Editor's Note: This post was originally published on the Root Cause blog.
The theme of last month's Skoll World Forum, "Large Scale Change - ecosystems, networks, and collaborative action," mirrors the trend to move beyond the traditional philanthropic approach of scaling high-performing social entrepreneurs toward a focus on synergy within and across sectors.
Meanwhile, important lessons are being captured. Peter Hill's recent blog post on Boston After School and Beyond highlighted key features of successful cross-collaboration, including strong leadership, shared outcomes and the significance of role of a site-based coordinator. These ideas are consistent with Kramer and Kania's Winter 2011 SSIR article on Collective Impact. As organizations leverage existing resources through highly coordinated systems to address complex social issues, the three business principles of management - incentives, measurement, and decision rights – can provide insightful lessons.
In a business environment, managers are provided with intrinsic and extrinsic incentives to ensure that motivations are aligned with organizational performance. Similarly, incentives are essential to synchronize the motivations of organizations to achieve change together. For example, State Street Foundation's Youth Violence Prevention Collaborative convenes funders from foundations, government and the private sector into various working groups, including Youth Workforce Development and Education, Youth Development and Mentoring, and Family Supports and Mental Health. The funders are incentivized to extend the social impact of their dollars spent through a shared understanding of the social issue, promising programs, service delivery gaps, and how to measure impact.
The hallmark of an effective performance measurement system is the adoption of relevant measures that accurately reflect the priorities of a business or organization. Measurement drives behavior. Appropriate process and outcome indicators ensure the alignment of objectives. A prime example of effective shared measurement is Shape Up Somerville, the city-wide campaign to combat childhood obesity. With a strict evaluation of their key performance indicator, BMI scores, the cross-sector stakeholders orchestrated efforts to increase physical activity and availability of healthy food options. Through this effort, the initiative achieved a statistically significant decrease in BMI scores for children at high risk for obesity.
Effective decision rights are based on the notion that managers should be held accountable only for outcomes falling within their spheres of authority. With the right decision-making structure in place, managers are able to align their actions to measurements. We come back again to the idea that measurement drives behavior. For Boston After School and Beyond, its achievements were driven by the ability of the site coordinator to align practices across programs and bridge gaps. The site coordinator had the appropriate decision rights to design the programs to efficiently allocate resources for optimal outcomes.
Incentives align individuals with collective goals. Decision rights grant individuals the flexibility to adapt activities to what is being measured. Finally, measurement drives behavior. The three legs of the stool support one another to achieve equilibrium.
As the importance of cross-sector collaboration becomes increasingly recognized, so too must incentives, decision rights and measurement be effectively used to manage these complex relationships.
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