and ever has children). What might he do?
Well, through genetic engineering he might try to have his knock-your-socks-off-itis gene removed via
“gene knockout.” Or he might get it replaced with the assistance of a virus that is carrying the “socks-stayup” allele for this gene. Or maybe he could just sit under an X-ray machine for hours, hoping that the
electromagnetic radiation produces the desired mutation.
As you can tell (I hope!), this is a made-up example. But gene knockout and replacement via genetic
engineering and genetic mutation are quite real. Each can alter the DNA, and thus the genes, of an
organism. In this way, we tend to get modified versions of organisms in future generations.
Of course, your friend with knock-your-socks-off-itis might try the mating route: have a child with
someone who does not have this gene and hope for a “socks on” offspring. The “math” here, as we’ve seen,
comes from the fact that, under Mendelian inheritance each parent contributes genetic material to his or
her children, thus allowing the possibility of a gene from one parent to counteract a gene from the other.
Even this stylized description should help us see that it is possible to start with a certain organism and
then begin to introduce genetic variation, which ideally, but not necessarily, creates improvements.
Indeed, we can consider a hybrid organism to be one with traits from different sources. With this broad
definition, we include the variability that comes from mating a lion and a tiger or from crossbreeding
different varieties of watermelon. But we also include organisms that have been “tweaked” by altering
their genes such as is done to make certain mosquitoes malaria resistant (thus preventing them from
spreading the disease among a vulnerable population), just as we said that tweaking can eliminate knockyour-socks-off-itis. As we’ll see, these same ideas apply to creating cross-sector social hybrids.
Why are these ideas important to us, given our interest in improving the world? First, the notion of
introducing variation and then letting successful variants proliferate can be thought of as a model to
better society. Through societal “genetic engineering,” we can alter specific traits of an organization, or
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possibly combine the traits of two different parent organizations.
A deeper examination, however, will show that this is not only a model for how to better society, but is
how organizations really do adapt and change to become more effective. The evolutionary forces that
control the natural world are every bit as applicable in an organization-in-society context. In fact, in the
next chapter we will look carefully at how to understand and leverage these effects in a societal setting.
But let’s begin with a rough understanding of how this works.
Putting Organizations Under a Microscope
There is nothing special about wheat (a natural hybrid occupying more farmland than any other plant),
seedless watermelons, or ligers. And one organization borrowing traits from another is just as possible as
a Labrador retriever “borrowing” traits from a poodle, or a lion “borrowing” traits from a tiger.
Consider a normal, neighborhood bank in Minnesota that makes loans to its customers. If there were a
“banking genome,” it might have genes for describing the following: the amount of money a bank has
available to lend, who its loan clients are and where they live, and how it obtains the money it uses to
make loans, among dozens, if not hundreds, of other features. By understanding and manipulating this
genome, we could change the characteristics of our bank in Minnesota. We could take the gene for
“amount of money available to lend” and change its value (that is, change its allele) from $10 million to
$50 million; replace the allele representing “loan to local citizens” with one representing “make loans to
the developing world”; and similarly adjust the value of the gene for “source of funds” from “local
depositors” to “online lenders.” In essence, by making these adjustments, we have changed the
description of a bank that makes loans within its own community to an online microfinance institution
that attracts and distributes money around the world.
“But do banks have genomes?” you might ask. Fair question. In truth, a genome is nothing more than a
language for creating a precise description. Though there are more than 6.5 billion people on the planet—
no two of us identical—a single genome is sufficient for describing us all. That is because the genome
specifies, position for position in every chromosome, the type of information allowed, rather than a
specific value. For instance, there is a position on the genome for a hemoglobin gene, but some
individuals may have “sickle genes” (actually, alleles), whereas most people have normal hemoglobin
genes. Similarly, the genome indicates on which chromosomes, and where upon them, eye color is coded
for—and different values there produce different eye colors.
This idea of a descriptive language can be extended in a natural way to describe businesses or other
organizations. For instance, we can imagine “corporate genes” that indicate whether an organization is a
for-profit or nonprofit, and whether a corporation’s stock is publicly traded on a stock exchange or
privately held by a small group of people. If we really wanted to create a corporate genome, we might
begin to argue about how many genes to include, though it is unlikely that there would be anywhere near
the estimated 20,000 to 100,000 genes in the human genome. But for now, all that is really relevant is
that we could create a corporate genome. And because we can, we have a description (you might think of it
as a way to spell out instructions) powerful enough to account for all the variation in organizations.
Example: Multi-Organization Hybrid and Its DNA
The Global Fund
Recall that our definition of a hybrid organism is one with traits
from different sources, and that this definition applies both to
biological organisms and artificial organisms such as organizations.
Such hybrid organizations are likely to become more and more
common, even assuming the form of strange hydralike creatures
with multiple heads: part business, part government, part charity,
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and part multilateral. In fact, we see such multiheaded organisms
attacking some of the world’s severest problems. For example, the
Global Fund to fight AIDS, Tuberculosis, and Malaria is a
partnership between governments, nonprofits, businesses, and
affected communities to help raise and disperse funding for
international health issues. The “hybrid power” of the Global Fund
is extended further when it combines forces with other
organizations, creating what we might view as an even more
complex uber-hybrid.
The Global Fund has targeted Tanzania, an East African country
relying mostly on agriculture, as a recipient of its aid. Like most
sub-Saharan African countries, Tanzania is poor, the average citizen
living on approximately three dollars per day in terms of U.S.
purchasing power. Ninety percent of the population lives in an area
where malaria can be contracted. Malaria is a highly preventable,
treatable disease in the developed world that kills at least one
million people a year—or one person every ten to thirty seconds—in
countries too poor to prevent or treat it.
To combat malaria in Tanzania, the Global Fund needed help.
There not only was a need to combat malaria, but also a need to
come up with a solution that was affordable and appealing to those
who needed it most. The Global Fund made a grant to the
government of Tanzania to provide antimalaria bed nets in an
effective, fair, and sustainable way. What was required was to
manufacture this product, distribute it, and sell it in a way that
would not destroy local economic activity. A voucher system was
managed by a faith-based nonprofit, Mennonite Economic
Development Associates (MEDA), to help at-risk individuals buy
bed nets from local businesses. The bed nets were made locally by
A–Z, a company in Dar es Salaam using special chemicals produced
by a Japanese chemical company, Sumitomo, which also licensed
its proprietary technology. Because many Tanzanians were not
accustomed to using bed nets for protection against malaria, the job
of educating citizens about why and how to use them effectively fell
to the international nonprofit known as PSI (formerly, Population
Services International), Tanzania, headquartered in Washington,
D.C. UNICEF helped distribute some of the bed nets that A–Z made
elsewhere in Africa. The entire “multiheaded” network was
orchestrated and partially funded by the Acumen Fund, a hybridlike
venture capital firm that helps launch organizations with potential
for strong societal returns (traditional venture capitalists seek
strong financial returns).
Got all that? (Catch your breath.) The main point is that a business
genome would be capable of describing this hybrid structure, even
if we quibble about whether what we’ve got is really a hybrid,
“partial dominance,” or even a chimera (a rare but real occurrence
in nature where the genetic materials from different individuals are
fused, allowing you to share your fraternal twin’s DNA!).
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We can even conceive of a business chromosome robust enough to describe a complex networked
organization involving multiple parties to prevent malaria in Tanzania (described in the box). And
because we can describe such a hybrid organization and see how it could grow from less developed parts,
we can also imagine how similar approaches might be developed to address world hunger, poverty, lack of
education, and so on. Once we free ourselves from thinking only about “what is,” we can begin to imagine
powerful new approaches to deeply entrenched problems.
What qualities do successful hybrids possess? They can have traits more desirable than their parents
(hundreds of advantages per fruit for seedless watermelons). They can be well adapted to changing
environmental conditions (hybrid Galapagos finches’ “inferior” beaks became an advantage after a storm
in the mid-1980s introduced new plants to which their beaks were extremely well suited). And they can be
very long lasting (like the hybrid wheat that evolved millennia ago and today occupies much of the world’s
farmland).
But what does a successful societal hybrid look like? Such an organization should, of course, help solve
tough societal problems. It can be the proverbial better mousetrap. By combining the traits of two
successful organizations, it can compensate for the flaws or deficits of either one. In nature, the resulting
improvements are sometimes called “hybrid vigor.” If in nature, why not in organizations? Hybrid
solutions to societal problems can be essential, too, in times when societal “storms” are gathering and
threatening the environment or our social order.
Evolution Under the Covers—Sexual and Otherwise
The same evolutionary forces that operate in the natural world operate in the world of organizational
genetics. We can interbreed two crops; we can also interbreed two organizations. Mutations introduce
variety in the natural world and in the world of organizations as well. Genetic engineering? Though GMOs
currently stands for genetically modified organisms, how about genetically modified organizations, too?
There is vast expressive capability within a genome. There are some three billion DNA molecules, or
nucleotides, in the human genome. By altering just 4 percent of this structure, we end up with the genome
for a chimp instead.
In terms of organizational genetics, we see the same potential. First, by making small changes in
organizational architecture, we can produce large changes in outward appearance or performance (as with
chimps and humans). And by changing a little bit more—even just 5 to 10 percent—the changes can be
that much more pronounced.
Because both organisms and organizations possess underlying genomes, both can evolve over time. But
the processes by which they evolve differ in important ways. The hallmark of biological evolution, of
course, is “organic” change. Sexual reproduction mixes up the genetic material of two parents, producing
offspring different from either one. In certain situations such as plant breeding, parents might be selected
with the express purpose of producing a certain kind of offspring. For instance, a high-yield (or highnutrition) variety of vegetable might be crossed with one that can better withstand the elements in the
hope of providing very-low-income farmers living in harsh conditions with a better food source. Whether
the exchange of genetic material takes place “au naturel” or as the result of intentional crossbreeding, the
phenomenon is one that is most clearly revealed empirically. Plant-1 (a tall red flower) + Plant-2 (a short
white flower) = Plant-3, a plant whose height (tall) and color (pink) we can easily observe. The changes
taking place “under the covers,” so to speak—changes taking place at the structural level of the genome—
remain hidden from view.
Organizational evolution, in contrast, can be far more targeted and precise. Two companies don’t just
casually “mate,” hoping their union produces cute little baby companies. Instead, it is as if corporations
have state-of-the-art technology for analyzing and sequencing DNA. If we examine an organization with
great care, we can see the “instructions” that it follows. What are its hiring policies? How much does it
spend on research? Does it have a chief technology officer? Which technologies does it use, and how does
it use them? How much money has it raised by issuing stock? Or bonds? In which countries are its
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products manufactured? Does it own these plants or outsource the responsibility? The list of instructions
is huge, but it is finite. By reading about an organization, doing business with it, talking with past and
present employees, and carefully studying it in many other ways, we can obtain a very detailed
understanding of the instructions that dictate how it will behave in the real world. We can discover (with
considerably fidelity) its “genome.”
Once these genetic instructions are understood, they can be adopted by another organization. The small,
local bank in Minnesota that we talked about earlier can therefore study the “instructions” for other
organizations and decide which ones it wants to adopt. By identifying and adopting instructions that allow
it to interact with banking clients over the Internet and to make small loans to the developing world, the
bank can evolve into a microfinance institution.
At this point, you might be having some objections or at least some questions. Are an organization’s
genomic instructions really written down? Are they known completely? Can another organization really
adopt them?
The answers to these questions are related. Think for a moment about technology. Only a bit more than a
decade ago, the Internet was dismissed as a toy or a fad, even by big companies such as Microsoft.
Companies that even dared to mention their own websites on television still spelled out their complete,
clunky web address: http://www-my_company_name.com (usually saying “backslash” when they meant
“forward slash,” but hey!). Today we just assume that all companies are on the Internet, and we can guess
their web addresses or use Google to find them in an instant. But back then, just a few organizations were
marketing over the Internet, and it seemed to be working. When this was observed, it was imitated and
eventually became common practice. You see the same phenomenon today with blogs (few people ask
what they are anymore) and comment areas where customers can review a product’s features. Twitter,
anyone?
Think about organizational structure. What do an organic food co-op and a street gang have in common
with a large Wall Street firm? Nothing? What about the fact that all of them have a set of officers who
direct the organization, all have a board of directors, and all have bylaws that govern their operation?
Each of these things was at some point “new,” but over time, it was observed, inspected, and found to be
useful to the point that we more or less take it for granted. In truth, these successful “genetic instructions”
were simply being widely copied and adopted across quite different segments of society.
Or think about workflow, the way a company gets its work done. Fairly recently, U.S. companies
discovered they could have certain nonessential activities performed more cheaply overseas, especially in
India. They began to outsource operations such as payroll, record keeping, and customer help-desk
support. After this came slightly more ambitious efforts. Doctors in the United States, for instance, could
voice-record medical notes and send them overseas, where they could be transcribed cheaply and
effectively before being shipped back to the doctor’s own office. And if medical record keeping could be
shipped overseas, why not aspects of medical practice itself? We have begun to see this. Massachusetts
General Hospital in Boston now has licensed radiologists in Bangalore, India. They receive X-rays and
other digital images over the Internet, interpret them, and return their findings to the United States. Is it a
coincidence that help-desk services, medical transcription, and now specialized practices in medicine are
all being outsourced? Of course not. Bits of DNA from one activity (and firm) are being injected into
another.
Companies are always trying to steal other companies’ DNA. By night, they may pick through their
competitors’ garbage. (Really. Yuck.) By day, they “benchmark.” Companies such as Toyota and L. L. Bean
are as well studied as the Talmud. Toyota’s DNA has genes that make it “lean,” and other organizations—
whether they manufacture a product or run a hospital—want to acquire them. L. L. Bean’s ability to get
orders out the door is legendary, prompting companies such as Gillette and Chrysler to study and imitate
its order fulfillment (to help them get things out their own doors), but also the New York Times (which
studies Bean to “fulfill” its customer service requests). Yet best-in-the-world companies do benchmarking
themselves. When Bean found that it couldn’t keep up with Internet speeds and volumes using its mailorder methods and facilities, it studied others it considered on the electronic cutting edge. Companies
want genes that fit well and make them look good, no buts about it.
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And now companies have begun benchmarking environmental activities. Companies that never knew the
difference between Styrofoam and compost suddenly want to be green. There are green standards for
them to follow (Leadership in Energy and Environmental Design—LEED—for example), and
environmental benchmarking companies to advise them. And then there are leading organizations,
including Interface (textiles), TerraCycle.net (can you guess the main ingredient in its Worm Poop lawn
fertilizer sold in a recycled pop can?), and Oberlin College (uber-environmental) that are inspiring other
organizations to change their colors . . . to green, naturally.
So, you’re starting to be convinced that there are organizational genes that are propagated throughout
society. (Some might call them memes, which means “ideas that spread.”) And these are really just
instructions that other organizations can follow. But can these instructions really be known completely?
No, they can’t. There are trade secrets, of course, and certain organizational intricacies that may be
impossible to untangle perfectly. But then again, there are no perfect, written rules for how to speak
English either, and we seem to get along fine. We have no trouble understanding the sentence “I
downloaded the MP3 file to my iPod over Wi-Fi,” even though four of its terms are so new that they aren’t
in most dictionaries. Instructions don’t need to be perfect for us to interpret and then follow them. And, as
we know, Making It Appropriate is vital to successful performance—no less so when we are talking about
taking another organization’s ideas and tweaking them to fit your own.
In fact, the search for ideas that make your own organization perform better is really a search for effective
building blocks. These building blocks are strands of corporate DNA that have been put to the test and
shown to work in a variety of circumstances. Most animals have eyes (even though evolutionary forces led
to the eye being “invented” independently forty times, because eyes are good building blocks that
themselves contain other smaller building blocks such as lenses and retinas). The idea of building blocks
is found throughout nature, even down to the level of the cell, where the Krebs cycle, for example, is an
emergent and vital chain of chemical reactions supporting all living cells that use oxygen to “breathe.”
Recap: all companies are trying to invent new and better ways of doing things, copying others who they
think have good ideas, and being copied by others who think that they, too, possess a “secret” (even
“secret” with a very lowercase s). Question: What is the net result of these simultaneous attempts at
getting better through trial and error and imitation? We turn to that question next.
Complexity and Emergence
A new, multidisciplinary approach to science is emerging: complex adaptive systems. Complex adaptive
systems address problems that seem to have very little in common: How do fads suddenly emerge and just
as suddenly disappear? Why do ants prefer one food source over another that is equally appealing? How
do our brains work? How does the economy organize itself when no one is in charge? What unites these
questions is the idea that relatively simple, easy to understand interactions among small elements of a
system produce powerful and very surprising emergent effects.
One of the techniques in the arsenal of a complex adaptive systems scientist is the genetic algorithm. An
algorithm can be thought of as a “recipe” that can direct a computer or any other individual or system that
is capable of interpreting and then acting on instructions. As the name suggests, the genetic algorithm is
based on biological evolution. As we will see, the genetic algorithm produces changes in the direction of
increasing “fitness.” But “genetic adaptation” does not—repeat, not—only describe changes among living
things. Any system that involves copying and that has a tendency for variation that can differentiate
(short-term) winners from losers is a candidate. This even includes rocks, crystals—possible precursors to
DNA—and certainly organizations. Any instructions that are specified in sufficient detail to be carried out
reliably are subject to adaptation. The genetic algorithm allows us to examine what happens when we pit a
set of instructions against each other.
Genetic Algorithm for Comparing and Improving a Set of Instructions
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1. The algorithm operates on a set of instructions, each designed to address the same “problem” or
2.
3.
4.
5.
task. Each instruction can be thought of as a long list of features, a structure identical to a
chromosome, that determine its “owner’s” genetic makeup. Equivalently, an instruction may be
regarded as a very long and detailed set of directions—not a single step—just as directions for
driving from point A to point B contain many details. Let the instructions “duke it out” by letting
them guide work on the same problem or task. Evaluate the effectiveness of each competing
instruction by using an appropriate means of measurement. For instance, if the instructions are
supposed to guide you to a destination, their effectiveness may be judged by how close or how
quickly they get you to it.
Select some of the instructions that are performing the best.
Reward these best-performing instructions by making copies of them. Some aspects—features—of
these best-performing instructions must be above average; otherwise, the entire instruction
wouldn’t be among those chosen.
Create new (never seen before) instructions by letting the existing set (including those created in
Step 3) “mate.” Mating involves creating a new instruction from two “parent” instructions by
combining some of the sub-instructions of each parent. The new instruction may not make a lot
sense. What’s worse, there is a two-way praying mantis syndrome at play, for once mating takes
place, both parent instructions are history.
Repeat Steps 1 through 4 many, many times. For convenience, think of each repetition as another
“generation.”
The illustration above shows two “instructions”—each a string of ten symbols—before and after they
exchange instructional sub-sequences.
1. Evolution takes place in all kinds of systems, biological, mechanical, social, and more.
2. A common mechanism, or algorithm, describes this evolutionary process—a “genetic algorithm,”
3.
4.
so to speak. The mechanism is powerful and robust. When we say organizations can and do
evolve, we mean this more literally than metaphorically.
The genetic algorithm makes improvements over time by “tinkering” with the appropriate
instructions (“DNA”) to produce better crops, vehicles, organizations, and so on.
The “residue” from generation to generation is a set of successful building blocks, which tend to
get more complex, perform better, and become more and more common over succeeding
generations.
Brief Overview of What Genetic Algorithms Do
What happens when we let the genetic algorithm operate on a set of instructions? To start, in each
generation the instructions that are performing better than the rest (Step 1) are identified (Step 2) and
replicated (Step 3). But these instructions are not preserved; they are broken apart and combined with
other instructions (Step 4).
As this process occurs again and again across many generations, the “duking it out” step usually becomes
a competition among new instructions that never existed before. After all, they came from a “mating
process” involving their “parent” instructions. But the building blocks of successful instructions can
endure and be passed on from generation to generation. If you mate instructions for building a bicycle
with instructions for building a lawn mower, you may end up with something resembling a motorcycle—a
kind of motorized bike.
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In the next generation, even though the original “parents” won’t be around anymore to cut grass or be
ridden safely by six-year-olds, the building blocks of both the lawn mower and bicycle may be preserved in
the new gizmo. The bike might contribute its frame and tires; the lawn mower might contribute its twostroke motor. These same building blocks (by being parts of new configurations) now participate in the
duking out/selecting/rewarding/mating cycle, even though the original, specific “parents” that produced
them have been tossed aside on a heap of obsolescence. (Is this the way Harley-Davidson gets its
inspiration? Probably not.)
So, why should we pay any attention to this process at all? Important question, to which there is an
important answer. This model describes how any system evolves to better meet the demands (or
expectations) of its external environment. And the “emergent” nature of what evolves means that what we
end up with may be something quite different—and much more intricate and well suited—than what we
began with. If the instructions we are considering (Step 1) are biological chromosomes and not
instructions for building physical machines, then we have a competition in which individual biological
organisms (think different varieties of wild grasses) might “duke it out” (Step 2) by competing to occupy
the same parcel of land, fighting over available water, soil nutrients, and so on. Varieties of grass that best
adjust to these conditions (the “environment”) will predominate (Step 3), more successfully reproducing
and coming to occupy a greater percentage of the land over time. Occasionally, however, the pollen from
one variety may fertilize another, giving rise to unexpected variation (Step 4). There is nothing that
automatically confers an advantage to this new variety, but it has won the right to duke it out in the next
generation. Its performance “against” other grass varieties, and its ability to replicate (Steps 2 and 3)
depend on how well it takes advantage of the physical environment.
Muddying?—No, Generalizing—the Picture
I understand that right now you might be saying, “Yes, but what you’ve described resembles ordinary
biological evolution. You said that the model would explain how any system evolves and improves.” Let’s
address that issue by looking at a really tricky question: Heredity and biological evolution require the
availability of DNA, but DNA is an incredibly complex organic molecule that, itself, must have evolved. So,
where did DNA come from?
Amazingly, some scientists think that DNA could have emerged from an evolutionary process in which
different kinds of clay and mud played the starring role. Clay and mud contain crystals that line up to
create tightly packed, repeating patterns. In fact, two or more different kinds of crystals, with different
atomic-level patterns of molecules, are capable of being formed from the same mud or clay. And once they
form, each type of crystal tries to “replicate,” or grow, by gathering additional material from the clay or
mud and attaching it to form an ever-growing crystal. So, replication using clay or mud is indeed possible.
So is a variation. Although each type of crystal is defined by a unique pattern, imperfections arise, too. As
Richard Dawkins, from whom I am borrowing this metaphor, describes it, if you examine a crystal with a
sufficiently powerful microscope, you’ll see something like a repeating herringbone pattern. But every
once in a while, the pattern might twist, veer off at an angle, drop a stitch, or insert something extraneous.
These defects appear unpredictably and unexpectedly, and that means they can convey information.
Imagine that you are sitting at home and your water pipes are tapping out a rhythm with the regularity of
a metronome. If, unexpectedly, this pattern were replaced with the sound of “dot-dot-dot d-a-s-h d-a-s-h
d-a-s-h dot-dot-dot,” you might be tempted to conclude that someone was trapped in your water heater
and sending you an SOS to help them escape. (Please don’t blame the brilliant science writer Richard
Dawkins for the SOS part of what I’ve just written. I loosely borrowed his herringbone description and his
scientific descriptions of how clay or mud could be the predecessor of DNA. But someone caught in the
water heater? That’s mine.)
So, replication is possible with mud and clay crystals. And now we see that variation is, too, meaning that
variations can be considered to contain instructions or convey information. But what about the proverbial
“survival of the fittest”? How do clay and mud compete (“duke it out”)? And what does it mean to say that
one type is performing better than another? Even here, certain muds and clays have the “right (though
messy) stuff.” Some are better than others simply because they win at the game of survival by better
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reproducing themselves. This is the sense in which insects far outperform humans in terms of total
biomass. In this way, they lead us by a wide margin in the ultimate game of survival.
How can a particular type of clay or mud win at this game versus other grimy contestants? Possibly by
affecting the flow of the very rivers or streams from which it came, altering the rate of flow so that the
right kind of building blocks for creating its own type of crystals are more likely to be leached from the
riverbed and deposited into the stream. More of the right kind of building blocks, more chance for the
right kind of crystals to form, and more chance of a particular type of mud or clay “winning.” (Of course,
there is no “intention” to win here, but it is not needed.) This particular clay or crystal might gain further
advantage if it is flaky enough to dry up occasionally and be blown to other streams when things get very
dry, or if it is “crafty” enough to cause its host river to split into diverging tributaries that spread in
different directions. In either case, the “winning DNA” (excuse me, mud or clay) is beginning to slime the
competition. Eventually, these inorganic clay molecules can even selectively support the “success”
(survival) of certain carbon-containing organic materials, thus taking another important step toward the
birth of (organic) DNA.
We’ve seen small Minnesota banks evolving into microfinance institutions, food co-ops and street gangs
borrowing ideas from sophisticated businesses, and bicycles mating with lawn mowers; and we’ve just
taken a look at how DNA itself might even evolve from river clay or mud. In each case, the adaptations
obey the logic of the genetic algorithm (although I’ve presented only the trailer of the algorithm, not the
whole movie, in my descriptions).
If we were to watch the entire genetic algorithm movie, including the context in which it operates, here is
what we would see. Individually, different “organisms,” which we can alternatively view as different
“instructions,” are fighting for their survival. To survive means to fare well at the task or problem at hand
so that the organism participates in the rounds of replication and mating. In this sense, our bicycle and
lawn mower must have been performing well enough against other contenders to be selected for
replication and mating. How will our lawn mower–bicycle hybrid do in the next generation? If the task at
hand is providing a means of transportation, it will probably be a hit, fare well in the genetic competition,
and continue to pass on its own “genes” (which, of course, it got from its parents).
But as we zoom out with our cameras, we see that the action is really taking place among an entire set of
characters and unfolding over time. Although our lawn mower–bicycle–motorcycle contraption will
continue to evolve (unless its lineage comes to an end—“I knew it wasn’t a good idea to ride some sort of
screwy lawn mower on the highway”)—it’s more instructive to look at the competing set of instructions (or
organisms) duking it out generation to generation. On average, we’d see two things. First, certain
features—and even combinations of features—would get more and more common over time. The same
wheel that provided a performance advantage to a bicycle found its way to the hybrid bicycle–lawn
mower, where again, this new means of transportation would likely be superior to anything with square
wheels, triangular wheels, or no wheels all. So “wheel” emerges as a building block. Second, because it is
the effective combination of features that gets more and more common, we would see performance
improvements (again, on average) generation to generation for the entire set of instructions in force. That
is, for an instruction to be duking it out in generation 1,000, it is likely to be a better performer than
instructions in force 999 generations earlier.
Let’s step back from the clay and mud, broken bicycle chains, lawn mower oil, and community banks that
have been reborn as microfinance institutions to recap (Yes, I’m repeating content from the previous box I
used to preview what was to come. Put your hand up if you really read it.):
1. Evolution takes place in all kinds of systems, whether biological, mechanical, social, or rivers
2.
containing mud and clay.
A common mechanism, or algorithm, describes this evolutionary process—a “genetic algorithm.”
The mechanism is powerful and robust. When we say organizations can and do evolve, we mean
this literally, not metaphorically.
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3. The genetic algorithm can make improvements over time by “tinkering” with the appropriate
instructions (“DNA”) to produce better-performing vehicles, grasses, mud, or organizations.
4. The “residue” from generation to generation is a set of building blocks, which tend to get more
complex, perform better, and become more and more common over succeeding generations.
In the next chapter, we’ll see that we can use the genetic framework I’ve described to create hybrid
solutions that help produce a better world at the societal level. And by understanding the genetic
mechanism, we can dramatically speed up evolution in the processes.
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CHAPTER ELEVEN
Give me a lever long enough and a fulcrum on which to place it,
and I shall move the world.
—Archimedes, 280–211 BC
As the anthropologist Margaret Mead once remarked, “Never doubt that a small group of thoughtful,
committed citizens can change the world. Indeed, it is the only thing that ever has.” Still, wouldn’t it be
nice to have a “playbook” for doing so?
Although that is asking a bit much, there are some powerful levers for producing wide-scale social change.
And we can make sense of them by looking through the lens of evolution.
Let’s quickly review the mechanical aspects of evolution, which we explored in the last chapter. But this
time, rather than slogging around in the primordial mud, let’s ascend to the aesthetic heights of art—well,
at least the kind of art that a computer can produce.
In my teaching, I have occasionally used a free software package called SBART to perform the following
exercise in “evolution in silico.” First, I begin with twenty randomly generated computer images, such as
these:
Knowing that these images will “evolve” according to my class’s preferences, I set a target, or goal, for this
evolution. For instance, it could be to see if the images can evolve to look more like a spiderweb.
How does such computer-mediated evolution work?
To begin, my students and I look at the starting set of images and simply note how their features vary: by
color (greens, purples, grays, blues …); pattern (solid, symmetrical …); complexity (simple, intricate …);
symmetry (horizontal, vertical …); and along other dimensions. Some of these features will probably be
more spiderweb-like than others.
With this in mind, students vote on which images look most like a spiderweb. Of course, this is nothing
more than their opinion. They don’t have to justify their vote in any way.
Based on the images that get the most votes, the program generates a new set of twenty images, replacing
the old. These new images borrow features from the images just identified, but they are not exact
duplicates: instead, they are variations based on interchanging features of some selected images with
those of others, or by introducing some “mutations” (such as changing an image’s colors).
With this new set of twenty images, students again consider their features; they vote on which images are
most spiderweb-like, and a third set of twenty images is generated based on these, with variation again
playing a key role in modifying the selected set. And so on.
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In other words, we run through the following cycle over and over:
Step 1: Identify (… “all” important features)
Step 2: Test
(… to see which ones “work best”)
Step 3: Copy
(… the best performers)
Step 4: Vary
(… using genetic “cross-over,” mutation, etc.
This is the basis of the genetic algorithm.
And what is the result?
I used the SBART software package for twenty-five generations, producing the following results.(Here, I
am playing the role of my students, so I am doing the voting.) Now, perhaps no self-respecting spider
would want to dwell in any of these on a long-term basis. But some images probably look more habitable
than the original set of “spiderwebs.”
Of course, these results came after twenty-five generations of computer-based evolution: a mere blink of
the evolutionary eye. But this is enough to show us that we are “heading” toward arachno-friendly
territory. Just think where we might be after, oh, several thousand generations.
What else does this show us? First, that evolution is not limited to things that are alive. I did not pour any
DNA onto my computer to make these images evolve. Their adaptation simply followed the evolutionary
pattern laid out by the genetic algorithm. This is a powerful method that can describe how any conceivable
type of evolution takes place: in plants, animals, images—or in business and society (stay tuned).
What else does our evolved set of images reveal? We are beginning to see the emergence of “building
blocks”: an emphasis on gray, black, and white over colors; weaves over solids; and patterns that lack
complete symmetry. If we could watch a movie of how these images evolve over time, we’d see that each
building block might grow in prevalence at a different rate. But, if these patterns are truly to endure: (1)
they would likely “take hold” at some point in time and then almost “explode” in prevalence; and (2) they
would combine, as we are beginning to see already, into bigger patterns (e.g., black-and-white
nonsymmetrical weaves) that themselves begin to “take over.”
There is a comparison to biological evolution that is important, too. In biological evolution, there is a real,
honest-to-God environment in which adaptation takes place. (This holds for the “natural” evolution of
muds and clays, too.) The environment provides the “test” to determine who is most fit. Animals that
must breathe helium or travel backward in time will never come into being—the world is just not like that.
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This also means that the individuals that do adapt best to the real-world environment, by and large, also
get to mate the most (make copies with variation). But they don’t first get to say, “Show me your
chromosomes.” An individual’s likelihood of reproducing is correlated with how “fit” it is with respect to
its performance in its environment, not some secret, internal code that it shares with potential mates.
In synthetic evolution, on the other hand, humans get to play some part in the way the environment sorts
out winners and losers—sometimes the whole part. For instance, to produce the images that I displayed, I
provided every shred of feedback from the environment. I was the environment: for an image to perform
well, it had to please me. Twenty-four times (or “generations”) I looked at the set of images on display and
chose those that looked, to me, most like a spiderweb. Simply by clicking my mouse, I replaced all the
drama of individuals competing for food, water, and shelter, fighting off predators, and, for the lucky,
producing offspring. Nothing but me, computer circuitry, a color monitor, and a mouse.
In fact, I could have gone even further. The SBART program allows you to look at the “DNA” of any image,
take a little section, and insert it into the DNA of another image. (I didn’t do this.) With enough
knowledge about how to interpret DNA, this can put evolution on a fast track. Instead of waiting for the
right traits to appear so you can vote for them, you can go through the DNA buffet line, selecting what
appeals to you.
Even then, there will still be an important role for the environment. As the saying goes, the proof of the
DNA copying and pasting is in the pudding (or something like that). Reading the DNA of images is
difficult. When you borrow some DNA from one image and include it in another, what you’re really doing
is making a prediction that the newly produced image will be what you’re looking for. The environment—
the combination of the image-rendering circuitry in my computer and my judgments about the aesthetics
of the images produced—still provides the ultimate test of “what’s best.”
Let me be painfully clear. The SBART program has no built-in preference for spiders, spiderwebs, or
creepy crawlies of any kind. In using this program, not only can I “cheat evolution” if I want by stealing
DNA, but I get to set the target “outcome” I’m looking for (since I provide the feedback). I could just as
easily have said to myself, “Let’s see if I can evolve a Picasso instead of a spiderweb.” As we will see,
setting the right targets is a key to producing the right kind of societal change.
Pulling Societal Levers
You didn’t pick up this book to learn about mud or computer images. But, as I hope I have convinced you,
if those can evolve (to become DNA or spiderwebs), then anything can evolve—and by using the same
mechanism we’ve looked at. And if anything can evolve, how about taking advantage of that observation
to see how to evolve a society whose inhabitant have a better quality of life and live on a healthier planet?
Before we dive in, though: obviously, society—with all of its problems and opportunities—isn’t some kind
of simulation running inside a computer (apologies to die-hard fans of the The Matrix). So is it really
instructive to think about some kind of algorithm for societal change? Answer: yes, because each of the
steps that we can use to describe, say, computer images that evolve—identify, test, copy, and vary—is
going on in a changing society, too. These steps may be happening simultaneously among millions (or
billions) of different companies, organizations, or people; they may be taking place out of sequence; and
there may be no master “computer brain” making things go or “master accountant” keeping score. And all
that is fine, because in truth, systems change according to the tests we provide; new forms arise,
influenced by what’s preceded them; they must be “jiggered” to fit their context; and, ultimately, certain
“building blocks” will become better suited to the task or problem being addressed, and they will
predominate.
In what follows, I may describe something as an attempt to “identify important features.” You might feel
that my example is also an illustration of, say, “copying the best.” Again, what is important is that all
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aspects of societal evolution are happening at once, with some activities in the real world fulfilling the role
of two or more steps of our genetic algorithm. The world does not change in lockstep, but it does change
along the lines I’ve described.
One more thing. There are parallels—and differences—between how organizations change and how
society as a whole changes. Organizations search for new ways to operate, new products and services to
sell, and new markets to serve. They steal shamelessly from other organizations, making sure that their
Big Picture Design encompasses all aspects of what they do. In addition, they Make It Appropriate by
creating variation that modifies a solution to fit the right context. They Make It Stick by testing and
measuring to ensure results. And they strive to expand and Make It Bigger.
But organizations do these by design. They make decisions; they are in control—but only of their own
actions (even if they try to influence others).
Our attention in this chapter is on societal change. No one can “design” society or single-handedly create
societal change. There are a huge number of moving parts, and even more interactions among them. No
one is in ultimate control.
But society can—and does—change by evolving, not by the design of a single architect, individual, or
organization. It evolves according to the evolutionary processes that we have outlined. Although it is
impossible to play God and orchestrate societal movements in exactly the ways we wish, we can
understand how evolution produces change. By doing so we can put powerful evolutionary forces to work.
Now, time to dive in.
Step 1: Identifying Important Features
How do you find effective means to address a vexing societal problem? One of the best ways may be to
keep your eyes open. By the mid-1990s, Taiwan had become relatively affluent. With its newfound wealth,
it wanted to provide health care for its citizens, something completely new to the island state. Newness
presented opportunity in the form of a blank slate. Taiwan had no “legacy” health care systems or vested
interests in preserving the status quo. It could invent a health care system as it pleased.
Taiwan decided to build its health care system by keeping its eyes open. The government created a
committee that examined the best “wealthy country” health care systems in thirteen countries (not
including the United States, which the committee decided had no “system,” just a market). By noting the
attractions and disadvantages of these systems, Taiwan designed something completely new: a
mandatory, national health insurance system to which all citizens have access that requires everyone to
join and pay in. There is a choice of doctor, no waiting time for medical care, and competition among
providers. And there are no gatekeepers in the system, so citizens can get care whenever they want,
including weekends.
The system is also very high-tech. Everyone has a “smart card,” which carries information about your
medical history, medicines you’re taking, and even your pattern of using the health care system.
Sophisticated technology also dramatically reduces the costs of running the system to less than 2 percent,
the lowest administrative costs in the world. The system costs less than half of what the U.S. system costs
(6 percent versus 16 percent of national income), though it has experienced financial strain because of the
low fees paid by citizens.
The Taiwanese government looked to wealthy countries in creating their health care system, but that is
not the only way to keep your eyes open. To identify (and sometimes design) the best features, you must
expect to look anywhere, simply because good ideas are everywhere. Anil Gupta, an economist,
professor, and social entrepreneur in Ahmedabad, India, provides a tremendous illustration of this idea.
Ahmedabad, and the surrounding state of Gujarat, has pockets of prosperity and industrialization, but
many people are mired in poverty. As Gupta is aware, however, poverty does not mean lack of ingenuity: it
can mean just the opposite. Because people are poor, they have to do more with less. Gupta has
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crisscrossed Gujarat and many other Indian states in search of grassroots, innovative ideas for alleviating
poverty and promoting a better standard of life. More than twenty times in more than a decade he has led
a group of students and other like-minded searchers on Shodh Yatras, or journeys of discovery.
A Shodh Yatra is a weeklong trek, on foot, from village to village throughout a region. Walkers make
personal discoveries of what is inside them. But under the bright glare of the sun (Shodh Yatras may cover
several hundred kilometers in broiling Indian summers), other external discoveries are made, too: a
bicycle with flip-down pontoons to negotiate flooded “roadways” in monsoon season, water sprayers
spring-activated by a farmer’s footsteps to provide irrigation, or an attachment for a motorcycle that
converts it into a kind of tractor. Shodh Yatras also help Gupta’s team discover, or more precisely,
document, various herbs and plants that local citizens use as human and animal medicines.
To Gupta, these discoveries have the potential to change lives on a large scale. For example, an invention
that works in one poor village might be shared with another, or it may represent a product that can be
manufactured for sale with the possible creation of jobs and income flowing to the inventor’s village. It
may even represent the kind of idea, or the “seed” of an idea, that might interest a larger company that
can help perfect it, market it, and make it widely available while still rewarding the inventor.
To support these ambitions, Gupta has founded or is associated with a number of organizations that help
in various ways, from protecting intellectual property to providing support for improved design,
manufacturing, marketing, and so on. Through the Society for Research and Initiatives for Sustainable
Technologies and Institutions, the Honey Bee Network, the National Innovation Foundation, and other
institutions, Gupta is on a relentless and extraordinarily productive search to identify “best features” and
ideas in India, fully aware that those with these insights and the hunger to convert them into a new reality
can be found anywhere.
A Shodh Yatra begins a “business journey” that may or may not result in a new product or service
reaching the right customers. But sometimes reaching the right customers is the whole point. And that is
where innovation markets can be extremely useful.
InnoCentive is an online service linking potential “buyers” of innovative ideas with “sellers.” Originally
an in-house service of the pharmaceutical company Eli Lilly, InnoCentive is now an open marketplace for
innovation. Solution “seekers” contract with InnoCentive to list a problem for which they desire a
solution. Seekers can be companies or nonprofits, and the problems they want addressed can be centered
on business, science, technology, health, or other areas. Seekers post detailed descriptions of the problems
they want solved as well as the reward they will pay for a solution. Rewards can range from $5,000 to $1
million. Problem “solvers” submit solutions to these problems in hopes of being selected the winner.
Seekers judge the solutions submit to determine if the problem is truly solved to their satisfaction, and
thus they determine when and to whom they should pay the predetermined reward.
InnoCentive plays no part in these judgments. But they ensure that winning and losing solvers’
intellectual property is protected (until the seeker deems the problem solved and gains property rights to
the solution). InnoCentive is compensated by seekers who pay to list the problems they want solved.
Solvers offer solutions without paying any kind of participation fee.
InnoCentive typically receives hard problems; otherwise, they would have been solved by traditional
methods such as corporate research and development. They are important problems, too, requiring a
$35,000 fee to seek a solution, though nonprofits pay lower rates. Solutions vary in terms of what a seeker
wants: Some want a broad range of ideas to provide them with, in effect, external brainstorming. Others
want fully developed solutions that can be put into practice right away. And still others require
accompanying evidence of a solution’s effectiveness.
InnoCentive has proven to be up to the challenge of addressing difficult societal issues. In the developing
world, these include providing efficient, effective means of “mobile banking” to the rural poor; addressing
health issues like malaria, tuberculosis, and AIDS; developing bio-latrines; and inventing new means of
capturing and storing rainwater. Societal solutions in the developed world have been produced, too, such
as increasing public transportation ridership in Chicago to reduce CO2 emissions, and developing
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sustainable packaging.
InnoCentive has created a robust infrastructure for encouraging a cadre of problem solvers to work on
someone else’s important problem. Offering monetary prizes up to $1 million ($4 million has been
awarded; $16 million more is still on the table) certainly doesn’t hurt and goes a long way toward
explaining how InnoCentive has 170,000 solvers in its system. But another element on which InnoCentive
relies is the joy solvers get from working on difficult, meaningful problems and the pride and status that
can go along with solving them. Google relied on these very principles to create a society-changing
competition as a ten-year birthday present to itself.
The name Google is a misspelling of the word Googol, a number you write by placing a 1 in front of a
hundred zeroes. That’s a big number, by the way. For its tenth birthday, Google created its Project 10100
(ten to the hundredth power) challenge. The company that was founded to “do no evil” launched Project
10100 to do the most good. As a company that has transformed our abilities to access information—
“Where have I seen that actor before?” Google . . . type … type … click … click. “Oh, yeah, he was the guy in
the TV show DIY Medicine who gave himself a spleen transplant”—Google realizes that the world’s
toughest problems might be addressed by information that is already “out there.” It could be out there as
an idea in a university research lab or in the heads of freethinking individuals who have hit upon the seed
of a fantastic idea—even if they don’t know how to bring it about. So Google created Project 10100.
Project 10100 issued an open call to “idea people” around the world. It committed $10 million to be split
among five (or fewer) ideas addressing problems related to health, livelihood, environment, education,
and other critical areas of need.
Those who submitted ideas didn’t even have to know how to make their idea work—the idea itself was the
important thing. By combining online voting with a panel of judges, Google’s intent was to identify the
ideas that “helped the most.” This meant that the need was urgent, affecting many people, and that the
idea itself could be implemented quickly, cost-effectively, and with lasting impact. The $10 million in
prize money was given to the organizations best suited to implement the winning ideas. And the winning
submitters? According to Google, they “get good karma.”
Project 10100 is just one way of implementing a prize-based, open competition to achieve a goal that is
important to society. (Other notable efforts include a series of X PRIZES and Ashoka’s Changemakers
competitions—and I’ll discuss these later.) Similarly, InnoCentive is just one example of an effective
innovation market, the Taiwan health care system represents just one example of radical redesign in
health care (consider medical tourism), and a Shodh Yatra is not the only way to keep your eyes open by
looking anywhere for good, new ideas.
What all these examples show is how you can identify the important features of a solution to a tough
societal problem.
At this point, possibly—just possibly—you may be experiencing a mild case of déjà vu. Remember,
effective cross-sector hybrid organizations have to master Big Picture Design. Effective organizations
“steal” ideas shamelessly as OneWorld Health was able to do with out-of-favor intellectual property and as
NFTE did by making entrepreneurship the centerpiece of struggling high schools’ curricula. And Big
Picture Design had to take into account all aspects of a problem: having a new drug for the disease VL
wasn’t enough; OneWorld Health needed to design ways to deliver, market, and produce it, among other
essential requirements for success.
So are we looking at something new?
First: Yes, there are similarities between Big Picture Design and our current focus on identifying all the
important features of a problem. Those similarities are not coincidental. Just as successful organizations
can change by seeking breakthrough ideas, so can society as a whole. But the scale of change that is
possible is quite different.
And creating broad change is the point here: uncovering powerful means of seeking solutions with the
potential to create wide-scale improvements in society. That is what we saw with the Taiwanese health
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care system, which affects nearly twenty-five million people. That is a criterion Google used in Project
10100.
Powerful approaches also acknowledge that intelligence is evenly distributed around the world, even if
opportunity isn’t. That’s why such methods, including innovation marketplaces like InnoCentive and
Gupta’s Shodh Yatras, make appeals either to an unusually broad or just plain “unusual” set of problem
solvers.
Powerful methods recognize that humans respond to a variety of compelling stimuli: money, of course
(InnoCentive), but also a desire to make a difference (Project 10100). There is even evidence that creative
problem solving is best achieved by fostering autonomy, creativity, and a sense of social contribution. By
providing effective incentives, the quest for new features and new ideas can be dramatically accelerated.
Identifying important features of a solution often leads to their immediate application, as when a solution
is rewarded for being ready to use right away. Yet sometimes we may also identify solutions that are
applicable only in the future, not today. In other words, solution “features” discovered now may get
matched with the right problem later.
That is the essence of innovation marketplaces such as Yet2.com that allow intellectual property created
by one organization to be listed and licensed by another. It is also what Gupta is doing when he catalogs
grassroots innovations and indigenous herbal and plant-based remedies. I remind you that one of the
most modern antimalaria treatments, for instance, is based on an herbal remedy identified centuries ago.
By creating a framework for a broad constituency of problem solvers to connect with an equally broad
constituency of solution seekers, we have an important lever for creating societal change. But there are
three additional aspects, and we consider each in the sections that follow.
Step 2: Test to See What Works Best
Remember our all-at-once, swirling, evolutionary stew of identifying good ideas and features, testing,
copying the best, and creating variation? It’s all at once, because the real world isn’t kind enough to slow
down and perform a single algorithmic step at a time. It’s evolutionary, because these four processes
together create powerful changes. It’s time to look at the second of these processes, testing, to understand
the important role this plays in creating societal-level change.
We can think of biological evolution as a game. But a game in which the object is not to win (because that
is impossible), but to keep winning enough to continue playing. Calling evolution a game (or process, if
you like that better) with a fixed object is like calling the high school prom king and queen the “ultimate
winners” in life. In either case, things change, and just as Monsieur King et Madame Queen have moved
on since high school—hopefully—living organisms must keep changing, too, to keep pace with a constantly
changing environment (constantly changing at least in biological terms). Or recall Darwin’s Galapagos
finches with their inferior beaks—the “losers” that became “winners” when conditions changed after a
storm, making their beaks extremely well suited to the new plant life on the island.
In creating societal change, we can’t suddenly will a storm to blow in, making new changes possible. But
we can create an environment appropriate for change by insisting on new ways of keeping score. New
ways of keeping score don’t mean that the home team gets seven outs per inning, a bigger goal to kick
into, or jet packs on the backs of their tracksuits. If anything, new ways of keeping score should be fairer
than the ways we traditionally keep score.
The deck has been particularly stacked in favor of business—at least certain businesses. Many industrial
processes take products from the earth, do some smelting, boiling, or mixing, some molding, hammering,
or bolting, and then place new products on shelves or maybe in parking lots. If what they spend for
materials, labor, storage, transportation, and so on is lower than their product’s selling price, they’re
happy: They’re winners; they’ve made a profit.
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Unfortunately for us (and fortunately for them), this way of keeping score is not fair at all. We have more
than three-and-a-half billion years’ worth of “stuff” on the planet. This includes all of our forests, rivers,
lakes, oceans, soil, air, oil, mineral deposits, grasslands, and tundras—not to mention all the animal and
microbial life forms on the planet.
This vast store of wealth has the potential to sustain human and other forms of life nearly forever. Yet in
the last fifty years, we have done tremendous damage to this treasure. We have decimated our forests and
topsoil, as well as our freshwater and saltwater ecosystems. In the United States alone, the cars and light
trucks we drive belch more than 300 million tons of carbon into the air every year. The earth is warming
at an alarming rate, up about 1°F in the past thirty years. Highly knowledgeable scientists fear that if this
rate of warming continues for another century, there will be “changes that constitute practically a
different planet.”
It stands to reason that this kind of damage would count heavily against businesses contributing to it. If
you lent a friend your car and he somehow managed to set its upholstery on fire, you wouldn’t expect him
to simply tell you he “took a beautiful drive on a country road” when he returned it to you. That kind of
“scorekeeping” omits some important details.
Yet business often behaves as if it has taken a scenic country drive: “Our profits are up 15 percent
compared with last year. We are thrilled.” There is no mention of the flaming backseat. That’s not how the
score is kept. We incur the equivalent of $36 trillion (yes, t) in unreported environmental damages to our
“cars’ upholstery” every year.
This oversight has certainly been noticed. Triple bottom line (3BL) accounting has sprung up as an
alternative means of gauging a business’s performance. Rather than keeping track of a firm’s financial
performance alone, triple bottom line accounting focuses on a firm’s financial, social, and environmental
performance. These three Ps (people, profit, and the planet) or three Es (equity, economics, and the
environment) provide a set of metrics for better judging the totality of a company’s performance.
With this kind of fuller disclosure, a (traditionally) top-performing company may no longer look so good.
If it pollutes lakes and rivers, or if it neglects the well-being of the communities in which it operates, its
products may be shunned, its stock might plummet, and its ability to attract the best and the brightest can
be badly damaged. These effects may come from stockholders’ fear of future liability, consumers’ anger
and disgust, and prospective employees’ beliefs about how they may be treated. These concerns may
reinforce each other, too, creating an avalanche of financial, operational, and reputational problems.
Note: although triple bottom line accounting is better than standard financial accounting alone, Bill
McDonough (a leading voice for sustainability) points out that it can mistakenly create the equation:
doing less bad = doing good. The real point is not to pollute less, for instance, but to not pollute at all.
At present, there are no uniform, mandatory standards for triple bottom line reporting. But certain
voluntary reporting standards are starting to be adopted. The best-known of these are standards issued by
the Global Reporting Initiative (GRI). This multi-stakeholder network issues its Sustainability Reporting
Guidelines covering companies’ financial, environmental, and social performance. The breadth of
contributors to the framework and the number of well-known companies that have voluntarily adopted
these guidelines have made them the de facto standard.
The overall standards plus supplemental information gathered by industry cover a firm’s goals, systems,
policies, and other 3BL indicators in addition to concrete performance measures covering emissions,
waste, labor-friendly contracts, recycling and reuse.
Even though GRI guidelines are used voluntarily, they are being used—by more than a thousand
organizations. This by itself creates pressure for other companies to do the same in order to appear
“green,” or “social,” or some other commendable adjective. By having multiple stakeholders develop and
support the standards, development costs can be kept low, and the GRI can provide a simple-to-follow
process that any company can use to report 3BL sustainability. Outsiders who want to compare one
company’s sustainability effort with another’s are provided with a means to make apples-to-apples
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comparisons.
Most important, reporting can lead to action. The nonprofit Coalition for Environmentally Responsible
Economies (CERES) helped launch the Global Reporting Initiative in 1997. Since then, it has had an
unwavering intent to shed light on the risks and opportunities companies face regarding the environment.
In 2009, it persuaded the National Association of Insurance Commissioners to make it mandatory for
insurance companies to include in their annual reports the risks they face from climate change and their
strategies to meet those risks. By shining a bright financial beacon on this industry, CERES hopes to find
new supporters in its effort to curtail the destruction of the environment. By creating a new test for
insurance companies to pass, CERES hopes to affect other industries, too.
Indirectly, public reporting of environmental and societal progress and performance may be paving the
way for mandatory mechanisms to enforce good corporate behavior. Approximately a century ago, it was
recognized that taxes and subsidies might be needed to correct environmental, social, or other damages
that companies were not being held accountable for. Not surprisingly, this was never a popular idea with
business. The greater willingness today to protect the planet through carbon taxes, or similar mechanisms
that penalize a company for emitting carbon dioxide, may be related to companies getting used to opening
up their social and environmental books to the world.
There are other methods of testing, too, to try to ensure that scores are kept more fairly, accurately, and
transparently. The Forest Stewardship Council, which we took a look at in discussing Home Depot and
IKEA, tries to disrupt the logic that a board is a board is a board. No, FSC would explain, some boards are
harvested in ways that violate the integrity of our forests, and others are not. As a step toward fairer
scorekeeping for consumers (Home Depot) or producers (IKEA), FSC monitoring tracks the way in which
forest products are grown, harvested, and manufactured. One final example of how business scorekeeping
can produce widespread change: The Dow Jones Sustainability Indexes (DJSI) apply a strict methodology
to produce a sustainability performance score for companies. Based on the premise that the value of a
company’s stock is ultimately tied to its sustainability, the DJSI considers the top 10 percent of
sustainable performers in different industries and ranks them according to their financial performance.
By creating this blended means of evaluation, investors can direct money toward the best-performing,
most sustainable companies, and move it out of companies that have not taken up the challenge of
sustainability.
If businesses need new ways to keep score, then how about . . . nonprofits? Nonprofits are, in many
people’s minds and in some actual ways, the antithesis of for-profit businesses. For-profits seek to make
money and are powered by capitalism, and markets, and shareholder value, and stock prices, whereas
nonprofits, which seek to provide social good, can be powered by capitalism, and markets, and
shareholder value, and stock prices. And, no, that is not a typo.
“Social stock exchanges” provide a new way for nonprofits to keep score. Charitable donors trying to
decide whom to donate to have had limited information to guide them. Of course, they might prefer a
charity addressing a certain disease or a certain activity such as cleaning up the environment. And they
can turn to independent charity ratings or the information that charities disclose about the percentage of
their contributions that goes toward providing direct services rather than toward overhead.
But the amount of information available about nonprofits is paltry compared with what is available for
public companies. This means that underperforming charitable organizations may be able to hide their
lackluster performance and high performers can go unnoticed. Of course, “hiding” and being “noticed” (or
not) can have strong implications for how much money they receive from donors.
Wouldn’t you like to know a lot more about which charities are “winning” according to the test of the
social value they deliver so that they can “win,” too, in terms of your donations? That is the essence of
social stock markets.
Several efforts are under way to explore the very idea of social stock markets. Brazil and South Africa have
taken initial steps to raise funds through a market where different nonprofits compete for donor funds.
BOVESPA, the traditional Brazilian stock exchange, created a completely separate social stock exchange
in 2003 to improve the effectiveness of its charitable activities. This social stock exchange is a portfolio of
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social purpose projects undertaken by non-governmental organizations (NGOs) focusing on education to
benefit poor youth. The portfolio favors innovative grassroots efforts. BOVESPA used its know-how in
running a stock market to allow investors to buy “social shares” online in the hopes of creating social
returns.
The BOVESPA social stock exchange allows donors to buy shares in one or more social projects, similarly
to how others invest in stocks. BOVESPA requires NGOs to disclose information about their operations,
performance, and other pertinent matters. Although donors cannot sell their shares or trade them, the
exchange is successful, like other stock markets, in aggregating and helping vet information to assist
Brazilian and even international investors in making better-informed decisions. Although the absolute
amount of money raised through the BOVESPA social stock market has been fairly small, the Brazilian
context must be kept in mind. The distribution of wealth favors the rich more than almost any other
country. Even so, until recently not much was done to support the poor. Even nonprofit organizations are
a fairly recent phenomenon. To make matters worse, charitable contributions are not tax deductible.
In 2006, the Johannesburg Stock Exchange of South Africa launched a similar effort. The South African
Social Investment Exchange (SASIX), like BOVESPA, uses an outsider organization, in its case
GreaterGood SA, to identify and monitor promising NGOs. After understanding these NGOs’ capacity and
potential for impact, SASIX presents investors with a slate of “social stocks.” Here, too, investors cannot
cash out or trade shares, but they can carefully follow the progress of the NGOs and the projects they
invest it.
Are these efforts fully formed stock exchanges? No—not if all you can do after investing is track your
investment. But are these efforts a step toward a stock exchange for social projects? Yes. They provide a
level of assurance that any project and any NGO that you invest in is a good one. They help investors
understand exactly how the funds will be put to work, too.
Just as important, they help establish a new conception of what is possible. By linking the word social
with the concepts of profit, investment, returns, and markets, BOVESPA and SASIX have helped create a
culture where online, “open” philanthropy is starting to seem more normal.
These efforts are not without challenges. It is not clear how well these efforts will scale up, especially if
they are seen as favoring the donations of individuals rather than contributions from charitable
foundations. There is even the question of their survival, given that all administrative costs are now borne
by the sponsoring stock markets. And the NGOs and the projects that are listed on the exchanges can be
questioned, too. Are they truly the best, or merely the best at data gathering or presenting their
performance in quantitative terms?
Despite these questions, these are important efforts. They give real shape and form to the idea of “social
business enterprises” articulated by Muhammad Yunus. Yunus, winner of the Nobel Peace Prize for his
pioneering work on microfinance, has suggested that there is a false dichotomy between for-profit and
nonprofit organizations. What if, he argued, a business were for-profit, but its aim was not to become as
profitable as possible—the accepted ambition of a for-profit business? What if it aimed to make only
enough money to pay its bills and keep its operations alive and growing while focusing on producing the
greatest possible social returns?
Some of the funding for these social business enterprises could come from investors who would receive
company stock with the same expectations you would have of any other stock: you could buy it, trade it, or
sell it. All the expectations but one—you would be investing and moving your money from one stock to
another with the hope of producing the greatest returns for society.
In fact, in discussing the idea of social business enterprises, Yunus suggested that social stock markets
could be the very mechanism for implementing his vision. A fully developed social stock market would
need some of the trappings of ordinary stock markets (though they might take very different forms):
agreed-upon performance metrics, its own Wall St. Journal, analyst reports, brokers, and enough
investors and good “social stocks” to permit a true stock-trading market to exist.
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BOVESPA and SASIX aren’t that. But they are a step on the path. And efforts are under way to create
others, including a more fully functioning social stock market in London.
Even the legal apparatus necessary for social business enterprises to thrive is now available. Low-profit,
limited liability corporations, or L3Cs, can be formed in Vermont and Michigan but used to run
businesses in any state. As their name implies, these legal entities are not created to maximize profits.
L3Cs are particularly attractive to philanthropic foundations, which may help meet their annual legal
obligations to disburse funds by investing in them. This is so because the only type of investment that a
foundation can make to qualify as a disbursement is in a high-risk, low-return business whose primary
purpose is in line with the foundation’s nonprofit goals. And that’s precisely what L3Cs are set up to do, by
putting social returns first and financial returns a distant second.
This kind of flexibility, naturally, wreaks havoc with traditional scorekeeping. If LC3s are essentially
charities, but they can also distribute after-tax profits to investors, what should we compare them with?
How do we know which one is winning? Are we trying to decide which is better, Mia Hamm playing the
trombone or Michael Jordan making a soufflé? Maybe we need social stock markets to help us answer
these questions.
Getting Unstuck
We’ve been looking at how the “testing” aspect of identify-the-best, test, vary, and copy can be leveraged
in promoting large-scale societal change. But sometimes, the game isn’t fair even if the score is being kept
the right way. Imagine, for example, a running race in which, when the gun goes off, your opponent has to
run only a hundred yards, while you have to run a mile just to get to the starting line.
That is the problem that many small, underfunded organizations face, especially when they are serving a
customer base without much money: they’re stuck way behind a fair starting line. Do you remember
KickStart? Its founders knew they had products they could sell to poor people to help them develop or
strengthen their own businesses to improve their lives. But a genuine “market” approach was effective
only after KickStart was able to develop the products it wanted to sell. The market was not strong enough
to attract the investors it needed to raise money for the necessary design and engineering, since the profits
KickStart would make later would pay the bills but not make anyone rich. (And most investors are looking
to get rich.) What KickStart faced is common to many organizations trying to develop and provide services
to the poor—whether shelter, new sources of energy, or medicines. Getting to the starting line is
exceedingly difficult. Running the race once you get there is easier.
This is where various kinds of intermediaries can play a huge rule. Financial intermediaries, like the
Acumen Fund, the socially oriented venture capital fund, can provide money to help launch or expand
promising social ventures. Social marketing firms such as PSI (the former Population Services
International) can help nurture and develop markets for “new” products (like bed nets, condoms, and so
on) that aren’t sought out regularly enough by affected groups. Organizations such as Anil Gupta’s
Grassroots Innovation Augmentation Network can provide technical assistance to transform good ideas
into better products.
The Scoreboard Through the Fog
But let’s say the game is not fixed and the score is being kept the right way, but you still don’t know who’s
really winning. Why? There could be a thick fog completely blocking the scoreboard.
Not to despair. “The sun will come out, tomorr . . .” No, we don’t need to wait that long. Today, already,
right at this very moment, there are means to clear away the fog and the mental cobwebs we sometimes
develop in trying to figure out if a “bad” company is simply trying to “green-wash” us (slick marketing can
make “Plunder & Steal” seem like the world’s most eco-friendly firm) and let us see the light of day—and
the scoreboard.
For instance, are you interested in doing businesses with companies whose legal DNA mandates that they
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serve the interests of their employees, the communities in which they operate, or the environment? And,
would it appeal to you to know which companies have exceeded well-documented standards for social and
environmental behavior—standards certified by an independent nonprofit organization? What about
companies that undergo periodic audits to ensure their commendable behavior? Or companies that
publicly declare they will use business for societal good and support other companies striving to do the
same?
If these qualities are appealing, you may want to direct your purchases toward companies that are legally
structured in a new, nontraditional way: as B (for Benefit) Corporations. Or direct your investments
toward them.
B Corporations, in truth, are traditional for-profit corporations that have been certified to behave in
socially and environmentally responsible ways. They must change their bylaws or articles of incorporation
and get a passing grade on an evaluation of their social/environmental performance, which provides
feedback they can use to improve in those areas, too. At present there are several hundred B Corporations.
B Corporation certification already provides some assurance to “responsible” companies wishing, say, to
raise money from outside investors who may later protest that they are not trying to maximize their stock
price.
Legal issues surrounding B Corporations may eventually need to be resolved in court if unhappy investors
find fault with the company’s societal orientation. But by legally and formally declaring their intentions, B
Corporations are armed with ammunition to fend off business takeovers by profit-only suitors or
investors.
B Corporations’ new quasi-“legal structure” creates a North Star for companies trying to steer a
responsible and profitable course through the fog. But sometimes you just want something gadget-y to
“do the math” and give you advice—an aid as nimble in supporting “responsible” buying as a GPS system
is in helping you confront a maze of roads in a strange town.
Enter GoodGuide.
GoodGuide is a company—a B Corporation, at that—dedicated to helping consumers make healthful,
socially responsible, and environmentally informed decisions. It gathers and stores third-party
information on 70,000 products from more than two hundred databases, including life cycle data,
product ingredients, and information collected by social monitoring organizations. It uses various sources
of expertise about companies and products to evaluate their environmental impact (e.g., tons of carbon
emitted into the atmosphere), social impact (e.g., human rights policies), as well as potential health
hazards (e.g., possible disruption or interference with the endocrine system). The environmental ratings,
especially, attempt to include all aspects of a product’s “life cycle”—from the inputs and process used to
make it, to how it is transported, stored, and disposed of.
Various scoring algorithms are used to compute an overall product or company rating that blends social,
environmental, and health issues. You can even get an explanation of what data were used, and how, to
produce these scores. These ratings are available through the GoodGuide website, and there is also a free
“app” consumers can use on their smart phones while shopping (who wants to lug a computer to the
mall?) to help them instantaneously with purchasing decisions.
GoodGuide was first developed in the Sustainability Information Lab at the University of CaliforniaBerkeley. Other research institutions and organizations are taking different tacks to make it easier for us
to make sense of an enormous amount of potentially useful but confusing information. For instance,
Massachusetts Institute of Technology is developing a Climate Collaboratorium that allows users to raise
issues about the environment, offer potential solutions to address them, and provide evidence in support
of or opposition to a proposed solution.
All in an effort to let us see the scoreboard through the fog so that we can get back to playing the game.
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Step 3: Copies of the Best
Our adaptive stew now has two of the four ingredients needed to make large-scale, societal change
possible: identifying the best features and testing. Let’s look at the next ingredient—indeed, what some
might consider the secret sauce: making lots of copies of the best.
We may view this as the “survival” part of “survival of the fittest.” While others wither and fade away, the
victorious not only survive but thrive, reproduce, and are imitated. We have already seen how this works
within an individual organization. Organizations shamelessly “steal” the ideas of others if it benefits them.
They realize that there is no need to reinvent the wheel, even as they tweak it for their own purposes.
Good ideas survive and multiply.
Making copies of the best also operates at a larger scale—at the level of society as a whole. To bring about
large-scale change, we can resort to several powerful forces.
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We need to powerfully, persuasively, and conveniently create influence through ideas;
we need to empower people with the necessary skills and training;
we must marshal the appropriate resources;
we must create leverage through major institutions; and
we must cultivate a new type of future leader.
Making copies of the best may be understood in different ways—all applicable to our discussion. We
might produce (near-) literal copies, say by adding additional branch offices as identical as possible to one
that exists already. We may copy a large portion of an idea (since we allow variation, this qualifies as
copying) or just its essence (perhaps by letting others know about it and teaching them to adopt
something similar). Copying, in these various senses, includes a string of McDonald’s (literal copying), the
proliferation of online retailers (copying an essential idea), or a guy with a Beatles haircut (copying the
essence, but w-a-a-a-a-a-y too late).
Powerful, Persuasive Ideas
By the age of thirty-five, Jeff Skoll had already made his fortune. Skoll was the first president and first
employee of eBay, the wildly successful company that allows you to sell all your old “treasures” online. He
was ready for his next challenge.
He decided to create a positive influence on society by making movies. People who knew the movie
business told him it would be impossible for an outsider with no background to break in. Others said there
might be a slight chance, but that no one would want to watch the kind of movies that can create a positive
influence. Instead, they like watching films starring top actors like Tom Hanks, Julia Roberts, Philip
Seymour Hoffman, Jamie Foxx, Robert Downey Jr., Catherine Keener, Charlize Theron, Frances
McDormand, Sissy Spacek, George Clooney, Matt Damon, William Hurt, and Amanda Peet.
So Skoll’s movie company hired these actors, among a stable of other well-known stars, to create movies
about the global oil industry, women’s rights, a free press, and the Soviet-Afghanistan conflict, among
other films.
Still sound boring? Perhaps the names Syriana; North Country; Good Night, and Good Luck; and
Charlie Wilson’s War are more appealing. Each of these films, and others, including Murderball, Fast
Food Nation, The Soloist, and Waiting for Superman brought a “serious topic” embedded in an engaging
story to everyday audiences.
Skoll’s company, Participant Media (originally Participant Productions), hopes to create awareness of the
key issues of the day by telling good stories. Once it has succeeded in that, Participant has accompanying
social action campaigns to help viewers further explore the issues surrounding a movie and to get
involved. To do so, Participant has worked with nearly a hundred nonprofits to reach more than twenty
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million people. In these ways, it is “copying” important social ideas and spreading them widely.
The film Participant released that may have had the greatest influence in creating increased awareness
was the documentary An Inconvenient Truth. Before this film, there certainly was an awareness of climate
change and of humans’ role in producing most of the damage, but it was a bit muted and not at the
forefront of people’s minds or conversations.
Human activity has been putting dangerous amounts of carbon and other greenhouse gases into the
atmosphere since we became an industrial society. The Intergovernmental Panel on Climate Change has
been warning since its first assessment report in 1990 that this could cause the earth’s temperature to rise
at a rate not seen for ten thousand years. Al Gore had been learning about and trying to stop the effects of
global warming for thirty years when An Inconvenient Truth first appeared in theaters.
Although it would be wrong to say the film “caused” a shift in the public’s ideas about climate change or
policy makers’ views about what actions to take, it certainly was influential. The film won an Academy
Award for the best documentary feature film. (Who said Jeff Skoll couldn’t make movies?)
Although everyone is still not on board regarding global warming, opinion polls have reflected an increase
in the public’s concern, understanding of the issue, and belief that there is a consensus of scientists who
think global warming is occurring. Unfortunately, we still have the kind of “boiling frog” problem that
Gore illustrated in the film, namely that although climate scientists are blaring alarms about the urgency
to act, most of us still do not acknowledge the need to do so because changes in the climate are too small
and too slow for us to experience personally.
The year after the release of An Inconvenient Truth, Al Gore shared the Nobel Peace Prize with the
Intergovernmental Panel on Climate Change for efforts to “build up and disseminate greater knowledge
about man-made climate change, and to lay the foundations for the measures that are needed to
counteract such change.” The Nobel Prize committee added this about Gore: “He is probably the single
individual who has done most to create greater worldwide understanding of the measures that need to be
adopted.”
An Inconvenient Truth brought people into the theater. It set a near-record attendance mark for a
documentary film. After watching the film, more than 28,000 viewers downloaded materials from
Participant Media’s website so they could act on the film’s message. Participant claims that it was directly
responsible for offsetting more than 106,000 tons of CO2, and indirectly responsible for four climate
change bills introduced in the U.S. Congress. (Who said Skoll couldn’t get people to watch movies
promoting societal action?)
Participant is waging a war of ideas that leads to action. Richard Dawkins (of mud-to-DNA fame) might
call this the propagation of memes. Memes are ideas or small snippets of the culture that get passed on
with variation throughout society. As in genetics, “winning” means being copied, and being copied means
“winning.” So how can you make a meme win?
In short, memes (ideas) tend to be long-lived when they are memorable and easy to pass on. We might say
that our belief that blue jeans are in fashion, the fact that we all recognize the tune “Happy Birthday,” and
even our lay understanding that the earth orbits the sun are all the result of successful memes becoming
strongly entrenched in society. (Just a thought: why don’t we try to influence memes through movies?)
How do we create memorable memes that spread for the public good? Author Seth Godin suggests that
language must play a role. He asks, how can “global warming” be bad when global, warm, and
greenhouses (as in greenhouse gases) are all good? Among Godin’s solutions: call our climate problem
“atmospheric cancer” or “pollution death.” The nonprofit environmental marketing group
ecoAmerica agrees that language is crucial when it comes to exciting people and making a message
memorable. They prefer terms such as pollution refund to the technical phrase cap and trade. Their
research even shows that the environment is too off-putting a term. Better to talk about “the air we
breathe,” or the “water our children drink.”
I’ve heard it said, too, that the idea of something being “sustainable” is also too bland. You wouldn’t brag
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that your relationship with your wife or kids is “sustainable,” would you?
And how can we ratchet up interest and (action!) when a catastrophic increase of 4oC over the next
century is something that none of us would even notice? Godin says we should put CO2 emission meters
in all cars and bombard people with disturbing environmental pictures and stories.
He also suggests that symbols and icons are important. WeCanSolveIt.org and Repower America, for
example, typeset the adjacent letters we in their names to make them look like an upside-down me,
emphasizing the role every individual must play in bringing about clean energy. These groups have
splashed ads for clean energy brandishing their logo over the airwaves and “computer” waves. The ads
include mainstays of the political left and right disagreeing about almost everything except the need to
take action to address our dependence on petroleum-based fuel, as well as holding BP accountable for the
oil spill disaster in the Gulf of Mexico.
With the talent and energy marketers have for selling anything and everything—from bottled water (often
drawn from municipal water supplies) to poisons (cigarettes), from disturbing movies marketed as
comedies (Bad Santa) to “health” products of dubious value (just watch late-night television)—can’t we
expect more? If Coke and Pepsi each spend more than a billion dollars a year to get us to drink their
carbonated sugar products, is any price too high to preserve the health of the planet?
Of course, there is agreement that shaping people’s aspirations through language is only a beginning.
People must more profoundly engage the issues, too, as Participant well understands.
Empower with Skills and Training
Changing people’s minds is important. Changing their behavior is essential, if we are to make large-scale
improvements to society.
No organization represents these ideas better than Ashoka. Ashoka was founded by Bill Drayton, a
man with a broad and deep education and a wealth of experience at McKinsey & Company, the influential
business consulting firm, and at the Environmental Protection Agency, where he was a few decades ahead
of his time in studying and developing emissions trading programs similar to those being debated today.
Founded in 1981, Ashoka was also decades ahead of its time. Ashoka provides vital support to social
entrepreneurs, individuals who, by Ashoka’s definition, tackle society’s most pressing social problems
through innovative solutions that have the potential for widespread impact and adoption.
A key to Ashoka’s success is its ability to identify and leverage the talents of world-class social
entrepreneurs. Ashoka scours the planet to identify people who are creating innovations with impact in
the areas of education/learning, health, economic development, human rights, and the environment.
Those individuals whom Ashoka believes it can help nurture to become world-class change makers are
awarded Ashoka Fellowships. Today, there are more than two thousand Fellows from more than sixty
countries.
The diversity of innovative approaches that Fellows take is impressive. Take the area of learning and
education. In the United States alone, we see examples as different as these:
1. College Summit, a nonprofit organization that creates the appropriate culture and provides the
2.
3.
appropriate skills to prepare low-income, high-performing students for college, and that supports
colleges in identifying these students.
High Tech High, a charter school that immerses urban students in real-world problems that
prepare them for the world of work and simultaneously bolsters their academic performance.
The Center for Inspired Teaching, which offers mentoring and individualized programs to
sharpen teachers’ self-awareness and improve their communication and listening skills as a
means to improve student learning in public schools.
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4. CEO Women (Creating Economic Opportunities for Women), which helps female immigrants and
refugees become more fluent in English and learn how to become entrepreneurs by using
educational “soap operas” (not textbooks) focusing on problems and solutions faced by characters
similar to themselves.
To be awarded a fellowship, each Fellow must have already demonstrated the power of his or her idea, but
not yet on a truly large scale. And impact on a large scale is what Ashoka craves. Ashoka Fellows receive a
stipend that frees them to work full time on their ideas for several years. During this time, these social
entrepreneurs, most of whom are skilled in areas unrelated to business, continually develop their business
models. I once had a conversation with the founder of College Summit, J. B. Schramm, as we traveled
together to London. As he shared some of his ideas with me, he had the look of a nonbusiness person
whose business plan was going to be examined in every detail by one of the world’s most respected
business consulting firms. Which was exactly the case, because he was traveling as part of his fellowship
to meet with McKinsey & Co. for one of their periodic reviews of his ideas.
Giving social entrepreneurs such as J. B. Schramm access to some of the best minds in business strategy is
one way Ashoka can help take an idea born in the basement of a housing project and make it selfsustaining and national. College Summit currently operates in eleven regions within the United States and
is experiencing explosive growth in the number of high school students it serves. The organization
generates one-third of its revenue from fees, with the expectation that additional customers, such as
colleges who benefit from College Summit’s work, will fund the remaining two-thirds of its budget.
Receiving formal business training is only one way that Ashoka Fellows can perfect their business ideas
and influence more lives. College Summit, High Tech High, The Center for Inspired Teaching, and CEO
Women have each developed one particular approach to improving the educational lives of students. Yet
together their approaches form a larger whole—a more complete mosaic, as Ashoka sees it. Thus, Ashoka
encourages its Fellows to engage with each other to influence each other’s practices and adopt those that
fit their own programs. At a more powerful level still, Ashoka tries to glean common threads running
through the most successful social entrepreneurs’ work in a particular project area. These become
captured and made available to social entrepreneurs worldwide working on similar problems. For
instance, an observation about many youth-centered activities, including education, is that they lack
teachers or other qualified adults to teach or provide training. And you can’t wish, hope, or legislate that
away. But there is a “building block” that social entrepreneurs widely employ in response: empower
children, and help make them responsible for the teaching and training that takes place. Once uncovered
by Ashoka, this building block was shared and then successfully copied by an even greater number of
youth-centered organizations.
This element of the mosaic has become the basis for another Ashoka activity called Youth Venture, whose
website looks like something from MTV. The aim of Youth Venture is consistent with the Ashoka slogan,
“Everyone a Changemaker.”
Through its interactive forum, Youth Venture guides youth in selecting an idea, forming a team to
successfully put it into action, and expanding its impact. It may help with start-up funding as well.
Youth Venture operates on multiple levels. Of course, it hopes to produce new social ventures. As
important, Youth Venture doesn’t want you to have to wait until you graduate from college before you
decide you can become an entrepreneur (okay, so Bill Gates dropped out). Instead, it is directed at
teenagers and even younger children who are hungry to create change—now. And, like its more stately big
brother, Ashoka’s Fellows program, it links Youth Venturers together using a website that it hopes has the
magnetic properties of Facebook. Even more, Youth Venture is attempting to produce a cultural shift—a
new mind-set where anyone, anywhere, no matter her background or material wealth, can view herself
not only as having the potential but also the ability to effect change: someone who is a Changemaker.
Marshalling Resources
Having the appropriate supporting resources can allow small organizations to expand and, more
generally, to imitate practices of proven social and economic value. The right kind of support may take the
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form of physical infrastructure (a manufacturing facility, for example), a partnership, new markets being
opened, or money.
Ashoka clearly knows the importance of adequate “plumbing” and “wiring” for grassroots social
entrepreneurs to flourish. Its “Full Economic Citizenship” program aims to provide the benefits of a
market economy to those who have been excluded from its advantages. This initiative links these
individuals with partner organizations from the business world and the citizen sector (a phrase that
Ashoka prefers to nonprofit or non-governmental organization, since, to Ashoka, these carry negative
connotations). These partnerships strive to provide essential services such as health care and housing, as
well as the opportunity for poor individuals to improve their income by selling products locally and even
globally. In addition to the benefits flowing to low-income populations, this initiative benefits business
and citizen sector organizations by strengthening the relationships they have in low-income communities
and providing new business opportunities.
The sequence of steps that these three partners take to create and distribute goods draws upon the
productive energy of low-income citizens themselves, the financial and managerial resources of business
partners, and the abilities of citizen sector organizations to help gain a better understanding of
opportunities and work toward their acceptance. Ashoka’s name for these partnerships? Something that
may make us smile: a hybrid value chain.
As Ashoka is aware, lack of access to money is often a barrier faced by poor people striving to improve
their lives as well as citizen sector organizations that serve as a catalyst in helping them achieve financial
security. Ashoka envisions a new financial sector emerging to serve these needs—not out of charity, but
because it makes business sense. New organizations would complement and possibly even extend the
efforts of microfinance institutions, but they would be different in their own right.
In fact, new kinds of financial institutions are beginning to appear. One of the most acclaimed is the
nonprofit Acumen Fund. Acumen Fund is a very rare breed. It is a venture capital firm that returns no
money to its investors and does not try to make the greatest possible profits on its investments. Acumen
Fund investors and the Acumen Fund team are driven by a desire to make powerful societal change. They
value “societal returns” over financial returns while respecting the value and power of money.
Acumen Fund is a lean firm with offices in the United States, India, Pakistan, and Kenya. It is loaded with
talented individuals with degrees from some of the finest universities in the world—ambitious people who
could have written their own ticket to jobs of their choosing. And they did, by taking jobs at Acumen
Fund.
Acumen receives charitable contributions from individuals, foundations, and other organizations. With
the money it receives, Acumen Fund acts more like a for-profit organization by either lending money to
other organizations, with interest, or giving them funding in exchange for a financial stake in their
business.
The organizations that Acumen Fund invests in address one of several problems that face the very poor:
inadequate access to health care, substandard housing, lack of clean water, and nonexistent cheap, clean
energy. By targeting its investments to the countries in which it has foreign offices, Acumen Fund is able
to better understand a region’s specific needs in these areas and the best organizations to address them.
Acumen Fund invests in both nonprofit and for-profit businesses, helping them grow and establish a
sustainable financial footing, ideally within five to seven years. It is not in a hurry for a financial return (it
provides “patient” capital), and it picks businesses to invest in that can become long-term partners in
serving a region’s basic needs. During the period of its investment, Acumen Fund hopes that each
organization it invests in will reach at least a million low-income citizens with the service it provides. But
investments may also be made in smaller organizations that are rapidly growing, that have the inclination
and capacity to harness market forces effectively, or that are leading the way in providing health, water,
housing, or energy services in the region.
Acumen Fund may also help broker complex deals to develop solutions to a region’s particular challenge.
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You may recall from an earlier chapter that Acumen Fund facilitated an antimalarial bed net campaign in
Tanzania. It played a financial role in helping the bed-net maker, A–Z, enlarge its operation and provide a
more “modern” bed net. But it also helped put the pieces together so that A–Z worked with the Japanese
chemical company Sumitomo, the Tanzanian government, the Global Fund, PSI, and other organizations.
Acumen Fund had the, well, business acumen to understand the importance of each of these
organizations in creating the appropriate business “ecosystem” not only to manufacture bed nets, but to
distribute them, provide financing, and even to ensure that they were seen as something you must use
properly to avoid malaria.
Acumen Fund understands that even if an organization that it supports succeeds in helping a million
people, it could still take up to four thousand replicates of it to reach all who are in need. (1,000,000 ×
4,000 = size of the world’s population living in poverty.) So, like Ashoka, Acumen Fund tries to help
others benefit from its success and learn from its failures by providing a library containing multimedia
tools and lessons.
A different perspective on raising and disbursing funds to serve those at the base of the pyramid is taken
by IGNIA, a Mexican firm that receives investments from private investors, foundations, and others who
expect not only to be repaid but repaid with handsome profit. IGNIA invests these funds in entrepreneurs
with the potential to deliver much-needed essential products and services (in health care, housing,
utilities, and education) to a large number of low-income Mexican citizens. In effect, IGNIA is creating a
base of the pyramid “mutual fund”—a basket of companies whose joint success determines the success of
the fund—that offers attractive investment opportunities to investors. By having a portfolio of companies
that it invests in, IGNIA and its investors are protected against any one investment failing. IGNIA further
increases the prospects for success of the fund and the companies it invests in by providing business
guidance based on the significant experience of its senior leaders and other advisers.
Institutions Can Move Markets
If you are old enough to recall the late 1980s but not so old that you can’t remember where you put your
car keys, you will recall fast food companies like McDonald’s serving burgers, fries, and drinks in
throwaway polystyrene containers. This is the way fast food was always served—at least until the natives
of planet Earth began to get restless and agitate for change. Environmental advocacy groups, and
sometimes groups of schoolkids, urged McDonald’s to reconsider its choices for packaging, first by waging
a war of information. They pointed out that McDonald’s was the largest consumer of polystyrene, buying
more than 3.5 billion clamshell containers every year. This was a huge concern for those worried about a
material that does not degrade in landfills and is toxic when burned improperly.
McDonald’s responded by asking what difference it made to use paper wrappers or Styrofoam clamshells
and cups. “We used to use paper only. We could do it again. It’s not that we can’t, it’s just that we see no
reason to change.”
So the anti-polystyrene crowd escalated tactics. They encouraged customers to send greasy clamshells
back to McDonald’s headquarters. They also encouraged a boycott of McDonald’s altogether. The
Environmental Defense Fund played a large part in getting McDonald’s to change its behavior, too,
working with them to understand the best options for dealing with its waste.
The result? McDonald’s replaced polystyrene with paper, eliminating the one billion-plus pounds of
polystyrene it was using for its foods and drinks when the protests were taking place. (Alas, some drinks
are again served in polystyrene cups.)
A similar sea change is now taking place at Wal-Mart. The world’s largest retail chain store—the world’s
largest company of any kind—has made the decision to “go green.” They are, literally, selling hundreds of
millions of energy-saving compact fluorescent lights to customers and striving to reduce the energy
consumption of other consumer products such as flat-screen TVs by 20 percent. Wal-Mart itself is aiming
to eliminate its waste and obtain its entire energy supply from renewable sources. Further, it is putting its
suppliers on alert that it plans to grade them on their environmental performance, looking carefully, for
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example, at how their packaging fares along nine dimensions, including greenhouse gas emissions,
recycled content, and transportation.
Of course, more than fifty thousand Wal-Mart suppliers have seen this all before: when Wal-Mart wanted
to contain its costs by improving the way it was able to track its inventory and in-bound supplies, it
required them to use electronic means such as radio frequency identifiers (RFID tags), lest they become
“former suppliers.” As it goes, when the retail giant says, “Jump!” you don’t ask, “Why?” You just put on
your sneakers as quickly as you can and ask, “Is this high enough?” Wal-Mart creates legions of suppliers
happy to “copy” its dictates.
It’s easy to criticize large dinosaurs like McDonald’s and Wal-Mart. And both have been lightning rods for
environmentalists’ scorn. But when they change their mind—and business practices—watch out. The
effect is as if the sun were to relocate to a new address: every planet in the solar system would be
wrenched into a new position, too (even Pluto, which, let’s agree, is still a planet at the far end of the solar
system). That’s how gravity works. And Wal-Mart’s decisions.
So, even if we’re wary of mega-companies such as Wal-Mart and mistrustful of their intentions, we are
probably wrong to consider them dinosaurs. Quite the opposite: they provide gigantic levers. If we learn
how to grab them and pull, we quite literally can change the world.
Should it trouble us that Wal-Mart is “only” trying to hold down its costs rather than trying to be green
because “green is good?” I don’t think so. After all, environmental advocates have been presenting facts
and arguments to Wal-Mart for years, trying to convince the company that going green will save it green.
At last, and thankfully, that message seems to have gotten through. Wal-Mart and other organizations are
realizing that holding down energy costs, reducing expensive material costs, and selling products that help
their customers save energy (and money) is better than green-washing. (They still sell tons of, er, “goods,”
as leaders of our buy-buy-buy culture—leading to waste and pollution.)
Finally, we must never forget that the institutions we have grown accustomed to will change. By
understanding this, and both shaping and harnessing the effects of these changes, we gain another means
to change the world.
Let’s think about microfinance one more time. Initially, as we know, no one thought the poor would have
the discipline or ability to repay a loan, no matter how small. And even if they did, wasn’t charging them
any interest at all a form of usury? But those days are history—all of two or three decades ago.
With microfinance becoming more popular and attracting more funds, new issues are arising and we must
ask new questions. In 2000, the Mexican microfinance firm Compartamos changed from a nonprofit
microfinance institution to a for-profit company. In 2007 it completed its transformation, selling stock to
investors and being listed on the Mexican stock exchange. Many questioned—and may still question—this
move, believing that it contradicted Compartamos’s goal at the outset of providing small loans to the poor.
But the situation is not so straightforward. Compartamos has vast reach, serving all but two Mexican
states and providing financial services to more than one million customers. Many are rural, far from
major cities, and almost all are women who run small micro-enterprises. These women have small loan
balances (an average balance of about $450, or about 20 percent below average for Mexican microfinance
institutions), but the time and work Compartamos must put into identifying these loan customers and
servicing their loans are not reduced just because their loan balances are smaller. So Compartamos has
more difficulty covering its administrative expenses from charging interest than if the loans were larger.
These facts make Compartamos’s customers a relatively risky and expensive group to make loans to.
Accordingly, because of all these factors—smaller loans, riskier customers, and proportionately higher
administrative costs—Compartamos charges higher-than-average interest rates. If we step back and ask if
this is the “death” of microfinance, we may come to the opposite conclusion. Slowly, microfinance is
becoming more mainstream. People who simply want to make a profit are now interested, not just the
socially minded. When Compartamos first issued its stock, it had thirteen times more potential investors
than available stock.
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Compartamos’s profits and rising stock price have attracted other firms eager to copy it and reap the
rewards, resulting in more dollars flowing to more people who can use the money to start or grow small
businesses or make other major improvements in their lives. Firms such as Compartamos may ultimately
be unable or unwilling to serve the very poorest segment of society. That does not mean those people will
remain unserved, however. Nonprofit microfinance institutions, which rely on charitable donations or
funding from governments or other nonprofit agencies, can fill the gap.
For us, we should recognize that the actions of Compartamos can be likened to McDonald’s or Wal-Mart.
These are big institutions being pushed to change and pulling along others as they do. By working through
these institutions—monitoring their actions and influencing their behavior when necessary—there’s the
opportunity to create vast, positive change.
Institutions will change, and others will have no choice but to follow. We must make sure that they
change in the right way.
Preparing Future Leaders
If we are lucky, we will dodge a humans-on-Earth-ending climactic bullet. But only if we take the right
actions, starting right now, and continue them as a new habit of planetary behavior.
Who provides the best hope of finding, developing, and carrying out such new (to us) and exemplary
behavior? Those in the “minor leagues” playing T-ball and three-on-three soccer; riding their bikes,
catching frogs, and building mud pies; learning to tie their shoes (okay, Velcro); and discovering their own
abilities. For soon they will be in the “major leagues.” They will need to think differently, to be broadly
educated, and to see and to act on critical relationships.
Consider this way of thinking and acting differently:
When there is a glut of coffee, its price drops, and coffee farmers’ income plummets. Farmers can’t coax
more coffee from their plants, and just 4 percent of the plant (the bean) is sold as coffee anyway, whereas
96 percent of its total mass goes to waste.
The whole idea of even growing coffee seems not to make sense. Unless you think and act differently.
You can plant banana trees to shade the coffee crop. You can plant herbs that attract insects so that you
don’t need herbicides. And you now have shade-grown organic coffee that commands a higher price.
You also have the waste from the coffee tree trimmings, which provides a remarkably nutritious
environment for mushrooms to grow much faster than normal. The mushrooms growing in this
Starbucks-like environment unfortunately create a new kind of waste—I should have said fortunately
because it can be fed to livestock. But they create waste, too, and certainly this must be the tail end of
nature’s digestive system. But it’s not, if you use it as lunch for bacteria that are part of a bio-digester that
can produce natural gas (to create steam to pasteurize the banana waste to produce the environment for
the mushrooms to grow, to …). The bio-digester’s “waste” (are you getting the idea that there is no such
thing as waste in nature?) is sludge that helps grow algae in ponds to purify the water to help support the
pond’s fish. Of course, you also end up with dried bananas, and meat or dairy from the livestock.
This hybrid way of thinking comes from a deep understanding of nature—an understanding of its
biological, chemical, and ecological properties, but also the way it can help create a vibrant economic
system. The underlying science relies on basic principles unknown to most adults, but known to the
scientifically literate. And the economics embraces much more complexity than the customary step-bystep, break-it-apart-and-analyze-it thinking that is often taken as the pinnacle of knowledge.
So, who could ever learn to think and act this way? How about … kids!
The Zero Emissions Research Institute (ZERI) was actually involved in a similar transformation of a
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community of coffee farmers in Columbia in the 1990s. These farmers initially suffered a loss of income by
being subject to world market prices for coffee, but ultimately ended up wealthier and better supported by
a more robust economic system for generating their livelihood and a more robust ecosystem for
supporting their land. ZERI estimates that the earth’s twenty-five million coffee farms together could
produce fifty million more jobs if these kinds of practices were widely implemented. They can also
generate more than ten million additional tons of food.
ZERI also believes that children—not just honors students in the world’s best high schools, but young
children like those living in Brazil’s favelas—can master this kind of thinking. ZERI’s founder, Gunter
Pauli, has created a series of fables to teach children. Like Aesop, Pauli’s ambition is to provide students
with a moral understanding. But this understanding is based on a deep knowledge of science. His thirtysix fables (in Spanish and English minibooks) contain 1,500 deeply researched scientific ideas—the very
kinds of topics that can be used to support new bio-economic systems, including osmosis, gravity and
tides, chemical reactions and electricity, water surface tension, and Newton’s third law. Yet these ideas are
embedded in stories that any youngster can understand and be interested in.
As early as elementary school, children can begin a ZERI journey of educational discovery. By
questioning, receiving answers, and constructing their own (increasingly accurate) scientific models of the
world, they build their understanding and stimulate their imaginations. ZERI also encourages a deep
emotional connection to its lessons—lessons embracing social and economic justice and an unswerving
commitment to the natural world.
By the end of their journey, ZERI-taught students have the knowledge, passion, and commitment to act.
Too many people with too little planet and not enough opportunity? Not if you fundamentally change your
perspective and believe in radically redesigned economic systems that create jobs and perfect their use of
natural resources.
In the next decade or so, let us hope that the number of young leaders with this kind of orientation
becomes enormous, that their confidence is grounded in a more complex “systems” reality, and that their
ambition for personal accomplishment and gain is channeled by the challenges of respecting and
preserving our home planet—socially, economically, and environmentally.
That’s how you create the biggest changes of all.
Step 4: Creating Variation
As I have described already, evolutionary changes in society come from four forces swirling together in an
adaptive blend to spew out effective, society-changing ideas: identifying the features of effective solutions;
testing them; copying the best; and introducing variation. We have taken a good look at all of these but
the last, to which we turn our attention now.
Solutions to societal problems rarely spring into being fully formed, ready to be adopted. Even when we
are successful in identifying new ideas that may lead to effective societal solutions, they are likely to reveal
themselves as puzzles requiring careful thought and new insights. This is where variation comes in. The
impetus for varying the approaches we take in seeking societal betterment can be as different as the
profound secrets of nature or kids seemingly puttering about on computers.
Variation Inspired by Nature
Consider biomimicry. This is the activity of creating designs that mimic nature.
Someday soon shoelaces will be a thing of the past, just as typewriters are today, because who needs to
teach a kid to tie her shoes when there’s Velcro? Velcro was invented in the 1940’s by a Swiss engineer, or
millions of years ago by nature, if you really want to give credit where credit’s due. Velcro’s hook-and-loop
design is a direct imitation of burrs sticking to an animal’s fur. With an ordinary microscope, you can see
that burrs look like hooks, and fur creates a series of loops on which the hooks get snagged.
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But not all of nature’s designs are so easily understood. Trees miraculously turn sunlight, water, carbon
dioxide, and air into cellulose, which binds to become wood. This is an amazing recipe for producing
something stiffer than steel or concrete and with better bending strength. Or how about spiderwebs? They
are stronger than both steel and Kevlar and are produced by itsy-bitsy critters that do all their work at
room temperature. Can our designs touch spiders or trees? Not even close.
But sometimes we can crack a tricky biological code. For example, the lotus flower grows in swamps, yet
its leaves are immaculate. Why? The simple—and wrong—answer is to assume that the leaves are so
smooth that they act as a repellent. The truth is that, at the microscopic level, the leaves’ surfaces are spiky
and jagged. Air between these spikes causes water droplets to hover poised upon the leaves’ surface,
where they attract mud and grime. When the leaf tilts in any way or the wind blows, the drops of water
carry away the dirt and clean the plant.
And so? And so by cracking this code we can obtain buildings protected by self-cleaning paint (Lotusan)
or stain- and bacteria-resistant high-performance fabrics (GreenShield). The benefits we get include a
reduction or elimination of many chemicals that are harmful to the environment or hazardous to human
health. And we learn that creating industrial variations of exquisitely adapted natural processes can set
society on a course in which we live harmoniously with nature rather than opposing it.
A lesson we might take away, too, is that sometimes, deep and specialized technical knowledge is
necessary to create appropriate variations. But not always. At least not always in the way you might think.
Variation Inspired by Outsiders
Remember InnoCentive? Many of the competitions they have run have been won by individuals in fields
very different from those of the original problem seekers. For example, an oil tanker that cracks or springs
a leak may need to be emptied very quickly. The Oil Spill Recovery Institute feared that this could become
an extremely difficult task in frigid Arctic waters as crude oil turned into icy slush. They turned to
InnoCentive and got an answer to their problem, but from an outsider—a chemist—whose insight was
formed by pouring concrete one summer. Concrete vibrators prevent concrete from setting up too soon
and allow it to be easily poured into tight spaces. So why not do something similar with oil?
This is far from an isolated example. A study of InnoCentive revealed that the greater the number of
disciplines that attempt to solve an InnoCentive problem, the more likely it is to be solved. And the odds
improve as a solver’s expertise gets further away from the original problem.
All of which can be great for people with, ahem, “unmarketable” skills. Although InnoCentive relies on a
fair number of problem solvers with advanced degrees, relevant outside experience can come from
anyone—including computer gamers.
The ability to sequence DNA has led to a massive amount of data. Buried within these data are clues for
designing new drugs or enzymes, developing effective biofuels, and cleaning up pollution. DNA
sequencing data record how strings of amino acids line up, but they tell us nothing about how these
sequences fold into three-dimensional shapes. Yet that is where the “action” of these proteins (folded
strings of amino acids) takes place.
Typically, figuring out how proteins fold involves lots and lots of computational power, a fair amount of
trial and error, and a good amount of luck. Enter FoldIt—a “computer game” that allows human game
players to fold proteins. The premise here is that there are some things that humans are amazingly good
at, such as understanding language (three-year-olds are better at this than the most powerful computers)
and understanding spatial relationships. And folding proteins is all about spatial relationships.
The FoldIt software takes you through a series of tutorial exercises, teaching you to position partially
folded proteins to get a better look at them, pull certain sections, and rotate others. Feedback lets you
know how you’re doing according to the actual biology and chemistry of protein folding. (Proteins fold
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into the most stable configurations possible; the more stable your shape, the higher your score.) Once you
get the hang of the software, you can try folding proteins whose optimal 3-D shape is not yet known,
which can provide important new scientific information. Ultimately, the hope is to let players design
completely new proteins. By understanding and creating folded shapes, medical advances may be made to
fight HIV/AIDS (where proteins are involved in attacking human cells), cancer (where proteins fail to
properly protect and repair cells), and Alzheimer’s (where snippets of proteins are thought to be left
behind, cluttering our brain circuitry).
At this point, the best FoldIt gamers perform quite well. FoldIt lists the winners for every puzzle to give
them credit. Winners include a thirteen-year-old, a home security designer, and others with no special
biology background. PhD-level biologists, on the other hand, have no special aptitude at FoldIt. Will we
benefit from important new discoveries when the abilities of those who are best at “seeing” how to fold a
protein are unleashed on the increasingly ambitious protein “games” being developed? The jury is out.
But as the magazine The Economist suggests, even the possibility presents a dilemma to parents: “Should
they tell their children to stop playing games and get on with their homework or encourage them to
continue playing and possibly share in a Nobel prize?”
Institutions Opening to Variation
As we’re beginning to see, creating variation in a way that has the potential to transform society requires
different kinds of institutions. Biomimicry is based on an entirely new conception of how industry should
work to design, maintain, and retire planet-preserving products. Competitions such as InnoCentive’s tear
down the institutional boundaries between organizations that inhibit a good idea from finding a new
home elsewhere. And as the example of FoldIt shows, even the most fundamental problems within a
highly technical discipline may remain unsolved unless “membership” in the discipline becomes
dramatically more open.
Similar transformations are needed to support the adaptation and adoption of ideas whose origins are in
the developing world. Anil Gupta’s Shodh Yatra discoveries are the starting point of innovations with the
potential to change society. But identifying new, useful technologies is just one step; something more is
required to allow them to take off. To create change on a large scale, many of these innovations require
variation: mechanical variation so they work better, physical variation so they’re easier to produce, and
variation in the way they are marketed so that they’re more appealing, just to list a few of the changes that
can be necessary.
If you remember, Gupta’s work gains support from a number of organizations that help in various ways—
from protecting property and providing support for design, to improving manufacturing, marketing, and
so on. One support institution, the Grassroots Innovation Augmentation Network, provides just the kinds
of variations we are describing. Another, Gupta’s Honey Bee Network, fulfills his ambition to allow
grassroots ideas to cross-pollinate so that they spread more widely and borrow from each other more
easily.
Even so, Gupta is also keenly aware of the importance of protecting indigenous knowledge (especially
knowledge about plants, which large corporations might suddenly try to “copyright” by introducing “new”
products) and of providing tangible benefits to those whose ingenuity and effort have led to new
inventions. Thus, the suite of institutions supports the protection of intellectual property rights (through
patents obtained in India and the United States) and strives to connect these products with new
customers and markets by providing technical, business, and financial support.
These various business support and development institutions collect the “germ” of good ideas and try to
make them even better. Turning a prototype into a product. From a product, creating a market. A similar
attitude—starting with something that is close to what is needed and opening up the design process—
characterizes the Open Architecture Network.
The Open Architecture Network sprang from the ideas and wishes of Architecture for Humanity. This
nonprofit organization was founded to help provide design and building support to those who couldn’t
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afford (and were unlikely to ever obtain) high-quality dwellings, adequate schools, decent sanitation, and
many of the other things we more or less take for granted. By tapping the expertise of individuals
worldwide, the group assists in creating, alongside the affected stakeholders, inclusive designs that help
address the deficits in their lives.
The Open Architecture Network is an online community of designers, architects, engineers, and others
who produce open-source designs. The network sponsors specific design competitions, including a smart,
safe, sustainable “classroom for the future”; transforming one city block in Dallas to “reinvent” the very
idea of inner-city America; and addressing the digital divide in Africa, Asia, and South America.
There is tremendous benefit from the ideas generated in response to competitions. But there may be more
power generated by losing entries than the winner. Why?
Simply because there are so many of them, and the Open Architecture Network makes sure that all ideas,
plans, designs, and other intellectual property it receives can be shared and used by others. The specific
problem one designer faces may be addressed by someone else’s design—or a piece of that design—which
another party is free to modify or extend. The processes of sharing, commentary, and collaboration
actually extend to nondesigners, including teachers, health care workers, or volunteer groups—anyone
who might have on-the-ground knowledge of what is needed or suggestions for how to supply it.
In its grandest dreams, the Open Architecture Network would see its electronic repository provide design
ideas that the five billion poorest citizens of the planet would access, change, and reassemble like
Tinkertoys to make them more appropriate to their needs and situations. Talk about variation on a
societal scale! The Open Architecture Network embraces the principles of the open-source movement.
This movement itself is a powerful force for producing relevant, appropriate variations intended to
address societal needs.
The term open source originally suggested a new means for producing computer software. Traditionally,
software companies carefully guard their underlying software code. It is, after all, the way they make
money—either by selling the software itself or by selling (or leasing) a service that the software enables.
Open-source software, on the other hand, gives anyone the ability not only to “look inside,” but to change
the software if certain guidelines are followed. The major advantage of “going open” is getting hundreds,
even thousands, of people to work on perfecting and improving a piece of software. This makes producing
software better (more people looking to make fixes and additions), quicker (an extreme division of labor),
and cheaper (labor is free). In fact, open-source software is usually free altogether, creating powerful
alternatives to “boxed” software requiring a recurring cycle of license renewals (for a fee) or upgrades
(also for a fee) without users really getting what they want anyway. There are also vast implications for the
adoption of software in the developing world, where the prices we pay are completely out of the reach of
the multitudes.
And so others outside the software arena thought, “If ‘going open’ works for software, why not us?” This
question heralded a shift in culture and attitudes. The MIT Open CourseWare initiative was among the
first in education to allow students and nonstudents—anywhere, and without any formal affiliation to
MIT—to receive a large share of the benefits of an MIT education. And all for free. Want to know about
linear algebra? (I didn’t think so.) Well, if you did, you could obtain a syllabus, readings, video recorded
lectures, quizzes and tests (with solutions), and a variety of other materials—the same materials that
students at MIT receive. A similar set of materials is available for almost every course in the MIT catalog.
You can even translate these materials into other languages, which is very useful for schools in poorer
countries, and modify them by adhering to stated agreements covering modifications. These include not
profiting from your actions, giving proper attribution, and enforcing “share alike”—meaning that anyone
altering a derivative work that you produce must adhere to the same agreements.
Medicine is “going open,” too, with a boost from an unlikely source—the U.S. government. Electronic
health records (EHR) can replace manual systems that hospitals have used to record, store, and transport
(and misplace and lose) medical information. Electronic records provide immediate, accurate, and
complete access to patients’ charts and histories, clinical test results, X-rays, MRIs, CAT scans, and other
data and information. The results: improved care at reduced costs.
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EHR systems aren’t cheap. But the Veterans Health Administration (VHA) has been developing an EHR
system over several decades. And rather than keeping it under lock and key, they have put it in the public
domain, where others can use it, change it, and extend it. This is welcome news to the nearly 98 percent of
U.S. hospitals that use such state-of-the-art technology as pneumatic tubes like those at the drive-up
window at your bank to shuttle information from one point to another. A set of software developers
around the world works on this open source medical system, without compensation, just as software
specialists do in other areas.
The VHA’s VistA system is only one notable example of open-source medicine. Other efforts can be found
in the developed and developing world, covering advances in hardware and software to support
improvements in clinical medicine, public health, health administration, and other areas of health care.
Many of these open-source efforts coincide with increased usage of both cell phones and Web 2.0
technology (greater interactivity over the Web). Together, these have greatly broadened our conception of
who is capable of doing what and who should communicate with whom. For instance, the nonprofit
organization DataDyne.org has developed an open-source model using cell phones for collecting
epidemiological data in very poor countries. Each country can tailor the software for its particular needs
and likewise customize any analyses they need to carry out. Perhaps most important, the collection of data
can be carried out by some of the two billion mobile phone users now in developing countries where
epidemics break out, often far away from urban centers.
The “opening” of systems and processes has had ripple effects throughout institutions. Think again about
OneWorld Health’s efforts to combat diseases affecting the poor. A supporting network, the Tropical
Disease Initiative (TDI), has sprung up that can boost OneWorld’s nonprofit pharmacy efforts. The TDI
does computational experiments to find promising new leads for infectious diseases of the tropics. It
explicitly promotes open-source collaborations and provides a drug discovery “kernel,” as they call it,
which contains technical information about various drugs and drug categories along with various targets
for these agents.
This type of variation—simultaneously a variation on both the drug discovery process and on the original
software-only open-source movement—is consistent with the radical remaking of other institutions. Forprofit charities? Think Google.org. Nonprofit stock exchanges? Think BOVESPA or SASIX.
As Darwin said, “It is not the strongest of the species that survives, nor the most intelligent, but the one
most responsive to change.”
Or Andy Warhol: “They say that time changes things, but you actually have to change them yourself.”
With six-billion-plus potential change agents on the planet, maybe we’ve got a chance.
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CHAPTER TWELVE
Building Blocks For Your Future:
The Changemaker's Cube
At the end of a fact-filled briefing, U.S. President Lyndon Johnson turned to face his advisers, asking
only: “Therefore, what?”
We’ve covered a lot of ground learning about how to change the world.
We’ve delved into poverty, health care, the environment, education ...
We’ve examined treadle pumps, attic treasures, inner-city entrepreneurs …
We’ve met Gina, Cynthia, Patrick, Sachin, Steve …
We’ve touched down in India, Kenya, the Amazon, Bangladesh, the United States …
We’ve been guided by open source, the BoP Protocol, markets connecting all points of the globe,
transactions covering everything under the sun …
We’ve been instructed about Big Picture Design, Making It Appropriate, Making It Stick, and Making It
Bigger.
We’ve discovered that organizations have “DNA,” and that because of this they can breed and evolve.
We know how society as a whole advances if we deftly apply evolution’s levers: identifying features,
testing, copying, and introducing variation.
It’s time to ask, “Therefore, what?”
I didn’t write this book to tell stories, though I hope you like what you’ve read.
You see, I take the ideas in this book seriously. What I’ve written comes from what I’ve learned from
teachers, friends, students, and others in situations I’ve been fortunate to be in around the world (I’ve
“stolen shamelessly”). I’ve selected the examples that seem most relevant for me, for my ends, making
tweaks here and there for emphasis or clearer illustration (“making them appropriate”). Much of what I
have written has passed the test of time, but other ideas are emerging still, and you—the jury—will judge
their power and breadth (yes, your judgments will ideally “make them stick”).
My hope is that this book will provoke multiple experiments in copying and variation—ultimately, my way
of “Making It Bigger.”
I wrote this book in the hopes that you will take action.
Therefore:
What—kind of future can you create for yourself?
What—should you do to get there?
What—can you do to keep moving when the world’s problems seem
so big and outcomes seem so uncertain?
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--The Changemaker's Cube
Take Rubik’s Cube, the puzzle that makes you feel curious, engaged, addicted, frustrated, angry, smart, or
stupid … depending on who you are, how much effort you’ve put into solving it, and the success you may
have had—or not. It’s nothing but a set of cubes—or let’s call them building blocks—that you can arrange
in various configurations. Let’s play with them to create your future.
The real Rubik’s Cube is a 3 × 3 × 3 multicolored plastic form, which, as you probably know, can be
twisted in three different planes. The number of configurations you can produce is 3 × 3, carry the 1,
subtract 15, to the power of . . . er, enormous.
At the very least, the complexity of the cube makes it a nice metaphor to examine the complexities of our
lives. But what does our cube look like? (It’s not really a cube at all, since its height, width, and depth
are all different.)
To make a point, I’ve somewhat arbitrarily created a cube that’s 3 × 4 × 5—for the three levels at which
you can have impact, the four generic types of activities you can engage in, and the five aptitudes you can
draw from. As with the real Rubik’s Cube, we can manipulate these dimensions independently, resulting
in different combinations of impact + activity + aptitude that we can apply to different societal
problems. Let's call this our Changemaker's Cube.
Let’s look at these three “dimensions” in a bit more detail. The impact dimension represents the effects
that you can achieve through your efforts. You can help individuals (one by one, in groups, or in
communities). You can strive to change organizations, whether businesses, governments, nonprofits, or
other institutions. You can work for change from within or without. You can focus your efforts on societylevel problems, too. You may be devoted to a cause such as healing the planet or ending hunger. Naturally,
if you work at this level, you are bound to work on changing various organizations, and your actions will
affect individuals. Likewise if your focus is on individuals or organizations: we must realize that these
three levels of impact have blurred boundaries between them.
The activity dimension indicates, approximately, when you join an effort to produce change—regardless
of whether we’re talking about individuals, organizations, or society. You may like to jump in early, when
plans are being drawn up and help devise. Not all plans work, of course, so another important activity in
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producing effective change is to validate. You can adjust, based on the outcomes being produced. And you
can amplify what is working so that it helps others (more individuals, additional organizations, a larger
portion of society). For illustration, let’s consider what these various activities might look like in the
context of devising a program to improve the health of a community:
1.
2.
3.
4.
Devise: design a program of eating and exercise.
Validate: check weights, blood pressure, and so on at appropriate intervals.
Adjust: make modifications as necessary (maybe pound cake isn’t a diet food).
Amplify: apply what you find to be working to help more people.
The aptitude dimension, which covers your skills, talents, and interests, is a bit like your distribution
requirements in college. Each aptitude represents a work style that might appeal to you. Social means
acting with a focus on interpersonal relationships. You might fulfill this “distribution requirement”
through psychology, empathy-based training, or something similar. Technical represents the application
knowledge. Engineering or law fit the bill. Creative places an emphasis on, well—creativity. If you like to
write, make music, take pictures, or make films, you are doing creative things. Knowledge-based means
generating new ideas even if they aren’t immediately applied. Biology, mathematics, chemistry, or even
conceptual design belong to the knowledge-based aptitude. Finally, an administrative aptitude relies on
combining smaller parts into bigger, effective wholes. Business naturally comes to mind as an
administrative aptitude, but being a music conductor or a movie director qualifies just as well.
Now let’s play with the cube!
Example: organization +design + creative
Let’s start with the cube associated with organization + design + creative. How might you use that
particular combination—that building block—to help alleviate poverty? In other words, how might you
impact an organization through creative design?
Here’s one way: many organizations that serve the poor have an overwhelming amount of work on their
plate and not enough time to get it all done. Despite intake interviews and other forms of data collection,
they often fail to get a deeper understanding of their clients’ circumstances and challenges—information
that could lead to better support.
Could you develop a program to give these clients cameras (something creative) and let them take
photographs of their lives, focusing on what they deem most important? This may lead to new processes
or services within your institution (design/organization); it could even lead to the organization
developing a new product that it can sell (design/creative).
In fact, not only is this possible but it’s been done. A form of participatory journalism called Photovoice
gives cameras to those who are usually the object of a study. Rather than having schoolchildren (or others
such as peasant farmers or welfare recipients) submit to the questions of bureaucrats, survey takers, or
others with an ask-then-check-a-box mentality, Photovoice gives them easy-to-use still cameras requiring
little or no instruction and asks them to photo-document their life with accompanying text (the “voice”
part of Photovoice). In addition to bringing increased dignity and respect to the photographer, such a
project provides the kind of information that an organization can use to reengineer its products or
services. On top of this, a collection of Photovoice “stories” can be packaged as coffee table books, note
cards, or other typically hauntingly beautiful items that can be sold to support the service organization or
its constituents.
Now, how might you employ your creativity to help design change in an organization focusing on the
health of local rivers?
Example: organization + validate + creative
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What if we twist the cube just a bit, turning up the following combination: organization + validate +
creative? How might you use this combination to address health care issues?
Easy! You could use Photovoice again to document patients’ compliance at home in taking pills, following
a prescribed exercise program, or managing their diabetes. As you are seeing, a “good” answer, such as
Photovoice, might apply to several questions. And, of course, there are no “right” answers.
How might you combine validate and creativity to transform an organization that addresses poverty (or,
if you like, education)?
Want another? Good … Let’s twist again.
Example: Society + amplify + social
What if you were interested in amplifying a societal solution using social means to help protect the
environment? If you were thinking big—societal-level solutions require that, of course—you might have
invented a game involving the whole world. What’s more social than a friendly competition? Winner gets
to save the planet. An Eco World Cup.
The automotive X PRIZE has done just that. It pits international car firms against each other to design
extremely efficient, nonpolluting cars. Just to compete, cars must get at least a hundred miles per gallon
(or equivalent efficiency if they use fuel sources other than gasoline) plus significant reductions of
greenhouse gas emissions per mile. They also must be “real” cars in these ways that appeal to consumers:
Cars meet prevailing safety standards. They can be produced, sold, and serviced on a relatively large
scale—thus holding down costs. The kind of fuel or alternative powering infrastructure they use is
available. And they offer consumer-friendly features.
If your team’s car passes these tests, you get to enter a series of “elimination races” on real roads. In the
end, the fastest car wins, and winning team gets a $10 million prize.
But the real winner should be the planet and all of us who live on it. By mobilizing teams internationally
to think of dramatically new ways to build cars and demanding the coordinated efforts of engineers,
designers, investors, and others who play key roles, the X PRIZE should soon lead to super-efficient,
extremely “clean” cars on our roads.
Now your turn: amplify a societal solution using your social aptitude.
Example: Society + amplify + social
How about something a little less than planet-sized, but again amplifying efforts to produce society-level
changes using social means?
You may feel—make that know—that both the health of the planet and the future of decaying U.S. cities
depend on the same thing: sustainable solutions that focus on the three Ps—people, profit, and the planet.
But what can one person do?
Holly Harlan of Entrepreneurs for Sustainability (E4S.org) is a “master connector” who links people and
ideas within the greater metropolitan area of Cleveland (two to three million people) and beyond to help
create a vibrant city built on the principles of sustainability. The region has pockets of sustainable activity
with businesses and other organizations addressing topics such as renewable industries, energy efficiency,
green building, and sustainable food systems. Entrepreneurs for Sustainability builds connections to
strengthen the relationships within these different pockets and then brings these separate networks
together. Holly is creating a network of networks.
Lao-tzu told us more than two thousand years ago that “a journey of a thousand miles begins with a single
step.” Holly might say, “Creating sustainable Cleveland begins with a new relationship.” Entrepreneurs for
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Sustainability gathers together leaders, future leaders, and curious bystanders so that people start talking;
so that they undertake new sustainability projects; so that, by their joint efforts, an environmentally,
socially, and economically sustainable Cleveland becomes a reality.
One day people may be shocked to learn that the Cuyahoga River that flows through Cleveland to Lake
Erie once was so polluted that it caught fire. If Holly and her network of thousands have their way, people
will instead think of Cleveland as the “green city on the blue lake.”
Exercise: It’s Your Cube Now
The Changemaker's Cube is in your hands now. Do you consider yourself technical? administrative?
social? … How so? Place yourself along the dimension of aptitude. (Or place the you who you’d like to be.)
Now make choices along the other two dimensions, the dimensions corresponding to impact and activity.
Make terms that seem too vague to you—design, adjust, validate, amplify, for example—more concrete;
replace them with activities that resonate with you, such as design blueprints, design computer fonts,
design health information systems. Make these ideas your own.
Choose a problem area—poverty, education, the environment (or something more specific such as
cleaning up a local lake)—and let the choices you made along the dimensions of your cube guide you
toward a better understanding of where your life might take you.
There are sixty (3 levels of impact × 4 activities × 5 aptitudes) building blocks to which you can turn your
attention. Given the multiple interpretations you can provide for each and the nearly countless number of
problems for which you can use this approach, you could have a lifetime’s work ahead of you.
But isn’t that the point?
Make the Changemaker's Cube work for you. Good luck.
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FAQ: The Practitioner’s Guide
To Becoming a Changemaker
Q: Do I have what it takes to help change the world?
A: I don’t know if those who make it their life’s work to change the world are born or made—probably
some of both. What they share is a sense of passion about what they do. The best have an unrelenting
tenacity to produce the results they want to see. And incidentally, a passionate approach to work and
career often spills over to a life rich in many other areas.
Q: What does it mean to “change the world”? Clearly, all the world’s problems aren’t going away
anytime soon, no matter what I do. So how can you “succeed”?
A: You can’t define success in terms of “solving all the world’s problems” or even those that concern you
most, though having hopes and goals for attacking them is important. You can define success in your own
life. If what you’re doing gives you meaning—a sense that you are doing something that really matters—
makes you eager to charge ahead, and gives you an outlet for being, well, “you,” that’s real success. Part of
your feeling of success will usually involve relationships with others who share your passion. It certainly
doesn’t revolve around what “other people” think or gaining their approval.
Q: Aren’t all the most important problems “taken,” or at least the jobs that you need to have to address
them?
A: You’re kidding, right? Maybe what you mean is that many high-profile organizations that do work to
alleviate poverty or provide health care or heal the environment have more applicants than positions.
That doesn’t mean that they are unavailable to you, just difficult to get. But there is so much need on the
planet, and there are so many organizations that are taking—and can be taught to take—innovative
approaches to addressing key societal problems that you certainly can find something that fits you well.
You can work within a traditional company to influence it or work from the outside. You can work in the
developing world or in a developed-world context. You can start something of your own. The possibilities
are endless.
Q: But isn’t it important to find the right opportunity, because that can set you up or set you back?
A: Even if you get one of those “perfect” jobs that everyone wants, it won’t be perfect. No company or
organization is. Neither is there a perfect way to address any given problem of society. The opportunity
you receive is equal to what you make of it. It may not be the perfect fit; it may not last a lifetime (it
almost certainly won’t), and you may ultimately feel the position isn’t taking you forward the way you’d
like. It’s not about finding the best company but producing the best you. When it’s time, acknowledge
what’s gone wrong, learn from your experience, and move on. You certainly have heard that there’s no
failure, just learning. That advice may be especially true in advancing your career.
Q: When is the best time to seek an off-the-beaten-path-change-the-world job?
A: Knee-jerk answer: tomorrow. Bit longer answer: probably tomorrow. More extended answer: only you
know, but you are asking this question because you sense that “going corporate” or “going social work” or
“going law” in a conventional sense isn’t right for you. It’s easy to think in terms of waiting until you’re “all
ready”—more money, better skills, more security, and so on—but it won’t be easy then either. You may
have gotten used to a fat corporate income. Someone always seems to have skills that are superior to
yours. Now you’ve got kids to think about. … Your concerns are real, and it’s crazy not to acknowledge
them. But ask yourself what a successful life is all about. If it’s about meaning and contribution, then my
answer remains the same: probably tomorrow. If you want it enough, you can pick up the skills you need
and move forward despite your doubts and concerns.
Q: How do I start?
A: Begin by getting as clear as you can about what makes you you. The answer will be different from your
closest friend’s, even if you agree with each other about nearly everything. What are you passionate about?
What are you willing to put in the hours to achieve? What would you do for free if you knew you
absolutely would succeed? Then read, talk, network, find role models—you know the drill. Strive to
116
become more and more knowledgeable in your chosen area. Wow them with what you know when you get
the chance. (Of course, humility is a virtue, too.) Authentically become the you who deserves the job
you’re waiting for.
Q: When does it end?
A: For most people who are truly committed to a cause and passionate about what they do, it doesn’t. And
that’s good, because a life lived this way is a life lived with the knowledge that you’re not “going through
the motions.” You’re living with “flow” when you direct your energies toward something you truly care
about. Why would you want to stop? To play golf?
Q: You started this book talking about hybrid this, hybrid that. What do you mean?
A: We’ve seen how innovative, society-focused organizations steal ideas shamelessly and adapt them to
their own context. These organizations comprise a constellation of ideas and features, which they test out,
tweak, reject, or ramp up as they strive to grow and have greater impact. We’ve seen how society itself
makes advances through a process of recombining effective features and letting the “fittest” not only
survive but thrive.
Isn’t your life worth hybridizing? Aren’t there ideas, skills, attitudes, even experiences of others that you
can “steal shamelessly,” test out, adapt, and amplify as you think best? At every moment there are “two
roads” (and more) diverging ahead of you. So, based on all you know, choose, go forward, and know that
there’s always another fork ahead if you want to change direction.
Q: You also said at the outset that you don’t have to choose, that you can create a life that has it all. It
doesn’t appear that all society changers are wealthy. What gives?
A: You really don’t have to choose whether to pursue wealth or a life that gives you meaning. There are
certainly many examples of people who find great meaning in their life who are materially comfortable
and then some. The idea of “living hybrid” means noticing what others whom you want to emulate do and
choosing to move your life in their direction. But I’m guessing that what you admire most in the people
you’d want to emulate isn’t their “stuff”—fancy cars, big houses, trips around the world (though those
might be amazing perks). Even if they gave you those things, you might feel more “important,” but
becoming important is a lot different from pursuing and living the life you really desire. By doing what
makes your heart sing, you get meaning—something more elusive but ever more gratifying. So, you see,
you don’t have to choose. But my advice: choose wisely.
Q: This all sounds good. Are there any examples of the kinds of people you’re hinting at in this FAQ or
the kinds of organizations that they work for?
A: Please read the book!
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117

Design Your Life, Change the World

Transcription

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