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Innovating for a Higher Purpose

An excerpt from Fearless Innovation delves into new potentials for innovation as a driving force in the social sector.

“Innovation” is becoming one of the most overused and meaningless buzzwords of the decade. It is the thing that every leader demands, yet many don’t understand why they need it, or even what it is. Leaders are often very enthusiastic about encouraging everyone to be innovative, yet vague about what it means in practical terms. Companies are often enamored with the latest “disruption” of the month, yet innovation is not only about disruptive technology. Sometimes it's not about disruption at all. At its core it is about business outcomes and people; it is about new ways of doing business, talent, and change management; it is about transforming to new operating models based on co-development and ecosystems of partnerships; it is a journey.

We are facing unprecedented challenges in the world today, and challenges always lead to innovation. The “lonely innovator” is a myth and to solve our problems and provide value we need to collaborate and embrace a diversity of opinions. Fearless Innovation shares ways for organizations to create viable ecosystems and partner with all their stakeholders for common good—employees, shareholders, customers, and local communities. As the world becomes more connected, embracing the ecosystem is essential to success. After all, once innovation is woven into the fabric of an organization’s culture and its ecosystem, it becomes so intuitive, so ever-present and unidentifiable, that it needs no name at all. — Alex Goryachev

The innovation-change cycle can be illustrated by the work of Abraham Maslow. If you’re not familiar with Maslow, he was a twentieth-century American psychologist, best known for developing the concept of Maslow’s hierarchy of needs, typically depicted as a pyramid consisting of five levels that address our material and immaterial human needs.

At the bottom level, we have our most basic physiological needs, such as food, shelter, and clothing. The next level up is safety, covering aspects like personal safety and financial security. Level three is that of friendship, family, and a sense of connection, known as the love and belonging level. The fourth level is esteem, including self-esteem, status, and the feeling of accomplishment. And the top level is self-actualization, basically, a level that’s all about being the best people we can be focused on a sense of morality, personal development, and creativity.

This pyramid shows that as one set of needs is met, others arise, and they always will until we reach the “self-actualization” zone. And though self-actualization is an excellent concept we should all strive for, it seems that for most people, more material desires will continue to replace any that have been met. (I’ll leave whether or not this is an endless cycle to the psychologists and real therapists.) The point is that, depending on time, place, and circumstances, fulfilling all of these needs presents challenges, especially as we move on up the pyramid.

Maslow’s hierarchy can actually be seen as one of innovation in practice. Innovation solves the issues society faces at each level, meeting demands of our physical safety, human collaboration, and social, cultural, and economic change. It’s a forward-looking mindset and attitude, and it can’t exist on its own, but only in relation to the world around us.

This concept can be illustrated by observing the earth at night. In 2017, NASA scientists released new global maps of the earth after the sun goes down around the world.1 Produced almost every decade for the past twenty-five years, these “night light” maps contribute to a better understanding of our world, including changing economic, social, and environmental implications. When looking at the map, the first thing that jumps out is how dark it actually is throughout much of the globe despite a number of bright clusters. The dark areas are mostly spread out in developing countries, many of which have yet to begin experiencing the effects of the Fourth Industrial Revolution.

While some of us are living in smart houses, with amenities like connected irrigation systems, and are sending off cotton swabs of DNA to learn about our personal genomics, almost half of the world has yet to get connected to the internet.2 While we’re playing on our smartphones, swiping left on Tinder, or watching YouTube videos, one-third of the world population lacks access to clean water3 and half of the world population doesn’t have access to basic healthcare.

I don’t make these comparisons to be flip or to embarrass or shame anyone—there’s nothing wrong with taking advantage of the Fourth Industrial Revolution’s opportunities to pursue a variety of experiences. I bring these issues up because I firmly believe that we all have a responsibility to improve the living conditions for people everywhere. Such improvement can only happen through innovation and economic opportunity. Organizations that are leading this change by investing in making the world a better place end up benefiting more than just their shareholders—they benefit everyone.

Innovation Wants to Be Free

For innovation to succeed in your organization, it’s not just other companies that need to be involved—you need to tap into the entire ecosystem. That means partnering and co-innovating with customers, suppliers, academia, non-profits, cities, governments, and more. Not all innovative ideas are born inside the offices of traditional companies (Exhibit A: the internet). Countries, cities, and municipalities are actively driving new policies to become more innovative on their own and attract new businesses and residents. Academic institutions are expanding research programs toward entrepreneurs. And consumers are starting to feel that their voice is valued unlike ever before, as they have so many ways to connect with companies and make an impact on them.

Engaging with the entire ecosystem leads to a larger pool of opinions and vantage points. And diversity creates the best teams. It’s no different when looking outside the walls of your office—the more varied the points of view, the better the results. Working with other organizations and groups builds collective knowledge in an ever-expanding innovation atmosphere. Innovation’s not the domain of only one person, one initiative, one company, one industry, or one country. Just like open source, innovation has no borders, and no owners—it’s everywhere all the time. To that end, if you really want to be innovative you cannot be territorial. You must think creatively and partner with people and groups far and wide, including customers, cities and governments, academia, and non-profits.

Partnering With Cities and Government

Though laissez-faire economists would argue that the best government involvement in business is no government involvement at all, cities and municipalities (and of course their government leaders) play a particularly important role in innovation and are ideal partners. As of 2017, worldwide, three million people per week were moving into urban areas, with 54 percent of the population already living in cities.5 It has been estimated that by 2050, that number will rise to 66 percent of the global population.6 Now that’s a lot of people, and they’re going to need resources, jobs, opportunities, modern infrastructure, amenities, and more. There are also some areas that are favored over others, causing smaller cities and towns to experience a brain drain or a net loss of citizens.

In response, a number of cities are increasingly competing to become hotbeds of innovation while improving their citizens’ experience. One way they’re doing this is by creating innovation hubs, or even by trying to bring in so many companies and organizations that they turn the entire city into an innovation hub itself. Sometimes referred to as innovation communities, labs, or centers, hubs connect startups, government agencies, private enterprises, academics and researchers, customers, and others to explore much more than “business problems.” They focus on the overall issues facing communities and individuals today and provide excellent opportunities for co-innovation. City-backed innovation hubs are an example of cooperation between local governments, businesses, and organizations that can lead to benefits for all. Together, they’re investing in the creation of stronger communities. These towns become more attractive places to live, providing a larger tax base and greater resources, and businesses work to provide scalable, profitable solutions to problems that can be implemented elsewhere.

The size of the town or city shouldn’t really matter either. In fact, my hometown of Carlsbad, CA (population 115,000) was one of the earliest cities to embrace this concept with an ambitious innovation strategy and vision.7 The town set out to improve mobility, sustainability, government services, and civic engagement while creating a connected economy by partnering with nonprofits, businesses, community groups, and citizens. This strategy gives the city a consistent economic boost from a diverse range of startups, those that either began in town or moved there from other locations. Many big employers also want to be based there because of the town’s services, progressive leadership, and vibrant ecosystem. When local governments like the one in Carlsbad take an active role in shaping the innovation agenda for the region, citizens are happier, economic growth takes place, there is an influx of talent, and innovators are given the opportunity to deliver new value.

Case Study: Bloomberg Philanthropies

In 1981, Michael R. Bloomberg was let go from Salomon Brothers, a Wall Street investment bank that he had begun working for in 1966, where he started in an entry-level position fresh out of Harvard Business School. He moved his way up through the company throughout the late ’60s and ’70s, holding positions in equity trading, sales, and information systems. But when 1981 rolled around and he was back on the job market, he decided to take a leap into entrepreneurship, founding a little startup called Bloomberg LP. Over the years, his namesake firm has developed into a global data, software, finance, and media company, now employing almost 20,000 people in 120 countries.8 As his company, and wealth, grew, Bloomberg began focusing more on philanthropic efforts. He may be best known for his three-term run as mayor of New York City, from 2002 through 2013, but he may end up being most remembered for Bloomberg Philanthropies, a charitable organization he established in the early 2000s that focuses on arts and culture, education, public health, the environment, and government innovation.

In his 2019 annual letter on philanthropy, Bloomberg stated, “I’m an optimist: I always believe that tomorrow will be better than today. But I’m also a realist, and I know that believing and hoping won’t make it so. Doing is what matters.”9 It’s this type of focus on executing outcomes that have contributed to Bloomberg Philanthropies becoming one of the largest philanthropic foundations in the US. Whether looking at ways to help solve problems surrounding climate change, the opioid crisis, gun violence, or public education, the foundation doesn’t just contribute money, but tries to create actionable solutions. This effort can clearly be seen in its support of innovation in city governments through proactive sponsorship of innovation teams and chief innovation officers. Acting as in-house innovation consultants, these groups join city governments for three-year stints to focus on handling problems that are specific to the given city.

We’re not talking about small, easy-to-fix issues here. Starting in 2011, these “i-teams” helped reduce the murder rate in New Orleans, decrease homelessness in Atlanta, and stem the tide of gun violence in Memphis, while also working to improve its underprivileged neighborhoods.11 As Bloomberg stated, “Successful innovation depends as much on the ability to generate ideas as it does the capacity to execute them—and i-teams help cities do both.”12 Understanding the need for additional resources in many cities and state governments to get beyond bureaucracy, politics, and gridlock, and to actually help citizens throughout communities, Bloomberg Philanthropies has partnered with the organization Living Cities to further move their city-based innovation efforts forward. Using a mix of technology, data, and on-the-ground community building, they aim to make actual impacts on people’s lives around the country.

It’s not that city governments are inept (at least not all of them) or that their leaders don’t care about constituents; the reality of the matter is that without a dedicated focus on innovation, important work just won’t get done. If all municipal governments had innovation built in at the core of what they do, there’d be no need for these types of “innovation interventions.” But it’s not that easy. Budgets aren’t unlimited, and local governments aren’t necessarily known for their speed. Until they are, co-innovation efforts like those the Bloomberg Philanthropies supply through its “i-team” program will be necessary to orchestrate outcomes around the most pressing local issues today.

Innovation for All

There are plenty of opportunities to partner with others and exchange valuable knowledge and ideas. These relationships will help you achieve your set strategy and continue to grow, but they’ll also make your community, locally or globally, a better place. Companies, nonprofits, cities, and other organizations willing to share knowledge and embrace the concept of building the innovation ecosystem will certainly see their impact metrics improve, but they’ll also be working toward a greater good. The bigger the innovation ecosystem, the more all of the related organizations and institutions reap the benefits of co-innovation.

The groups involved find new ideas, partnerships, and opportunities that would likely have been unavailable otherwise. In learning about what’s going on in other industries, markets, and spaces, a larger knowledge base develops. Yes, competition still exists, and you won’t find competitors singing “Kumbaya” in a circle around the water cooler, or the kombucha tap, but when this knowledge is passed back and forth and shared, innovation thrives and so does society.

In joining an ecosystem and engaging others, innovators are given free range. They go beyond our teams, companies, and industries and begin having even larger impacts. Don’t get me wrong, you likely came to this book for advice on improving your company’s bottom line, not someone else’s, but this type of co-innovation has the potential to do both, while also making a positive change in the world. And I hope that’s something we can all get behind.

This article originally appeared in Standford Social Innovation Review on June 2, 2020


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