Marjorie Kelly on the Emergent Ownership Revolution

Do you need something more tangible to use when talking about social business?

Is the 'social purpose' argument a bit thin for you?

According to Marjorie Kelly in Towards Mission-Controlled Corporations: Extractive vs Generative Design there are 5 elements of a generative ownership-driven design framework for social businesses:

1. Membership – How can we have the right people forming part of the business? How can they contribute to the running of the business? What roles and authority can they have?
2. Purpose – What purpose can a business have beyond profit-making for shareholders? What problems might it solve? How is 'wealth', and value spread within the local community?
3. Governance – Who is the board? Who does the board answer to? 
4. Finance – Where does the money come from? Where does it go? How does it circulate through the business? How does it generate wealth and value?
5. Networks – How does the business get access to goods, services, information? How might the exchange be carried out? How might it be non-financial? How might it reach beyond typical boundaries e.g. geography?

What types of careers are there in international development?

Skills (What you can do!)

• All skills needed!!

Functions (What role you would play!)

You may have 1 or more of these skills!

• Fundraising - storytelling, strategy, communications, budgeting, networking, relationship building, research, project management
• Policy - research, communications, legal, institutional development, relationship building, politics
• Institutional development - research, governance, relationship building, politics
• Economic development - economic modelling, industrial development, market systems strategy, welfare 
• Social welfare - advocacy, social welfare subsidies, charity work, 
• Private sector development - business innovation, enterprise development, enabling environment, entrepreneurship, taxation and legal
• Marketing and retail - commerce, business management, sociology, psychology, policy and/or network development
• Operations - logistics, network management, project management, finance, and/or results measurement 
• HRM - sociology, psychology, training and development, and/or team building
• Finance - finance, strategy, M&E, project management, and/or legal
• Results measurement - finance, strategy, project management, and/or research

New Trends (Where you might position yourself!)

• Market-based development
• Socialist market systems
• Social welfare
• Ethical business
• Fintech
• Behaviourial sciences
• Systems change
• Resilience
• Conflict 
• Livestock
• Healthcare
• Climate and the natural environment
• Informal sector
• NGO organisational development
• Foundation funding

Things to Remember!

• Be different - If you have good ideas that seem too out-of-the-box for traditional work, this could be the right time to build a skills around it and offer that skill to the development space
• Look deeper than large institutions - If you want to learn on the job, develop tangible skills and be part of an impactful project, start at the field and work upwards
• Competences are important - teamwork, patience, time management, critical thinking, adaptability, focus and determination

Why might some poverty reduction project incorporate behaviour change theories?

Nudges
(behaviour change tactics)

• Commitment device. A commitment device is a choice that an individual makes in the present which restricts his own set of choices in the future, often as a means of controlling future impulsive behavior and limiting choices to those that reflect long-term goals.
• Temptation bundling 
• Loss aversion. More pain with loss than the pleasure for what we gain. The customers that cancel with you are more worried about what they will lose than what they could gain by switching and going elsewhere

System actors
(for market actors integrating nudges)
Market actors who may be interested in behaviour change nudges are diverse. We see commercial enterprises looking to develop a customer base within a low-income population at the bottom-of-the-pyramid; we see Governments wanting to affect the behaviour of citizens such as through giving up smoking, reducing speeds on the roads and paying taxes on time; and we see opinion leaders/institutions/social networks wanting to influence and change socio-cultural dynamics - think of #blacklivesmatter.

System change
(why?)
We think that some behaviour change nudging is needed when the context is new for people, such as a unprecedented growth in the market economy, or recent modernisation, or evolving non-traditional systems, or new sectors and economic activity that require new practice and behaviours.

Facilitation using behaviour change
(for development practitioners)

• Avoid prescribing behaviour. Instead, help system actors find the behaviour they want to adopt; let it be self-deterministic and self-motivated. This makes it easier to find the right nudge - through the process, system actors will indicate the right nudge for them and what it will take to adhere to the effects of the nudge. 
• Be intuitive and look for deeper narratives. System actors will tell you what they want but this will not be overt, out-loud and obvious. This will be through their attitudes, behaviours, mindset, actions, and perceptions. You will need to read all of these cues to understand the full script of what the actor is (not) saying to you.
• Look into the socio-economic benefits for sharing the costs of desgining and implementing nudges and the socio-economic benefits for the value created. This should be the basis for programming the nudge into the market system
• Celebrate the effort not just the intellect. Telling people that they are smart and intelligent can create situations where the individual relies on their intelligence to get them through complex situations. Often what is needed more is a combination of patience, commitment, sacrifice, and possibly super-normal hard work (= effort)

RCTs in poverty reduction and development: why are some practitioners abandoning RCTs?

This blogpost about ethics in international development is about a randomised control trial (RCT) in Kenya. In the experiment, some households in Kenya were given unconditional cash transfers of either USD 404 or USD 1525. The researchers found, unsurprisingly, that the lucky ones were happier and that their unlucky neighbours were unhappy. The paper is aptly titled “Your Gain is my Pain”.

Most importantly, however, the blogger reflects on why this type of research is done at all: "Am I the only one to think that is not ethical dishing out large sums of money in small communities and observing how jealous and unhappy this makes the unlucky members of these tight knit communities?" 

For myself, as a development practitioner with a systems thinking perspective, RCTs can come across as having very limited usefulness and application. They can also be quite machine-based: they either choose to wilfully ignore human behaviour or they simply limit their interactions with other disciplines (psychology, sociology, anthropology) so that they can create more simple hypotheses. Thus, it is felt that the applicability of an RCT for complex problems (such as systemic poverty) is limited.

The RCT we have seen from Kenya seems to fall into that trap too. This RCT seems to need to test the notion that poor people in Kenya might not exhibit the same reactions and behaviours as other people. As if the nature of the human condition (in Africa) is under exploration. To me, this is strange and feels like the original hypotheses might have been drastically distilled and reduced down to overly simplified thoughts.

I wonder how the findings would actually be useful to policy and projects. Who might need proofs from an RCT that Kenyans are like any other human being? How could such research be useful for development planning at an economic or social level? Why is the notion that proving that desperation, jealously and unhappiness occurs among very poor people is valuable? I would also wonder what long-lasting impact this type of research would have on social relationships in the communities in the future.

Globally, there is a large community of development practitioner who feel that RCTs in poverty interventions are not ethical and not useful. From my conversations with them, they make the following points:

1. In many RCTs, an assumption is made that the the groups will not be communicating with each other. However, it is actually very difficult to have demarcated and clear boundaries for the treatment groups to be adequately isolated. People talk. Information can flow through multiple channels and through multiple mechanisms (face-to-face, mobile phone, internet, etc) across groups, geographies, social hierarchies, institutions, etc. 
2. In RCTs, people might be very desperate because of the psychological and social impact of poverty and crisis. In this case all the RCT does is exacerbate that desperation and exacerbate those behaviours that present themselves when people are in desperate situations. The results are therefore naturally biased and skewed and outlying when compared to any group at any point in time. This is not adequately recognised in RCTs and thus not at all reflected when RCTs attempt to influence policy and project applications.
3. Over time, the RCT can have a lasting negative impact. Those RCTs which test the type of reactions as the one featured here in Kenya - jealousy and unhappiness - can damage social relationships between individuals and groups even after the trial has ended. Real people are not as adept to switching off their pain and trauma (and any additional feelings of betrayal, anger, envy, frustration, etc.) as machines might be able to! 

A video on the three dimensions of the facilitators' role

The video describes the three principal dimensions of the facilitator´s job.

Check out the website to find out! http://english.iifac.org/

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Alternatively, watch the video here from IIFACWEB and published on 1 Apr 2013

Do market-based approaches hold too many false assumptions?

This blog post from the Institute of Development Studies (IDS) attempts to reflect the main challenges in implementing market-based approaches. It questions the "false assumptions" of market development and systems thinking for poverty reduction.

In fact, what is most evident is that a very damaging assumption held by policy makers and practitioners alike is that market-based approaches simply mean "business" and "market access". In fact these are two outcomes of a functioning market system - among many others - but not the end-goal. In reality, well-designed market-based approaches that adopt systemic principles also deliver the following benefits:

• Production and supply systems that respond to demand and the needs of the market so that relationships are inherently win-win and about capturing the value within the system 
• Inclusivity of poor, marginalised, vulnerable groups as key actors and influencers (including, women, youth, disabled, etc.) 
• Market resilience and the ability of the system to stay strong and react positively to economic, social, political shocks even after any development intervention 
• Innovation is from within the market itself and emergence of new products and services (both for mainstream as well as niche users)
• Better relationships between market actors and market-driven design and testing and learning so that products and services respond to market needs 

When talking about market-based systemic approaches to poverty reduction, the first step is for all parties to get on the same page. For advisors to development projects, these are some things to look out for:

• An inaccurate understanding of systemic thinking and a persistence towards value chain approaches. The former is about the structures, patterns and cycles in systems, and the systemic constraints that affect the functioning of a system (rather than any specific events or element or value chain). Systemic analyses then lead to solutions and leverage points that generate long-term change throughout the wider system (and not for any particular market actor value chain or sector). 
• Visible conflicts between projects and market partners and disagreements around 'ownership' and 'control'. There can often be a tug-of-war between 'who does' and 'who pays'. The project may be doing too much and be paying too much and can be reticent to relinquish control and allow market forces and systemic pressures to take over. 
• A lack of understanding of what a better functioning market system looks like. Poverty is often considered a 'wicked problem'. As a result, without diversity for multiple viewpoints in problem-solving, there can often be difficulty in envisioning a better future. Some projects also perceive that by formalising all things informal and turning informal activities into formal value chains will somehow naturally strengthen systems. 
• A lack of appreciation for (and a fear of) complexity. As a result, there may be a pattern of efforts to simplify, delineate, isolate and control within specific timeframes and outcomes, leading to tick-box approaches to measuring systems change. 
• A heavy emphasis on quantity over quality in project activities. In particular, a tendency to prioritise activities that promise large impacts for lots of beneficiaries as soon as possible ... over and above interventions at leverage points in the system that take time but draw people into the system and bring about sustainability through relationships, value creation, growth, feedback, market response and evolution 
• A tendency to directly intervene in the market instead of employing facilitative approaches and market-based tactics. Examples: 
• running 'project pilots' instead of working through market actors and offering opportunities for 'market exposure and idea testing' 
• dragging actors into the market through 'cost-sharing' instead of supporting existing interest and willingness for 'early-stage market entry' 
• organising and leading 'stakeholder forums' to get buy-in for the project's bright ideas instead of facilitating membership based groupings around common market constraints 
• when buying down the risk in new markets, offering a heavy amount of 'financial subsidy' to businesses instead of non-financial options such as 'networking, capacity building, coaching, information-sharing and relationship-building' 
• a lack of adequate focus on the incentives, relationships and behaviours in markets. This can be evidenced by projects that make broad assumptions about why the private sector does not already work in marginalised markets. e.g. ICT4Development projects often make the mistake that ICT constraints are primarily technical software issues, and do not spend enough time addressing the incentives and facilitating the relationships and interactions between firms and the market (mostly small rural-based enterprises).

Article - Oversimplifying behaviourial science

Why are simplistic solutions dangerous when addressing complexity? Do they promote simplified and lazy thinking? Do they result in linear solutions based on 'low-hanging fruit' for complex problems?

Does the new found energy and excitement around behaviourial science, psychology and marketing for selling products (both in wealthy consumer driven markets as well as in low-income bottom-of-the-pyramid markets) run the same risks?

This blog post was originally published here by Jesse Singal

Here's an excerpt.

"Although this product sounds like a fun idea, I’d worry that it could be distracting for drivers and it’s misleading to cite these rather complex and nuanced studies as evidence that looking at a smiley emoticon will make us all happier on the road," he concluded.

So no, MotorMood isn’t scientifically proven. But why should it be? It’s a light-up smiley face! Either people will like it and support it and buy it, or they won’t. Science shouldn’t have anything to do with it.

I’m only picking on this one Kickstarter because it’s a particularly silly example, and because this style of claim is so common right now. The emails arrive daily with the expectation that Science of Us and, presumably, the dozen other sites a given company is pitching, will breathlessly report shaky scientific claims that exist solely to prop up or draw attention to a given product or company.

This is a waste of everyone’s time, and in the long run it makes it hard for people who don’t think or write about this stuff for a living to understand what scientific claims really are, and what making and testing them entails.Surely there’s enough room in the world for actual, real-life science, and for products that are just fun (or stupid, depending on your opinion) but don’t need science’s imprimatur.

In other words, there’s no need to drag behavioral science into areas where it doesn’t belong. Like, you know, light-up smiley faces on Kickstarter.

Article - UK supermarkets criticised over misleading pricing tactics

Great steps forward in the UK. Helping consumers feel justified in their feelings of anxiety, confusion and mistrust. I know in the past, supermarket managers have hidden behind trading standards and claimed that their price tactics are in line with the rules and fully endorsed by the trading standards office.

And, this argument is very relevant everywhere where are market systems at work!

When working in 'retail' as a market system intervention, one thing that development projects need to remember is their role in market regulation. This means the policies and institutions and an adequate oversight function in the system to curtail predatory, confusing, misleading behaviour by retailers. Including agro-inputs firms (agrovets), animal and human health service providers, small grocery shops for the urban or rural poor etc...

The article was originally published here on the Guardian website.

UK supermarkets criticised over misleading pricing tactics
Rebecca Smithers Consumer affairs correspondent
Thursday 16 July 2015 09.09 BST

The competition regulator has criticised the UK’s leading supermarkets over their pricing, after a three-month inquiry uncovered evidence of “poor practice that could confuse or mislead shoppers”.

The Competition and Markets Authority stopped short of a full-blown market investigation but has announced a series of recommendations to bring more clarity to pricing and promotions to the grocery sector.

The top tricks supermarkets use to confuse customers

 

Read more

It plans to work with businesses to cut out potentially misleading promotional practices such as “was/now” offers, where a product is on sale at a discounted price for longer than the higher price applied. It also wants guidelines to be issued to supermarkets and has published its own at-a-glance guidance for consumers.

The investigation by the CMA was launched following a “super-complaint”lodged by the consumer group Which? in April, which claimed supermarkets had duped shoppers out of hundreds of millions of pounds through misleading pricing tactics.

Which? submitted a dossier setting out details of “dodgy multi-buys, shrinking products and baffling sales offers” to the authority, saying retailers were creating the illusion of savings, with 40% of groceries sold on promotion. Supermarkets were fooling shoppers into choosing products they might not have bought if they knew the full facts, it complained.

The supermarket sector was worth an estimated £148bn - 178bn to the UK economy in 2014.

In its formal response to the super-complaint, the CMA said the problems raised by the investigation were “not occurring in large numbers across the whole sector” and that retailers were generally taking compliance seriously. But it admitted more could be done to reduce the complexity in the way individual items were priced, particularly with complex ‘unit pricing’.

We have found that, whilst supermarkets want to comply with the law and shoppers enjoy a wide range of choices, with an estimated 40% of grocery spending being on items on promotion, there are still areas of poor practice that could confuse or mislead shoppers. So we are recommending further action to improve compliance and ensure that shoppers have clear, accurate information.”Nisha Arora, the CMA’s senior director, consumer, said: “We welcomed the super-complaint, which presented us with information that demanded closer inspection. We have gathered and examined a great deal of further evidence over the past three months and are now announcing what further action we are taking and recommending others to take.

Richard Lloyd, the executive director of Which?, said: “The CMA’s report confirms what our research over many years has repeatedly highlighted: there are hundreds of misleading offers on the shelves every day that do not comply with the rules.This puts supermarkets on notice to clean up their pricing practices or face legal action.

“Given the findings, we now expect to see urgent enforcement action from the CMA. The government must also quickly strengthen the rules so that retailers have no more excuses. As a result of our super-complaint, if all the changes are implemented widely, this will be good for consumers, competition and, ultimately, the economy.”

The CMA has been in close contact with retailers cited in the dossier, asking them for explanations for the misleading pricing and promotions. For the first time in its history, it has used social media including Twitter and Facebook to get more consumer and focus group feedback. 

This is only the sixth time Which? has used its super-complaint power since it was granted the right in 2002. It last issued a super-complaint in 2011 when it asked the Office of Fair Trading (OFT) to investigate excessive credit and debit card surcharges. The OFT upheld its complaint. The right to make a super-complaint to the CMA or an industry regulator is limited to a small number of consumer bodies such as Which? and Energywatch. After Which? submitted its dossier to the CMA, the regulator had 90 days in which to respond. Which? said more than 120,000 consumers had signed a petition supporting the super-complaint and urging the CMA to take action.

A decade ago Citizens Advice helped bring the payment protection insurance scandal to public attention by lodging a super-complaint with the now-defunct Office of Fair Trading.

http://www.theguardian.com/business/2015/jul/16/uk-supermarkets-criticised-misleading-pricing

Working with the private sector in market systems projects

What have I learnt working with the private sector in market systems projects?

Identify the systemic constraint and address the change at that leverage point. It is important to identify what is stopping the private sector from already reaching out to these markets. In one project, we found that livestock inputs suppliers were interested in developing distribution networks in very poor marginalised pastoralist communities but what had stopped them in the past was a lack of experience in in these markets. For them, lack of experience made the cost of market entry and market testing too high. The project therefore supported a market entry testing process for the firms. Each one carried out market research, tested their own distribution models and learnt from successes and failures. Over time, specific firms saw market potential and fully immersed themselves in the process, often evolving their strategies to respond to their insights on market dynamics.

From the outset, build in a pathway to market outreach with the private sector. In one project, we solicited proposals from firms to provide business services to agriculture firms working with smallholder farmers. We added a question asking firms to describe a) what they would try and find out about the market through the grant and b) how they would design market outreach and development strategies beyond the grant to continue interactions with market actors. The outcome was that firms better understood the catalyst nature of the grant. This also aligned expectations and incentives and all subsequent discussions between the firms and the project focussed on what was being learnt about the market and how the firm would scale out in the future.

Look at the market actor and seek out evidence of internal leverage points. Many firms will have engaged with hard-to-reach markets in the past. They may have made investments that have not worked out, or at least, invested in some basic research (codified or tacit) to test the water. When talking to firms about partnerships, look for resources that are vestiges of this history (a person, a report, a process, etc.). These can be put into the mix. A project can layer in additional resources, or improve the functioning of the resource, or help scale out out the resource, etc. In one project, we found that a university had set up an internship programme for agribusinesses students. However, this internship was not very successful because the university did not have the networks and knowledge to develop relationships with the private sector in rural areas. The project helped build these relationships. At the same time, the project helped train the interns who then on-trained rural firms> Over time, the university gathered enough knowledge to develop appropriate short courses for these rural firms – incorporating the expertise from the project as well as through the interns.

Article - Are we spoiling the private sector?

This blog was originally published here on the SEEP MaFI website.

Are We Spoiling the Private Sector?
by Md. Rubaiyath Sarwar in 2012

"As market facilitators, we strive to make the market inclusive...facilitate some small changes with the hope that the market system will open up to the poor! And we work with our ever so accommodating partners-more often than not lead firms. In the process, we keep on knocking from door to door, asking the private sector if they are willing to partner with us. And then, we negotiate, select the partners and implement our interventions. The interventions fetch excellent results. So much so that we do the same thing with the same partner in a larger scale. We call it replication. And then we involve more partners to do the same thing. We call it scale up. In some cases we say no to our beloved partner as we believe we have solved the market problem. But to our surpise, few months later, we see our partner doing almost the same thing with another project funded by another donor. Do we see another form of distortion taking place? Aren't we making ourselves too dependent on the lead firms? Why are our interventions often skewed towards the lead firms? What about other market system actors which include- civil society, professional associations, the government, the NGOs, cooperatives...? Do we always need to have commercial incentives to have sustainable impacts on scale?"

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Over the last decade we have observed increasing donor investment on market development projects for ‘large scale,’ ‘systemic ‘ and ‘sustainable change’ in agricultural and industrial sectors in Africa, South Asia and South East Asia. The projects proved that the donors can get better value for their investment if the private sector is attracted to invest on the interventions. More importantly, the partnership between the private sector and the project on cost sharing basis evolved as a principle tool to reposition development projects from being providers of critical services to being facilitators of the services.  I have been a direct participant in this paradigm shift and evolved from being a project manager to becoming a technical advisor and evaluator of market development projects in agricultural, industrial and health sectors in several countries that include Bangladesh and Nigeria, the two hotspots for market development projects in the world. 

As my roles shifted and my exposure expanded across different sectors in different countries and contexts, I observed an alarming trend.  It was becoming increasingly evident that (i) market development and support to lead firms was becoming increasingly synonymous (ii) there were projects inThe question attracted wide range of participants contributing to a technically rich discussion. Contributors included Mary Morgan-Inclusive Market Development Expert, Scott Merrill- Independent Consultant, Marcus Jenal, Specialist on Systemic Approaches for Development and James Blewett, Director of Markets, Enterprise and Trade Division at Landell Mills Ltd. All the contributors shared the feeling that indeed there is a risk that market development projects, if not carefully managed, can lead to a new form of market distortion where the private sector become reliant on donor funds.  However, they also reiterated the importance and significance of the collaboration with the lead firms and suggested several approaches that could mitigate the risk of the private sector becoming reliant on donor funds.

Mary suggested that partnerships work when the disparate goals of the private sector (making profits), vulnerable and poor producers (being able to produce and sell their produce at an acceptable price) and the development projects (increasing income and employment for the poor) converge towards the overall goal of inclusive market development (sustainable and systemic change in the market for employment and income generation of the poor).  While acknowledging the potential pitfall of partnerships, Mary pointed out that the risk might be higher in their absence.  She contributed further to the discussion by raising the point that often the support provided by the projects is much too heavy for the private sector to deliver once project support is withdrawn.  As evidence, she cited a case involving Wal-Mart and Mercy Corps in an intervention on developing an inclusive supply chain for Wal-Mart in Guatemala.

The questions raised by Mary were addressed by Scott who argued that the risk of distortion is high when the projects fail to adopt good practices for partnerships. He proposed that instead of pushing the private sector towards the partnership, the development projects should seek to pull the private sector towards the development goal by soliciting proposals from the lead firms. He suggested that we should be careful with how we use the term ‘partnership’ since it could be interpreted as the lead firms being subcontractors or sub-grantees. Scott emphasized on the need to establish objective selection criteria, conduct due diligence and structure relationships with lead firms to ensure sustainability of the interventions. Scott proposed to support the lead firms to develop a business plan so that the commercial benefit from the intervention could be laid out in details prior to the inception of the intervention. This could ensure that the firm owned the development activities and continued to deliver the service after the project support was withdrawn. 

James Blewett reflected on his experience in managing a challenge fund project in Afghanistan and argued that challenge funds reduce the risk of distortion in private sector engagement since it seeks to proactively engage the prospective grantees (which include lead firms) in design, co-investment and management of the interventions.  He also suggested the use of financial modeling tools used by investment projects to determine ‘tipping points’ so that the project’s financial contribution to the intervention is just enough to incentivize the private sector to address the investment risk associated with the intervention.

A very important contribution to the discussion came from Marcus who suggested that before deciding on the financial arrangements and technical support, the projects should ask why the private sector is not investing on the intervention on its own if it made commercial sense. He advocated for ‘form follows function’ approach and suggested that the projects should partner with lead firms when it is clear that the vulnerable will benefit from the partnership. Marcus argued that the lead firms often do not invest to reach out to the vulnerable not because they haven’t seen the opportunities, but because of a dysfunctional regulatory system, which according to him is the systemic constraint that needs to be tackled.

From the discussion it was evident that while the need for collaboration with the private sector is real, there needs to be further push from the donors, development projects and practitioners to ensure good practices and reduce risk of distortion in the market systems due to over-engagement with the private sector. The discussion also revealed that there are good practices and models that are being followed and discussion around these models could help market development practitioners to be better able to answer to why they have partnered with the lead firm, what support (financial and technical) they should be providing and why, and finally, how the lead firm is expected to sustain the intervention after the project support is withdrawn.  the same region or country competing for partnership with same lead firms (given that there are not too many in the country that qualifies to become a partner) (iii) the proliferation of market development projects in the same sector led to increasing number of lead firms receiving funds from them that ended up subsidizing their R&D, distribution and marketing costs and (iv) it was becoming difficult to evaluate whether the intervention resulted in systemic change since the lead firms continued to replicate the intervention with funds from other projects once the support from the original project was withdrawn. This prompted me to ask the members of the Market Facilitation Initiative (MaFI) whether they shared the feeling that probably it is time for us market development practitioners to be a little cautious when we approach lead firms.   

Article - How systems thinking can impact climate change

(The blog has been reproduced from where it was originally found on the Clinton Foundation website here.)

How Systems Thinking Can Impact Climate Change

By Dymphna van der Lans

Sep 19 2014

Systems thinker: a phrase that has come to define my method for problem solving, my approach to tackling the world’s greatest challenges, and most importantly, who I am today. When I was asked to serve as the CEO of the Clinton Climate Initiative, I had the opportunity to reflect on what led me to this point and how my identity as a systems thinker would ultimately shape our mission moving forward to confront the complicated threats of climate change.

I was fortunate to be raised by systems thinkers as I grew up in the Netherlands, where everything and everyone is close together. Since there is no wilderness, very little land and very little space, we have to be thoughtful about our resources and about each other, and I have carried these lessons with me to where I am today.

The world, as I see it, is made up of systems, and is the result of any interconnected set of elements that is coherently organized in a way that achieves an outcome.

The world, as I see it, is made up of systems, and is the result of any interconnected set of elements that is coherently organized in a way that achieves an outcome. A tree is a system. A forest is a system. I am a system. Systems are often embedded in larger systems, which are embedded in yet larger systems. The earth’s climate is a system comprised of the subsystems of our atmosphere, our oceans, the land, and human society.

The earth’s climate is a system comprised of the subsystems of our atmosphere, our oceans, the land, and human society.

“Systems Thinking” views outcomes as the result of the interactions between the various elements of a system and recognizes that systems often contain within them the causes of their own success, and — this is critical— the causes of their own failure. Similarly, “Systems Problems” are problems that have origins in the interactions of the elements of a system, characterized by a high degree of interconnection and interdependence with other variables around them.

Climate change may well be the most complex systems problem that we have ever faced. In our modern economy, almost every human activity is linked to the use of fossil fuels or other sources of climate-altering greenhouse gases. Every time we buy or download a book, every time we cook a meal, every time we travel across town, we are impacting the climate.

In our modern economy, almost every human activity is linked to the use of fossil fuels or other sources of climate-altering greenhouse gases. Every time we buy or download a book, every time we cook a meal, every time we travel across town, we are impacting the climate.

At the same time, almost everything that sustains and enriches our lives is affected, directly or indirectly, by the changing climate. At the Clinton Foundation, we realize that access to clean water, the price of our food, national security, the health of ourselves and our loved ones, economic opportunity for this generation and those to come, all are placed in jeopardy by climate change.

We must insist on solving more than one problem at a time and on tackling multiple interrelated challenges at the same time. We need the resolve to address systems rather than symptoms. A solution will not be effective or enduring if it creates new problems. And so, we need new business models, new technologies, new policy frameworks, and most importantly, new ways of engaging with each other.

We are moving away from focusing on single technologies to using a whole systems approach as we recognize that there is no single silver bullet solution to stopping climate change.

The Clinton Climate Initiative (CCI) does exactly that in its unique systems thinking approach. We are moving away from focusing on single technologies to using a whole systems approach as we recognize that there is no single silver bullet solution to stopping climate change. Rather than narrowly focusing on one approach, like renewable energy as the only solution, we take a more holistic view to developing systemic solutions. We collaborate with world-class partners to increase the resiliency of communities facing climate change and to create replicable and sustainable models for others to follow.

At the core of our engagement philosophy is Systems Thinking; identifying and activating leverage points that can create significant, positive impact in climate change mitigation and energy transition for communities around the world. CCI has worked with governments and communities to build data systems to better inform decisions and policies on the management of land and natural resources. CCI has also developed waste, water, and energy strategies with our Small Islands partners to create impact from boosting the local economy to women’s empowerment. Finally, CCI has introduced innovative financing mechanisms by partnering with employers to bring energy efficiency benefits to lower home energy expenses and improve people’s lives and their living and working environments.

Through our programs, focused on landscapes and land use, energy supply and energy demand, and energy efficiency, we aim to work together to tackle these systems problems. Now we call on you to take action, to start thinking about your home, your country, your world, and your climate as a system. We ask that you join us in creating solutions that take into account the entire system and all its complexities. Together, we can work to create measurable, meaningful and lasting contributions—one system at a time.

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https://www.clintonfoundation.org/blog/2014/09/19/how-systems-thinking-can-impact-climate-change

The dangers of of the 'cash transfer magic bullet'

Cash transfers, conditional or not, are a particularly dangerous movement in development. 

The research from Harvard, MIT, NPR on cash transfers has been often cited in the media. But, it is clear that the the cash transfer mechanism is a very limited and is a short-term stimulus that does not address systemic failures that keep people poor. Could this be another magic bullet that make donors feel good about giving money? Won't money just flood the systems but play no role in building systems? How is this sustainable or scaleable beyond any donor handout?

It is the system that causes poverty, and not, as is assumed under the cash transfer paradigm, people and people's willingness and ability to pay. To take this one step further it is the weak poorly-functioning system for goods, services, information, knowledge that causes poverty. if for example, there are medicines available for poor people to buy, the systemic problem is actually that medicines are not well-distributed and clearly branded with a system for verification so that counterfeits cannot creep in. If there are agents/traders/salespeople/distributors working for the big pharmas, the question is always: what are they incentivised to do? Is it to push products for commission? If so, what will the effect be on the quality of information that goes out to people on what they should buy? Who can poor people go to make sure their ability to spend isn’t subsumed by their inability to get a good quality product?

In weak systems, there are systemic constraints that trap poor people in a cycle of no/bad/sub-optimal investment. They also have no 'voice' to complain, protest, influence, push up quality. Poor people are ‘voiceless’. Cash transfers simple result in money in the pocket but no voice or influence.

Article - Digital finance for smallholder farmers - a systemic approach

This USAID Microlinks article describes a systemic approach to building financial systems for digital-based smallholder farmer finance. This approach is naturally scalable as it has the in-built mechanisms for growth.

These interventions use the following design tactics:

1. Behaviour change principles such as, features and incentives to make it easier for people to adopt a new practice for the first time 
2. Multi-level design - digital services can both bring in new behaviours as well as make existing good practice more efficient and automated and easier to stick to
3. Savings and insurance services for resilience and long-term sustainability 

Source: How Digital Financial Services Can Meet The Financing Demands Of Smallholder Farmers, LIZ DIEBOLD, Agriculture Finance And Investment Lead, NANDINI HARIHARESWARA, Senior Digital Finance Advisor, And HARSHA KODALI, Agricultural Finance Specialist PUBLISHED ON JUNE 16, 2015, AVAILABLE AT WWW.MICROLINKS.ORG/BLOG/HOW-DIGITAL-FINANCIAL-SERVICES-CAN-MEET-FINANCING-DEMANDS-SMALLHOLDER-FARMERS

Has Africa outgrown aid? #bbcafricadebate

A fascinating debate! I collected many of the comments made on Twitter and reflected on my own experiences and insights. I then looked for any common messages and themes of the debate.

Addressing the dangers of aid

• Aid needs to change; but saying that Africa has outgrown aid suggests that Africa is a child that needs raising
• Aid can be a political tool of foreign donors forcing governments and people into agreements that are 'unfair' and 'unjust'
• Aid needs the support of better systems to monitor how it is being spent BUT aid can be limited in effectiveness when most time is spent time reporting and appeasing donors 
• Aid is lumped in with transparency to appease donors, but not other valuable system actors, such as the citizens
• Aid must be flexible to the changing nature of dynamic systems and economies

Making immediate changes to aid

• Aid must be better communicated to African citizens so that they are not "voiceless citizens"
• Aid must start to recognise the different roles for aid in the different economic and market systems in Africa 
• such as, from Rwanda and Ethiopia, to Kenya and South Africa, to Ghana and Nigeria, to Sierra Leone and Senegal, to Tunisia and Eqypt to Chad and Niger
• Aid must not be delivered at the mercy/desire/will of donors with demanding reporting standards; not every last penny spent can be tracked and it is more important to see broader outputs and outcomes than a tick-box of donor-driven activities

Developing a future role for aid

• Aid must be re-conceptualised towards trade, economic development, market systems and business for poverty reduction and systemic resilience
• in the social sector, this might mean applying systems thinking to public goods for better access by all 
• Aid has a role to play in security and anti-terrorism as well as in institutions building and strengthening
• Aid might eventually play a long term role in the economy as remittances and FDI - aid has been sent by African diaspora for decades and diaspora are looking for new ways to send money home and invest in local businesses
• Aid needs to be re-designed to prevent being a tool for corruption; aid needs better practice-driven local leadership, stewardship and management 

Article - Diffusion of innovations theory

Diffusion of innovations

Diffusion of innovations is a theory that seeks to explain how, why, and at what rate new ideas and technology spread through cultures. Everett Rogers, a professor of communication studies, popularized the theory in his book Diffusion of Innovations; the book was first published in 1962, and is now in its fifth edition (2003).^[1] Rogers argues that diffusion is the process by which an innovation is communicated through certain channels over time among the participants in a social system. The origins of the diffusion of innovations theory are varied and span multiple disciplines. Rogers proposes that four main elements influence the spread of a new idea: the innovation itself, communication channels, time, and a social system. This process relies heavily on human capital. The innovation must be widely adopted in order to self-sustain. Within the rate of adoption, there is a point at which an innovation reaches critical mass. The categories of adopters are: innovators, early adopters, early majority, late majority, and laggards.^[2] Diffusion manifests itself in different ways in various cultures and fields and is highly subject to the type of adopters and innovation-decision process.

The key elements in diffusion research are:

Element	Definition
Innovation	Innovations are a broad category, relative to the current knowledge of the analyzed unit. Any idea, practice, or object that is perceived as new by an individual or other unit of adoption could be considered an innovation available for study.[14]
Adopters	Adopters are the minimal unit of analysis. In most studies, adopters are individuals, but can also be organizations (businesses, schools, hospitals, etc.), clusters within social networks, or countries.[15]
Communication channels	Diffusion, by definition, takes place among people or organizations. Communication channels allow the transfer of information from one unit to the other.[16]Communication patterns or capabilities must be established between parties as a minimum for diffusion to occur.[17]
Time	The passage of time is necessary for innovations to be adopted; they are rarely adopted instantaneously. In fact, in the Ryan and Gross (1943) study on hybrid corn adoption, adoption occurred over more than ten years, and most farmers only dedicated a fraction on their fields to the new corn in the first years after adoption.[6][18]
Social system	The social system is the combination of external influences (mass media, organizational or governmental mandates) and internal influences (strong and weak social relationships, distance from opinion leaders).[19] There are many roles in a social system, and their combination represents the total influences on a potential adopter.[20]

Five stages of the adoption process

Stage	Definition
Knowledge	The individual is first exposed to an innovation, but lacks information about the innovation. During this stage the individual has not yet been inspired to find out more information about the innovation.
Persuasion	The individual is interested in the innovation and actively seeks related information/details.
Decision	The individual takes the concept of the change and weighs the advantages/disadvantages of using the innovation and decides whether to adopt or reject the innovation. Due to the individualistic nature of this stage, Rogers notes that it is the most difficult stage on which to acquire empirical evidence.[11]
Implementation	The individual employs the innovation to a varying degree depending on the situation. During this stage the individual also determines the usefulness of the innovation and may search for further information about it.
Confirmation	The individual finalizes his/her decision to continue using the innovation. This stage is both intrapersonal (may cause cognitive dissonance) and interpersonal, confirmation the group has made the right decision.

Change agents bring innovations to new communities– first through the gatekeepers, then through the opinion leaders, and so on through the community.

Adopter category	Definition
Innovators	Innovators are willing to take risks, have the highest social status, have financial liquidity, are social and have closest contact to scientific sources and interaction with other innovators. Their risk tolerance allows them to adopt technologies that may ultimately fail. Financial resources help absorb these failures. [40]
Early adopters	These individuals have the highest degree of opinion leadership among the adopter categories. Early adopters have a higher social status, financial liquidity, advanced education and are more socially forward than late adopters. They are more discreet in adoption choices than innovators. They use judicious choice of adoption to help them maintain a central communication position.[41]
Early Majority	They adopt an innovation after a varying degree of time that is significantly longer than the innovators and early adopters. Early Majority have above average social status, contact with early adopters and seldom hold positions of opinion leadership in a system (Rogers 1962, p. 283)
Late Majority	They adopt an innovation after the average participant. These individuals approach an innovation with a high degree of skepticism and after the majority of society has adopted the innovation. Late Majority are typically skeptical about an innovation, have below average social status, little financial liquidity, in contact with others in late majority and early majority and little opinion leadership.
Laggards	They are the last to adopt an innovation. Unlike some of the previous categories, individuals in this category show little to no opinion leadership. These individuals typically have an aversion to change-agents. Laggards typically tend to be focused on "traditions", lowest social status, lowest financial liquidity, oldest among adopters, and in contact with only family and close friends.
Leapfroggers	When resistors upgrade they often skip several generations in order to reach the most recent technologies.

Source: Wikipedia

A failure of systems thinking

The critique of systems thinking has some truth to it. 

A big problem is that a lot of time and effort goes in to just explaining the underlying principles. An example given in this Fast Company article shows that it can take 3 days or more to train managers and leaders on systems thinking. In many cases, the application comes later. This can be frustrating for practitioners.

In my work, I often train practitioners in systems thinking for market development. I mainly train practitioners in developing countries whose projects are funded by international aid agencies and donor funds. I work in Africa and Latin America and the Caribbean. These are some the tactics I have used.

"I never teach my pupils; I only attempt to provide the conditions in which they can learn." - Albert Einstein

Firstly, good systems training should allow practitioners to be comfortable with the language. The didactic approach doesn't work. People don't learn by being preached at and being told what they must know. So, at certain points, I provide space for the practitioners to reflect on the language. I allow practitioners to ask questions of common labels, such as 'counter-intuitiveness' and 'feedback loops'. I also allow room for re-wording and I give participants ownership of the lexicon.

Secondly, as a trainer, I am helping to re-energise and re-configure the mindset of practitioners to be able to practice systems thinking in actual projects. I help participants make those mental connections and I provide as many opportunities as possible to apply systems principles. I do this through appropriate case studies, stories, quotes, project briefs. I also provide lots of opportunities for discussion, analysis, and reflection.

Thirdly, as learners, we find it generally better to try out new ideas as we go along. What I like to do is couch training within a practical part of a project - a market study, a partners assessment, a strategy review, etc. I try to avoid having systems training as a disconnected piece either before a project, during a project as a response to a donor demand or as an afterthought as a posthumous project review. I try to be principled with the principles by offering the opportunity to dive deeply into specific principles. I provide an overview and then focus on certain key ideas, and I layer in opportunities for practical application as part of the training. The aim to to help participants get a specific piece of the project done. And still maintain the perspective of a systems thinker.

LESSONS LEARNED — WHY THE FAILURE OF SYSTEMS THINKING SHOULD INFORM THE FUTURE OF DESIGN THINKING BY FRED COLLOPY, June 7, 2009, available at www.fastcompany.com/1291598/lessons-learned-why-failure-systems-thinking-should-inform-future-design-thinking