It’s been a brutal week for representative democracy in the United States. First, we had the gruesome report (albeit better late than never) from the Senate Select Committee on Intelligence describing the widespread program of torture undertaken by the CIA from 2001 to 2006. Presently, we’re watching an ungainly legislative mess—all $1 Trillion and 1,603 pages of the so-called “Cromnibus”—slouching its way through Congress at the eleventh hour. As different as they are, both episodes represent profound institutional failures.
My spirits were buoyed, however, by an email I received yesterday from my daughter Sophia, a senior at Georgetown. She passed on a letter to the community from the university’s President, Jack DeGioia—one that made her feel proud to be affiliated with the institution.
You might recall DeGioia’s resounding defense of Georgetown law student Sandra Fluke, and civil discourse more broadly, when she was attacked by Rush Limbaugh two years ago for her congressional testimony calling for health insurance plans to cover contraceptives. Needless to say, this was not an easy defense for the president of a Catholic institution (whose health plan did not provide for birth control) to give, but he offered it without flinching. After noting that Limbaugh’s critique could “only be described as misogynistic, vitriolic, and a misrepresentation of the position of our student,” he went on to observe that “In our vibrant and diverse society, there always are important differences that need to be debated, with strong and legitimate beliefs held on all sides of challenging issues. The greatest contribution of the American project is the recognition that together, we can rely on civil discourse to engage the tensions that characterize these difficult issues, and work towards resolutions that balance deeply held and different perspectives.”
In yesterday’s public letter to the Georgetown community, written in the wake of the controversy surrounding the deaths of Michael Brown and Eric Garner, DeGioia offered some broader “reflections on citizenship and a just society.” As DeGioia put it, in the aftermath of these developments, “the fabric that we think of as America seems to be fraying.”
What can we do about this? I would encourage you to read DeGioia’s letter in its entirety to appreciate his assessment, but let me excerpt two central paragraphs for your consideration here:
Citizenship—participation in a just society—then, is predicated on more than the rule of law, on more than the privileges and rights bestowed through membership in a particular political order. It assumes a commitment to a common shared project—a civic project that entails a sense of belonging to something bigger than any one of us: the idea that together it is possible to build a commonweal. This possibility is predicated on the conviction that we are connected to one another by something deeper than transactions, economic or otherwise. Responsible participation in a just society presumes a deep belief that we can only realize our own promise and potential as individuals through our shared commitment to such a common project.
On other occasions, I have written to you encouraging civility in discourse and in our interactions with one another. The events of these past months reveal that much more is required. We need to engage in the work of rebuilding our commonweal; we need to reexamine our commitments to one another; we need to identify concrete projects through which, together, we can build for the common good—projects that will enable us to rebuild trust in one another and to justify belief in the principles on which our American democracy was founded.
President DeGioia has once again given all of us—not just the members of the Georgetown community—truths to ponder and a standard to live up to, both through his message and the example of his leadership.
Last week marked the public launch of the Madison Initiative’s systems map, version 1.0. This map captures our take on the key variables in our system of representative government, the causal links and loops that connect them, as well as where our grantees are working to improve the system. The map will serve as the framework for our evolving strategy. If you haven’t yet—and why haven’t you?—you can take a guided tour of our map and provide us feedback on it here.
By way of continuing the conversation, I’m sharing responses to three questions I recently put to Jeff Mohr, co-Founder and CEO of Kumu, the online platform we have used to develop and share our systems map. Jeff has been an essential partner for us on this part of our work, and Kumu has proven to be an exceptional tool. I think you’ll appreciate Jeff’s take on the power of systems mapping when it comes to tackling complex problems.
1) What prompted you to start Kumu?
Honestly, Kumu was born out of a frustration with how awful the existing tools were for tackling complex social issues. We tried to map relationships among actors in the Hawaii renewable energy space a few years ago and threw our hands up in frustration. Why do we have an abundance of beautifully designed, elegant tools for sharing pictures, fetching cabs, and keeping in touch with friends, and yet nothing for solving complex issues?
We believe better tools have a big role to play in making greater impact. US foundations deploy more than $47 billion each year and yet many things seem to be getting worse—not better. Sure these challenges are innately difficult, operate on long time frames, and are often unpredictable, but we’ve got to get better at solving them and stop wasting so much money.
Take any of the major issues of today (obesity, education, health care, or even ISIS) and you’re guaranteed to be working with complex systems that cross sectors, geographies, and communities. These issues are rooted in culture and require significant behavioral shifts to overcome, yet we approach them as if money, knowledge, and idealism will magically solve them.
Organizations spend little time mapping out the underlying structure of the systems they are working to change and often duplicate (or worse hinder) efforts by working in silos. Dr. Paul Betalden puts it best, “Every system is perfectly designed to get the results that it gets.” We’re not mysteriously getting screwed out of making an impact. These are the results of the systems we’ve designed (intentionally or not) and if we expect to change those results, we need to intimately understand the structure of the systems, actors, and incentives holding the status quo in place. And that’s what we’re trying to help people do with Kumu.
2) Kumu doesn’t seem like your typical Silicon Valley startup. Most of them wouldn’t feel obliged to provide a social manifesto, like you do, the first three tenets of which are “Sh*t’s Broken, We’re all Responsible, All hope is not lost—yet!” Say a bit more about the determination driving your social mission.
Peter Thiel has a great question that he asks of possible investees, “What do you believe that few others do?” At its core, the manifesto is our response to this question. It defines the bias we operate under for building Kumu.
We believe it should be easier to be happy in this life—that it shouldn’t be a battle for anyone to have their basic needs met. Sure there needs to be incentives for people to go off and do grand things and make lots of money, but there also needs to be balance and compassion. Capitalism doesn't mean we're each on our own.
In a way, it’s getting back to the argument of the founding fathers—that everyone has a right to life, liberty, and the pursuit of happiness. These are very basic needs but needs that still aren't met in much of the developing world. What’s worse is they only grow harder to grasp as the world moves faster and gets more complex.
3) Any words of encouragement or advice you’d offer to teams that are doing mapping work for the first time?
Teams spend a lot of time worrying about whether their map is “right.” I can tell you right now, it’s wrong. The right approach is rarely intuitive. It’s usually incredibly messy and full of contradictions. But the good news is it’s not about getting it right. Creating a system map is as much about the process as it is the map. That’s why its important to be smart about who you engage in the process, how early you bring them in, and that you frame it as an ongoing, evolving understanding of the system. As Joi Ito of the MIT Media Lab points out, “The only way these solutions work is when they’re developed in partnership with the people actually affected by these problems.” So be inclusive.
Set the expectation that this work will be complex, messy, and slow. Don’t expect that any one map will magically unlock the missing secret. There are no silver bullets when working on complex issues. As Ben Horowitz would tell you, it takes a lot of lead bullets. Mapping is more about how we can increase the odds that our lead bullets actually hit the target. And especially in large, cross-sector challenges, about how we can get everyone to at least aim at the same target and stop shooting each other in the foot.
Focus on discovering and changing the underlying system dynamics. Danny Burns, from the Institute of Development Studies, urges that “sustainable change requires changes in system dynamics.” Even if your intervention appears to have “worked,” without altering the core dynamic that brought about the problem in the first place, you’ve only kicked the can down the road a little further.
Finally, don’t forget to have some fun along the way. Ultimately this work is about building relationships and breaking down barriers, and laughter truly is the shortest distance between two people.
A year ago, as we were beginning to discuss the plans for the Madison Initiative with our Board, Larry Kramer and I wrote in a memo to them that “we must take care not to oversimplify an exceedingly complex and dynamic reality. This is a common mistake…resulting in a great deal of bad conventional wisdom.” We went on to observe that the system of representative democracy whose health we seek to improve “is more accurately described as a system of systems (and subsystems) on a national scale. These interconnect in ways no one fully understands, partly because the systems and subsystems are themselves dynamic. The Foundation’s usual approach, which rests on a model of linear causation (‘if we do X, then Y will happen’), is inapposite to this sort of problem.”
Fair enough. But if we weren’t going to use a conventional logic model or theory of change, what would we do to represent our view of the world and where, why, and how we were funding grantees to change it? If we didn’t feel like we knew enough to make a big bet on a particular intervention, how would we know where to spread the small bets that we were planning instead? What framework would we use to determine whether those smaller bets were paying off so that we could follow up accordingly?
Driven by these questions, and guided by the steady advice of Julia Coffman and Tanya Beer, our developmental evaluators at the Center for Evaluation Innovation, last spring the Madison Initiative team embarked on a journey to develop a systems map that would help us understand the dynamic, complex, and decidedly non-linear system of systems in which we are making grants. Several months later, after some gnashing of teeth, plenty of good humor, and great technical support from Jeff Mohr, the CEO of Kumu, the online platform for developing systems maps we are using, we have finally arrived. We have our first draft map.
I say first draft because we know that there is much to be improved in it. We’ve included a number of diverse perspectives in creating this version, but we can do better. That’s where you come in: we need your help. You can take a guided tour and evaluate our map by hitting the link at the bottom of this post. Recognizing that systems maps can be notoriously difficult to navigate, we have created an accompanying narrative that walks the user through the map as it unfolds step by step. We then hope you will come back to us with any questions and feedback about what is missing or misconstrued. You can comment directly through Kumu, on this post, via email or phone – however you want to provide them, we welcome your thoughts.
We are publically sharing this systems map, along with an integrated “overlay” map detailing all of our grants and the network of grantees that are working to improve different parts of the system, so that others can see what we are up to – and help us see it more clearly and do it better. After we get the first wave of input, we will revise this map accordingly, and we will continue to do so periodically as our work unfolds. The map will serve as the framework for both our strategy and our ongoing evaluation of it, so it is imperative that we continue to refine it.
We will follow up next week with a post from Jeff Mohr on the potential for this kind of mapping work to support social change. Then we will hear from Julia Coffman and Tanya Beer about how they will help us use the map to evaluate our work and course correct as we go. In the meantime, you can start reviewing the map at this link. Thank you in advance for your insights!
What do the midterm elections mean for the Madison Initiative? As a private foundation, we are legally bound not to engage in or support any electioneering activities on behalf of (or opposed to) any candidate or party. But the outcome of the election obviously has implications for our goal of creating more space for negotiation and compromise in Congress. Here is my take on the results (and to be clear these are my views and not that of the Foundation or even other members of the Madison Initiative team).
First and foremost, it is getting harder to argue that the GOP is an asymmetrically polarized party after an election in which the Republicans captured seven seats (thus far) from the Democrats to take control of the Senate; increased their House majority to at least 60 seats (their largest majority in four generations); secured 31 governor's offices, including those of Illinois, Maryland, and Massachusetts; and now have majority control in 69 of the 99 state legislative bodies. That doesn’t look like a political party that’s thumbing its nose at the median voter to me.
Second, it will be interesting to see whether the GOP surge generates any doubts in the minds of those funders, observers, and advocates on the left who have been heretofore convinced that the only way for Congress to work productively again is to sweep progressive majorities into the House and Senate and sustain them over time. To my mind those holding this view are indulging in what David Brooks has aptly described as, “the No. 1 political fantasy in America today, which has inebriated both parties. It is the fantasy that the other party will not exist. It is the fantasy that you are about to win a 1932-style victory that will render your opponents powerless.”
Third, and picking up on Brooks’ theme from the other side: In their moment of triumph, Republicans would do well to remember that this outcome was more or less predictable, in direction if not entirely in scale, given the recurring tides of American politics. 2014 was, after all, the second midterm in an increasingly unpopular presidential administration with the nation confronting vexing problems at home and abroad. Just as George W. Bush had to acknowledge the "thumping" he and his party took in 2006, Barack Obama and his colleagues received one last week—whether they are prepared to admit it or not.
Fourth, I continue to be struck by the way we are sorting ourselves into a red America and a blue America. Consider the map developed by National Journal of party control of House seats in the upcoming Congress. We see a vast expanse of predominantly rural red hinterlands interspersed with blue enclaves on both coasts, post-industrial cities, and the Upper Mississippi Valley.
In sum, the midterms underscored the fact that the country remains deeply and more or less evenly divided. Both parties are in position to win significant portion of the offices in play at the federal and state level in any given election, and—lest we forget—this is not necessarily a bad thing insofar as it supports democratic responsiveness and accountability.
But these same developments underscore an urgent challenge: to figure out how our system of government can work when control of it is both shared and hotly contested by political parties of approximately equal strength that have substantially different visions for the future of our country and are pursuing them from different geographic bases.
We need to redouble efforts to support the ability of legislators in Washington to reach workable compromises—not because they are naturally inclined to, but because they need to if our system of government is going to be able to address the problems we face. I don’t see any other way forward.
Recent high-profile failures by the Secret Service and at the Veterans Health Administration have given plenty of ammunition to late-night comedians and conservative talk-show hosts who delight in riffing on the federal government’s stumbles. Less dramatic, but just as troubling to anyone who cares about effective government, the Government Accountability Office (GAO) provided much more systematic and telling evidence of federal management malpractice in a report to Congress last month: “Managing For Results: Agencies’ Trends in the Use of Performance Information to Make Decisions.”
GAO’s report shows that when it comes to federal agencies using performance information to manage their work more effectively, things are not getting better—in fact if anything they are getting worse. Comparing 2007 and 2013 surveys of 4,400 federal managers across the 24 largest federal agencies regarding the use of performance information in their work, GAO found that “that most agencies showed no statistically significant change in use during this period….only two agencies experienced a statistically significant improvement in the use of performance information. During the same period, four agencies experienced a statistically significant decline in the use of performance information.” (It’s worth noting that one of the regressing agencies was the Department of Veterans Affairs.)
Who is to blame for this sorry state of affairs? It is tempting to point the finger squarely at the President. After all, he runs the executive branch, and the buck stops there, right? Certainly a big part of it does. And, as the botched healthcare.gov rollout showed, this administration has stumbled on the implementation of even some of its most important priorities.
But Congress is also to blame. GAO, the independent and scrupulously non-partisan investigative arm of Congress, has been observing and reporting shortcomings in how federal agencies use (or fail to use) basic performance information for years. In 1993, Congress passed the Government Performance and Results Act (GPRA), which required that federal agencies for the first time engage in the basic disciplines of goal setting, performance measurement, and reporting. In 2010, Congress passed another law modernizing GPRA. A major thrust of both pieces of legislation was to ensure Congress has better information about executive branch performance to inform its own deliberations.
A wag might suggest that GAO should survey members of Congress and their staffs to ascertain just how much information about agency performance really matters to them when they are authorizing and appropriating funds for the work of these agencies. My strong hypothesis would be that such information is even less relevant in Congress than it is in the executive branch.
How can Congress better focus on and use agency performance information in its own decision-making? The problem here is that this requires qualities that are in increasingly short supply on Capitol Hill: deep policy expertise, inquiring minds, a functional committee system, a determination not just to surface problems but solve them, and—not least—a willingness to work with people with whom one disagrees.
We have been told by several observers and allies that these attributes are those of a bygone Congress, and that productive legislative oversight of the executive branch is dead in a polarized age. But we are not ready to write it off. It’s hard for us to see how we can have effective government, problem-solving in Congress, or representative democracy, for that matter, without it.
The Madison Initiative has thus made a set of grants to explore whether it might be possible to improve congressional oversight and the broader nexus between Congress and the executive branch. We are supporting a revitalization of the Project on Government Oversight’s well-regarded bipartisan Congressional Oversight Training for staff and committees. We are also funding the Partnership for Public Service to assess where and how executive branch dysfunction could be reduced by improving how Congress functions, and what it would take to bring this about. We will keep you posted on what we are learning through the work of these grantees.
How can foundations help grantees measure and improve their performance? This is a tough question for philanthropy, and we have wrestled with it in the Madison Initiative. While foundations routinely express their determination to drive outcomes and impact, too often their interactions with grantees on issues of performance measurement are counter-productive. The more insistent foundations are on accountability for results from those they fund, the greater the temptation grantees face to show how well they are doing and how much impact they are having—imperatives that tend to undermine the sustained patterns of measurement, reflection, and learning that are needed for ongoing improvement in outcomes. I have taken to calling this dynamic the performance measurement trap.
With the advice of our developmental evaluators at the Center for Evaluation Innovation, we recently refined our grant application forms in an effort to break out of this trap. The rest of this post is a verbatim excerpt of what we are now asking of prospective grantees with respect to performance measurement. We’d welcome your feedback so we can continue to fine tune our approach:
One of our most important goals in supporting your organization is to help you measure, reflect on, and learn from your results so that you can continue to focus and improve your impact. Insofar as our grantees are able to do this, so can we. But this requires a different approach to measurement and reporting than is typical for foundations and grantees. In this alternative approach, the primary constituency is your organization, not ours. The primary purpose is supporting your improvement in the future, not reporting to us on your performance in the past. The primary disposition is a spirit of inquiry and openness, not of advocating for your organization and trying to put your best foot forward.
We appreciate grantees that approach their work with the understanding that things don’t always work out as planned, and that their grasp on the circumstances they are trying to change in the world is inevitably imperfect and in need of adjustment. Conversely, we will be inclined toward skepticism with grantees whose worldview and strategy holds up year after year, for whom everything is materializing as they had intended, and who only have success stories to share.
To help establish the right learning dynamics, we would like you to situate what you will be measuring and how you will be measuring it in the context of the hypotheses your work is in effect testing. Whatever your strategies or plans, you are no doubt working on one or more hypotheses through which you are seeking to bring about positive change(s) in the world. You are essentially saying, ‘if we do XX, then YY will happen.’
Two friends of the Madison Initiative have just written books that defend the importance of spirited partisanship for a healthy democracy, cutting against the grain of conventional wisdom. Let me give you a sampling of their arguments in the hope that it will convince you to read these timely contributions in their entirety.
Russ Muirhead is a political theorist at Dartmouth College and the author of The Promise of Party in a Polarized Age. In his preface, Muirhead argues that, “Rather than expect that partisanship can be overcome, or transcended, or simply turned off in those places where its presence would be corrupting, it is better—more true to the real possibilities for democratic politics—to differentiate between more elevated and more base expressions of party spirit…what politics needs is not less partisanship, but better partisanship.” In the rest of the book Muirhead defends “a kind of party spirit that is worn lightly, one that is open to facts and revision, and tolerant of—even appreciative of—opponents.”
Muirhead acknowledges that his fellow democratic theorists have not as a rule looked favorably on partisanship, viewing it as a partial conception or distortion of the common good. But he highlights two vital roles that parties play in democratic politics.
First, the ideal of equality underpinning democracy presumes the essential morality of majority rule. Political parties are what enable such majorities to be established; they thereby give democratic politics its legitimacy. Muirhead notes that partisans have to balance what they will stand for with who it will lead them to stand with (and vice versa) in their quest for a majority. This is a morally fraught but unavoidable judgment for those seeking to form democratically legitimate majorities.
Second, Muirhead, invoking John Stuart Mill, argues that, given human psychology and the limits of reason, democratic politics needs the clarifying contest of opposing truths, of “standing antagonisms” between those who emphasize tradition or progress, freedom or equality. Parties are the institutions that form around and defend their versions of these truths, and per Mill, “No whole truth is possible but by combining the points of view of all the fractional truths.”
Jason Grumet, President of the Bipartisan Policy Center, underscores this point in City of Rivals: Restoring the Glorious Mess of American Democracy. “Ideologically driven institutions serve an essential role in the political process. Our democracy depends on the collision between different interests and political parties.” Grumet goes on to observe, however, that “in a divided nation, ‘all or nothing’ politics have an all but certain outcome—and rarely is it ‘all.’” The better alternative is what Grumet terms “constructive partisanship,” which rests on personal relationships among partisans prepared to practice “the dark art of principled compromise.”
It is tempting to think that in our current age the political debate has finally raged out of control (mea culpa), but Grumet rightly points out that American history has long been characterized by extreme conflict. “What has changed of late is that the essential tension between partisanship and familiarity has fallen out of balance. The challenge for us, moving forward, is to rediscover that equilibrium.”
The way forward, Grumet argues, is decidedly not the reformers’ well-trodden path of more transparency, campaign finance reform, new ethics laws, etc., which he argues convincingly have produced much of the dysfunction we are trying now to unravel.
Grumet’s alternative solution is almost homely in its simplicity. Leaders need to take the risk, not insubstantial in the current environment, of investing in and restoring the mutual understanding and personal connections that used to enable the policy-making process to more or less function. It is easy to scoff at this, but harder to disagree with the basic truth that “whether a condominium board, a university, or a national legislature, human relationships form the core of our institutions.”
We have heard plenty of criticism of this particular line of our grant-making from those who argue that it reflects a quaint and even naïve view of partisan politics. We aren’t suggesting that the cultivation of cross-party relationships and dialog will be sufficient to address the pathologies of polarization, but we do regard it as a necessary part of the equation.
It’s safe to say that we can all remember where we happened to be on this day 13 years ago. For my part, I was in a non-descript hotel room in a non-descript corporate park in Thousand Oaks, California. I had flown to LAX the day before to meet with a client in the bio-tech industry. I got up very early that morning to do a conference call with two merchant energy traders based in Atlanta. I was hoping they would become my next clients. About halfway through the call, the trading floor they had dialed in from was taken over, first by pagers going off, then frantic shouts. They just said, “The floor is going nuts, we gotta go,” and hung up. Not quite sure what had happened, I clicked on the TV to find out, and so I saw the scenes that horrified and transfixed us all that September morning.
The violence of that day pushed my normal preoccupations with client work and commercial prospects into the background. I experienced, along with many others, unprecedented feelings of solidarity with my fellow citizens and a corresponding sense of patriotism. I received the kindness of strangers and sought in turn to share it with others. For all of the death and loss that 9/11 rained down, it felt like we were living in a different country, one that had painfully rediscovered some misplaced but vital truths.
The surge of connection and affiliation that we felt in the wake of 9/11 was mirrored in a sudden and dramatic increase in approval of Congress. As this Gallup chart shows, from 1974 through 1997, approval ratings for Congress fluctuated, but consistently stayed in the 20-40% range. Beginning in 1998, approval ratings had begun edging up and were oscillating between the low forties and high fifties. A poll conducted by Gallup days before the attack found that 42% of Americans approved of “the way Congress is doing its job.” One month after 9/11, Gallup found that Congress’s approval rating had doubled, to 84%.
In many respects this upsurge is not surprising. Americans were rallying around their government and its institutions in the aftermath of the attack by Al Qaeda. A Gallup survey tracking public trust in government also showed a sudden increase, peaking at 60% in October 2011.
Perhaps the sharp spike in the public’s approval of Congress was due in part to the fact that the divisiveness, partisanship, and frustration that tend to emanate from the institution faded into the background for a time, enabling many of us to appreciate anew the ideas and values that the institution was meant to embody. These ideas and values were suddenly under assault—literally so with the subsequent discovery of Anthrax-laden letters in the congressional mailroom. It was natural to approve of and thus affirm what Congress stood for in that moment.
But the chart also shows that, just as our newly felt social solidarity faded as the months stretched on after the attacks, so did congressional approval ratings. Within a year they had returned to pre-9/11 levels, and—with the exception of a brief uptick in the early days of the first Obama Administration—they have declined steadily ever since. For the last three years, less than one in five Americans have approved of Congress. At the height of last year’s government shut down, not even one in ten did.
The secular downward slope to the recent nadir raises questions about what will happen when future attacks or emergencies hit the country—as they surely will—in ways that put the resilience of representative democracy to the test. Will we be able to rally around our system of government in general and Congress in particular from such a low baseline of support? Will we be able to respond effectively as a nation if we cannot? Will Congress be able to act, and if it does will its actions have sufficient legitimacy? These are questions we should consider on this day, and in the days that lie ahead.
Five years ago my friends and Bridgespan Group colleagues Ann Goggins-Gregory and Don Howard coined a memorable phrase and plumbed a troublesome phenomenon in their essay, “The Nonprofit Starvation Cycle.” It laid bare the challenge of supporting the organizational infrastructure that nonprofits need to function effectively. Yes, Goggins-Gregory and Howard were talking without shame about the “o” word, as in overhead. They noted that that the starvation cycle “starts with funders’ unrealistic expectations about how much running a nonprofit costs, and results in nonprofits misrepresenting their costs while skimping on vital systems—acts that feed funders skewed beliefs.” They went on to note that if the cycle is ever going to be broken, “funders must take the lead.”
My brief time as a grantmaker has only served to validate the extent of this problem and the reinforcing dynamics of the starvation cycle. I have been struck by the number of peers at other foundations who have told me without batting an eye that they don’t fund overhead, or that they only do so using (arbitrary and undoubtedly low) cut-off points, like five or ten percent. Ironically, it is often the foundations endowed by very successful business people (who presumably should know better) that are most insistent on paying no or low overhead. If you sense some frustration on my part, it is because these funders are in effect free-riding on those of us prepared to underwrite our mutual grantees’ essential infrastructure.
But I have also been struck by how otherwise thoughtful and bold grantee leaders are inclined to dissemble on the issue of overhead. When I asked one recently what his overhead rate was—truly wanting to know so we could budget accordingly—he replied “In my experience our overhead rate is whatever a funder tells us it is.” Time and again I have seen low-balled and suspiciously round overhead rates of ten percent that, after further probing, turn out to be more like eighteen or twenty-three percent.
Thus both grantees and funders are implicated in the starvation cycle. If I were to take any issue with the argument Goggins-Gregory and Howard made in their highly original assessment, it is that both parties—not just funders—need to take the initiative to break the cycle.
At the Madison Initiative we are trying to do our part by providing general support whenever possible so that our grantees can incur costs and allocate resources to cover them as they best see fit. Two-thirds of the $11 million we have granted so far this year has been for general support. When circumstances require a more focused project grant geared to specific outcomes, we encourage our grantees to identify their actual overhead costs, not those that they speculate we would be willing to support.
To end this cycle, we will need our grantees to do their part. They should start by identifying their true costs. It is always surprising and a little disheartening to learn how many organizations don’t know these essential numbers. As a nonprofit CFO once told me in a lament that was at once sad and funny, “in this organization, the past is more uncertain than the future!” (Bridgespan, by the way, has a very helpful and freely accessible online tool kit to help you sort all this cost data out.)
Once nonprofit leaders have assessed their cost structure, what they really need to do is to be candid with funders in their moment of truth. Tell us what your costs to deliver really are, and ask us to fund them fully. If, as is often the case, your funder has a fixed amount to devote to a project grant, revisit your investment in the deliverables and work products with them to see if you can identify an alternative plan in which there is enough left over to amply support your infrastructure.
I’m not suggesting that such candor is easy to muster. But effective leaders need to be willing to take the risk of saying something that a funder might not want to hear when their organization’s long run effectiveness is at stake. If they are not, then shame on them. Funders, for our part, should fund the full cost of the work we are asking our grantees to undertake in a way that leaves their overall organization and its finances whole; if we don’t, then shame on us!
The recently completed World Cup reminded us again that soccer, played at the highest level, really is a beautiful game. However, those of us gearing up to coach our children in youth leagues this fall appreciate that the beautiful game can get ugly very quickly. No matter how many times during practice that you tell Ava she will be playing left striker or Isabelle that she is right middie, once the game starts on Saturday all bets are off. You quickly have a mob of pig-tailed, eye-blacked fourth graders clumped up and flailing away at the beleaguered ball like it was the devil himself. Then some poor girl takes a cleat on the ankle and starts howling, at which point the ref blows her whistle, gets both sides sorted out, and the madness starts all over again. I try not to over-coach during games, so I bite my tongue when all this is playing out, but in my head I’m shouting to myself: “FOR GOD’S SAKE LADIES, SPREAD OUT! PLAY YOUR ROLES LIKE WE TALKED ABOUT IN PRACTICE!! STAY IN YOUR LANES!!!”
I have come to appreciate that the role confusion and cluster-kicking that is part and parcel of pee wee soccer can be an apt metaphor for a set of temptations facing philanthropic foundations. The growing norm of actively collaborating with other funders in order to achieve “collective impact”– and perhaps the desire not to go out on a limb by ourselves – can leave us feeling compelled to fund whatever grantees and issue areas our foundation partners are supporting, and for them to do likewise with us. Our commitment to supporting grantees can lead us to gloss over the complications of the power relationship that inevitably exists between funders and recipients. In the name of being helpful, we help ourselves to a seat at a grantee’s table, and we then proceed to get into their business at a level of detail at which we have no business doing. Our determination to bring about systems changes or advance justice as we happen to define it can find us plotting campaign strategies almost as if we were working in a political party’s war room instead of funding tax-exempt, charitable activities.
What is lost if we succumb to these variants of the pee wee soccer phenomenon are the unique contributions that philanthropy and individual foundations can and should be making in a free society – e.g., supporting the development of ideas and approaches that may not have wide adherence at present (and indeed may even be unpopular); equipping promising leaders and their charitable organizations with the resources and degrees of freedom they need to bring their work to fruition; and cultivating vantage points that may enable society to see issues that currently vex and divide us in a better light. In philanthropy, as in soccer, things work better when we remember our roles and stay in our lanes.