Can Non-profits Learn From Innovative Companies?

Lori Halley 21 March 2014 0 comments

This month’s Nonprofit Blog Carnival Host, Allyson Kapin at the Rad Blog, asked us for ideas on how non-profits “can evolve to create more innovative and effective organizations.” For instance, Allyson wondered if non-profits would benefit from “thinking like a startup” and “focusing on being sustainable.” 

When I started thinking about innovation, I remembered scanning the recently published list of Fast Company’s Most Innovative Companies for 2014.  So I took a closer look at the list to see if there might be some ideas that might translate to non-profits. 

I know that there is an on-going debate about whether non-profits should think and be managed more like for-profit companies. I’ve also seen the case made for having companies think more like non-profits. I’m not suggesting that non-profits can or should look at the top 10 innovative companies on the Fast Company list and try to emulate them somehow.  Although some of the organizations may surprise you - it includes one of the largest foundations in the U.S., and an online charity. But it is interesting to look at the powerful reasons why these organizations have been singled out. I find that even the terms used to describe why they were chosen can offer inspiration. 

What makes the top 10 most innovative companies stand out?

Here’s Fast Company’s top 10 list for 2014 and the reasons why they were selected. I’ve bolded some of the key words that offer insight into why these companies are innovation leaders:

  1. Google - "for becoming a $350 billion giant that lets loose almost too many innovations and milestones to count"
  2. Bloomberg Philanthropies - "for doing good, methodically"
  3. Xiaomi - "for reinventing the smartphone business model in the world’s largest mobile market"
  4. Dropbox - "for becoming the everything cloud"
  5. Netflix - "for creating great TV in a new context, using an already-proven model"
  6. Airbnb - "for making the most of its hosts"
  7. Nike - "for setting a sustainable example"
  8. Zipdial - "for turning a consumer cheat into an asset"
  9. DonorsChoose.org - "for setting its sights on education reform"  
  10. Yelp - "for sealing the deal with its users"

Innovation lessons 

Along with their list of top companies, Fast Company also identified Twelve Innovation Lessons for 2014.  You can read the article to find out all twelve, but here are the 7 lessons that I think are most pertinent for non-profits [with my takeaways below]: 

1. EXCEPTIONAL IS EXPECTED 

The No. 1 company on our list, Google, did not land there for the range of its activities--despite the 29 achievements we list. In fact, today's smartest businesses tend to laser-focus on just a few goals; broad ambition can distract from the nitty-gritty required to turn goals into reality. Yet from Google Fiber to Google Glass to investing in new health technologies, Google executes at a high level repeatedly. That's why it tops the list.

[I’d say that most supporters or donors would “expect exceptional” from the non-profits that they support. Let’s face it, we know that folks set high standards for organizations in the charitable sector. And most non-profits would be considered “exceptional” in their ability to find innovative ways to meet their mission with limited budgets and resources!]

2. INNOVATION IS EPISODIC

Only a handful of companies on our list repeat year after year. That's not because companies suddenly lose their edge; it's because innovation ebbs and flows. As editor-at-large Jon Gertner explains in his eye-opening guide to breakthrough change at Philips (No. 50), development of LED lighting has been under way there for 50 years--but a specific 11-month deadline provided the essential innovative exclamation point. 

[Non-profits should strive for innovation, but recognize that some great innovations may take time and patience.] 

4. SUSTAINABILITY HAS FOUND A NEW GEAR

Remember when operating a "green" business was either a gimmick or a promise (or both)? No more. Today, energy efficiency, alternative fuels, and recycling are core advantages for successful enterprises. …[including non-profits!]

6. PASSION IS UNDERRATED

Crowdsourcing may seem like old news, but tapping into a genuine fan base is powerful. SXSW (No. 12) started as a small regional gathering and now attracts 60,000 people from around the globe. … 

[Non-profits certainly understand the power of passion – both from their supporters, donors, volunteers and staff!] 

7. CONFLICT ISN'T REQUIRED

How do you make meaningful change in the face of calcified institutions? Sometimes you just have to go around them. That's the path Charles Best at DonorsChoose.org (No. 9) has taken, avoiding unions and politicos by crowdsourcing direct assistance to teachers. Bloomberg Philanthropies (No. 2) uses data to answer questions other foundations aren't asking… 

[Many non-profit staff or volunteers may feel their organization is suffering from legacy practices or slow-moving processes. Innovation might mean finding new approaches and having open minds to consider and embrace new ideas and methodologies.] 

8. HAPPY CUSTOMERS MAKE YOU HAPPY

... Yelp (No. 10) ... continues to reward grateful users with new features. …

[Giving makes us feel good so we need to be sure to continually demonstrate to donors the impact their donations are making. Their happiness will make you happy (and motivated) too!] 

12. DREAMING BIG ISN'T FOLLY; IT'S REQUIRED

Philips scientists calculated that LED lighting could cut total worldwide electricity use by 10%--saving some $250 billion. It's the reason they've put decades into developing it. Pharma researcher Medivation (No. 16) believed it could attack cancer in a new way, and it got a breakthrough drug on the market three years faster than the norm. … 

[The lesson from Philips is that a dream may take some time and patience! But this doesn’t mean individuals and organizations - including non-profits - shouldn’t dream big!]

What do you think? Are there any other lessons non-profits can learn from these leading business innovators?

Image source:  Innovation - green road sign courtesy of Bigstockphoto.com

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Lori Halley [Engaging Apricot] Lori Halley [Engaging Apricot]

Posted by Lori Halley [Engaging Apricot]

Published Friday, 21 March 2014 at 8:30 AM

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