Knowledge Exchange: Investing in Networks

Loose Ties + Strong Trust = Innovation in Los Angeles

This is a re-post, originally published October 17, 2015 on Philantopic, a blog of opinion and commentary at Philanthropy News Digest.  You can view the original post here.

In 2008, Lisa Watson was the executive director of the Downtown Women’s Center (DWC), an organization dedicated to meeting the needs of women on Los Angeles’ Skid Row hoping to overcome poverty and homelessness. That year, Lisa received a Stanton Fellowship to investigate the viability of a co-located social enterprise retail store that would offer workforce training to homeless women and generate revenues for the center. Revenues would be used to subsidize housing and supportive services in the pricey Los Angeles real estate market.

For the past ten years the Durfee Foundation has awarded a select number of Stanton Fellowships to social change leaders in Los Angeles with the aim of fostering innovative solutions to some of the city’s most intractable problems. Lisa’s project became a reality in 2011 with the opening of MADE by DWC, a gift boutique and café that offers organic coffee and food along with one-of-a-kind vintage and contemporary women’s clothing, accessories, household accents, and their signature handMADE product line. One hundred percent of the proceeds support the residents of the Downtown Women’s Center, providing the kind of earned revenue that is a vital component of long-term sustainability for most nonprofits.

Cross-Disciplinary Connections

Prior to the fellowship, Lisa had met a handful of other Stanton alumni, all in the housing/homelessness space. Over the course of her fellowship, however, she expanded her connections to include Stanton fellows with expertise in urban planning, health, education, the environment, and economic development, as well as contacts in the L.A. Mayor’s Office. The interactions with other fellows significantly affected her project’s design as well as its resulting success. “By bringing together smart people from various disciplines in Los Angeles,” she notes, “problems can be viewed through various prisms rather than through a telescope. Solutions and strategies are developed by looking more richly at the problem from various perspectives and disciplines.”

The Stanton Fellowship provides funds over two years for each fellow to think deeply about a specific challenge related to their work and to tease out solutions that will improve life in Los Angeles. The Durfee Foundation deliberately encourages connecting and knowledge sharing among fellows as a way to foster the cross-fertilization of ideas that might lead to new approaches. Stanton Fellows are intentionally selected to represent a wide-ranging spectrum of issues and sectors, with fellows coming from government and social enterprise as well as nonprofits. Key elements of the program include opening and concluding fellowship retreats that overlap with the next/prior cohort of fellows; quarterly get-togethers hosted by a fellow who provides a tour of the issue they are tackling and includes time for fellows to update the group on their projects; and foundation staff matching fellows with program alumni mentors. In addition, every other year the foundation hosts a retreat to which all alumni of the program as well as current fellows are invited.

Enhanced Peripheral Vision

In order to better understand the network dimension of the program, the Durfee Foundation asked Network Impact to assess the role that ties among Stanton Fellows play in contributing to the program’s goals. To that end, in the fall of 2014 we surveyed current fellows and alumni, and supplemented that work with focus-group interviews and Social Network analysis (SNA) to assess the nature of the connections among fellows over time. What we found has implications for funders who are supporting innovation in the social sector, particularly investors in fellowship or leadership development programs who are curious about the wider impact of these initiatives.

The Strength of Loose Ties

“I can ask any Stanton person for their support, and I have done so. Some I only see once a year and that’s fine….I know who to call if I need something.”

It is not uncommon for fellowship programs to cultivate close, trusting relationships among participants as a way to promote more alignment and coordination among participants. For example, bonds that have been deliberately fostered among community leaders who participate in the Barr Fellows Program in Boston have led to increased collaboration among leading nonprofit organizations in that city. In contrast, a social network analysis of the ties among Stanton fellows reveals a different pattern. In the Stanton case, loose ties among fellows resulting in an exchange of “information that leads to new thinking or framing” are more common (see the maps below). Our mapping also shows that participation in the program increases each fellow’s reach, creating pathways to advice and information from a variety of nonprofit leaders. The majority of connections among fellows are not regular, close, or personal. Instead, the overall effect is one of improved “peripheral vision.” With a view to engaging in transformational activity beyond their own “silos,” nonprofit leaders working on different issues can adopt lessons from other settings and better align their plans of action. Our observations offer a different take on the Strength of Weak Ties thesis put forward by Marc Granovetter. Moreover, research on networks suggests that high levels of trust in networks typically coincide with strong, often personal, bonds among members. In the Stanton network, fellows tend to seek advice from peers as trusted sources, not on the basis of strong personal ties.

Below are maps of connections that “provided information that led to new thinking or framing that has been useful in my work” before the Stanton Fellowship, and after. This type of connection saw a 308 percent increase compared to the intensity of connections before the start of the fellowship period.

DurfeeBeforeAfterNetworkMaps

A Culture of Trust

“I feel free to pick up the phone and call anybody who was a Stanton Fellow, because it’s sort of a common culture that we all share, and it’s a very different level of trust and access….”

Like other social changemakers, one of the things that Stanton fellows value most highly is their access to trusted information from peers. As in most networks, trust lowers transaction costs for peer exchange; in the case of the Stanton fellowship, this network “glue” is the product of a shared set of understandings that the Durfee Foundation fosters between itself and Stanton fellows and among the fellows themselves. As one fellow explained: “We refer to it as a ‘fellowship’, and that is a particularly relevant word for this experience. I think we all feel very strongly that this is a community that matters deeply and has added immensely to our lives, personally and professionally….Stanton calls are always taken and returned, and there is a warmth and common bond that immediately eases whatever else is happening in the day.”

Reflecting on how this culture of trust has been created and maintained, fellows repeatedly cited the efforts of Durfee Foundation staff to encourage them to take risks. One alumnus of the program explained, “They have created this culture that is incredibly healthy and vibrant and encouraging….They invite you to push the envelope and are not fearful of what other foundations might perceive as failure, which is a healthy environment in which to experiment.”

Equally important is fellows’ confidence in the foundation’s capacity to select candidates whose motivations are aligned with theirs: the desire to transform conditions in Los Angeles for the better and to help the most vulnerable in the city. As one fellow observed, “The staff set the standard for how much we all connect. That’s part of the leadership everyone trusts so much.” Another reflected: “I think my comfort harks back to the rigor and savvy with which the selection takes place. It does say something to me about who is in that group of people, that I can trust them, at least enough to reach out to them.” In other words, the mere fact of being selected as a fellow inspires confidence and trust.

Reflecting on her time as a Stanton Fellow, Lisa describes her experience of getting beyond traditional silos in an environment of loose ties but strong trust. “The whole idea of trying to change a city we all care about is a real connector point. It taught me to love L.A. more, and I now feel more a part of it. I was exposed to all these different things that were totally out of my world and experience. As a result, I am involved and engaged in the city in new ways, with different people than I would have been before I was selected to be a fellow.”

Lisa’s project evolved based on her fertile exchanges with other Stanton Fellows and has continued to grow, with more than fifty of the women involved in the training now gainfully employed, and MADE by DWC products now being sold online and in stores in Los Angeles, providing much-needed funds to advance the full spectrum of DWC programs. Our hope is that others looking to nurture innovative social change efforts will look at how their current activities to connect diverse leaders present opportunities to increase the visibility of their grantees’ efforts and will begin to track the value created through those network connections.

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Investing in Networks Grows Impact

We often hear grantmakers talk about leveraging dollars but rarely get to see year-to-year data showing a funder’s investment over time with the additional resources they attract to an issue. The Garfield Foundation agreed to let us review their investments in the RE-AMP network over the last ten years so we could take a closer look at a specific case. Our analysis shows that even foundations with a modest corpus can leverage their charitable dollars many times over by investing in networks. Our latest blog post on this topic is featured in The Stanford Social Innovation Review .

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Network Power for Philanthropy and Nonprofits

Drawing on cases of nonprofit networks, this article makes a case for widespread use of networks in the civil sector and examines the practical uses of the knowledge developed by “network science.” Individual chapters focus on the formation and structure of networks for philanthropy and non-profits from the most essential stages of development – framing and defining the term “network” itself – to the dynamics within existing networks and the interactions that sustain them over time. Written by Peter Plastrik and Madeleine Taylor for the Barr Foundation.

Download the article here

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Net Gains: A Handbook for Network Builders Seeking Social Change

Net Gains provides practical advice for the growing community of network builders developing networks for social change. The handbook draws from the experiences of network builders, case studies covering a diversity of different networks, and emerging scientific knowledge about “connectivity.” The guide is divided into four parts, each focusing on a specific element of network building and offering strategies for successful development of networks at different stages in their evolution, from the moment of their inception, to the management of their ongoing production.

The handbook can be downloaded here.

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The Way for Foundations to Have More Impact? Fund Networks!!

At Network Impact, we’ve been arguing for this for several years. A fascinating new report from the Monitor Institute picks up the theme.

The Monitor Institute’s recent (and excellent) report, “What’s Next for Philanthropy,” describes the changing strategic landscape in which foundations make their investment decisions–and urges philanthropists to adopt a new set of practices for increasing their impact that includes “activating networks.” Monitor’s reasoning: “Advances in network theory and practice now allow funders to be more deliberate about supporting connectivity, coordinating networks, and thinking about how the collective impact of all of their efforts can produce change far beyond the success of any single grant, grantee, or donor.”

Yes, indeed! Madeleine Taylor and I made this point in our first report on networks,”Network Power for Philanthropy and Nonprofits,” in 2004. With financial and intellectual support from the Barr Foundation in Boston, we identified numerous examples of social innovators using network approaches to generate impact, dissected the theories of networks, framed the practices of network building, and suggested ways that the social-change sector could accelerate and spread the use of networks to increase social impact. More recently, as we’ve seen foundations become more interested in network building, we wrote a short paper on what foundations should worry about and expect when they start investing in social change networks.

Monitor’s report offers a compelling, spot-on paradigm shift for foundations:
Simply stated, philanthropists operate today in a stressful, rapidly evolving, networked, and interdependent world.

Many of philanthropy’s core practices and principles remain essentially unchanged from the way they were a hundred years ago, when Andrew Carnegie and John D. Rockefeller first created the foundation form. As we and other observers have been noting for some time, the world around philanthropy is changing much, much faster than philanthropy itself…
…Where the cutting edge of philanthropic innovation over the last decade was mostly about improving organizational effectiveness, efficiency, and responsiveness, we believe that the work of the next 10 years will have to build on those efforts to include an additional focus on coordination and adaptation. Coordination, because given the scale and social complexity of the challenges they face, funders will increasingly look to other actors, both in philanthropy and across sectors, to activate sufficient resources to make sustainable progress on issues of shared concern. No private funder alone, not even Bill Gates, has the resources and reach required to move the needle on our most pressing and intractable problems. And adaptation, because given the pace of change today, funders will need to get smarter more quickly, incorporating the best available data and knowledge about what is working and regularly adjusting what they do to add value amidst the dynamic circumstances we all face.

Monitor’s summary of why networks matter in this changing world focuses on the need for greater coordination and leveraging of resources to achieve systemic impact–and what a big change in practice this is for foundations: Although the individual grant is the typical unit of analysis for most foundations, the success of any grant or organization is rarely sufficient to move the needle on a complex problem. We have all felt the irony when successful programs are lauded while the system they aspire to change continues to fail. Funders are well positioned to support connectivity and to coordinate and knit together the pieces of a network of activity that can have impacts far beyond the success of any one grant, grantee, or donor. And advances in network theory and practice now allow funders to be much more deliberate about supporting and participating in networks and in thinking about how the collective impact of a coordinated portfolio of grants can produce more significant change. These very advances in network practice–the art of building, growing, and maintaining various types of networks–are the focus of our consulting, tool-building, and research work at Network Impact.

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Networks for Social Impact: Welcome to the Start of Something Big

We’re betting on network approaches to become an important way of increasing social change.

For the past six years, Madeleine Taylor and I have been working with the idea that network-building approaches offer social-change agents and organizations a powerful new way to generate impact. We’ve consulted with networks large and small; written and circulated articles and drafted a handbook, Net Gains, that thousands have downloaded for free; and provided a PDF Network Health Scorecard, also free. In the process we’ve become convinced that networks for social impact is an emerging field ripe with potential value and opportunities for development–but also with evolutionary challenges. Recently we’ve summarized our assessment of the field’s condition, as part of the development strategy for our Center for Network Impact, and wanted to share this. Your feedback is welcome.

•    There is a growing interest in the use of networks as alternatives and/or complements to organizational structures in the nonprofit/social-innovation/philanthropic sector. In the wake of several highly popular books about network phenomenon and theory, a significant jump in information from academics, practitioners, and experts has occurred. The rapid and wide spread of Web 2.0, digital social networking, ensures that interest in the many applications of networks will be sustained.

•    The “practice field” is in an early stage of development. In our analysis of field-building, this first stage is characterized by conceptual framing and isolated examples of practice. In the next developmental stage, networks of practitioners and a wave of innovations will emerge, but practices remain fragmentary and are often considered to be proprietary. This precedes a stage in which practitioners converge around a common frameworks, methods, and tools; integrate previously differentiated practices; and develop a professional implementation support network.

•    Some portions of the field appear to be gaining greater traction than others.Several growth areas are evident:

  • The use by governments and larger nonprofits of service-delivery networks to reduce costs and increase effectiveness. Emergency preparedness is one niche in which both public and nonprofit entities are redesigning their systems around network models.
  • Civic/nonprofit and community use of policy development and advocacy networks, driven by the success of Internet-based political action and growing interest in engaging a wide range of stakeholders in policy decision-making.
  • The use by some foundations and nonprofits of networks for integrated place-based development.
  • The use by some foundations of networks as a strategy for improving the effectiveness of grantmaking and efficiency in nonprofit sectors.
  • “Web 2.0” social networks, driven by adaptation of new technological tools.

•   The growing demand for knowledge about using networks for social impact is both top-down and bottom-up. Top-down “design” knowledge is sought by larger, more established institutions—foundations, public agencies, and larger nonprofits—that want to increase their effectiveness, but are uncertain about the value of network approaches or how to design these approaches. Bottom-up “practice” knowledge is sought by individuals and smaller organizations that want to get smarter about the use of networks, but have little funding to pay for learning and no established learning processes they can plug in to.

•    The expertise about network building for social change and innovation covers the range of network theory, design, management, evaluation, and investing, but much of this relatively new knowledge is not made practical for and easily accessible by practitioners. Tools, “just in time” advice, and easily navigated information products are in demand, but there’s little capacity to respond at the scale of this demand.

•    Development (philanthropic) capital is scarce. Few foundations have identified network building as a strategy that is funded (as opposed to just talked about) and there is competition among development practitioners for resources. For now, the prevailing model for field development is based on scarcity, rather than abundance, of resources.

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Network Tool: Network Health Scorecard


Regular check ups can help network builders track progress and decide what the network needs next. The Network Health Scorecard provides a quick series of questions that can yield a useful assessment of the health of your network - diagnosing strengths and areas for growth.

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