Creative Tensions in Philanthropy

During the Monitor Institute workshop on the future of philanthropy, one of the themes that resonated with me was the need for philanthropy to get comfortable with the creative tension between opposing goals. One of those creative tension pairs was Innovation vs. Effectiveness. The idea was that we need to reject the idea of one vs the other and instead relish the creative tension that exists between the two.

F. Scott Fitzgerald once said, “The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function.” Yet at the same time, the concept of cognitive dissonance proposes that holding two contradictory ideas simultaneously generates an uncomfortable feeling and so people have a motivational drive to reduce dissonance by changing their attitudes, beliefs, and behaviors, or by justifying or rationalizing them.

It is uncomfortable to wrestle with opposing goals. For instance, much of the criticism of the Social Innovation Fund focused on the fact that it was called the “Innovation” fund, yet it demanded proven levels of effectiveness.

What other opposing forces operating within philanthropy that generate creative tension? How can we harness creative tension rather than have it paralyze us?


  1. Laura Deaton says:

    Interesting post, Sean. I’d like to see discussions about nonprofit organizations as distinct entrepreneurial businesses v. integrated systems and the benefits of using philanthropy to foster competition v. colloaboration as one of the key areas of philanthropic tension that needs more dialogue and focus.

    “Only nonprofits who can prove their effectiveness should be supported and we should send more money their way and help them grow stronger, bigger, better and reach more people,” is one message that floats around the sector. When I hear this message, it strikes me that it comes from the perspective of nonprofit organizations as separate entities who are vying for marketshare and only the best should survive. It has the for-profit undercurrent of eventual exit strategies for nonprofits orgs as monopolies or aquisition targets, and implies takeovers, forced mergers or closures, perhaps leaving areas completely under-served by organizations that were providing value but weren’t measuring it (and thus didn’t get funding channeled their way), or perhaps rightfully weeding out those who were providing sub-standard services and making room for more effective organizations to come in and serve that mission in a better way. This has the ring of a “top-down” approach of focusing funding and investment on the already existing high performing organizations.

    A different perspective is a systems view of organizations and the sector. It holds that “Nonprofits serve and work alongside each other as an integrated system. They stand both “shoulder-to-shoulder” and “on the shoulders” of other nonprofit organizations (and other sectors) and their ability to create outcomes cannot be measured independently of the other organizations, governmental agencies, etc upon whom they rely.” This systems perspective might lead funders to instead lend support in the areas of capacity building for initiatives such as back-office consolidations, multi-agency and multi-sector collaboratives, nontraditional alliances, and joint funding initiatives. It could also lead funders to consider a more “bottoms-up” approach to the sector and invest in training and organizational capacity building in new and different way, and one that reaches organizations that aren’t currently effective to help them build capacity.

    These two different lenses (individual v. collective) can generate that creative tension for the sector. How to harness it instead of becoming paralyzed? Realize and recognize that philanthropy CAN do both and NEEDS to do both to effectively serve the sector. Instead of making it an “either-or” choice, we can create a real dialogue in the sector about providing support across the spectrum and encourage both paths at the same time. We can recognize that there’s an incredible dearth of capacity-building resources at the systems level while also encouraging and supporting individual organizations to set benchmarks, measure outcomes, and create the organizational infrastructure which will allow them to deliver outstanding services and programs in a sustainable way.

  2. Perhaps a first step before moving forward, side or even backward is as Byron Nelson (American Golfer, b.1912) suggests:

    “One way to break up any kind of tension is good deep breathing.”

  3. Laura, those are excellent examples of creative tension!

  4. Here’s some more of the Creative Tensions mentioned during the Monitor workshop:

    Urgency and Stamina
    Evidence and Risk
    Top-down and Bottom-up
    Analysis and Creativity
    Autonomy and Relationships
    Best Practices and New Practices

  5. Laura Deaton says:

    Just experienced one more through a conversation today with a local philanthropist: distributed and centralized. For philanthropists, the tension between giving smaller amounts to many organizations, causes or communities v. focused, targeted giving of larger sums to one org, one cause, or one community.

  6. I wanted to explore further the best vs new practices. I was in a meeting last week with a colleauge who serves as an intermediary working with both communities and foundations. They noted the very real tension of being a consultant and thought partner to both, sometimes in the same engagement and how it is becoming increasingly challenging to steer through the mist. As we know, there is not a clear path nor is there a sustained position on best (and who get’s to decide) and new (are they really new?).

    Thoughts and guidance?

  7. Libby Villavicencio says:

    Laura, you raise thought-provoking ideas.

    The notion of a systems approach can work quite well from an outcomes perspective if the basis, and start, of the collective is a strong outcome, or as Jim Collins refers to it, a ‘BHAG.’ (Big Hairy Audacious Goal) Without a BHAG to ground it, initiatives often devolve into a focus on activity (meetings, etc.) that doesn’t lead to any greater impact than if the groups worked individually.

  8. Laura Deaton says:

    Libby – Love Jim Collins’ BHAG because it is a great way to communicate exactly what the sector is about. I think that perhaps community-based orgs already have the uber-BHAG, “Together we can create a new future for this community.” (Gotta credit Hildy Gottlieb for that vision). If philanthropists add a focused dedication to systemic capacity-building to their portfolios to help them reach this really huge BHAG, couldn’t it really re-shape what this network of service providers could do together? It’s exciting to imagine! What if every nonprofit in every community had the resources they needed to create real change?

  9. Jara, we’re definitely in a developing industry that is still working on “best” practices. You question turns on the ethics of serving both sides of the funding table. I think the jury is still out on that. Personally, I think that over time the “best” practice will evolve that says you can’t serve both sides. But that doesn’t mean it is unethical to do so now. Ethics are very much rooted in intent and so I think until we come to firmer conclusions, everyone needs to think long and hard about the intent of their actions.

  10. Jessica Berger says:

    Great point Sean. I think another cognitive dissonance might be the idea that a non-profit should serve more people but spend and make less money.

    Laura, I think you’re dead on about nonprofits not being “survival of the fittest” but instead work alongside each other. Much like the idea of “No Child Left Behind” it’s actually the ones that are underperforming that need more funding and more support. And I couldn’t agree more that their creative outcomes cannot be measured independently of others. However, the problem is how can they be measured? And when do you stop funding underperformance and ineffectiveness?

  11. Laura Deaton says:

    Jara – I actually do think that intermediaries can effectively serve “both sides” if instead we look at the “sides” as tail-ends of the same spectrum. Call it the “community betterment spectrum” or “social good” or anything else, but if we look at the sides as key players on the same team instead of two different teams, the game changes. If the intermediary doesn’t try to play lawyer/advocate for sides, but instead takes a connector/interpreter role that serves issues and missions instead of people/organizations, then much of the conflict disappears.

    Jessica – I do think that measuring organizations as systems instead of in separate silos calls for a different approach to measurement, and one that is likely much more organic and community-based than what we have currently. And, I think that the “how” of measuring may be different from community to community and may be based, in part, on the priorities of a particular community. Imagine a city/region that brings all of the sectors together (private, gov’t, nonprofit), and facilitates a real dialogue about what the vision of the community is for its people, and about the priorities for reaching that vision? Then, imagine that the community sets cross-sector benchmarks, and funnels resources (Board members, program volunteers, grants, private donations) into the areas that are most needed to address priorities. And imagine that the community tracks outcomes against benchmarks and regularly and transparently reports progress. Now, let’s take it one step further. What if one of the goals was an actual infrastructure/capacity-building goal? And what if funders helped build the engine to support it? What if it included technical assistance and training to support specific organizations who were struggling with performance management? What if it focused on developing well-trained, strategically focused Board members and then (only after they were trained) helped them find seats on Boards where they could provide immense value toward reaching the communities vision? My first thought is that it would shift your last question from “when do you stop funding underperformance and ineffectiveness?” to “how can we ensure that our funding is supporting key priorities and helping build a community’s capacity to serve?” The answer becomes quite simple when the funder invests in convening the community around key priorities, fostering cross-sector dialogue, and supporting the technical assistance, training and capacity-building itself.

  12. Laura and Jara,
    To be clear, I think that the ethics and best practices of consulting in the social sector are still evolving. Laura presents an excellent argument in favor of consultants working with both nonprofits and funders.

    It will be interesting to see how the role of “connector” emerges in this sector. At the Monitor meeting I attended recently, Jacob Harold of Hewlett talked about the need for “magic Sherpas” to connect donors to the resources they need. I love the term Magic Sherpa! And I certainly see how such a person could effectively and ethically serve both nonprofits and funders.

  13. This is the 3rd time writing this response. WordPress not playing well with Firefox tonight.

    That being said, it has taken me a bit to repond to Sean’s comments about ethics and the role of the “intermediary.” I continue to be challenged by and curious about our tendency to take an “either or” position or frame to issues. You see it in so many discussions: 1) non profit vs for profit. 2) outcome vs process evaluation, 3) direct services vs structural change, etc. The list continues.

    What prevents an intemediary from serving both a foundation and a grantee? Is there a potential greater benefit if we can find a way to instead of serving two master/mistresses but to serve the mission and impact?

  14. Thanks Laura. I wish the notion of a continumm was present in more conversations.

  15. Evening Sean,

    I agree that best practices, ethics and so many things are in a constant state of evolution. Context and intention seem to me to be critical components in which transparency and consistency can really support strong relationships or connections across and within sectors.