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United Way Blog

Rock Stars in Nashville

The following post is by guest blogger Doug Taylor, CEO, United Way Australia

It’s hard to think of an academic as a rock star, but that’s how Mark Kramer, Co-Founder and Managing Director of FSG, was received at the United Way Community Leaders Conference in Nashville in early May 2012. Perhaps it was because we were in the U.S. County Music Capital (Dolly Parton made an appearance as well, but that’s another story altogether).

Kramer’s work, along with his colleagues, has been seminal in recent years in re-thinking the role of nonprofits and business in solving social problems as outlined in the ideas of Creating Shared Value and Collective Impact. On the 125th Anniversary of United Way, this thinking has resonated and reinforced our resolve to become a community impact focused organization.

Like so many institutions, we lost our way for a few decades as we became more focused on the means and not the end of social change making. Our theory of change for a long time was to raise as much money as possible and fund nonprofits to provide services to their “clients” in the community.

In the U.S. and Australia, this has coincided with an explosion in the numbers of nonprofit organizations. This has benefitted a great many in society, as these community based organizations have increased the quality and diversity of services provided to people who are often not able to address their specific needs alone.

However, one of the unintended consequences of this is a vast system of institutions working individually and often on the same issue to create, in Kramer’s words, “isolated impact.” They each have a primary purpose to manage the problems of the clients they seek to benefit primarily through funding contracts. The problem with this is that “no single organization is responsible for any major social problems, nor can any single organization cure it.”  

In Kramer’s own words most nonprofits are trying to address social problems with their “hands tied behind their back” because they are not working and learning together and they don’t evaluate their work using consistent frameworks. The increased complexity of the social systems and problems provides a compelling case for a more collaborative approach. He made two overarching suggestions on how to move beyond the current service delivery models that predominate.

He spoke about the importance of raising our expectations for change and setting community-level goals. For too long we’ve let government pick up the tab for improving major social problems and as a result let business and nonprofits off the hook. 

This is no more evident for me than in Detroit where my good friend Michael Brennan, CEO of United Way for Southeastern Michigan (Detroit), has worked with others to create change in high schools where only 60 percent of young people graduate. This problem is not unusual across the U.S. but is startling when you consider the long term prospects for young people if they don’t finish school. It was also a concern to the local car manufacturing industry who, post–General Motors, Ford and Chrysler, needed to be better positioned in terms of technology integration and a better skilled workforce.

These factors were the foundation for a collective effort that resulted in a 25 percent reduction of chronic absenteeism in schools in Detroit. As a result of this success, General Motors Foundation has committed $27.1 million to take these promising strategies to 30 other schools with the goal of 80 percent graduation. This could only happen when local institutions stopped just taking responsibility for their own service and interest and instead made a community-wide impact through collaboration with others.  

Kramer also spoke about the value of engaging businesses, which he believes for too long have focused on writing checks to nonprofits and not being core partners in solving community problems. His words reflected in his Creating Shared Value paper highlight the opportunity for businesses to find ways to address their own needs in solving community issues.

Creating Shared Value compels businesses to think more broadly about their potential to create value for customers and communities and in doing so, enhance profitability. He argues that when shared value is created, the result is growth in the variety and volume of resources available (and not all of it money) for research and development, which is the fuel of innovation.

To make his point Kramer spoke about the Cisco Learning Academies which were developed to create a skilled future IT workforce. This program has yielded Cisco access to four million alumni across the world that are ready to become employees in an industry that only a few years ago was not even invented.

I recall being part of a team of people who rolled out an Academy in Western Sydney. This continues to be an important program providing industry entry points for young people and skilled employees for business. We made this happen, in Kramer’s words, by making use of a “local cluster” of organizations working across sectors to address a social need.

In Australia, we’ve seen great outcomes achieved by the 90 Homes for 90 Lives Coalition who have collaborated to address homelessness in Woolloomooloo. This coalition identified a best practice model, developed a business case and leveraged a $2.9 million grant for Bridge Housing (read more). As a result, 22 people have been housed. Critical to this work was the collaboration and the setting of a clear community-level goal.

Raising our collective gaze from our services to individual clients to the broader needs of the community is everyone’s responsibility. Kramer spoke about the critical role of “backbone” organizations, such as United Way, in improving community level conditions. It’s challenging work but increasingly necessary given the predominance of wickedly complex issues in our local communities.

In many ways it’s the harder road, and it’s easy to fall back to our own institutional agendas. However, it’s important to remember that “if it’s important to you, you’ll find a way; if it’s not, you will find an excuse.”  It’s time to stop letting ourselves off the hook with excuses.

Kramer M. & Kania, Collective Impact, Stanford Social Innovation Review

Porter M. & Kramer M, Creating Shared Value, Harvard Business Review