Three ways big organizations can use their size to innovate

Social Enterprise

Three ways big organizations can use their size to innovate

Tech journalist Tony Perkins at a 2009 event in Silicon Valley. Entrepreneurs are naturally drawn to fund dramatic innovations, but is that smart? Photo: <a href="http://www.flickr.com/photos/44124348109@N01/3552090794/">Steve Jurvetson (Flickr)</a>
Tech journalist Tony Perkins at a 2009 event in Silicon Valley. Entrepreneurs are naturally drawn to fund dramatic innovations, but is that smart? Photo: Steve Jurvetson (Flickr)

Sure, small organizations are often the source of big new ideas. But in the quest to end poverty, big organizations' innovations can be even more important if executed well.

This requires critical thinking about what innovation is really for, a new essay argues.

A recent flood of antipoverty money marked for "innovation" has led some organizations to embrace new ideas simply because they're new, Christian Seelos and Johanna Mair write in fall's Stanford Social Innovation Review. The resulting clutter of initiatives "reminds us of the frantic hunt for the next miracle diet guaranteeing weight loss in seven days," they argue.

Ouch.

Instead, Seelos and Mair suggest, large organizations looking to innovate should embrace their strengths.

1) When you do something a lot, small improvements make big differences. The world's largest eye hospital focuses on a single procedure: cataract surgery. In a similar vein, North America's largest chocolate manufacturer stakes everything on one food: chocolate. By specializing, both guarantee that their incremental improvements--easier to achieve than disruptive innovations--have major results.

2) Big organizations are most efficient at doing big things. It doesn't take a large organization to design a better water purifier. But only a large organization, with existing skills and contacts around the world, could efficiently spend $20 million to build and distribute thousands of them.

3) Only an enduring institution can make the most of failure. If Indian NGO Gram Vikas had closed its doors after a failed venture into developing small-scale dairies, its leaders couldn't have applied their newfound understanding of rural poverty to solving a different problem: rural sanitation. Thirty years later, Gram Vikas brings water and sanitation to 66,000 families in eastern India. Social problems are complicated, and making progress against them can require long-term stability and relatively deep pockets.

If big organizations' innovation strategy leads them to embrace smaller, more incremental, less sexy changes, so be it. Maybe a large organization should focus on communicating the sexiness of profound results; or maybe it should simply give up on pretending that incremental changes are sexy, and appeal to investors' brains instead.

Generally speaking, Seelos and Mair say, NGOs need to look for innovations that actually advance existing goals, not simply to push for new ideas at every available opportunity. Innovation, in short, shouldn't be supplied unless it's actually demanded.

Seelos and Mair didn't explicitly set out to reflect on the particular role that large NGOs can play in the quest for innovative solutions to poverty. But their argument makes it clear that big organizations should be careful not to pull back on core programs in the name of novelty—and that funders shouldn't ask them to.

RELATED: Mercy Corps' market mission: a Q&A with CEO Neal Keny-Guyer via NextBillion

RELATED: Clinton announces $44 million social innovation commitment

Curated news and insights about innovative, market-driven solutions to poverty explored through news, commentary and discussion.

Learn more »

Global Envision newsletter