The Innovation Generation - The "Values" Proposition

In my work with families and foundations helping them make good [for them] decisions about their giving strategies, there are two pre-condition steps which make all the difference: I help them understand their “culture” and their “values.” Without an understanding of both of those, their philanthropy may be high quality but their satisfaction is likely not to be. So I spend a lot of time on both.

With the critical mass of newer models of non profit organizations and giving models, it is interesting to step back to see what it looks like from the “culture” and “values” vantage.

There is no need to rehearse here all of the developments of this era. Technology and communication have redefined how we do things, when we do things, with whom we do things. The question which remains is does it change why we do things. We know that there is a speed and rapidity of the spread of information unimagined only 2 decades ago; there is a concomitant lower cost of entry which means that innovation and experimentation are available to huge numbers; we know that boundaries and borders are porous; we know that communities [whatever that means] are virtual, viral, and transient.

The cultural response to all of this is pretty clear [although by no means trauma free]. Many of the younger people I know feel that the concept of privacy has essentially disappeared. Loyalty, if it means anything, certainly doesn’t mean what it did in the past. The anarchy of knowledge lets people question whether all “truth” is relative, or at least have a pervasive skepticism toward any claim. We know that just as economies are global so are connections only coincidentally geographically bound. We know that the experience of and in cyberspace can be more encompassing and defining as anything outside of one’s front door.

The question: if the way in which we experience the world is so profoundly changed, have our values changed as well? For example, we may believe in “open source” organizations, programming, etc. but do we behave that way in our relations with our co-workers, our business competitors, our social circles or are we just as competitive, protective, and ego driven in those realms? We may believe in the absence of privacy but do we know when information can hurt, or help, another? We may believe in the anarchy of a Google search, often driven by popularity of clicks, making all information open to all and not just “experts, but do we know how to distinguish what is pure fiction from what has more legitimacy? We may have a healthy skepticism toward the limits of the modern nation state, but what system are we moving toward which protects civil liberties, human freedom, and provides much needed human services? We may be fascinated by and participate in the very welcome opportunity to direct one’s personal philanthropy toward a project of one’s choosing [by the click of a mouse], but are we learning how to know the difference between fads and real problem solving?

As readers of my blogs know, and people who have heard me speak over the last several years certainly know, I am a believer in the concept I coined a few years ago: that those of us above a certain age are “guests in this century”©. The challenge is NOT to get those of this transformed world to embrace a culture or values of a century and era now past. That is not a worthwhile enterprise and would be unsuccessful anyway. It is incumbent upon us to embrace the culture of this world – or get out of the way. One of the great joys of my life is the time I spend learning from, and occasionally sharing wisdom with, those who are reinventing the world in which we live.

But we are not exempt from engaging the values question. Change is disruptive. In the rush to the future, people lose jobs, people get hurt, and values suspended. It is my belief that we are now at the time when the celebration of innovation, transformation, and social networking suggests an approaching maturity. After all, who doesn’t use Google? Who still thinks that Facebook is for kids? Changes will continue, innovation will expand, networking is only just beginning. But it is also time to begin to decide to commit ourselves to thinking about what we mean by responsibility, legitimacy, reliability, honesty, and transparency. If we do, it will be interesting to see whether our new world will be accompanied by a new humanism, true collaboration, and selflessness. If so, the disruption wrought by technology will be more than justified and history will smile upon this era; if not, we will have a lot of cleaning up to do.
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"Rumors in an age of unreason": a response to Elizabeth Kobert

A response to Elizabeth Kolbert – NEW YORKER, 2 November issue

In the 2 November issue of The New Yorker, Elizabeth Kolbert offers a thoughtful summary essay regarding the work of Cass Sunstein, the current head of the White House Office of Information and Regulatory Affairs.

Sunstein’s work attempts to unpack the epistemological changes which accompany the internet and cyberspace information age and Kolbert provides an intriguing overview of some of the early implications.

We know how quickly rumors get legs in cyberspace [pardon the mixed metaphor] and how resistant they are to correction. She gives ample witness to this with the unwillingness of some right wing fanatics to accept that Obama is an American citizen despite all of the evidence to the contrary, and how easy it is for such bizarre misinformation to have extended and uncontrolled reach.

Her essay also discusses some of the studies on the impact of the self-selection of information which the web permits, perhaps encourages, and interestingly relates it to studies of peer impact on attitudes.

In general, this is a useful addition to the growing literature on this subject, and interested me to go deeper into Sunstein’s writings.

What stimulated this post, though, is the very last line of the article. Here is her last paragraph:

The Web is certainly a transformational technology, just as TV and radio and newspapers once were. There is a temptation, as a result, to confuse the medium with the message, to assume that, because the internet is being used to produce a certain political effect, it was somehow destined to do so. This account is, in the end, to easy on us… To borrow from that old favorite of the right: computers don’t spread rumors, people do.

Here is where I disagree:

The printing press indeed transformed our epistemology. It made literacy available to all classes of society and it was the precondition to modernity. It is not an exaggeration to say that it democratized information and was the sine qua non of democracy as a political system.

But the printing press was still a medium where information was largely mediated. The price of entry, until very recently, was such that it was hard to sustain peculiar or bizarre theories without fairly deep pockets or political power. The propaganda which led to the holocaust, perhaps the most extreme example of sick attitudes becoming mainstream was only possible because of the control of all elements of society which the Nazis held. Their destructive and hateful opinions existed before, but as fringe thinking. Only when implemented as official state policy did it impact a nation’s behavior mandate.

In general, though, the very process of mediation may have served to moderate extreme views. Someone had to edit and approve articles and editorials. And even with television, a somewhat more choreographed but no less mediated medium, we know who stands where. Fox News, for example, makes no denial of its right wing bias. We don’t expect reason from them. [Sorry, couldn’t help myself.]

The Internet though goes further. It doesn’t simply make information more democratic; it actually anarchizes it. Anyone anywhere can say anything he or she wants, can post it, and see if it sticks. There is no price of entry, there is no editor or publisher or board which has to approve, there is no cost to distribution, and so far anyway, with very very limited exceptions, such views can show up on a Google search for anyone to see, as “valid” as any other search result. It is quite true that such “rumors” are not by the internet but by the people who spread them, but the medium changes the game profoundly.

The easy answer, of course, is that the medium is still so new and transformative that we haven’t yet developed a reliable standard to teach the billions of users to know how to exercise intellectual rigor and restraint when, if fact, we have at the same time just been telling them that information is now immediately available to anyone. In other words, its very appeal is its Achilles heel. Kolbert’s point seems to be that when we learn the ethics of how to use and “read” the internet, we will realize the difference between fact and rumor. As I say, she is somewhat right, but not completely.

The corollary to the anarchy of knowledge is an attitude toward “truth”. Too many people assume that no one really tells the whole truth, or more perversely, everyone only acts to their own self-interest. If there is only relative truth, then why not reinforce one’s own biases or skepticisms? Who is to say that your medicine is better than my holistic treatment? Who is to say that the published archived document is not simply a clever Photoshop creation? Why should we believe that 6 million died at the hands of the Nazis when someone else avers that it is pure fiction?

If we teach skepticism toward advertising, a healthy lesson, where do we draw the line on skepticism toward history or news? The transformation of society which the internet has unleashed is much more profound than simply becoming an easy place for rumors to take off. It implies an entire rethinking of how much we can or should trust government, any government; it challenges the very concepts of authority and borders and education and community and human interrelationships which defined us since the last transformational moment in history.

The challenge, which I believe Ms. Kolbert underestimates, is that the medium itself has changed what the messages mean. Our ethics may not be irrelevant; but applying those ethics in this new world often makes them inscrutable.
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Saying 'Yes" Wisely: now available on Amazon

Pleased to announce that, at long last, my book, SAYING 'YES' WISELY: INSIGHTS FOR THE THOUGHTFUL PHILANTHROPIST is now available on Amazon.
http://www.amazon.com/gp/product/1933918470/ref=olp_product_details?ie=UTF8&me=&seller=

I welcome your thoughts.
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You don't need to be rich to be a philanthropist

The other evening, at a wonderful benefit event, honoring two genuinely deserving people who represent a new generation of philanthropic leadership, I had another one of those predictable conversations. “How much money does one need to have to utilize someone like you?” they asked. A question I am asked, in one form or anther, all the time.

[In my case it is an easy answer: it doesn’t matter. I charge everyone by the project, not by the depth of one’s pocket or the scope of one’s giving.]

Implicit in the question is that only the ultra rich or the super rich, or at least the very rich can afford the kind of advisory services which can make one a better, wiser, or more sophisticated Only the rich can really be philanthropists.

This is not true. The difference between being charitable and being a philanthropist is having a strategy. Since everyone, no matter how wealthy or stretched, says “no” to most requests and solicitations, and “yes” to a few, what matters is if one has thought through those decisions. The amount of one’s giving may determine what honors one may be offered, or to what boards one may be invited, or in what social group one is included, but it doesn’t determine if one has earned the title philanthropist.

We all know of very wealthy, even very generous people whose charitable giving seems to follow no evident logic. There is, of course, nothing inherently wrong with being an undisciplined altruist. No one should judge another’s personal choice of where to give his or her own money, and no organization should ever presume that they have an automatic or implicit claim on anyone’s giving. And many of these people who give without a plan support wonderful causes.

However, without a thought-through strategy and an understanding of what impact one wishes to have, there is also a chance that the same giving will be less well spent and the impact diminished.

It used to be harder but not today. Anyone of more limited means [which means the vast majority of us] can think and make decisions like the Forbes 400. One can be a savior of a vulnerable small organization providing after school programs or in-school arts supplies for a few hundred dollars each year. I know of several cases where $250 was sufficient for an organization or project to begin to make a difference. That is a mere $5 per week, less than a single vente cappuccino.

Moreover, there are a growing number of websites and social networking sites which allow one to choose a cause or project at whatever price point is comfortable. Just as a staffed foundation may receive proposals for substantial support, so can anyone look to education offerings, or environmental projects or social justice needs which are listed for anyone to fund.

Even the assessment of the proposals or soliciting organizing can be transparent – Guidestar, for example, allows anyone to view a tax return of any non profit [or even a private foundation in case you want to emulate its approach]

What matters more than these technologies, though, is the intentionality. It is the opportunity to focus one’s resources, of whatever size, to manifest your values, priorities, style, and commitments. It is the opportunity to invite one’s family into a discussion about what your values may be and your legacy to the world. It is the opportunity to know that one’s giving can be effective, impactful, and coherent. And it is the opportunity to know that the world can be a little different because of your thoughtfulness.

How much you have need not be a limitation to be a philanthropist. How much you give is not necessarily a measure of your philanthropy. How you strategize about your giving can do both, and will prove more gratifying at the same time.
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Why we teach funders - a modest plug

Today I attended a most interesting presentation at PhilanthropyNY [nee NYRAG]. The presenter, who shall remain nameless but who has a well deserved popular book about the widespread societal impact of cyberspace, gave much of his standard presentation. Well delivered, interesting, thought provoking, and reinforcing of many ideas we and others have discussed elsewhere.

Then he tried to apply his thinking to the field of philanthropy. In fairness, he acknowledged it wasn't his field. However, he then proceeded to say that he consulted with a philanthropist he knows and based the remainder of his presentation trying to relate his expertise to a field with which he is unfamiliar [an understatement, I daresay]. Sitting there, I twittered that I was not persuaded by his arguments which I will nickname "open source philanthropy." As I was leaving, it became clear that most others, all of whom are funders, felt similarly. It wasn't, we agreed, that he wasn't interesting. Nor did we say that there might not be things to learn. But the consensus was that he was unconvincing since his lack of knowledge was so apparent. Ironically, I believe that he would have hit a home run if he had stuck to his standard engaging presentation and let the listeners consider the applicability, but when he tried to give "advice", it was hard to let it go.

This experience emphasized why we developed the NYU Academy for Funder Education. What we all know is that many people who are in the funding world have had little more education than this speaker. All too often they have to learn on the job, make needless mistakes, or assume that the particular way in which their family or foundation does things is the "right" or "only" way. Too few know or take advantage of programs which teach core competencies or the ethics or the issue of power or best practices. We like to think that the program we have developed and fine tuned over these past 8 years is the state of the art. It may or may not be, but we can attest that several hundred funders- philanthropists and foundation professionals - have availed themselves of the courses and reported what a difference they make.

In any case, this morning reinforced the need. And reminded me why it matters.
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Non-Profit CEO Salaries - should they be reduced

The Chronicle of Philanthropy, the unofficial bible of our field, has released its survey of non-profit CEO salaries at the largest non-profit organizations in the United States. It revealed that there was a median growth of 7% - despite a general reduction of non-profit budgets and a massive slowdown in the economy in general.

The survey also listed a significant number of ceo’s who, voluntarily or otherwise, took a reduction in pay of some sort. Implicit in the article was a sense of surprise that the median increases were so high and the number who took reductions so low.

My own response is that such surveys distort the real discussion about non-profit salaries in general, and about the salaries of ceo’s at the overwhelming number of non-profits most of whom can only dream about the budget challenges of these large organizations and foundations. Boards of directors, or the ED’s themselves of the many thousands of smaller non profits, by far the majority, may feel that they need to follow the lead of the “big boys” and reduce staff salaries as well. After all, in times like these, with stretched and fragile budgets, isn’t it appropriate to show fiscal discipline by demonstrating that they too are setting the right example?

But there is a vast difference between a ceo making $1/2 million each year and one making $75,000. It isn’t for me to arbitrate what a living wage for ceo’s should be, but realistically a 10% cut in a $500,000 salary impacts lifestyle, while a 10% cut in a $75,000 budget can impact viability.

What is more, salaries below the top executive level are, by definition, lower. In so many not for profit organizations, the salaries of those on the front lines are already at a very fragile level, and too often the benefits are token at best. If we put pressure on the salary of the top executives, how will we maintain the levels of those whose salaries are but a fraction of their bosses?

It is fair to acknowledge that numerous senior executives have volunteered to reduce their own salaries in order to preserve positions or forego salary reductions among their staffs. Such leaders are to be praised and applauded. But, in my experience, with salary lines being the largest line in many non profit budgets, there is great pressure to balance budgets on the backs of overworked and underpaid staff. It is a hard and delicate issue.

But when one looks at the salaries of only the largest of their kind, as the Chronicle did, it inadvertently allows too many to overlook the real and continuing challenge to the voluntary sector – enabling those providing their services to do so at a living wage, with dignity and pride. Most non-profit executives are not overpaid; most of their staffs are underpaid. Even – or especially – in these economic times, let’s not forget that.
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Unemployment and efficiency - a necessary connection?

It hit me – something is wrong with this picture.

It hardly surprises when we read a press release announcing that another company or non profit has reduced its staffing – usually accompanied by a note of regret that financial exigencies – or some other carefully worded euphemism – necessitated these reductions. [A firing by any other name, even if part of a crowd, is the loss of a job.]

The recent deep recession has almost inured us to these announcements – after all, what can one expect during a time when income, purchasing power, and contributions are down and prospects for improvement hardly in the offing?

But in the last few days, two national not for profit organizations announced a restructuring which, incidentally, included staff reductions. What got my attention was that both energetically denied that finances played any part in the decisions. “Efficiencies” would mean no reduction of services but that they would be provided differently.

What, I wondered, does that really mean? That they are asking already overburdened and probably underpaid non-profit workers to take on even more portfolios? Have they somehow found a way to use technology to obviate those professional services? Are they trying to make a point to their supporters that they are tough enough to make the hard decisions even if the finances don’t demand them?

Then I remembered: for the last decade or so, virtually every merger or new executive of every for-profit company would proudly announce that their newly merged or restructured company would increase profits and earn the confidence of shareholders by – what else? – reducing personnel costs. Efficiencies and elimination of duplication of services would yield immediate results, justifying the “multiples” and projected profits into the future. It is hardly surprising that non-profits follow suit.

How quickly we forget that it was not so many years ago when companies prided themselves on the growth of their workforce, on how they were improving the quality of lives of those who were connected to their enterprise, that they could reduce work-time to 5 days [and those days were 9-5!]. Now no one flinches when a private company or even a non-profit reduces benefits, expects 24/7 commitment, and reduces workforce. It is as if all of the promises of a humane modernity have been reversed – all too often in the guise of efficiency or profit.

You may ask: “isn’t this the wrong time to be raising this question – at a time when businesses and non profit organizations are fighting for survival?” Why argue for changing the employment paradigm when the struggle is to avoid firing even more people?

For me, this is the best time to remind us that pressures on companies for short term profit have pushed our investments in people and long term strategies to a lower priority and disposable luxury. This is the best time to remind us that the relentless, and often ill advised push for non-profit efficiency has too often led non profit employers to lose sight of the value of their most precious resource – their own workers and the values that drive them.

I raise this issue on a philanthropy blog because, as the economy slowly and fitfully rebounds and philanthropy follows, it is incumbent upon funders to reinforce the right kinds of changes, adaptations, and efficiencies, and not be taken in by the often dubious or misplaced applicability of for-profit mentality in the independent sector. Do we really believe that a non-profit delivers better service because the workers are pushed to carry larger workloads – with few benefits or guarantees – than before? Do we really believe that we are fulfilling a vision of a caring society by having fewer people employed? Do we really believe that the ultimate measure of the success of any group or business or organization is that they can do as much with less?

As a society, the unemployment and underemployment crisis has been a long time coming. It reflects attitudes that predated the current financial crisis and, sadly, will outlast its recovery. I only hope that one of the lessons learned is that a post modern, technologically advanced, and complex society should not sacrifice its soul on the backs of its workers.

One wonders: if we had retained the value of employees, employment, and quality of life over the last 15 years or so, would we be in the mess we are today?
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