October 07, 2008

Geoff Mulgan on innovation in the social sector

Geoff Mulgan's "The Process of Social Innovation" (2006) makes one think about how government can be better organised to solve challenges in the social arena.
 

Geoff is the director of Young Foundation, a London-based thinktank which "identifies and understands unmet social needs and then develops practical initiatives and institutions to address them". He is the former Head of Policy for Tony Blair, and the first director of Blair's Strategy Unit. Geoff was ranked in 2004 as one of the UK’s 100 leading public intellectuals.

In the paper, Geoff states that social sectors (i.e. healthcare and education) will account for the biggest share of GDP growth over the next 20 years. However, business innovation models are insufficient in developing good social sector services because these services have a high degree of co-creation - you have a bandwagon of providers (public, private and voluntary organisations) with a wide array of consumers' needs.

To accelerate the pace in which innovative activities and services can be pushed out to solve unmet needs, Geoff has the following suggestions: -

1. Avoid intellectual snobbery - "Some of the most effective methods for cultivating social innovation start from the presumption that people are competent interpreters of their own lives and competent solvers of their own problems."

2. Look for "positive deviants" - i.e. people who are solving problems against the odds. He gave the example of youngsters with poor academic results finding good jobs, or ex-offenders with high likelihood to re-offend but do not.

3. Experimenting is necessary - few ideas emerge fully formed so there's a need for experimentation of the prototype model to see if it can work in reality. Also, experimenting enables the pioneers to galvanise enthusiasm for the project.

4. Creative tools can help - New social ideas are seldom inherently new but is applied to different markets or combined with other ideas to achieve results. To create such possibilities, he gave examples of tools people can use such as Edward de Bono's 6 thinking hats, methods by companies Ideo and What If?, and open source technology on the web.

5. For Governments: Reward outcomes, not outputs for innovations - Governments are generally risk-adverse and poor leaders in recognising innovation. Geoff suggests that governments can contain risks by rewarding outcomes rather than pay for outputs/ activities for projects, and changing attitudes and mindsets by rewarding risk-taking in general. Interestingly, the countries most interested in Young Foundation's work are very different societies: China is interested because she wants to speed up solutions to her profound challenges while the Scandinavian countries are keen to preserve their place in leading the world's social innovations. 


Article link: http://www.policyinnovations.org/ideas/policy_library/data/TheProcessofSocialInnovation

September 05, 2008

Behavioural economics: is it such a big deal?

nice debate on BE in this month's issue of Prospect:

http://www.prospect-magazine.co.uk/article_details.php?id=10359

in highlighting the insights and results of BE, we must be careful not to overstate its case.  Tim Harford's conclusion that "economics is stronger thanks to the behavioral economists, that much is clear. Yet the picture you paint - of a great intellectual tide, pent up and ready  to wash away most of what economists hold true - is not one I recognise" is correct.

August 30, 2008

What makes profit-maximization possible by Martin Wolf

Martin Wolf wrote a good piece recently on the role institutions play in the capitalistic economy.
Some quotes:

"So the big problem with competitive capitalism is not that it is uncreative. It is certainly highly creative. The problem is that it is unnatural. There have to be rules, ethical norms and institutional constraints governing profit-maximizing behavior, to ensure that the maximization operates for the social good."

"Americans are so used to a society in which the profit motive is constrained by -- and embedded in -- other norms and institutions, that they do not even recognize the pervasive presence of the latter in their lives. Like fish, they cannot identify the water in which they swim. They cannot imagine a world, for example, in which the US army decided to be a profit-maximizing firm...."

Read full article: http://creativecapitalism.typepad.com/creative_capitalism/2008/08/what-makes-prof.html

Yup, so if you were hit with Donald's "fish in the water" analogy recently, that's where he got it from. :)