Helping Funders Look Above The Maze

Funders need to lift their gaze to the ecosystem level to achieve transformative impact, according to an international expert visiting Australia as part of the Social Leadership Program.

Professor Kash Rangan, co-founder of the Social Enterprise Initiative at Harvard Business School, has been in Australia to facilitate part of the annual program, which this year focused on The Ecosystem of Impact.

It brought together a panel of international experts and leaders to examine the role of the funder in delivering transformative impact.

JBWere’s head of philanthropic services Shamal Dass, who hosted the program, told Pro Bono News it marked a shift in focus from previous years.

“For the first time this year we’ve actually spent time in funder’s workshops, working on the other side of the equation, so how do you fund for transformative impact. And for all types of funders,” Dass said.

“So we’re looking at everyone’s role in the ecosystem. We want to come at it from all angles because what we’re finding is everyone’s kind of talking in circles in their own camps.

“But if we’re all focused on homeless or the strong economy, diversity, equity, we all need to be thinking of the issue in the same system sense. To use the technical term that Professor Kristy Muir used when we were doing the session, we’re all agents in the system and we all have different leaders and we’ve got to understand those and then we all have a clear idea about distinct roles.”

Rangan said the “big idea” they were advocating was for funders to play a more important role in system thinking.

He used the analogy of a maze to highlight the importance of funders “lifting their gaze” to connect the dots.

“For a social entrepreneur or a small philanthropist funder on the ground, they might see themselves as operating in one portion of the maze but for them to take the beneficiary right through the system [they need to know the path ahead],” Rangan told Pro Bono News.

“To pick an example, it’s not just education but education and skills training and then a job, and then permanence on the job and then economic and social mobility, it’s like going through a maze because there are so many different systems, so many different partners that one has to navigate through to get to the end of the maze successfully.

“And that’s what social enterprises throughout the world, not just Australia, have been working on. They’ve been partially successful but not spectacularly successful.

“The argument now that’s being made is that funders, especially the larger funders, they could lift their gaze, they could rise up above the maze – imagine a helicopter – then they can see the pathway right through.”

According to Rangan, if funders can see the path through the maze, they can support each by funding the blockages.

“Because they know exactly where the maze has got a wrong path they might be able to fund the blockages, they might be able to assist certain opportunities so that the social entrepreneur on the ground is able to get that beneficiary through the maze much faster. That’s what we mean by system thinking,” he said.

He said funders did not currently have that view of the maze as they had been trained in the last decade to operate with the social entrepreneur in the maze and “push water up the hill”.

“Because the funders have been told, your money has to lead to outcomes and impact,” he said.

“What happens is it creates friction and a lot of conflict at the ground level where the funder is saying ‘here is the money, this is your output, I’m not satisfied with that, show me the impact, show me the outcome’. And then the social entrepreneur or community agent or community group runs even harder, but they don’t have that knowledge, they don’t have the connections, they don’t know where the blockages are.

“So really it is a question of saying, funders, you need to evolve your role, you need to take a different role. You have to do the funding and be on the ground, that’s important, but that is only one of the many roles you can play.”

Rangan stressed that having a systems view did not mean that funders had to do systems funding.

Rather the purpose is to get an idea of “what the maze looks like” and then funders can “come down and fund certain initiatives”.

Dass said one of the example used in the workshops was that of a hospital.

“If we all fund the preventative stuff people will still be dying every day, because we’re all concentrating on funding the prevention of cancer and prevention of diabetes or whatever,” he said.

“So the thing is there still needs to be funders down at the triage end because it is not acceptable to us as a society that people are still falling through the cracks, but if we’re all at the bottom end then no one’s at the top end trying to stop people coming in.

“So different funders, of different scales have different roles in the ecosystem but they all have to understand the system, so they’re not all in the same place or they’re not all in the wrong place.”

Rangan agreed the initial opportunity lay in mapping the idea to “stop stepping on each other’s toes”.

“There’s one thing that the nonprofit world suffers from is that many times we all fund our pet projects and these pet projects are similar projects so we’re stepping on each other’s toes, and some others don’t get money because they’re in different locations. So just mapping and then bringing some deliberate thinking to it has got a lot of first order impact,” he said.

“Then the second order is if you actually collaborate and coordinate your actions then there’s a better chance of getting a higher impact in terms of where all this leads to. And then of course if all these things click then you become a valuable player in the system, you can raise your voice, you can talk to the government much more authentically, and then you can really get system change and that’s the whole idea. Because we’ve got to get the whole system to work with us.”

Rangan said fostering collaboration between funders was central to their ability to do systems thinking.

“They don’t have to do syndicator funding, collaboration can mean collaborating to get a knowledge of what’s going on, get a map of what exactly you’re funding, then we all know what individual roles one can play in the ecosystem,” he said.

“But [there must be a] focus of collaboration, its not collaboration for the sake of collaboration, ‘Let’s get into the room and you tell me what you’re you doing, I’ll tell you what I’m doing’. It’s like ‘let’s collaborate on the issue of homelessness’.

“Then at least we can start mapping out what the issue of homelessness looks like, what kind of blockages there are, what kind of opportunities, who should work with whom and then the funders can go back. If you collaborate at least you can coordinate and that’s the whole idea.”

Rangan said he had been “pleasantly surprised” with the response from the funders.

“Both in Melbourne and Sydney, the funders are not only getting on board, they’re enthusiastic, they’re eager,” he said.

“I think in both locations they’ve been eager to talk to each other and I could sense at the end of each of those meetings, funders were looking forward to getting back together again and taking the next steps. So I was pleasantly surprised because I thought there might be some skepticism but there wasn’t as far as I could see.”

Dass said the theme to emerge from the program, which was led by JBWere in partnership with National Australia Bank and PwC, which came on board for the first time this year with The Impact Assembly and the Centre for Social Impact, was that of “bringing more head to the heart”.

“Because they have the heart, everyone in there is giving money away, spending time on it, it is just about bringing a bit more thoughtfulness about where the right intervention is, by the right type of philanthropist,” he said.

“The challenge for us is it was great and there’s great momentum, it’s about what we do with that momentum and how we work with Philanthropy Australia to capture that momentum and bring the funders together.

“As I said it is not all funders doing all things, it’s got to be the right group of five funders or so, across the right issue, who are willing to collaborate. That’s where we are at the moment.”

Rangan said he was optimistic.

“Like I said before I was pleasantly surprised we didn’t find any resistance from the funders, they were willing to jump into these kinds of discussions,” Rangan said.

“The idea of systems thinking is not new, it’s not rocket science, it’s not as if this has been invented. But they were very willing to go in that direction and understand what their roles might be if they bring this thinking to it.”