Chapter One
Innovation Is the Path, Impact Is the Destination
“Innovation” may be the most overused buzzword in the world today. As the pace of change continues to accelerate and our challenges grow ever more complex, we know we need to do something different just to keep up, let alone get ahead. Finding better ways to tackle the most pressing problems facing people and the planet is no exception. Over the past few years, the notion of innovation for social good has caught on like wildfire, with the term popping up in mission statements, messaging, job descriptions, and initiatives. This quest for social innovation has led to a proliferation of contests, hackathons, and pilots that may make a big splash, but has yielded limited tangible results.
So we should start by asking, What is innovation?
One unfortunate consequence of the hype has been that, in common parlance, innovation has often become conflated with invention. While invention is the spark of a new idea, innovation is the process of deploying that initial breakthrough to a constructive use. Thomas Edison’s famous quote, “Genius is 1% inspiration, 99% perspiration,” puts this in perspective. In other words, innovation is the long, hard slog that is required to take a promising invention (the 1%) and transform it into, in our case, meaningful social impact. Social innovation involves iterative testing and improvement, refining business models, influencing partners and policy, fine‐tuning logistics, and many other practicalities. Not as sexy as a big idea, but ultimately more important.
My colleague Peter Singer, CEO of Grand Challenges Canada, sums this up nicely when he observes, “Innovation is the path, impact is the destination.” This reminds us to stay focused on the ultimate change we seek to make in the world – whether it’s to alleviate suffering, end an injustice, or protect the environment. Innovation should be in service to that goal.
DELIVERING RESULTS
When a friend or charity asks you to donate to a cause, what is the pitch you typically hear? Perhaps a story about children who are suffering and need your help, or a terrible injustice that has to be set right? The organization is committed to addressing this devastating issue, so you dig deep into your pockets and give. The world praises both you and the charity for doing good. But, this is only the first step.
We should rightfully celebrate the commitment of mission‐driven nonprofits, the generosity of philanthropists, and the sacrifices of dedicated staff and volunteers. And, we should applaud the social enterprises, impact investors, and triple bottom line companies who meld profit with purpose. But, we can’t stop there. Results matter. We have a responsibility to deliver the most we possibly can, both for those who need our assistance and for those who entrust us with their time or money. True impact comes from engaging with both our hearts and our heads.
Lean Impact takes an uncompromising attitude towards maximizing social good, drawing inspiration from The Lean Startup and other modern innovation practices. At its core are the basic tenets of the scientific method – hypothesis‐driven experiments that reduce risk and increase the pace of learning. By applying these techniques to validate perceived customer value, an engine for growth, and the ensuing societal benefit of our interventions, we can achieve greater impact at greater scale.
Despite its scientific basis, Lean Impact is not rocket science. It simply accepts that no solution is likely to be designed perfectly at the outset, particularly considering the innate uncertainty of working on complex problems in dynamic environments. Thus, rather than crafting an intricate plan in advance, a more adaptive and learning‐oriented approach can achieve better results. By recognizing when the best path forward remains unclear, we can avoid deploying solutions that aren’t wanted, don’t work, or can’t scale.
Even Silicon Valley doesn’t always get this right. Prior to joining Google, I was the VP of engineering at an exciting, venture‐backed startup. After years building an elaborate, beautifully polished online experience, we launched with great fanfare. Alas, it wasn’t quite the instant hit we’d hoped. While a number of passionate users loved the product and some features showed real promise, major gaps in both the product design and the business model were quickly exposed. Unfortunately, we had spent almost all our capital to get to this point and were running out of cash. Soon I was laid off, along with half my team and most of the other executives. An interesting coda to this woeful tale is that Eric Ries, author of The Lean Startup, was among the engineers at the company. The experience proved to be formative for both of us.
The lessons from that failed startup are equally applicable to mission‐driven work. In a similar way, we have a tendency to devise elaborate plans and expect them to succeed. The all‐too‐common nature of project‐based funding encourages, and in some cases requires, a model of advanced planning within defined constraints. To apply for grants, organizations are typically expected to articulate compelling answers in detailed proposals that imply more confidence than is warranted. Of course, too often, that plan doesn’t play out exactly as anticipated, sometimes leading to suboptimal results, outright failure, or, even worse, damaging unintended consequences. Furthermore, these programs are usually confined to a predetermined timeframe and budget, rather than being designed to persist and expand over time. Even when they do succeed within their original parameters, they rarely lead to transformative impact.
Consider two possible ways to design a fictional car, as shown in Figure 1.1. The traditional plan–execute approach involves lengthy planning by engineers, product designers, industrial designers, and marketers, followed by an expensive manufacturing and production process. By the time the car ships years later, environmental standards may have changed or we may discover too late that customers find an open‐air car too impractical. This is essentially what happened at my startup.
Figure 1.1 The plan–execute versus the test–iterate approach to design.
Instead, a test–iterate approach starts with the simplest possible prototype to see how users respond under real‐world conditions. We could discover early that a three‐wheeled design doesn’t handle turns well or that environmentally sensitive customers won’t buy a gas‐guzzler, and iterate to take a different tack. Addressing other lessons, such as the need for protection from the elements, might only require an enhancement rather than an entirely new direction. Once we confirm we’re on the right track, we can prudently take the next step and make a bigger investment to build a more sophisticated version. By identifying any mismatches early, we avoid wasting time and money and gain a higher confidence that the final product will be well received.
It is important to clarify that “lean” does not mean cheap. Rather, think of “lean” as cutting out the fat, or waste. Providing a tool is a waste if people don’t use it for the intended purpose. Implementing a 10‐part intervention is a waste when a 5‐part version yields similar benefits. Deploying a one‐off program for a thousand people is a waste if there could be a way to reach millions. The aim of Lean Impact is to find the most efficient path to deliver the greatest social benefit at the largest possible scale.
Okay, maybe that sounds good in the abstract, but what would this look like in reality?
LEARNING WHILE LEARNING
Testing and iterating to improve social outcomes may look somewhat different from optimizing an online business, but it is based on the same underlying principles. Let’s take a look at an education nonprofit, and how it made its transition to Lean Impact.
In the year 2000, hundreds of parents and community members in the San Francisco Bay Area came together in search of a better approach to high school education. They sought a replicable model to provide high‐quality education to every child, regardless of background. Based on these discussions, Summit Public Schools opened its first school, Summit Preparatory Charter High School, in 2003. Founder and CEO Diane Tavenner had been a public school teacher herself and was passionate about preparing all students for future success. She set her sights high, with a goal of seeing 100% of her students graduate from college.
Eight years later, as Summit Prep’s first cohort completed college, the results were impressive and significantly better than the national average, but fell short of Diane’s goal. Many students needed more intensive academic preparation, and success in college often hinged on skills, such as persevering in the face of obstacles, that Summit’s high‐support environment didn’t foster.
While she felt pressure to keep scaling based on this initial success, Diane saw the results as an opportunity to rethink Summit’s educational model. But waiting for years to see the results of each high school cohort would be way too slow. She realized that she had to change the culture, tools, and processes to enable a faster iteration cycle if she was going to make the kind of shift she needed. So, rather than deciding on a particular set of interventions up front, she focused on embedding a culture and process for constant feedback and improvement. Diane and her team reviewed learning best practices and reflected on the skills, knowledge, and habits that lead to a fulfilling life. They also read The Lean Startup.
Over the course of 57 week‐long variations with 400 students for two hours a day, Summit iterated on the duration, frequency, sequence, and structure of class elements, balancing a mix of teacher‐led lessons, Khan Academy online content and exercises, one‐on‐one tutoring, and small‐group interactive projects. Each week, the team collected learning assessments, student satisfaction surveys, and reports from focus groups. These were combined with contextual data on how students and teachers spent their time, the resources they used, and the order in which they used them. Together, this data revealed a rich picture of the classroom and which approaches showed promise or should be dropped. Through these rapid‐cycle prototypes, Summit’s transformative approach to personalized learning began to take shape. Modifications ranged from small tweaks in curriculum to a complete reconfiguration of the school day.
By finding a way to speed up its feedback loop in a domain in which ultimate success takes years to measure and iteration is traditionally slow, Summit was able to dramatically accelerate its own learning, progress, and impact. In 2017, 99% of the seniors who graduated from one of Summit’s five Bay Area high schools were accepted into college. Once enrolled in college, Summit alumni are twice as likely to complete college compared to their peers. The Summit Public Schools model has been nationally recognized and adopted in over 300 public schools across the United States.
THE NEED
In many ways, the world has never been better. The average human is richer and healthier than ever before. Since 1990, global poverty, maternal and child mortality, and the number of children not enrolled in primary school have all been cut roughly in half.
Yet new challenges are fast emerging. Although income inequality across countries has declined, it has been increasing within countries.1 And while interstate conflict has been reduced, civil wars and terrorism are on the rise. At the end of 2016, over 65 million people were displaced from their homes due to conflict or persecution, the most since the Second World War.2 The number and intensity of climate‐related natural disasters has risen. And in 2015, the Ebola epidemic reminded us of how rapidly a dangerous virus can spread around the world.
Here in the United States, the forces of globalization and automation are causing anxiety as the economy transforms more quickly than ever, leaving many behind. The American dream has been shattered with the decline in social mobility. Racial tension and anti‐immigrant sentiment have flourished, the opioid crisis has made drug overdoses the leading cause of death for Americans under 50, and trust in government and political parties has eroded to near all‐time lows.
To tackle both long‐standing social ills and new challenges, 193 of the world’s leaders came together at the United Nations in 2015 to adopt a shared vision – the Sustainable Development Goals (SDGs), which aim to end poverty, protect the planet, and promote prosperity and well‐being for all. Unfortunately, experts estimate that for developing countries alone less than half of the required funding exists, leaving an annual shortfall of two to three trillion dollars.
This is a common story. We never have enough money to tackle the problems we face. And yet, the status quo is not acceptable. Certainly, we need to continue to advocate for more funding. We also need to recognize that our current interventions are insufficient. The path forward must include better solutions that will deliver far greater bang for buck and reach many more people over time.
BARRIERS TO SOCIAL INNOVATION
Let’s be real. Innovation for social good is harder than innovation for business. Period. It took me some time to realize this. Like many practitioners of Lean Startup, the techniques seemed so universal that it was hard for me to imagine a domain in which they wouldn’t apply. Then I tried. I shared the Lean Startup methodology with a nonprofit. At first, reactions were positive, even enthusiastic. Most people recognized the innate uncertainty of their work and welcomed ideas for being more nimble, managing risk, and accelerating progress towards their mission. But then, nothing changed.
When people returned to their desks, they found a grant proposal to write or previously funded activities to execute. I discovered that traditional grants require that a detailed design be laid out in a proposal – down to discrete activities, budgets, and staffing – and that implementation must faithfully adhere to that plan. I came to call this the enforced waterfall model, in reference to the outdated process for building shrink‐wrapped software when the need to manufacture and distribute floppy disks or CDs meant infrequent, high‐stakes releases. Each stage of designing, building, testing, and shipping was planned in advance and performed sequentially. The advent of the Web and cloud‐based computing freed software development from these strictures and unleashed a wave of innovation.
Unfortunately, breaking out of this mode is not a simple matter of convincing your manager. Even the CEO may have little say. Control often sits with the donors who hold the purse strings. Imagine if software engineers had to beseech a venture capitalist (VC) for permission before trying any new idea for a feature. That would certainly slow down innovation. Entrepreneurs do exist everywhere, but if they are grant funded, their arms may be tied behind their backs.
Those mission‐driven organizations that are fortunate enough to have access to more flexible funding may still find difficulty in satisfying their two entirely different types of customers: beneficiaries and funders. Even individual donors and impact investors frequently focus on defined geographies or sectors – be that health, education, poverty, climate, or otherwise. What if you’re funded to reduce malaria, but you discover that what is most needed are primary healthcare clinics? What if you’re funded to reduce rural poverty through agriculture, but people prefer to migrate to the city? What if you’re funded to improve girls’ education, but you realize what would make the biggest difference is sanitary pads? In the private sector, satisfying your user will increase profits and delight investors. But in the social sector, what people want, what will make the greatest impact, and what funders will pay for are not always the same.
The barriers to innovation don’t end there. Our instincts may lead us astray when working with populations whose experiences are quite different from our own. We work at the treacherous intersection of failed markets and failed policies. Metrics tend to be geared towards compliance and accountability, rather than decision‐making and learning. Measuring social impact is far more complicated than measuring e‐commerce transactions. And, taking risks implies a potential for failure that could jeopardize funding streams or make things worse for vulnerable people who are already living on the edge.
If you’ve found it difficult to adopt concepts from The Lean Startup and other innovation toolkits, you’re not alone. But, despite the added complexities, many mission‐oriented organizations have found it not only possible, but transformative. They are better serving their customers, accelerating their growth, and magnifying their impact.
PRINCIPLES OF LEAN IMPACT
Lean Impact is an approach to maximizing social benefit in the face of the complex challenges in our society. It builds upon the best practices for innovation from the Lean Startup and beyond, while introducing new techniques tailored to the unique nature of the mission‐driven arena. By combining scientific rigor with entrepreneurial agility, we can dramatically increase both the depth and breadth of our impact.
The essence of Lean Impact is captured by three core guiding principles. Throughout this book, I’ll demonstrate the power of this new mindset and how to translate it into practical action to fuel social innovation.
- Think big. Be audacious in the difference you aspire to make, basing your goals on the size of the real need in the world rather than what seems incrementally achievable.
- Start small. Between a desire to help people who are suffering today and pressure from funders to hit delivery targets, interventions often scale too soon. Starting small and staying small makes it far easier to learn and adapt – setting you on a path to greater impact over time.
- Relentlessly seek impact. Whether due to excitement, attachment, or the requirements imposed by a funder, we can become wedded to our intervention, technology, or institution. To make the biggest impact, fall in love with the problem, not your solution.
A NONLINEAR PROCESS
While The Lean Startup concentrates on the process of testing and validation, Lean Impact, by necessity, incorporates a broader perspective to bring these tools to the realm of social innovation. Tech startups have no trouble thinking big, and are encouraged to do so by the ecosystem of heady VCs who support them. They approach challenges with an abundance mentality. On the other hand, social and environmental interventions are often planned within tight constraints – of existing budget, limited staff, or the time window and dollar amount of a particular grant opportunity. Thus, the journey to massive impact at scale must begin earlier.
In Chapter Five, we’ll explore the techniques for validated learning pioneered by The Lean Startup. But before we get there, Chapter Two sets the stage by setting an audacious goal for social impact that breaks out of a mindset of scarcity and moves into a mindset of transformation. In Chapter Three, we begin to work towards that goal by investing in a deep understanding of our customers, stakeholders, and the underlying problems that impede change. Many social innovations falter because they haven’t established this critical foundation and leap too hastily into a solution. With a clear goal, customer, and problem, we think outside the box in Chapter Four to identify solutions that have the potential to address these unmet needs.
Lean Impact is not a linear process. As shown in Figure 1.2, your goal is a relatively fixed destination. But to achieve it, you may choose to tackle one or more problems standing in the way. Based on that problem, you could consider multiple potential solutions. The success of each solution, in turn, depends on a number of assumptions. By running experiments, you can validate or invalidate those assumptions to determine if there is a viable path forward.
Figure 1.2 The Lean Impact workflow.
Of course, a lot can go wrong. If a test fails, you may need to iterate by tweaking your model, trying an alternative solution, or perhaps making a more significant pivot by tackling a different problem altogether. On the other hand, if validation succeeds, you can have the confidence to move forward and increase your fidelity or scale, likely revealing a whole new layer of assumptions to be tested. The best social entrepreneurs approach this journey with humility, flexibility, and grit.
THE GROWING MOVEMENT
Despite the obstacles to innovation, nonprofits, social enterprises, companies, foundations, philanthropists, governments, and impact investors are beginning to chart a new path that embraces many of the concepts from The Lean Startup to solve the pressing social and environmental issues of our time. They are starting small, listening to their customers, rapidly iterating on solutions, and designing business models that can scale sustainably. Lean Impact shares the successes of these early pioneers, and serves as a guide for anyone working to achieve radically greater social good.
Let’s take a look at how.