The Chronicle of Philanthropy
Thursday, June 28, 2001
Section: opinion 

REVERSING THE INNOVATION CURSE

By Thomas G. David

Questioning the high premium placed on innovation is akin to heresy in philanthropy. But the obsession that foundations have with novelty can be a curse that they lay on grant seekers. 

In its nine-year history, the California Wellness Foundation has done its share of fostering innovation, and it will continue to do so when appropriate. But if the foundation were to make grants only for new projects, it would do a grave disservice to the nonprofit organizations it supports. 

With that in mind, the foundation recently reshaped its grant making. In most of its grant-making programs, the majority of grant money will be earmarked to help nonprofit groups pay their operating costs. 

By that, we mean it will not be necessary for a grantee to develop a new idea or propose the expansion of an existing program to receive the support of the California Wellness Foundation. An organization can apply for a grant to support work that it already is doing or to shore up its technological and organizational capabilities. 

The foundation is not abandoning an interest in innovation. But it will seek to strike a balance between that kind of project support, which is often foundation-driven, and grants that are responsive to the needs that nonprofit organizations say are most pressing. 

One way the foundation is instituting that change in emphasis is by altering the language it uses to describe its work. California Wellness now uses such words as "innovate, increase, and improve" less frequently in favor of such words as "support, strengthen and sustain." In so doing, it hopes to signal to grantees that the foundation provides flexible support to enhance the effectiveness of their programs and services, and affirm the mission, commitment, and capacity of their ingenuity.

For example, the foundation has made three rounds of grants to the six regional groups of urban community health centers in California. They have used the money to pay for preventive health services for uninsured patients and also for business-development and infrastructure projects that have substantially enhanced their competitiveness. 

In changing its approach, the foundation is going against an established trend in philanthropy. Foundations have frequently seen the most strategic use of their money as underwriting innovative ideas. They typically see grant making for start-up ventures as more desirable than helping existing organizations do what they already are doing. 

But in restricting their grant dollars to specific projects, foundations that consider themselves champions of innovation may deny charities the very fuel they need to prosper: support for mundane expenses like computers and other office equipment, training and professional development of staff members, strengthening of existing programs, and so on. 

Serving as an incubator for innovation is certainly an important and beneficial role for foundations, but not to the exclusion of other important needs. Accepting proposals only for new projects and expansion of services is shortsighted, particularly in view of the recent significant growth of foundation assets. 

The best way for foundations to help grantees survive and thrive is not to insist on something new as a precondition for financial support, but to provide the dollars needed for maximum flexibility. When foundations that spend hundreds of millions of dollars a year in grants refuse to give money for operations, they encourage grantees to invent projects just to obtain funds. In some cases, too, nonprofit groups dress up their grant applications to make them seem innovative even though the grantees will wind up spending the money on operating costs. Those kinds of charades waste everyone's time. 

It is the rare nonprofit group that has enough employees and volunteers to meet the demand for its services, let alone that can boast of a well-developed infrastructure to support its mission. Even fewer organizations have the resources to free up their key staff members for reflection, meaningful consultation with colleagues, and codification of their work, so that they might share their stories with others. 

Too often, foundations throw up impenetrable barriers against supporting these sorts of practical needs. Perhaps the most inappropriate argument against such support is that it's not a particularly interesting or sufficiently ego-gratifying undertaking for foundation program officers. Some, in fact, say that making grants for anything other than innovative projects is "boring."

But they should remember that a foundation's resources are not the personal property of its program officers and other staff members. Nor is it the duty of grant seekers to provide program officers with intellectual stimulation. 

When foundation officials reach that stage of ennui, it's time for a change of scenery. Perhaps fund raising would provide the missing zest in their lives.

Thomas G. David is executive vice president of the California Wellness Foundation, in Woodland Hills, California.

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