Sunday, February 15, 2009

What If this is as good as it gets?

"What if this is as good as it gets?"

That's the line Melvin Udall (Jack Nicholson) delivers in the movie "As Good as It Gets" as he scans the depressed faces waiting for their 50-minute hours in the psychiatrist's anteroom.

Most everyone I talk with has a Plan A for dealing with the economic meltdown. For most people I know, it is some form of hunkering down, trying to save every penny, until it blows over. That's what we are doing, more or less. Dinners out are rare. Keeping a record of our expenditures. Fewer cabs.

But what if this IS as good as it gets? Or, even more dramatically, what if we have not only not yet reached rock bottom, but when we do it is not going to start back up to where we were before? The Dow Jones. The jobs. Wall Street. Taking your kids to the ballpark? Making year-end charitable contributions that make up for not volunteering any of your time? What of all that is really gone for good?

I just read an essay called "Reset", written by Peter Karoff, an old friend. Karoff wrote for his constituency of non-profits and foundations, but the message is equally applicable to individuals, corporations, countries, and Barack Obama. I have attached his essay to the end of this post.

Playing off Rahm Emanuel's oft-quoted comment that "a crisis is a terrible thing to waste", Karoff suggests that rather than planning how to get through tough times until the status quo ante returns, what about planning as if the status quo ante is gone forever, that the new reality will be nothing like the old, and that the future is ours - or someone else's - to invent?

What if you internalize the idea that no one knows what will work or what the future will hold? What if you actually believe that the era of US global hegemony is over and that this country will have to refashion its relationships and responsibilities? What if you accept the possibility that you will never have enough money to retire and live in the manner to which you are accustomed, that you will never again earn as much as you did last year, and that your parents are not going to leave you a nest egg when they die?

What would you do differently, right now, if you believed that your life and expectations have irrevocably changed and the assumptions you have been relying on were no longer operative?

This is a leadership moment. The opportunity for exercising leadership is there for each of us, right now. It is easy to be in front of the crowd when you know where you are going. Very different when you assume it will never be the same again and the future is not only unknown, but unknowable.

How do you act in the face of an uncertain future, for yourself or for your country? What's your Plan B? How can you exercise leadership now in your personal, professional or civic? What will you do differently?

I am just as flummoxed by this as you are. But here are a few thoughts.

(1) Make hard choices. Of all the values you cherish, of all the activities you enjoy, which are essential and which can you let go? Of all the missions that your organization pursues, which are most important to you and to the people who count on you? Once you clarify your priorities, act on those values, whether it is stopping smoking or cutting out a product line or turning down work that makes you feel bad about yourself.

(2) Identify what is enduring and focus on that. For the US, it might mean remembering how this country was created and built and then opening borders even wider to allow an infusion of human energy and talent and imagination to enter just when it is needed the most. It might mean recommitting to universal quality education with a massive transfer of resources and a new conception of what it means to be a teacher and what it means to go to school, if need be sacrificing health care reform in the short run but creating a generation of young people who will figure it out later. We can learn much from the charter experiments that are being run within and parallel to the failing public school system. It might mean suspending disbelief about Hamas and being a real honest broker in the Middle East, using both carrots and sticks to get the Palestinian Authority, Israel, and Hamas to give up their fantasies and get on with the hard work of living peacefully side-by-side.

(3)Identify and then begin to close the gap between what you say you believe in and how you behave. (As I get older, I learn more about what I really believe in by watching what I do rather than listening to what I say.) Buy the hybrid car. Eat what Michael Pollan calls "real food". Join Facebook and re-connect with people you say you care about. Don't agree to be on a team at your firm unless it reflects the diversity you believe in.

(4) Run experiments, lots of them. Try out kooky-sounding ways of giving life to what you believe in, like the Indian eco-tour Tom Friedman wrote about in today's NYTimes. Organize your neighborhood on behlaf of something, anything, that you care about. Ahem, start a blog. A failed experiment is a learning opportunity and may move the ball forward just as far as a successful one. Test your own boundaries and tolerances physically, emotionally, and intellectually and test those of your family, your organization, and your public officials as well.

(4) Hold on to your optimism in the face of uncertainty, but temper it with realism. That is the only way to change the world...or yourself. Pessimism and naivete are the enemies of transformation.

Reset: The New Name of the Game

By Peter Karoff

“There will not be an economic ‘recovery’ – everything is going to be ‘reset.’” This comment from a very smart TPI client, spoken three weeks ago, was the first time I had heard the term ‘reset.’ Since then that word, and others like fundamental, and transformational, are being used by economists, business leaders, commentators and government leaders to indicate that “what is going on” is a huge disruption of business as usual for the American, and the global economy. Disruption is the term used when entrepreneurs introduce their innovations and in the process disrupt/destroy existing business models/industries. This disruption, however, was not of any entrepreneurial vision or design, but has been thrust upon us with astonishing vengeance.

President Obama’s Chief of Staff, Rahm Emanuel, was quoted as saying “never waste the opportunity that a crisis brings to the table.” The question then is whether we can use this crisis as a kind of jujitsu that lands us as a society in a better place.

Philanthropy is contingent on the ebb and flow of individual, family and corporate wealth, and the nonprofit sector is dependent on philanthropy, government resources, and earned income. What will a major reset of philanthropy’s fundamentals look like, and what should the actors in this massive Third Sector – more than 8% of GNP – do to turn it in ways that are positive?

In 2005 in The Atlantic Monthly, Jonathan Rauch wrote an article entitled Seeing Around Corners. The article dealt with how “we might learn to anticipate the kinds of events that lie ahead, and where to look for interventions that might work.” In my interview with John Abele, the co-founder of Boston Scientific, in The World We Want book, John talks about the experience of using ‘parallel tracks’ to overcome the ‘body of gods’ that fiercely resisted the introduction of less invasive surgery into the medical care system, which today seems almost incomprehensible when those procedures have become normative. I think some of the answers lie in exactly these ideas – seeing around corners – running parallel tracks – and overcoming the resident body of gods. And perhaps even more relevant – Peter Senge wrote this – “We have no idea the power we have to create the world anew.”

So far, the chorus of concern emanating from the field has had some predictable themes. Nationwide, foundations and other major donors, with assets declined 20% to 40%, are struggling with how to 1) do no harm, 2) stand up and be counted at a time when it is important to do so, and 3) be responsible to their fiduciary responsibilities. Nonprofit institutions and organizations, reeling under the impact of reduced income from all sources, are trying to figure out how to maintain mission critical programs and services with less. While difficult, and painful, these steps don’t go far enough.

A plan for a nonprofit based on the assumption that revenue will recover from the same sources to pre-crisis levels is very different from a plan that acknowledges there may never be such a recovery. A plan that is based on a foundation’s assets returning to previous levels is very different than one that assumes what we have today is what we have. A plan that only makes adjustments, even big ones, to the status quo, and does not transform how one goes about doing the work, is one of diminishing returns.

What else could be done now? Here are the elements on my short list:

Deal with, and acknowledge fear – the deer-in-the-headlight kind of fear that freezes intelligent response. Talk about it, stare it down.

A clean slate – sweep everything that you do now off the table. Take a deep breath and step way back and assume nothing exists except a blurry vision. In essence, it is as though you are starting from scratch. Reinvent the way you pay for, and do the work.

Look around the corner. Exercise your moral imagination. Make wild scenarios. Do complete end runs around the prevailing best practices – create multiple parallel tracks. As Barry Dym, the director of The Institute of Nonprofit Management and Leadership put it – “Shift the paradigm from loss to gain, from preservation to creation.”

Reassess your resources, especially those you have not valued enough. Think networks, contacts, the power of convening and access that you, your colleagues and board have. Make those calls you haven’t made in years, pull out all the stops – be shameless in the use of your cache to further the work.

Forget about going it alone. Subsume your ego. Collaborate and cost-share on a scale that was previously unimaginable. Cross domains, tear down silos between what you do and others with whom you had never imagined sharing services, and jointly serving the needs of your community of interest.

Put endowment capital to work. Make mission-based investing integral to program. Think hard about whether spending down is actually a capital investment in renewed sustainability.

Recruit new talent. Leap on the sea-change shift in attitude the financial meltdown is having on young people. The best and the brightest are no longer looking to Wall Street. This could be the biggest opportunity the nonprofit field has ever had to add great human resources.

Realize that the most influential ‘body of gods’ that need to be overcome, in addition to funders and government policy makers may be the ‘best practices’ with the field itself, or your board, the staff, and within you! Resist to your core – “that won’t work here” and “we tried that before” and “we never do that.”

Grit your teeth. This is going to be hard. Thousands of marginal nonprofit organizations will not exist eighteen months from now. Funders need to be objective, honest, and caring. Nonprofit boards need to be the same.

Renew your vows. The passion you feel, or once felt, for the work that you do, is central to the exercise of creative moral imagination. The centrality of philanthropy to the making of a better world is the heart and soul of why you are an actor on this stage. Make a poem of it.

Will the above better prepare you for a ‘reset?’ Will the field come through renewed and stronger? I think it is a fair beginning.

Peter Karoff is the founder of The Philanthropic Initiative (TPI) and author of The World We Want – New Dimensions of Philanthropy and Social Change) AltaMira Press (2006)

29 comments:

Rick Torseth said...

Marty,

Your blog entry and Karoff's essay are essential reading for us all. I don't know if we are at the bottom of the economic downturn but I'm quite sure we are nowhere near the bottom of the wake-up call this event is attempting to deliver to us. Your candor serves as a helpful knock on the emotional and mental denial strategies our culture is still attempting to employ. I also welcome your four suggestions for doing things different and Karoff's ten elements for action. These alone are enough to stimulate thinking, focus and action. Thank you for your work

Rick Torseth
Bainbridge Island, WA

Egy Azziera said...

First off we would like to congratulate you on your fine public speaking skills. It looks like those who said the Obama Administration would strike while the iron is hot may have been correct, and the Administration may be doing it in a way that does not require them to even get a vote in Congress.

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