Category Archives: Uncategorized

Why I March With #OccupyPortland (and #OccupyWallStreet)

Occupy Wall StreetI spent my afternoon marching with the Occupy Portland crowd. Not because I’m a socialist, not because I’m a hippie, not because I’m hopelessly naive and not because I bear blanket hatred for police or corporations. Quite the contrary. And not because my views align with everyone else I marched with. For me, the reasons are very specific.
Income Inequality
I am an enthusiastic capitalist. I have no interest in participating in command economies, no interest in disincentivizing innovation and success – and I certainly believe the profit motive has created social good.But last week I read this:

The top 1 percent takes in 24 percent of the national income and holds 40 percent of the national wealth. (Washington Post)

How can that be right? You can’t tell me that a rising tide is lifting all boats or that wealth is trickling down when the top 1% hold 40% of American wealth and more than 9% of Americans are unemployed.

From a pure reason perspective, the interests of the 1% are not necessarily aligned with the interests of the 99%.  And we all vote our interests – or at least what we perceive to be our interests.

In closing, the International Monetary Fund – no bastion of liberal policies – argues that income inequality is bad for growth:

For sustained growth to occur, Berg and Ostry found, the most important factors are a relatively equal income distribution and trade openness. (IMF research, quoted in the Washington Post)

Citizens United
While I feel strongly about the inequity of the current wealth gap, nothing outrages me more than the Supreme Court’s Citizens United decision. (Quick summary: The Supreme Court ruled that, legally, corporations may spend unlimited amounts of money on political advertising and communications.)
Corporations aren’t people, and their interests are not necessarily aligned with the majority of Americans. Corporations, generally, seek short-to-medium term profits and return to shareholders. Certainly the policies they pursue to further these ends – lessening environmental regulation, decreasing spending on social services, for example – may not be in the best, long-term interests of the American people.
Finally, from a constitutional, strict-constructionist perspective, if the founding fathers had intended for businesses to have a vote, they would have assigned them one.
I Speak for Myself
I don’t pretend to speak for the majority or even a minority of Occupy Wall Street protesters. I speak for myself. These are things that outrage me.And in closing, I love the police. They risk their lives to serve justice and public safety. I view my interests as completely aligned with theirs. I wish to particularly commend the Portland Police for their good nature and incredible badass-ery on bikes.

Theory of Change and Measuring Social Enterprise

Social entrepreneurs face countless challenges. Meeting social goals through business principles, accomplishing social interventions, respecting cultural norms and environmental goals: the list of business objectives is long and complicated  After designing a business model to address these goals, the next biggest challenge for social enterprises is measuring and demonstrating their success.

Social enterprises are both businesses and social change agents, and intrepid entrepreneurs measure their success against both threads. As a result, there are two broad metrics for measuring success of a social enterprise:

  1. Is the enterprise profitable?
  2. Is it generating social returns on investment?
The former is easy enough to measure (a simple financial statement should do the trick) but the latter requires serious evaluation.Too often measuring social ROI falls into the pattern of sharing anecdotal evidence or sharing only the actions taken by the entrepreneur (e.g. “we distributed 2,000 mosquito nets”). A successful social enterprise is measured not only by the actions of the entrepreneur, which are easily controlled and counted, but by measuring the change in behavior, situation or outcomes of the community where the enterprise is engaged.

 

The Theory of Change model is used by nonprofits and social change organizations to plan and target their programs. It also offers a helpful model for planning and measuring social enterprise.

Theory of Change and Generating Metrics

Before beginning implementation of a social enterprise, entrepreneurs should create a theory of change, beginning with an analysis (baseline data) of the situation of the people or community where they are engaging. The baseline data should measure the status or situation of the community. For example, if you will be purchasing agricultural products in a rural area in the U.S. and reselling them in an urban area, you might decide to measure complex factors that might change over time, including:

  • The average income of the rural community
  • Children’s success in school
  • Employment (and underemployment)

The next step (and the most powerful one) is to create a model describing how your enterprise will change that situation, and how. For example,

By purchasing produce from small family farmers in our hometown, we will increase average income from X to Y because we will invest new cash in the community, purchasing directly from community members. Currently, 10% of the population of our town is unemployed. By increasing demand for products from small farms, farmers will to hire 100 new employees over the next five years.

Finally, we will donate 5% of proceeds to the Schools Foundation, enabling the local schools to provide additional science and arts education. As a result, we will expect to increase school attendance by 10%.

Note that your theory of change should include a specific measurement model in addition to a narrative concept. For example, “success means more children would go to school” is a concept. “Success means school attendance will increase by 10%, across genders and age groups because our business will effect change in X, Y and Z circumstances” is a specific, measurable model of change.

Mind you, all of this theory of change is only as good as the baseline data – which is only in turn as good as your knowledge of and connection to the community you are working with. Designing interventions from afar or with only superficial knowledge of targeted communities is ineffective.

The theory of change, once articulated, provides the metrics of your success. You will know you have succeeded in generating social return on your investment once you can demonstrate the uptick in the metrics you planned to address through your theory of change.

In turn, investors, customers and funders bear a responsibility to ensure that the organizations and efforts they support are making demonstrable, measurable improvements in their targeted communities.

Must Read: Both Republicans and Democrats are Broken

I’ve written less over the last few months – and close to nothing at all about domestic politics – because I’m losing hope. Not just the cheerleader-y Obama kind of hope, but any faith whatsoever in the intentions, effectiveness and capacity for hope within American government. Combined with Americans’ lessening faith in government, the cynicism of elected office is sapping my willingness to pay attention.

There’s a reflection from a retired Republican congressional staffer, Mike Lofgren, making its way around the internet this morning that has captured, eloquently, the source of my own malaise. I want to make everyone read this, because I believe it so strongly:

Both parties are rotten – how could they not be, given the complete infestation of the political system by corporate money on a scale that now requires a presidential candidate to raise upwards of a billion dollars to be competitive in the general election? Both parties are captives to corporate loot.

Lofgren explains, in detail, the cynical and broken mechanisms behind both parties – and how the use of language and manipulation of voters’ values results in voting against their own interests. I’m aghast and not sure what to do about it.

The End of an Era (And the Beginning of a New America)

Osama Bin Laden was a terrorist. He didn’t stand for anything worth respecting. As President Obama pointed out, bin Laden was a murderer, and one without boundaries or reason. He killed scores of Muslims along with his other targets.

I never celebrate death, and I don’t intend to start today. But if the celebrations by the White House and Ground Zero seem undignified, I want to say that I think most Americans are celebrating not specifically a death, but their perception of end of an era of fear, and also their feeling of closure from an immense trauma. Over and over again, the interviewees at Ground Zero and the White House talk about “closure” – an opportunity to put fear behind us. Maybe it feels like the moment we can be safe again.

But we won’t be safe from terrorist attacks until we repair the way we build relationships with the Muslim world – not just with the powerhouse figureheads, but with the people in Tahrir, Deraa and Misurata.

The Arab Spring has begun to render the old geopolitical relationships obsolete. I am grateful for that, and awed at the bravery of the protesters and rebels in those cities – just as brave as the New York city firefighters who ran up stairs while buildings were falling down.

Perhaps this event is the end of the beginning of a new era in America. It’s the moment for a new unity in America – behind a vision of peace. I hope it will also be the moment we revise our outlook on the outside world.

This is not an occasion for joy. It’s an occasion for relief, and for gratefulness for brave people – protesters in Tahrir Square, New York city firefighters and the Navy SEALs who risked their lives today to capture a murderer. May freedom ring.

President Obama is a Bad Communicator

I voted for President Obama and cried more than once when listening to his campaign speeches. I am a weepy sort, but there’s no doubt he’s really good at inspiring speeches. I don’t, however, think he’s been a very effective president. 

President Obama does not communicate his vision for public policy as well as he brought thousands to his campaign rallies. As a result, he has spent the last year playing defense – on health care, the Deepwater Horizon disaster, Libya and the federal budget.

The president backs himself into these corners by communicating on a “need to know” basis. He starts with generalities and only escalates to explaining specifics when people are confused or unclear on the goals. The policy cycle usually looks something like this:

  • Introduce a general goal (i.e. “protect civilians in Libya”)
  • Leave it up to Congress, his Cabinet and his staff to handle the early communication and policy making (i.e. send Secretary Gates to Congress)
  • Wait for the country to react
  • When this method fails to build widespread support, set up a prime time address to the nation to explain what’s going on

At that point, the President seems somewhat befuddled that the American people haven’t already arrived at the same logical conclusion that he has. It’s like the Sherlock Holmes method for presidential communication. “Give them the facts, and let them deduce the proper conclusions!”

President Obama is making the same mistake that economists do: assuming that people make rational decisions when they have complete information. The hold-up, of course, is that we aren’t rational decision makers and we don’t usually have perfect information.

The American public is motivated by their emotion and their faith, whether the faith is in a religion, their preferred tax policy or in their idea of fairness. Americans assess policy suggestions not only by the planned results but against their faith.

It isn’t enough to tell people a policy is desirable simply on its merits. You have to explain why it’s useful or needed, why that’s an American value, and how you’re going to do it, from the beginning, so that people can vet your specific plans against their specific beliefs.

In his blog post today, Seth Godin describes the habits of people who fail. One of them: “Not signing up for visible and important projects.”

The President is not signing up for the visible and important projects. President Obama’s needs to start the communication process by making a decision on what policy outcomes he’s seeking and communicating not only the concept but also the concrete. Some more of Godin’s advice that the President should take to heart:

  1. Whenever possible, take on specific projects.
  2. Make detailed promises about what success looks like and when it will occur.
  3. Engage others in your projects. If you fail, they should be involved and know that they will fail with you.
  4. Be really clear about what the true risks are. Ignore the vivid, unlikely and ultimately non-fatal risks that take so much of our focus away.
  5. Concentrate your energy and will on the elements of the project that you have influence on, ignore external events that you can’t avoid or change.
  6. When you fail (and you will) be clear about it, call it by name and outline specifically what you learned so you won’t make the same mistake twice. People who blame others for failure will never be good at failing, because they’ve never done it.

President Obama is great at inspiring, but he will never be a leader until he both inspires and explains. We’re all dissolved in rancor and frustration with ineffective systems and broken incentives. The first step to inspiring the American people to accept real reform is honest communication about plans and willingness to pivot.

Tom’s Shoes on Why You Should Become a Social Entrepreneur

At SXSW, Blake Mycoskie told the story of Tom’s Shoes, a creative social business that brings resources to poor children while enjoying attention in the pages of Vogue and Vanity Fair. 

There are two roads to social business. You might get there as an entrepreneur seeking to solve a business problem who realizes there’s a way to add a social goal to your business model. Alternatively, you might be an activist working to solve a social problem who decides to do so through a for-profit business. Either way, you combine millenia of a successful human development – through for-profit business – with accomplishing social change.

Blake Mycoskie had a social problem he wanted to solve. Children in Argentina did not have shoes. Without shoes, kids didn’t leave their homes, go to school or pursue their educations. Blake wanted to get them some shoes.

“Instead of looking at charity to solve problems,” Mycoskie said, “I decided to look at look at business.” Mycoskie founded Tom’s Shoes, which sells shoes and gives one pair of shoes away to children in areas of need for each pair he sells. He’s been outrageously successful, creating a successful business and distributing more than 1 million pairs of shoes since 2006.

Mycoskie went from an erstwhile contestant on The Greatest Race to a startup founder who wanted to do something different. He went on vacation in Argentina and came back with an idea. Once back in Los Angeles, with a few hundred pairs of shoes in his garage, his business grew like dry leaves on fire. Mycoskie managed out of control demand from an apartment with no plan, but instead a surfeit of life and support.

Mycoskie’s success is founded not just in his hard work and fervent belief but in the simple one-for-one model that attracts customers and worldwide interest. It takes 30 seconds to understand what Tom’s Shoes accomplishes, and another 30 seconds to become its biggest fan. You’re on board with Tom’s Shoes because of the excellent product you purchase and the social benefit you accomplish.

Mycoskie’s speech at SXSW wasn’t just a celebration. He’s recruiting.

It’s Time to Redesign Your Business

There’s no reason any business shouldn’t be a social business. If you aren’t sold on making your business a social one for old-fashioned do-good reasons, well, I won’t tell. There’s a long list of business reasons for making your business a social one.

  • Loyal customers. With a business that meets social goals, customers aren’t just customers. They’re true believers – evangelists for your brand and your mission – because they’re proud to contribute to the work that you do. Tom’s does not spend money on advertising, because Tom’s customers do the advertising. The quality of the mission attracts customer interest and loyalty over time. Tom’s focuses on giving because their customers are doing the “word of mouth”.
  • Top talent. Social businesses attract and retain the best employees because talented people want to be part of something larger than just making money or creating good products. Your business’s social mission enables your employees to be the best people (and employees) they can be.
  • Partners. The brand differentiation accomplished by adding social goals to your business mission will attract partners who wish to meet their own social responsibility goals and take advantage of your experience in the sector. Ralph Lauren entered into one of its first design partnerships with Tom’s Shoes not because Tom’s shoes were groundbreaking, but because the concept for the business was interesting, different and resonated with customers.

In general, giving doesn’t just feel good; it makes money. You attract customers while solving social problems without appealing for a donation. Using business attracts diverse problem solvers and leverages traditional models to create sustainable solutions.

There are hundreds of thousands of social entrepreneurs around the world conceiving of business solutions for social problems – through investment, creative products, unusual financing structures, mentorship and needed services. Get on board.