Markets for Good Selected Readings: Making Sense of Data and Information in the Social Sector

EDITOR’S NOTES

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AUTHOR’S UPDATE

Any commentaries found in orange are updates provided by each author since the original date of publication on MarketsforGood.org.

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FOREWORD

The phrase social sector information infrastructure doesn’t roll off the tongue, but the topic has captured the imagination and intellect of a wide range of people.

Since October 2012, MarketsforGood.org has served as the center of gravity for discussion of the information infrastructure. We’ve had more than 100 guest contributors, 200 comments, and 30,000 visitors. The discussion on the site has been possible due to the passion and shared expertise of nonprofit leaders, technologists, foundations, academics, evaluators, intermediaries, and many others.

Today, we’re excited to present a retrospective collection of selected readings from the site. We start off this eBook with an introduction by Jeff Raikes, CEO of the Bill & Melinda Gates Foundation, in which he highlights the continuing wave of efforts that will push our sector to achieve even greater impact. Following Jeff’s introduction, the Markets for Good Collaboration Team recaps the first 15 months of the campaign, and how they expect Markets for Good to evolve going forward. The subsequent 17 posts and authors’ updates provide a range of perspectives on the most critical data-related challenges facing the social sector, and how these challenges can be addressed. Posts were chosen for their high readership, topic diversity, and thought leadership. The authors debate new and recurring hurdles in the social sector, like capacity and capital constraints; how qualitative data, including stories and beneficiary insights, can be incorporated into data-driven decision processes; and big-, medium-, and small-data management.

We welcome your feedback on this eBook; please contribute on MarketsforGood.org, Twitter, Facebook, LinkedIn, Vimeo, and Storify.

We’ve been delighted by the Markets for Good discussion to date: enlightening, informative, and active. We offer thanks to the many individuals whose blog posts, online comments, and support have given us great enthusiasm for the future of the social sector information infrastructure, and we hope you enjoy this compilation.

Eric J. Henderson, Markets for Good Curator

INTRODUCTION

One year ago, I joined a terrific gathering of leaders from across the world of philanthropy, nonprofits, impact investing, and social enterprise in San Francisco to kick-off the Markets for Good web campaign. I am truly impressed—and enthusiastic—about the kinds of conversations that have taken shape over the last year.

So I’m thrilled about this eBook and appreciate the time the contributors took to revisit and update their contributions. The following pages are filled with big, bold ideas about how we can upgrade the system for sharing knowledge in the social sector. But most exciting of all, I know these conversations represent a continuing wave of efforts that will push our sector to achieve even greater impact on the most challenging problems facing society.

To live up to our biggest aspirations, we need to ensure high-quality data—qualitative and quantitative in nature—is accessible to funders and implementers alike. Throughout my career, I have seen the many ways robust feedback ensures we have a better sense of what works, makes us more accountable to our ultimate beneficiaries, and provides an opportunity for us to draw attention to and tackle problems none of us could solve alone.

This is just the beginning—but as you will see, there are some incredible opportunities ahead for us to make our sector more effective and, ultimately, make a bigger difference in the lives of those we serve.

Jeff Raikes, CEO

Bill & Melinda Gates Foundation

MARKETS FOR GOOD: 15 MONTHS OF LEARNING

We launched the Markets for Good web campaign in October 2012, to foster a conversation about increasing the capacity of people and organizations in the social sector to generate, share, and use information to make better decisions.

We offered an initial vision of a social sector powered by information—which we shared in the form of a video, a Concept Paper, and a Strategic Story—and invited reactions, feedback, and critiques via social media and comments on the MarketsforGood.org site. We aimed to serve as the virtual water cooler for a growing community of people—from in and outside the social sector—who are interested in smart dialogue about how to use data and information to create social change. Not wanting to reinvent the wheel, we have focused on connecting, aligning, and amplifying the good work already being done by a range of organizations.

Seeking to present diverse perspectives, we invited over 100 contributors from a wide variety of organizations to share their insights in the form of guest blog posts. We have learned so much thanks to the interest, enthusiasm, and shared expertise of nonprofit leaders, technologists, foundation representatives, academics, evaluators, intermediaries, and others. Contributors have highlighted many exciting efforts, from the Full Frame Initiative’s work to re-frame how we define success and failure in community change, to Filantrofilia’s rating system for Mexican nonprofits, to the Nonprofit Insurance Alliance Group’s success in driving down the cost of nonprofit insurance coverage by using information to develop strong nonprofit risk profiles.

Emerging Themes

The MarketsforGood.org discussion has provided a rich view of what should be done to better enable the flow of high-quality information in the social sector. From Lucy Bernholz’s opening call to action to our posts on viable business models for social-sector information players, several key themes have emerged:

• Technology isn’t enough. One of the most consistent themes we’ve heard is that, while technology and digitally-generated data are important, making the best use of technology is not enough to ensure productive information use in the social sector.

• Beneficiary insights. This is not a new topic in the sector, and it goes by a few names including beneficiary feedback and constituent voice. Regardless of how it’s known, the fact that it has emerged as a key theme in the data conversation shows the continued passion for making sure that we’re collecting data from beneficiaries themselves, and using that to strengthen programming and/or to provide beneficiaries with a seat at the decision-making table. Tsitsi Masiyiwa of Zimbabwe’s Higher Life Foundation shows that it’s not all about using technology, but rather a deft mix of analog and tech methods to gain information relevant to the mission. For a synopsis on the topic and supporting context, please see this summary on Storify or click Beneficiary Insights in our homepage theme listing.

• Capacity constraints. The social sector is still working out how to best acquire quality data and use it consistently and productively. In one of our most read posts, Laura Quinn, founder of Idealware, asserts, "We all need to understand that if we as a social sector lean on nonprofits to provide data they simply don’t have the infrastructure to provide, what we’ll get is not better data—in fact, we may get data that’s worse ." To turn this around, one of the many things that we need to do is to build in-house analytics skills. Beth Kanter’s early post has continued to resonate, as she argues that the talent within the sector must include those with data skills .

• Big data I: small data. Amid the growing hype surrounding big data, we couldn’t ignore this ubiquitous topic and how it applies to the social sector. In our Big Data theme, we learned that, once we deaden the hype, it’s more likely " small and medium data that has the most potential for use in foundations and nonprofits. An important first step is to start with the data we have: understand it, collect it in reliable and responsible ways , and analyze it properly. Taken together, this means there are multiple relevant uses for data in the social sector, and the data doesn’t have to be big." Jonathan Koomey of Stanford University grounded the big data conversation in principles on how to handle and approach data of any size .

• Big data II: truly big data. However, big data has plenty of applications in the social sector, and we’re just beginning to understand its power. In his Markets for Good video, Robert Kirkpatrick explains how UN Global Pulse’s work demonstrates that predictive analytics are feasible for the social sector , as one example of big data’s use.

• Long-term strategies. We’ve hosted much discussion of what will be required to enhance social impact through deeper use of information and technology. Elizabeth Boris, director of the Center on Nonprofits and Philanthropy, makes the case that "the payoff for the nonprofit sector will require collaboration, persistence, advocacy, and patience—in addition to technology." Across our posts, we hear that the social sector must match complex problems with collaborative, long-term strategies and approaches.

• Capital constraints. Finally, we’re hearing about continued challenges in using information to attract capital—alongside some striking examples of where information has helped to reduce market inefficiencies. Like many others, Daniel Stid reiterates the importance of the social sector’s information infrastructure, while gently reminding us that information alone does not drive donors’ giving decisions . Melinda Tuan, in a separate post on evaluation, notes, The fundamental problem underlying these capacity constraints is how capital flows in the nonprofit sector. One barrier to the flow of capital is grantmakers’ and investors’ desire to see impact before they invest. Steve Wright counters this argument, If investors are waiting for evidence of impact before they fund, then they are either very conservative or poorly motivated investors.

Why Markets for Good?

As a society, we have robust private markets for goods and services (think of Amazon). And we have robust private markets for gain (think of the stock market). These markets successfully connect buyers and sellers, in part, due to an alignment of