SCALE

A crucial decision all social purpose organisations (SPOs) and funders face is which path to follow to achieve impact. Should they focus on providing services directly to the people in need? Or should they take a second path and partner with and go through the government? There is no right answer—and that is the point. If we are to achieve our goals and create systemic change, the social sector must work on both paths. Neither is more virtuous than the other. It is simply the case that the second one suffers from underuse and underinvestment. However, we are now seeing a small but growing cadre of SPOs actively working with, and leveraging the government, thereby functioning as system support organisations (SSOs). The first path—provision of direct services—is the default path for most SPOs and funders. Why? It offers a shorter road to impact, a higher likelihood of achieving at least some outcomes, and it is attractive to those eager to find direct attribution. It has a certain attraction. However, the second path—working in partnership with government as SSOs—offers the potential for much larger impact, as I have learned in my decades as a leader of both SPOs and a funding organisation. But it also takes longer, carries greater risk, and requires a low-ego, low-logo approach, with the government as the lead actor. The potential for this outsized impact has begun to lure a growing number of SPOs and funders towards the second path—particularly in India. SSOs such as Janaagraha, SaveLife, Pratham, Indus Action, Vidhi, ARMMAN, eGov, and Samagra have used it to achieve impact at scale and received widespread recognition for their success. An increasing number of Indian funders are also intentionally investing in SSOs that take the second path. One such example is The Convergence Foundation which has launched SCALE, an initiative that actively promotes the systems change approach for SPOs, funders, and government champions. This article explains why funders and SPOs have been slower to embrace this approach, the potential benefits of investing in it, and how they can do so effectively. Why governments matter for impact at scale Governments are the most important lever for determining social, economic, and environmental outcomes. The most significant examples of large-scale social impact have been achieved through public action. Despite their reputation for ineffectiveness, reforms by governments have made it possible for hundreds of millions to rise out of poverty in both China and India in recent decades. Likewise, governments have been the biggest driver in increasing life expectancy across much of Africa. Governments have the legal and democratic mandate to work for all. They alone can make policies, laws, budgets, and regulations that govern society. Even where market forces and private actors come in, such as with schooling, healthcare, or clean energy, governments establish the rules for an enabling environment. And in a democracy such as India, elected governments are accountable to citizens in a manner that even community-based organisations cannot be. State delivery systems are much larger than all SPOs combined. Only the government has the infrastructure and the reach to address social and environmental problems on a national scale. Even the best SPO projects typically reach only a fraction of the need and tend not to last after donor funding dries up. A government’s financial resources can dwarf philanthropy even in countries with large private giving. In India, annual private giving amounts to USD 15 billion. This is less than 2 percent of the USD 1 trillion spent on social welfare schemes by central and state governments. The upshot is clear: Governments’ greater resources, infrastructure, and rule-making power can help SPOs and funders multiply their impact. Achieving systems change Systems change is an intentional process to shift the structural conditions that hold a problem in place. Those conditions include: Laws and policies Practices Resource flows Relationships and connections Power dynamics Mindsets Government plays a key role, if not the key role, in shifting these conditions. And most or all of these may need shifting for systems change. It also requires engagement with government, increased investment in second-path strategies, and collaboration among SPOs. Despite their reputation for ineffectiveness, reforms by governments have made it possible for hundreds of millions to rise out of poverty. | Picture courtesy: Pexels Implications for SPOs I estimate that very few SPO and funder efforts are focused on the second path, and believe that the social sector could be much more impactful if we could gradually increase that to more than a third of our collective efforts. I am not advocating for every SPO to switch to working with the government or to incorporate it into their work. Many have developed the skills, muscle, and mindsets for successful first-path efforts. However, we should acknowledge that the two approaches are not mutually exclusive. SPOs can use both. They can also evolve from one to the other. In fact, many of the SSOs of today started as organisations on the first path. Then they identified a moment, either external (perhaps a shift in government policy or leadership that made collaboration more feasible) or internal (an ‘aha’ moment or the right funding partnership), that prompted a shift in strategy. Finally, while all SPOs can and should consider how working with the government could add value to their work, they should also consider the risks. What is needed for an SPO to be successful on the second path; for it to become an SSO? I offer four suggestions: 1. Get beyond your scepticism of government Place pragmatism over ideology. While inefficient bureaucracies, corruption, and rising authoritarianism are real problems, the government is not a monolith. It includes many well-intentioned, right-minded, and talented individuals striving for effective outcomes in their ministries and departments. 2. Walk in their shoes SPOs should seek first to understand before being understood, as Stephen Covey puts it. Understanding what government actors are accountable or rewarded for, and what pressures or challenges they work with, is essential groundwork. An SPO could start by being curious and empathetic about government actors’ perspectives, plans, and constraints. When an SPO looks closely and carefully at the government’s priorities, it will almost always find areas which align with its mission. That is the right place to start. 3. Co-design and co-create An SPO approaching the government for the first time with an evidence-backed report of their proven, scalable solution is likely to be disappointed. Research by Alix Bonargent shows that for better chances of success, programmes should be co-designed with the government from the beginning. Scaling is not about persuading a government to adopt, fund, or implement an intervention. It is about collaborating from the beginning and asking fundamental questions: What will it take to fix this for good for the largest number of people? 4. Invest in trust-filled relationships Working with public leaders requires trust and transparency. It involves saying: We are in this together for the long term and we will share the responsibility for achieving results. An SPO’s effectiveness depends disproportionately on this relational capability. Systemic change through the government takes time—at least five to 10 years, and often longer. During that time, civil servants will rotate and political leadership may change. SPOs need to create continuity strategies to manage such transitions. All of this requires dogged persistence, iteration, patience, and ongoing effort to build relationships and trust. As recent research by JustSystems highlights, engaging with governments to change systems is no cakewalk. There are no shortcuts or silver bullets. The road is long, winding, often frustrating, and has no guaranteed success. But when it is successful, the reach and sustainability of impact can be substantial. How can funders expand investments to include funding along the second path? Funding for the second path, while starting from a low base of financial support, is still an outlier among both corporate social responsibility (CSR) and philanthropic funders in India. The default for most funders is to support direct services that alleviate the symptoms of a failed system—build a school, fund a private health clinic, or feed the hungry. This is all good work and needed. But the scale is almost always and necessarily limited. Funders who want to address root causes and achieve impact at scale should consider the following: 1. Understand the government’s priorities Examine the government’s development plans in your priority geographies. Consider meeting with government leaders to better understand their plans. Identify where their priorities overlap with yours. Then search for SSOs that have a track record of collaborating with government on the issues you care about. 2. Start small Walk before you run. Consider initially allocating 10 percent of your portfolio towards second-path efforts. Follow the work closely to learn from your programme partners. As you gain knowledge and confidence, increase the percentage of your portfolio until it reaches at least 30 percent. 3. Move from attribution to contribution Funders have an understandable desire to prove impact. It is easier to see a new school building than it is to measure improvement in the education system. Second-path approaches, particularly those aiming for systems change, require many actors. The work does not lend itself to attribution to a single actor. Funders genuinely committed to achieving the largest possible impact must focus less on attribution and more on contribution. 4. Learn from those ahead of you Much can be learned from both funders and SSOs that have already been on the second path. Funders such as The Convergence Foundation and Veddis Foundation have long had a strong bias for it. The Convergence Foundation’s Systemic Impact Exemplars report documents many compelling examples of Indian SPOs that have achieved systemic impact through government engagement. Each one has learnings to share. And Just Systems is a global organisation rooted in the Global South that strengthens supportive infrastructure for government leaders and civil society to improve public systems. The road worth taking India's social sector stands at an inflection point. The first path will always be necessary—there are people who urgently need services and cannot wait for public systems to improve. But if we want to solve problems at scale, working with the government can no longer be the road less travelled. SSOs that have walked it demonstrate what is possible. Funders who have backed them have learned to measure success differently, and found that the returns, when they come, dwarf anything achievable through direct service alone. The path takes patience and persistence and demands a kind of institutional humility that does not come naturally to organisations built around visibility and impact measurement. But the destination—a social sector that does not just treat problems but ends them—is worth every difficult step. -- Know more Learn how nonprofits can measure systems change progress. Read how philanthropists and nonprofits are using systems change to solve the world’s biggest problems.

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