Ann Mei Chang, Author, 'Lean Impact: How to Innovate for Radically Greater Social Good'

November 18, 2018
Ann Mei Chang, Author, 'Lean Impact: How to Innovate for Radically Greater Social Good'

Poverty. Mass migration. Economic dislocation. Climate change.

The problems confronting societies around the globe are big — and getting bigger. The resources available to address those problems, however, are shrinking, as governments burdened by huge debts and future obligations and corporations wary of controversy pull back from “feel-good” causes and collective action. And while countless foundations and civil society groups continue to fight the good fight, their resources seem Lilliputian compared to the magnitude of the challenges we face.

It’s a moment that demands big thinking, bold thinking — but also creativity and out-of-the-box thinking. The kind of thinking we’ve come to expect from Silicon Valley, the global epicenter of a certain kind of innovation and can-do spirit. The question, for many, is: What, if anything, can technologists teach nonprofits and social entrepreneurs about social change?

In her new book, Lean Impact: How to Innovate for Radically Greater Social GoodAnn Mei Chang, a respected social change-maker and technologist, tackles that question head-on. Based on interviews with more than two hundred social change organizations spanning almost every continent, the book distills the lessons learned by change-makers over the years into a set of "lean" principles for nonprofits looking to innovate their way to greater impact.

PND recently spoke with Chang about the genesis of the book, the sometimes testy relationship between tech and the nonprofit sector, and her advice for millennials and social entrepreneurs impatient with the slow pace of change.

Philanthropy News Digest: How did you get into social change work?

Ann Mei Chang: I studied computer science in college and then worked in Silicon Valley for over twenty years, at big companies like Google, Apple, and Intuit, as well as a number of start-ups. But I had known since my mid-twenties that I wanted to spend the first half of my career in tech, and the second half doing something more meaningful, something to make the world a better place. I hoped I would be able to make that change, and I was committed to it, although I didn't know exactly when or how. But as I got closer to that point in my career, in my early forties, I began to look around at all the things I cared about, and decided to focus on global poverty, as it seemed to be at the root of so many other problems I cared about.

I recognized there was a lot I needed to learn about a very different space. I ended up taking a leave of absence from Google and went to the State Department on a fellowship, where I worked in the Secretary's Office of Global Women’s Issues, with a focus on issues around women and technology. It didn't take long before I was hooked. I resigned from Google and signed on for another year. After the State Department, where a lot of the work takes place at the ten-thousand-foot level, I joined a nonprofit called Mercy Corps to learn how the real work was being done in the trenches.

Then I was offered my dream job — as the first executive director for the Global Development Lab at USAID, the agency's newest bureau with an inspiring two-part mission. The first part was to identify breakthrough innovations that could accelerate progress in the global development and humanitarian aid work that USAID does. And the second was to look at how we could transform the practice of global development itself by bringing new tools and approaches to table. The first was the "what," and the second the "how."

It fit exactly into the way I was beginning to think about what was really needed to make a difference. That's why it felt like a dream job — it was an opportunity to do this work at the largest aid agency in the world, in the belly of the beast, so to speak, but where I'd be responsible for thinking about how we could work differently and more effectively.

PND: It's an interesting career trajectory, in that it bridges the worlds of both technology and social change. In your experience, do technologists get social change? Or do they tend to see it as another problem that needs to be "engineered"?

[P]eople in tech exist on a spectrum. I've known people in tech who think that technology can solve everything — we'll build a smart phone app and that will somehow end global poverty....

AMC: That really depends on the technologist. As with everything, people in tech exist on a spectrum. I've known people in tech who think that technology can solve everything — we'll build a smart phone app and that will somehow end global poverty. There can be a naiveté and hubris, especially when you’re building products for people who live in contexts that you’re not that familiar with.

But there's also a thriving community of tech people in the global development sphere — we call it ICT4D, or information communication technologies for development — who are both technologists and development professionals looking at the intersection between the two. This community has developed something called the principles for digital development, which embody the best practices for the responsible use of technology in development.

One of the really exciting things that happened while I was in government was the creation of US Digital Services and 18F, where a lot of people from the tech sector came in to work for the govern­ment and saw that their skills could be put to use to help the government better serve people. It was catalyzed by the debacle with HealthCare.gov, which caused a lot of people to recognize that tech had something it could contribute that would really make a difference.

PND: Your book, Lean Impact, builds on a book called The Lean Startup, by Eric Ries. If we grant that there are some things nonprofits and government can learn from business — and, more specifically, from Silicon Valley — would you also grant that there are things that nonprofits do at least as well as business?

AMC: I would answer that question a couple of ways. It's true that businesses, nonprofits, and governments function very differently and have different cultures, different processes, and so forth. That said, there are a number of factors that are causing that to change.

One is that in the world of social good, all these players need to work together if they hope to create sustainable change at scale. No one sector is capable of solving most of these problems on their own. And two is what I heard repeatedly in the course of my over two hundred interviews for the book — more and more of the most interesting work is happening at the intersection of sectors. It used to be that nonprofits did good and companies made money. Now you're seeing more nonprofits trying to build sustainable business models and more businesses trying to do good, because their employees, their customers, their stakeholders, and their investors are demanding it. You still have nonprofits and for-profits, but the gap between them is narrowing.

Eric's book has been incredibly popular and successful in the business world, but I've also talked to a lot of people who work in the social sector who have picked it up, were inspired by it, and said, "This makes so much sense, I want to do it." But they feel stuck. There are a lot of reasons for that, but basically it comes down to a number of struc­tural impediments that make it harder for nonprofits to innovate.

So, the idea behind Lean Impact is to build on these best practices for innovation and adapt them for the unique challenges of doing social good. None of this is rocket science. But it can be hard to do in the context in which we work.

PND: Innovation is a key theme of the book. How do you define it? And why does it need to be lean?

AMC: I think those questions go together. In the book I quote Edison, who famously said, "Genius is one percent inspiration and ninety-nine percent perspiration." That's very much true of innovation. It's one percent inspiration, which is the big idea, the invention, if you will. That's the part that people tend to focus on when we talk about innovation, because it's sexy. Someone comes up with some whiz-bang gadget and everyone goes, "Wow."

But I think innovation and the book is about the ninety-nine percent — the blood, sweat, and tears that is involved with taking that initial germ of a good idea and testing, iterat­ing, improving it; creating a business model; and building the infrastructure and operations to bring it to real impact in the real world.

The book looks at how to do that. Remember, despite being considered among the most innovative companies on the planet, Google didn’t "invent" search and Facebook didn't "invent" social networking. They built on existing ideas and relentlessly focused on improving the algorithms, the user interface, and the feature set, until, over time, they were head-and-shoulders above their competitors.

In the social sector, there tends to be a focus on the big idea, the flashy thing no one has thought of before versus the blood, sweat, and tears needed to take an idea that is already out there and figuring out how to really make it work....

In the social sector, there tends to be a focus on the big idea, the flashy thing no one has thought of before versus the blood, sweat, and tears needed to take an idea that is already out there and figuring out how to really make it work in a context in which it could have real impact.

PND: You're a believer in the importance of setting audacious goals. But I think many people engaged in social change work would argue that, given the constraints on resources, setting big audacious goals is a non-starter. Do they have a point?

AMC: The book is organized around three principles, and one of them is about the importance of thinking big. And yes, the nonprofit sector tends to plan based on constraints. They look at the money they have, the existing staff, or the size and scope of a particular grant and ask, What can we do with these resources? But that rarely makes an appreciable dent in the problem. The organizations that I have found to be the most impressive and most successful were the ones that think big and plan based on the real needs in the world. It forces them to make different decisions. Can I give you an example?

PND: Sure.

AMC: There's a social enterprise based here in New York called VisionSpring. They've identified an invention that has proven to improve productivity and learning. You know what I'm talking about. Eyeglasses. It's a technology that has been around for seven hundred years, and yet two and half billion people who could benefit still don't have a pair. So, VisionSpring set out to address this huge gap. They started out in two countries, India and El Salvador, and they hired "vision entrepreneurs" to go into rural areas to do eye exams and sell eyeglasses at a very low-cost. And these vision entrepreneurs came back with amazing stories about kids who were suddenly able and eager to learn and people who thought they'd never be able to see well again who could suddenly see and work and contribute to the community. These are results most nonprofits would have been very happy with: We had some resources, and we did some good, right?

But, for VisionSpring it wasn't enough. It was doing good and on to something that mattered. But it was also losing money on each person it served and was never going to raise enough money to reach all the people who could benefit from a pair of eyeglasses.

So it pivoted. It moved to a hub-and-spoke model by setting up vision centers in urban areas to serve a higher-end clientele. And with the profits, VisionSpring was able to cross-subsidize outreach to more rural areas. Under the new model, the organization soon became financially self-supporting, which is something most nonprofits would be happy about. But VisioinSpring still wasn't satisfied. Even though it was on financially solid ground, it would take decades for it to set up centers around the world to reach all the people who might benefit from a pair of eyeglasses.

So it pivoted again. This time it partnered with BRAC — one of the biggest global development organizations around — to leverage its existing network of community healthcare workers in every corner of Bangladesh. By working with BRAC, VisionSpring was able to train those community healthcare workers to provide eye exams and sell low-cost glasses across the country. It was a win-win, because it gave BRAC another benefit they could offer their constituents, while VisionSpring was able to get eyeglasses to a lot more people. Together, they've now helped over a million people. Which is pretty impressive. Today, VisionSpring has hundreds of partnerships through which they've been able to reach over four and a half million people. Again, most people would consider that a huge success.

But the organization still wasn't satisfied. The way VisionSpring saw it, they'd only reached a tiny fraction of the two and a half billion people who needed eyeglasses. So their most recent pivot was to spin out a new nonprofit called EYElliance, which brings together eyeglass manufacturers, governments, and nonprofits to look at the market and policy failures that are behind the supply-demand gap — things like the fact that eyeglass manufacturers aren't incentivized to invest in low-cost glasses or distribute them in rural areas and that governments tend not to include vision care in the services they provide. One of their first successes was an MOU they signed with the government of Liberia to integrate vision care into the national health and public school systems. One can imagine what that might mean for one of the poorest countries in the world. And as the coalition continues to focus on systems changes like that, you can see the potential for it to maybe, just maybe, get to that two and a half billion in need.

PND: You mentioned that the book is centered around three guiding principles. What are the other two?

AMC: The first is to think big. The idea is to have an audacious goal that moves the needle on the real need in the world.

Too often, social entrepreneurs and nonprofits...think too small and start too big....

The second is to start small. Too often, social entrepreneurs and nonprofits do the opposite: they think too small and start too big. Funders tend to ask nonprofits to set achievable goals and deliver reliably on them. That's not a recipe for innovation. The beauty of starting small is that it allows you to experiment when you don't yet have a solution to the problem and to validate your assumptions before making a bigger investment. It also makes it easier for nonprofits to try out more options and find the best one, to take more risk, to learn more quickly and cheaply, and to adapt and improve on their solution.

The third principle is to relentlessly seek impact. By that, I mean staying intently focused at every step of the way on your big audacious goal, and avoiding all the things that can throw you off track. In the book I encourage people to fall in love with the problem rather than their solution. Often, it's the opposite: we fall in love with a solution — because it's what we have been promoting, become attached to, feel pride of ownership for, or can't let go of. In the process, we can forget to ask ourselves whether it’s actually going to solve the problem. VisionSpring could have gotten very attached to its idea of vision entrepreneurs; they were doing some good and they had great stories to tell. But because it held on lightly to that particular path and kept returning to what its original audacious goal was, it realized it had to pivot — not once, not twice, but three times — and find even more effective ways to achieve its goal.

PND: What is the role of time in all of this? Should organizations looking to scale their impact ignore how long it might take or is taking? Or is time irrelevant to the equation?

AMC: Well, you've got to have both long- and short-term goals. Your big audacious goal should be your North Star that keeps you headed in the right direction. But by definition it's usually a long-term goal and is not granular enough to guide your short-term decisions. From a day-to-day standpoint, I recommend focusing on innovation metrics. In The Lean Startup Eric Ries coined the term "vanity metrics" for the kind of numbers that quantify activity and look good, but often are not a meaningful measure of progress. In the nonprofit space, this tends to be aggregate numbers like the number of people reached or touched. In contrast, innovation metrics capture the unit metrics that are the underlying drivers of real impact. In the book, I break those down into three buckets: value — is this something people demand, will come back for, and will tell their friends about; impact — does what you're delivering create the social benefit you intend; and growth — do you have an engine to drive scale to somewhere approximating the need that exists.

PND: Many of the case studies in the book feature NGOs and nonprofits working in a developing world context. Should we infer from that that it's easier to scale impact in a developing world as opposed to a developed world context?

AMC: No, not at all. I worked at USAID, Mercy Corps, and the State Department, which were all focused on global poverty, so I've had a lot more personal experience in this area. But at least a third of the examples in the book concern domestic organizations and efforts. Part of my research for the book was to learn more about the work that is happening domestically and about organizations that are innovating and pioneering new approaches to problems here in our backyard.

PND: Do you have an example you can share with us?

AMC: One example I like is an organization called Summit Public Schools, which operates a dozen charter schools in the Bay Area and Washington State. One reason I find them inspiring is that they have been rapidly innovating in the field of education, a field where impact can take years to fully realize. When Diane Tavenner started SPS, her big audacious goal was to have 100 percent of SPS' diverse student body graduate from college. She and her team started with a couple of schools, adopted the best educational practices they could find, and hit the ground running. Eight years later, when SPS' first cohort of students graduated from college, the graduation rate for those kids was much higher than average. Again, most people would say, "Hey, that's a huge success."

But Diane wasn't satisfied, because she had a big audacious goal, and 100 percent meant 100 percent. She also wasn’t willing to wait another eight years to see whether a new set of enhancements might succeed. Instead, she decided to focus on building innovation, iteration, and data into the culture of SPS so that teachers and administrators in SPS schools could speed up their pace of learning.

And that's what they did. In a space where, traditionally, it's very hard to innovate, SPS created a system where they could run week-long variations, trying a mix of elements such as lecture time, one-on-one mentoring, personalized learning with computers, group project time, and so on. They also introduced variety into the curriculum, changed the physical configuration of classrooms, and looked at a bunch of other dimensions of the school day. Each week they would gather data from individual student learning assessments, focus groups, and student and teacher feedback, to see what was working and what wasn't. Now, of course, the data collected wasn't going to tell you definitively whether this kid or that kid would, down the road, graduate from college. But it did tell them which elements of the curriculum and school day were more engaging and resulted in improved learning. With these iterations over the course of a year, they were able to fine-tune their approach and come up with a personalized learning model that was significantly better than the model they started with.

The students who were exposed to that approach haven't graduated college yet, but in the past year 99 percent of them were admitted to college. What's even more exciting is the SPS model is now being replicated at over three hundred different public schools in forty different states. Dianne and her team recognize that they would never be able to run enough schools themselves, but they have developed the capacity to be able to experiment and innovate much more quickly than most schools and school districts, and that should benefit everyone in the long run.

PND: The elimination of global poverty by 2030 is one of the seventeen UN Sustainable Development Goals. Do you think that's an achievable goal? And how might the principles outlined in your book help the global community achieve that goal as well as the other SDGs?

All indications are that we are not on track to achieve many of the SDGs by 2030, including ending extreme poverty....

AMC: All indications are that we are not on track to achieve many of the SDGs by 2030, including ending extreme poverty. I often hear people focus on the $2 trillion to $3 trillion annual funding gap that is needed to get us all the way there. It's completely unrealistic, of course, to think that we're going to somehow magically come up with $2 trillion or $3 trillion — if anything, foreign-aid dollars are more likely going to decline over the next decade. The only other alternative I can see is to innovate our way into better, more cost effective, more scalable solutions to these problems. That is, we need to get dramatically greater bang for the buck for the dollars we do have. Of course, that means innovation. If we shift our attention and apply more of the kinds of approaches I try to elevate in the book, we have a far better chance of achieving many more of the SDGs.

PND: After thirty-plus years of globalization and technology-driven disruption, we're seeing a serious populist backlash to many of the consequences of those phenomena in countries like Hungary, Poland, Italy, Brazil, and, yes, the U.S. What advice would you give to a young social entrepreneur with a great idea and a burning desire to change the world?

AMC: Well, the political landscape certainly has changed, and national­ism and populism are on the rise. But there are still a huge number of institutions out there that are continuing to drive and push for social change, whether its foundations or multilateral institutions like the World Bank and USAID or governments, including ours. At the same time, new problems are rearing their heads and demanding attention. I do think there's a ton of passion and interest among millennials to step up and take responsibil­ity for making the world a better place, and we're seeing that in the increased interest in things like impact investing and the drive to hold all com­panies, but especially giant multinationals, accountable. There's a real interest in the responsibility we all have to society and the planet.

The nonprofit space is changing as well. There's more emphasis on the need for rigor and on the need to scale, and that's part of what I think Lean Impact is trying to do — to take some of the techniques that have been honed by business and put them to work to solve some of the world's most important problems.

As for advice I might give, I think it really comes down to the principles outlined in the book. Don't get too attached to your big idea. Lots of people have great ideas, and most of them end up falling by the wayside. Be open to the possibility that your idea may need to be tweaked or even discarded and fall in love with the problem you want to solve instead.

Be audacious about your goals and what you’re trying to accomplish and remember: the foundation of innovation is an audacious goal. If your goals can be achieved with business as usual, there's no reason to take the risks needed to achieve something great. As I tell my teams, what would you do if you had to deliver ten times as much as what you're doing today? It forces you to think out of the box, to take some risks, and to try some things that are different.

Finally, get out there and start building, experimenting, and start learning. Be humble about what you know and don't know. And be relentless about trying and failing, trying and fail­ing, and finding the best path forward. Great things have never been achieved by those who were afraid to fail.

Mitch Nauffts sat down with Chang in October. The transcript of their conversation has been edited for length and clarity. For information on the Newsmakers series, contact Mitch at mfn@foundationcenter.org.