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In 1997, Clayton Christensen published the "Innovator's Dilemma" that sought to explain the very reasons why successful companies eventually fall victim to their own successes. Christensen argues that successful companies often get very 'comfortable' by relying on the very products / services that created their success that they do not feel any urgency to think about what their customers today will want tomorrow.

Non-profits are faced with the same dilemma described by Christensen and in many ways, are more likely to fall victim to it. Non-profits typically have a disproportionate reliance on passive income streams (donors who just write checks year-after-year), which creates less of a desire to reach new donors through new channels that can create far more engagement and sustainability to the organization's enduring mission.

So how can non-profits avoid the 'Innovator's Dilemma'?

  • Build a diverse board

Non-profit boards are often very homogeneous and un-engaged. A few members often drive a disproportionate amount of contribution. There is often very little accountability to attend critical meetings and provide strategic oversight to ensure the organization is developing the necessary channels to engage with both donors and recipients. Boards need to have diversity in every sense of the word - age, gender, professional trade, and economic standing (to name a few).

Boards often look for 'whales' who can generate huge fundraising leads through their personal connections and there is a lot of value to that. However, there is not only a place, but also a huge need to have board members who can bring insights on how to reach donors that have never been part of your funding base. This is not about 'millennials', it's about psycho-demographic targeting that seeks to reach donors based on contextual values such as lifestyle, personality and values - all things that are agnostic to traditional segmentation attributes.

  • Experiment...fail...and experiment more

Non-profits need to be experimenting far more today than in previous generations. Why? Simply put, there is too much of the same in the world of non-profits. It's not good enough to connect with donors on pure mission alone. You need to create a two-part narrative - problem and solution. It's easy to define the problem, but creating solutions that truly resonate with people is the linkage needed to build sustainable support. I am a huge advocate of 'multi-channel giving' - enabling people to engage with your cause through multiple avenues besides simple financial donation. But, in order to create these channels, you need to experiment and fail.

Organizations that don't tolerate experimentation and failure will never unlock growth. Ideas come from everywhere and simply dismissing them because they don't fit perfectly into a strategy is like throwing out a whole carton of eggs because one is cracked. This is far easier than it sounds, but a diverse board who brings a deep breadth of different attributes will help facilitate into an experimentation-driven organization that is willing to invest in ideas, even at the expense of failure.

  • Have the courage to change

It takes a lot for non-profit organizations to change course. Non-profits that have a long history often feel that changing course on mission or modality of solution will be undermining the founders of an organization. When the ailing Apple CEO, Steve Jobs, was transitioning out of the CEO role to Tim Cook, he gave him one piece of advice..."don't ever ask yourself what I would do?" It was probably the single most empowering thing for an incoming CEO of the most valuable company in the world to hear.

But, there are many lessons from that simple advice. Perhaps the most important is that times change and the way you empower others is by giving them the freedom to make the choices that are best for the organization as the world around it evolves. Far too many non-profits are paralyzed by their founders - it is not about fundamentally changing the underlying purpose of the organization; it is about creating better engagement and ultimately, sustainability, so that future generations can carry the torch of the cause.

Innovation is not some mythical leapfrog residual of thinking - it is iterative and it involves a lot of trying and failing.

"When you bring the right diversity of people together who are committed to the underlying cause, you will find evolutionary change in the form of an organizational culture shift based on new ideas and the initiative to actually try them. That will gradually dislodge the theory that 'what worked yesterday will work into perpetuity'. The best answer to any dilemma is to analyze carefully, but act definitively."