Try something newPosted: February 22, 2012
We’ve been thinking about value a lot recently, as we begin to test out the business model and pricing for our new think tank. We fully expect it to be tough job to convince potential customers and partners to work with us initially – ours is a very different approach after all, and it’s understandable, however much they might like the idea in principle, if many of these potential customers want to see how it works in practice first and in particular see some successful case studies.
But there’s another way of looking at this, which is the steadily eroding value proposition of traditional think tanks. As we’ve suggested before, think tanks have an important role to play in policy, but they will have to change in order to continue to do this. Here’s the dramatic way of putting it: if we don’t re-invent the think tank, will it still exist in ten years’ time?
It’s no secret that most think tanks live a hand-to-mouth existence. Look through their published accounts and you’ll see that some think tanks aren’t regarded by their auditors as ‘going concerns’. And this is where recent accounts are available; quite a few high-profile think tanks don’t appear to have filed accounts with the Charity Commission for some time, which is hardly reassuring. And now no-one (i.e. the organisations that typically commission them) has any money. Do the math.
Think tanks won’t survive through better management or cost-cutting though. Rather the problem is that the traditional think tank value proposition is beginning to crumble to dust. Consider what think tanks do and the way they traditionally do it, and whether it’s more likely or not that someone else will develop a way to do it better/faster/cheaper over the next few years (you can guess what we think). Let’s consider research, analysis and access in turn.
With regards research, my own experience of commissioning think tanks suggests that you can struggle to get much value between let’s say £20-35k. This is because it doesn’t pay for much time from the better/more senior think tank staff, the work is basically done by someone just out of university, and by the time the project gets going they’re already beginning to chase the next commission. Much lower than this and think tanks get less interested (though they may still bid for the work) – the commissioner of the project will understandably still want a good solid piece of work, but because of think tanks’ high overheads it will be a struggle to devote that much serious resource to it and the project margin just isn’t there. Consultants could be better value at the lower price point, but of course you won’t get the ‘brand advantage’ from working with them compared to some think tanks.
Then there’s the more fundamental point about what kind of research you want done and to what quality. Anything below this kind of price point (that is up to £35k) and you’re basically looking at largely desk research, with perhaps some interviews for case studies (any more field research than this and the economics wouldn’t make sense for the think tank). So here comes the point about the eroding value: surely this kind of activity can be carried out better/faster/cheaper through a crowdsourcing approach, if it’s ‘just’ about gathering and collating what we already know? (Again, you can anticipate our answer).
If you have deeper pockets and a more complicated research question/project, then you’ll also want to consider academic researchers since they are typically more likely to have the specialist research skills that such projects might require (and on some bids, think tanks will partner with a university for this reason, which can work out well but also poses a risk whether the collaboration will work in practice). But again, we’ve suggested that even multi-faceted research projects could be conducted largely online in collaboration with a large community of practitioners and service users.
As for analysis, well we’ve considered this in a previous post, but the headline is that most think tanks don’t really do serious policy analysis. What actually often happens is that charities and other commissioners pay a think tank to write a report that kinda looks like ‘research’ but for which certain findings are ‘anticipated’ (it’s basically research that isn’t, aimed at audiences who can’t tell the difference). Here we call it ‘policy wash.’ Now, as the commissioner, if you know what you want to say, why not just write it yourself and pay a think tank to slap their logo on the front of it? (In some cases we’ve been told about this is basically what’s happened).
And with regards ‘access’, it’s unclear what exactly you’re buying when you commission a think tank. If they promise access then they’re getting into dangerous territory (see last post), but if they don’t again you’re probably better spending your time and money working with your peer organisations on a public campaign – something that the internet can now help you with via web-based collaboration tools, social media campaigns etc.
So yes, we need to ensure we develop the right value proposition for our customers, but existing think tanks also need to consider the value they currently offer to customers – otherwise it’s our bet that those customers will go elsewhere.