Ten reasons why we need a new approach to developing social policy – 6. Policy would be cheaper to research and develop

This is the sixth in a series of posts on why social policy should be developed by and with the people who use and provide public and voluntary services. We’re publishing the rest of the series over the next week and a half, and we welcome your comments.

Innovation means that products and services get faster, better and cheaper – but only generally and only over time. On any given project, engineers say you have to ‘pick any two’ – that you can’t cut costs and improve quality while delivering in less time. In 1992, then NASA administrator Daniel Goldin disagreed. Under his ‘faster, better, cheaper‘ management philosophy, NASA launched 146 payloads worth a total of $18 billion, and all but 10 were successful. The problem was that the ones that were unsuccessful were hugely embarrassing – among them the debacle of the $125 million Mars Climate Orbiter, which was lost because a contractor failed to convert from imperial to metric units when coding its software.

In previous posts in this series we’re suggested that a lot of policy research and development could be conducted better and faster than at present, by being conducted collaboratively by and with provider organisations, practitioners and the public who use services. But we also think that this approach could prove cheaper as well, and that in this case instead of working against each other, faster-better-cheaper could be mutually reinforcing.

First of all though, why does ‘cheaper’ matter when it comes to policy? At the moment, many valuable contributors to better policy research and development are effectively priced out of the market. No organisation that conducts or commissions policy and research work has money to waste, but smaller charities typically don’t have sufficient resources or capacity to undertake much policy work themselves or to sponsor a think tank or a research consultancy to do it for them. The result is a narrower set of voices in policy – and policy is poorer for it.

The heart of the problem is the business models used by policy and research providers such as think tanks. We’ve suggested before that the business model behind think tanks is ripe for disruption. The reasons for this echo why incumbents in so many other sectors, from retail to media, are being disrupted by new market entrants based around the internet and social media: high fixed costs; incumbents focusing on existing ‘high-end’ customers; over-specified, often expensive products; and limited use of cheap, commonplace ICT. Most of the time, most think tanks operate as part of the old economy rather than the new.

As a result, and because of a lack of suitable alternatives, think tanks have in effect played a gatekeeper role in helping only a minority of organisations to develop and strengthen their policy messages to government and introducing these organisations to policymakers. Think tanks provide a platform, but not to everyone. It’s not that they want to exclude smaller organisations, just that most smaller organisations can’t afford to commission them.

However, the lesson from other sectors is that the internet and social media can offer routes around existing gatekeepers, by creating faster, better and cheaper ways for smaller ‘producers’ to reach new audiences. And for many charities and other organisations, the engineers’ dilemma  is actually less significant, since if ‘good enough’ policy work was faster it would also be better (for example, so that they can input to a current policy debate or media story).

The key is this is finding and building a better business model, which is what we’re attempting to do here. Our approach is based on building an online platform – a social network – so that organisations such as charities can work directly with frontline practitioners and service users on policy issues, and harness the time, commitment, expertise and support of these groups in order to produce more credible, independent policy.

What’s certain is that if we don’t manage it, someone else will – that’s the inevitability of innovation. Like other sectors before it, policymaking is about to be disrupted.

What it is (nearly)

I had a conversation today about this project where I spent a fair bit of the time explaining what it isn’t. For example:

  • It isn’t a think tank, commonly understood, because it won’t have the infrastructure or staffing or resources associated with think tanks (indeed this is a critical part of the business model);
  • It isn’t a competitor to existing think tanks, because we’re looking mainly at a market that doesn’t commission research at the moment;
  • It isn’t a research supplier as such, because the point of our approach is that charities and other provider organisations often have much of what they need in order to conduct policy work already (credibility, experience and expertise, relationships to stakeholders etc).

I don’t mind having to take this ‘isn’t’ approach – though it does make what we’re doing sound more negative than I’d like – but obviously it begs the question of what this is.

One of the difficulties with innovation (if I can call this an ‘innovation’) is describing what you’re doing in a simple, easily-graspable way for others, when by definition it’s something new, and at the same time as you’re still exploring for yourself and potential customers what the ‘is’ is. This is why you find yourself using more ‘isn’ts’ than you’d like (and hedging these often makes it even murkier: “Well, not exactly, it isn’t quite like so-and-so…” etc etc).

One way that anyone developing anything ‘new’ tries to get around this is to compare their ‘it’ to some existing products and services (‘it’s like x but for y’). Or they cite examples of things we’d all like more of and then suggest that their product or service will produce these things more cheaply and easily. We’ve done both of these at various times here. We’ve suggested that it’s like ‘Sourceforge [but] for social policy‘ and that we’d like what we’re doing here to support the production of many more user-led Spartacus-like reports.

Both of these approaches keep some of your options open – but only for a while. (And after all, what does it really mean to claim, as thousands of entrepreneurs must have done over the past few years, that they’re developing ‘the new Facebook, but for [insert niche but potentially profitable audience here]’? And if it’s so much like Facebook, minus of course the hundreds of millions of dollars of investment in functionality that Facebook and its investors have made, then why wouldn’t your target audience just use Facebook instead?)

Inevitably you begin to approach the point when you have to say ‘this is what it is’, in order to give potential partners enough to provide you with an honest response about whether it meets a real need they have – in short whether they’re in or not. But you resist this because you also have to give something up: the idea that your project appeals to everyone or could ever appeal to everyone. Promise and potential (which are nice things that everyone can buy into) has to give way to practical appeal (which of course means a much smaller audience of actual buyers). In this sense, the more you define what it is, the more you make it something that isn’t for some (probably most) of your potential audience.

We’re getting nearer to this point – but we’re not there quite yet.

Finding the One Thing

There’s an argument that really succesful businesses are successful because they have a single-minded and uncompromising obsession with One Thing. I read about this on Jason Cohen’s excellent A Smart Bear blog a while back and it struck me as pretty convincing at the time. Then I forgot about it – until this week.

Jason makes the point that what many businesses, especially start-ups, think is their competitive advantage usually isn’t. Virtually everything can be copied by competitors, and anything that can be copied will be copied. The only real competitive advantage is that which cannot be copied and cannot be bought. It requires unwavering devotion to the One Thing that is (a) hard, and (b) you refuse to lose, no matter what.

For example, Jason notes that Google has spent hundreds of millions of dollars on their search algorithm and that this remains the single biggest focus of the company even today, a decade after they decided that was their One Thing. Their homepage continues to reinforce this message – it’s remarkably clean and clear, with the focus remaining absolutely on the central search box. The very first version of the homepage is pretty much identical, in fact today’s version is even cleaner than the original, despite everything else the company now provides.

Not only does this focus mean that your primary energy is always directed into your competitive advantage, the argument is that it makes pitching much stronger but also easier. We’ve been holding workshops with charities on this project to get their initial reactions to the idea (we’re targeting charities as our initial target customers). They haven’t been marketing seminars – they’ve been genuine customer insight workshops – but of course in introducing the idea we’ve presented a list of potential benefits of our proposed approach (having public service practitioners and service users lead policy and research work). These benefits have ranged from more credible and practical research, to more cost-effective projects, to better dissemination of outputs (because project participants will have a natural incentive to also help promote the results). But Jason makes the point that hanging your hat on just one advantage that you can own completely is stronger than diluting your message across many advantages. Also, why try to defend 10 points when you only need one or two to make your case?

I realise now that this is what we’ve been doing – albeit certainly not disastrously (I hope), just as a natural and inevitable part of the process of developing an idea from scratch in open dialogue with potential customers. But it’s meant that the offer hasn’t been as clear as it needs to be, and also that we’ve lacked a strong focus for the ‘product’ (or rather, that what we thought was the focus may not actually be the focus). It’s also meant that we’ve effectively been trying to appeal to everyone, and everyone has been telling us they like the idea (which is nice, of course) – but perhaps the definition of a successful One Thing product or service is that it doesn’t appeal to everyone, instead it appeals only to a section of the market but in a very strong way (that is, strongly enough to build a sustainable business from).

I knew we’d reached the stage in developing the idea that we had to make some important (albeit not irreversible) decisions, like what we were proposing specifically and so what the starting ‘product’ is. Then we got some useful challenge from a contact in local government who likes our idea but suggested we needed to simplify the offer a lot in order to make it explicable to customers, and he was right – and it was this that reminded me of Jason’s article and so here we are.

The result was that we had a really good discussion today where we may have begun to focus in on our One Thing. What’s interesting to me is that no-one mentioned this One Thing in any of the workshops, at least not explicitly. No-one said this was their greatest need or priority from policy and research work, and no-one said that they were being let down by their existing suppliers (including think tanks) because they weren’t delivering this One Thing. And yet it feels like it could be a unique competitive advantage that could position us nicely. And it’s not what we thought it might be either – it wasn’t on our list of potential benefits at all. But suddenly we can see how all of the other things we’ve been talking about could possibly hang off of this One Thing, and the way that it could play to our potential strengths and circumvent some of our weaknesses (or at least make them less important to the customer).

Of course, we need to kick it around a lot more – and that’s before we take it out to potential customers and partners to see what they think, and really begin to work on how it’s achievable and how we can deliver it. But that’s a decent and welcome conclusion to the first chapter of our project and, hopefully, a good start to the next chapter as well.

Heartland revisited: How to avoid accusations of influence

The Heartland controversy rolls on. If you’ve missed it, this is the leak of documents from the Heartland Institute, a Chicago-based libertarian think tank. The documents, which include the names of previously anonymous donors and funders, were first published on the DeSmogBlog and ThinkProgress Green websites. Heartland says at least one of the documents is a forgery, but the story has reignited the debate over climate science and the funding of groups on either side of the ‘debate.’

The most recent twist in the story has been the revelation of how the documents were released. Environmental scientist Peter Gleick, president and co-founder of the Pacific Institute for Studies in Development, Environment, and Security based in Oakland, California, used an assumed name to obtain the documents. He’s been criticised for a lack of scientific integrity and unethical conduct. Gleick’s defenders say that his actions were taken in the name of a greater good (exposing who funds activities they believe misrepresent climate science), and that scientists have a right (even a duty) to engage with political issues. They also say that Gleick was acting as any good journalist would (although perhaps that’s not the best line of defence, with the Leveson inquiry into journalistic ethics going on in the UK at the moment).

Gleick himself has said that he acknowledges “…a serious lapse of [his] own and professional judgment and ethics.” Meanwhile, the Heartland Institute is trying to get some heat under its ‘Fakegate‘ presentation of the affair, depicting it as a concerted attempt by its opponents to discredit alternative positions on climate change.

I’ve suggested here before that if think tanks want to be public institutions in the sense of influencing public debate as well as public policy (and if they want to retain their publicly funded tax breaks), then they should consider how they could operate much more transparently. However, the Heartland Institute has made some points that are worth considering further in relation to transparency (the text below is taken from a Q&A section of Heartland’s website):

“Q: Why doesn’t Heartland reveal the identities of its donors?

A: For many years, we provided a complete list of Heartland’s corporate and foundation donors on this Web site and challenged other think tanks and advocacy groups to do the same. To our knowledge, not a single group followed our lead.
After much deliberation and with some regret, we now keep confidential the identities of all our donors for the following reasons:
  • People who disagree with our views have taken to selectively disclosing names of donors who they think are unpopular in order to avoid addressing the merits of our positions. Listing our donors makes this unfair and misleading tactic possible. By not disclosing our donors, we keep the focus on the issue.
  • We have procedures in place that protect our writers and editors from undue influence by donors. This makes the identities of our donors irrelevant.
  • We frequently take positions at odds with those of the individuals and companies who fund us, so it is unfair to them as well as to us to mention their funding when expressing our point of view.
  • No corporate donor gives more than 5 percent of our budget, and most give far less than that. We have a diverse funding base that is too large to accurately summarize each time we issue a statement.

If you do not approve of this policy, your argument is not with us but with those who would abuse a sincere effort at transparency. We urge anyone who sees the need for objective research and commentary on public policy issues to join us as a Member or donor.”

Interesting points – but surely wrong. Not disclosing donors has obviously failed to keep the focus on the issue, far from it. The identity of donors is then not irrelevant; even if it is to staff at Heartland on a day-to-day level, it isn’t to those who read Heartland’s materials and need to trust their integrity without further research. Being open about donors would help to support its claims of integrity (for example, by allowing us to see where the Institute had taken positions at odds with funders’ views). And the final statement has an interesting implication: if you want the work of the Institute to be objective, then you’ll have to pay for it, otherwise shut up (of course, this is not what the Institute meant to suggest).

It’s true that most think tanks can be made to sound sinister. It’s easy for critics to list donors and insinuate about their influence, or even better, to speculate on ‘shadowy funders’ in the absence of public information. This is exacerbated by the fact that not many people really know what think tanks do anyway, despite their ambitions to inform public debate.

Even where funding information is available, it doesn’t necessarily mean that ‘policy wash‘ has been going on; particular funders will understandably want to support organisations that see the world in the same way they do. And no-one when they’re young dreams of wanting to grow up to be a shill.

But we wouldn’t be discussing this at all if think tanks were 100 per cent open, not just about who funds them but perhaps even more importantly how they go about their work. Both require much greater transparency. The way out of the dilemma posed by the Heartland Institute’s response is not to tweak donor policy or document security; it’s to rethink the think tank in its entirety – starting with who pays for them and who participates in them.

Competitive advantage

One of the questions we’ve been asked most often is why established ‘competitors’ couldn’t just appropriate our idea. The short answer is that they could – we haven’t invented any proprietary technology – but we don’t think they will, at least not quite yet.

This question is part of any Need-Approach-Benefits-Competition (NABC) analysis. Why hasn’t this idea hasn’t been done before? More importantly, why couldn’t the competition respond? And most pointedly, what is the one ‘killer advantage’ that no-one else will be able to compete with? Of course this assumes that this isn’t just a bad idea that no-one in their right mind would want to appropriate, but to be fair that’s not the reaction we’ve been getting so far, so let’s proceed on the basis that we’re onto something.

First though, a recap. We’re developing a new think tank where the research and policy analysis conducted by the people who use and provide public services in an online social network. This idea derives from three (related) thoughts:

  • Think tanks could be meaningful vehicles for public involvement in public policy – in an age of mass participation, the notion of closed, hierarchically organised expertise seems increasingly outdated;
  • Think tanks could be open and transparent – from how they are funded and who sets their agenda, to how they conduct research and how they derive their findings and recommendations, and this could improve their work and enhance their impact;
  • The internet and social networks in particular could help to achieve both of these things.

Disruptive innovations that prove successful often seem obvious in retrospect, so why hasn’t this been done before? In an age of social networks, we’d be the first to admit that it’s a pretty obvious idea. but the reasons that established businesses don’t develop or respond effectively to disruptive innovations often come down to money, skills or awareness, so let’s consider these in turn.

Disruptive innovation is obviously disruptive for established businesses. It costs money to shift from one way of doing things to another. Effectively we’d be asking traditional think tanks to make a fundamental shift from offline to online. Then again, social media and social networks are pretty cheap to experiment with, and this is a transition that a think tank could make over time – growing an online community while they gradually reduce their reliance on traditional (and expensive) offline ways of working, and introducing their existing customers slowly to the new approach as appropriate.

What about skills? There’s no doubt it would be a big shift in this respect as well, from ‘thought leadership’ and managing projects, to facilitating the thoughts of others and moderating communities. It’s not only a different skill set, it’s a different mindset – and probably therefore a different group of people. But again, the transition could happen over time. A think tank could establish a separate online operation, staffed with different people, and see how this develops (creating new ‘greenfield’ business units has often been critical to the success of disruptive innovations by established companies, because it gives the new venture the required autonomy to do things differently from the main business).

There could be a problem with branding here, but again establishing a separate greenfield operation could get round this. Some of the most well-known think tanks have quite strong brands (at least in the Westminster bubble), but this could also prove a barrier if they tried to set up a new, more open, more diverse online community. For example, the Institute of Economic Affairs has a strong brand but it’s for liberal economic thought, so it would most likely repel as many people as it would attract; equally IPPR or Demos might appeal to some audiences but not others. Less political (partisan) think tanks wouldn’t have this problem, but then again they don’t have very prominent brands to begin with, so this might not be an advantage overall. A small number of UK think tanks, such as the Institute for Fiscal Studies and The King’s Fund, have both strong brands and non-partisan credibility but they are also sector-specific, which obviously narrows the breadth of their appeal if they wanted to develop a ‘full-spectrum’ online think tank that encompassed many sectors and issues (which is what we’re trying to do here). Creating a new brand, but one which is related in some way to an existing brand, might be the way to go (the Center for American Progress has in effect done this with the ThinkProgress comment site, although this reinforces the impression of partisanship rather than reducing it).

So it seems that established think tanks could do what we’re attempting to do. Why then don’t we think they will, at least for a while? The reason is that most think tanks aren’t driven to want to serve the market better (which is what disruptive innovations are designed to do), rather they’re focused on finding better ways to promote their own viewpoints, which is not the same thing. An open, public, online community might not help them do that; because it couldn’t be directed easily it might even disrupt their mission. Our ‘killer advantage’ might turn out to be think tanks themselves.

Try something new

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.