How Can the Organized Community Best Take Advantage of Social Innovation?

Over a century ago, the Jewish Publication Society was formed to “provide the children of Jewish immigrants to America with books about their heritage in the language of the New World.” During it’s long life-cycle, the JPS became the standard bearer for Jewish wisdom literature, its most popular item – and cash cow – being the JPS Tanakh, the Bible many if not most young Jews in America received when they were given the Good Book.

Recently, however, the JPS realized that the printed book, even the Good one, was under siege – and with it the existence of the JPS itself. Seeing online content grow all around it, the JPS had two general choices: cut back, cut down and hope for the best offline, or develop new directions and revenue generating products that can live in the world beyond print.

They chose the later, hiring an internet-abled educational entrepreneur, JT Waldman (full-disclosure, a PresenTense 2008 Fellow), to lead up their Interactive division.

End of story? Not really. As the JPS understood, you can’t solve a problem by simply hiring great talent; without managing that talent, the new direction and the organization’s direction will only diverge.

But how can the existing management of an organization effectively manage an employee driving changes in a field that existing management has no experience in?

Therein is the challenge of taking advantage of social innovation – a challenge briefly raised by Seth Cohen in his post yesterday, and a challenge I intend to take up in the next few entries.

For now, I’d like to address the challenge Seth brings up in the “Who” section. Particularly, on whether “motivating innovation outside of established organizations, are we dooming those established organizations to an innovation deficit?”

I would make the claim that this is a more complicated question than it seems. In the for-profit world, the answer is resoundedly ‘no’: small, independent start-ups live in an ecosystem with larger organizations, both feeding off of the strengths of the others. Large organizations benefit by having access to small and nimble start-ups who have no red tape and can try and fail a dozen times without having to explain anything to their stockholders. Start-ups await the day they can ‘exit’ by selling out to a larger organization (see Writely), or growing so large that they themselves become the large organization aquiring other start-ups (see Google).

While the benefit to large organizations holds steady in the non-profit world, the benefit to start-ups is very different. The main “stock” that non-profit founders have is recognition – which is to say that because they cannot by definition exit in terms of revenue, the main incentive beyond the salary that a nonprofit employee may get is the public recognition of their efforts (or the Ego Exit).

Acquisition – a goal in the for-profit space –  is generally an ego-quenching experience, since the entrepreneur, who while independent ran their own ship and got the credit for it, has to beat back their personality in favor of the larger organization’s benefit.

In other words, if we are to tip the scales in favor of integrating start-ups and their innovation into larger organizations, we’re going to have to start with the start-up founder incentives side of the equation.

Back to JPS and JT. To be clear, JT did not found an independent start-up that was acquired by JPS; instead, JPS hired JT and told him to go and start something new. Understanding that they could not provide him with the framework and guidance that would jump his venture to the next level, JT was given the opportunity to surround himself with digital-thinking entrepreneurs in the PresenTense Institute – where he tore his project apart and started the process of building it together again. In other words, JPS hired an entrepreneur and then let them go off to be an entrepreneur – and kept giving the space (at least in public – don’t know what is behind the scenes) so that this entrepreneur can reap the benefits of starting something up.

So while I don’t have the answer to the “Who” question, I think the Ego Exit is a good place to look: if our established organizations are interested in tapping the best minds of our innovative class, giving them credit and strengthening their hand might be the way to go about recruiting them.

Ariel Beery is Co-director of The PresenTense Group.