A Social Innovation Research and Development
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LEONARDO for Human & Environment Rights
Andrea Vitali
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Table of Content
Abstract ............................................................................................................................................................ 6
The Challenge ................................................................................................................................................... 7
Part 1 - Basic Research ................................................................................................................................... 10
What is Innovation ? ...................................................................................................................................... 11
Imitation ..................................................................................................................................................... 12
Invention .................................................................................................................................................... 13
Innovation .................................................................................................................................................. 15
Conclusion .................................................................................................................................................. 18
What we learned ? ......................................................................................................................................... 19
The XX Century ........................................................................................................................................... 19
Research and Development - How the “D” got into R&D ........................................................................... 20
Research and Development - World’s top 10 leaders statistics ................................................................. 22
Research and Development - Regional average statistics .......................................................................... 24
Conclusion .............................................................................................................................................. 25
Guilds ......................................................................................................................................................... 25
Conclusion .............................................................................................................................................. 26
The Italian Renaissance .............................................................................................................................. 27
Conclusion .............................................................................................................................................. 29
Leonardo da Vinci ....................................................................................................................................... 30
Conclusion .................................................................................................................................................. 31
The Social Economy - a common point of view .............................................................................................. 33
The Social Enterprise Compass ................................................................................................................... 34
The Social Economy - a new point of view ..................................................................................................... 36
Background ................................................................................................................................................ 36
The architecture of the social economy ..................................................................................................... 41
Conclusion .................................................................................................................................................. 44
Part 2 – Applied Research .............................................................................................................................. 45
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The Social Economy - the institutional conditions for Innovation .................................................................. 46
The Public Economy ....................................................................................................................................... 46
Public Finance: methods to generate internal innovation .......................................................................... 47
Public labor: redesigning the labor contract............................................................................................... 49
Organizational forms .................................................................................................................................. 49
Metrics and assessment ............................................................................................................................. 50
The circuit of information ........................................................................................................................... 51
The Grant Economy ........................................................................................................................................ 51
Generation of Innovative projects .............................................................................................................. 52
Finance ....................................................................................................................................................... 52
Packages of Support ................................................................................................................................... 54
Platforms, tools and protocols for innovation ............................................................................................ 54
Governance and accountability .................................................................................................................. 54
Regulatory, fiscal, legal and other conditions for extending the social economy ....................................... 54
The Market Economy ..................................................................................................................................... 55
Generation and value creation ................................................................................................................... 55
Finance ....................................................................................................................................................... 55
Organizations and ownership ..................................................................................................................... 56
Information ................................................................................................................................................ 56
Regulatory, fiscal, legal and other conditions for generating innovation in the social economy................ 57
The Household Economy ................................................................................................................................ 57
Public spaces for social innovation ............................................................................................................. 57
Valorizing household time .......................................................................................................................... 58
The New Mutualism ................................................................................................................................... 58
Constructed households as sites of innovation .......................................................................................... 58
Social Movements ...................................................................................................................................... 59
The Social Economy - the process roots for Innovation ................................................................................. 59
John Dewey ................................................................................................................................................ 59
Roberto Mangabeira Unger ........................................................................................................................ 61
The Social Economy - the process for Innovation ........................................................................................... 63
Prompts, inspirations and diagnoses .......................................................................................................... 63
Proposals and ideas .................................................................................................................................... 65
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Prototyping and pilots ................................................................................................................................ 67
Sustaining ................................................................................................................................................... 68
Scaling and diffusion................................................................................................................................... 71
Systemic change ......................................................................................................................................... 74
The Grant Economy – an economic evaluation .............................................................................................. 78
The Johns Hopkins Comparative Nonprofit Sector Project ......................................................................... 78
The Global Civil Society - Statistics ............................................................................................................. 79
From Social Economy to Social Innovation ..................................................................................................... 87
What is social innovation? .......................................................................................................................... 87
Why social innovation? .............................................................................................................................. 87
Process dimension ...................................................................................................................................... 89
Risks associated with the concept, and what social innovation is not ........................................................ 90
A working definition ................................................................................................................................... 91
Barriers to social innovations ..................................................................................................................... 92
Barriers from the perspective of the ‘social demand’ approach ................................................................ 93
Barriers from the perspective of the ‘societal challenges’ approach ......................................................... 96
Barriers from the perspective of the ‘systemic change’ approach ............................................................. 98
Social enterprise ......................................................................................................................................... 99
Conclusion 2° part – Applied Research ......................................................................................................... 100
Social innovation ...................................................................................................................................... 101
Social economy......................................................................................................................................... 103
Policy for science ...................................................................................................................................... 106
Social value ............................................................................................................................................... 106
The linear model of innovation ................................................................................................................ 106
Part 3 – Development .................................................................................................................................. 108
A new model of Social Innovation ................................................................................................................ 109
Enhancement of previous Social Innovation model ................................................................................. 109
Social value ............................................................................................................................................... 109
Policy for science ...................................................................................................................................... 110
Human Rights ........................................................................................................................................... 110
Environment Rights .................................................................................................................................. 111
The Research and Development social taxonomies ................................................................................. 113
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The Research role ..................................................................................................................................... 114
The process for the new model of Social Innovation................................................................................ 117
The social innovation economy ................................................................................................................ 119
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The Learning Environments ...................................................................................................................... 124
Orienting New Approaches ...................................................................................................................... 127
Research and Development Objectives .................................................................................................... 128
High Education ......................................................................................................................................... 134
The target – the demand side .................................................................................................................. 135
The knowledge and skills champion – the supply side ............................................................................. 135
Conclusion - the Challenge ........................................................................................................................... 136
References ................................................................................................................................................... 137
Acknowledgements ...................................................................................................................................... 140
Creative Commons Public License ................................................................................................................ 140
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“Homo sum, humani nihil a me alienum puto”
(I am a man: and I deem nothing pertaining to man is foreign to me)
Terence, 195/185–159 BC
“Imagine no possessions
I wonder if you can
No need for greed or hunger
A brotherhood of man
Imagine all the people
Sharing all the world...
You may say I'm a dreamer
But I'm not the only one
I hope someday you'll join us
And the world will live as one”
John Lennon, Imagine - 1971
“Willingness to take risk and see value in absurdity”
S. Sundaram, GSI EDU-Research
Abstract
Object of this research is to provide the reader with a new model of Social Innovation based on:
the genealogical history of Innovation and his linear model of Innovation
the current research and definitions for Social Economy
a new Social Value framework driving the Social Innovation model proposed
Scope of this research is twofold:
1. A research centered on innovation: the 1° part of the document starts with a challenge issued by
Godin B. at UNESCO on the effective role of innovation for development countries, the document
present a genealogical history of the category innovation to understand which are the origin of this
term, its relation with imitation and invention, and how has been influenced by industrial evolution
and economy in its accepted linear model of innovation. The consequence of this analysis is that
nowadays innovation is commonly referred to technological innovation. The document continues
with an analysis on how research and development has changed in the last century and the role of
development in shifting from “policy for science” in “science for policy”, becoming R&D a standard
de facto all round the world: some supporting statistics are included. Afterwards, some historical
references about Guilds, Italian Renaissance and Leonardo da Vinci are introduced to focus how
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humanistic values have influenced the arrival of new form of knowledge and organization. The 1°
part concludes with an introduction framework about Social Economy. The 2° part of the document
begins with Innovation conditions for Social Economy: institutional requirements for the
constituting four sub-economies and the stages of Social Economy process: some supporting
statistics about economic evaluation of Grant Economy are presented. The 2° part concludes with
an analysis focused on Social innovation: definition, drivers and barriers to Social Innovations are
presented. The 3° and final part of the document concerns with a new model of Social Innovation: a
project research, whose aim is the development of the new model, is suggested.
2. A project research centered on a new model of Social Innovation: the 3° and final part of the
document concerns with a new model of Social Innovation, and the differences with the current
model, the reference values and the design structure are presented. Finally a project research,
whose aim is the development of the new model, is suggested.
The Challenge
This is the challenged issued by Godin’s communication at UNESCO on March 20111.
For fifty years, countries have measured their inventive and innovative efforts using precise methodological
rules. The OECD has developed influential manuals to this end. However, the manuals’ recommendations
are concerned mainly, if not entirely, with the supply side of invention and innovation. … Diffusion is
measured from the perspective of the innovating firm (process innovation), with no statistics from users
other than firms, whether they be customers, organizations, or whole countries. … Today, “user innovation”
has become a catchword. …
The majority of UNESCO countries are, first of all, and for the better and the worst, consumers of knowledge
and technology produced elsewhere. There is therefore a need to emphasize these countries’ efforts to
absorb what comes from outside as much as their own inventive and innovative efforts. This means that the
statistical tables should give equal attention to invention and imitation, which is not the case currently. To
this end, one must shift his attention from an exclusive focus on firms.
The OECD recently published a document intended to contribute to integrating innovation into the policy
agendas of developing countries. Innovation and the Development Agenda, published in 2010, is part of the
OECD Innovation Strategy of that same year. This document is most welcome. The explicit aim is to
introduce in innovation policies a “different lens” from that of industrialized countries. This short note
1 B. Godin (2011), A User-View of Innovation: Some Critical Thoughts on the Current STI Frameworks and Their
Relevance to Developing Countries, Communication presented at Expert Meeting on Innovation Statistics, UNESCO, 8-
10 March, 2011.
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identifies four assumptions and biases on which Innovation and the Development Agenda rests. The
objective is to suggest the continuance of, and deeper thoughts on, what is certainly a beginning toward a
broader understanding of innovation.
1. Innovation is the (not-so) new (miracle) solution to development issues. To the OECD, “the last half-
century has seen different approaches to development which have achieved varying degrees of
success”. In their place, innovation should now be considered a strategy for development: “most
current social, economic and environmental challenges require creative solutions based on
innovation and technological advance”. But is it really the case and how precisely? The document,
as with most of the literature on innovation, starts with innovation as a panacea, not with problems
of development (except in general terms) or the extent (and limitations) to which innovation is or is
not a (THE) solution.
2. The document promotes, again as most of the literature on innovation does, a supply-side view of
innovation: firms, the commercialization of invention and the use of invention in industrial
production. I agree that this must be part of every innovation strategy. But a supply-side view needs
to be complemented by a user-side one. To a certain extent, a “different lens” is offered in the OECD
document: a certain emphasis is placed on the informal sector and non-technological innovation
and on the need to adapt the National Innovation System (NIS) framework to developing countries
such as: considering product innovation as much as process innovation (but the issue here is still
discussed in terms of the old, namely competitiveness), innovation in low-tech sectors, incremental
innovation, and adaptive capacities and learning. However, the framework remains a supply-side
view. Nothing in the document goes beyond innovation as commercialization.
3. A demand or user-side view, namely a consideration of the user or adopter of (already existing)
innovations, is poorly developed. Certainly, the document admits that, “If governments are to
support innovation activity, there is a case for policies that encourage the conversion of knowledge,
however that knowledge is gained”; “the demand-side of technology and innovation needs to be
stressed in addition to the conventional focus on the supply side”. Nevertheless, the document has
very little to say except general thoughts about absorptive capacities, mentions that developing
technologies need to be adapted to local needs. The document discusses the issues in terms of the
old: technology-flow– there is nothing on flows of scientific knowledge and how developing
countries get and use scientific knowledge from foreign sources. All in all, a user-side view still needs
to be articulated. It is one thing that a firm extracts value from innovation, but another if the end
user is not better for it – that it does not share in that added value.
4. There is little concern for “people” as innovators (doing things differently) except, again, as
introducers of new inventions to the market or as buyers of new inventions. Certainly, the
consideration of people as innovators in the larger sense gets some hearing in Innovation and the
Development Agenda, like the discussion of the informal sector. However, the issue is entirely
discussed in terms of the market. As if every solution to health, poverty and education need a firm, a
technology, a market. How do people change their behavior in response to new knowledge (like
AIDS)? How organizations (schools, hospitals) contribute to people adopting new behaviors? What
about microcredit, certainly one of the most innovative ideas of the last decades in the developing
country. Is it included in the statistics, as the current survey is constructed?
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Why such a vision? Simply because the authors continue to use the dominant frameworks – and the OECD
itself urges implanting of its own methodology in developing countries, like reviews of innovation policies. …
In the last five decades, all frameworks used at the OECD have been supply-side including NIS.… NIS is
entirely centered on innovation in firms: the system gravitates around firms and the way other
organizations and institutions contribute to innovation in firms. The manual is entirely concerned with
surveying innovation in firms. Innovation is defined as “implementation”, namely introducing invention on
the market or bringing a new invention into industrial use. With regard to diffusion (“the spread of
innovation”) and transfer (“linkages and flows”), the manual deals only with how the firm acquires
knowledge and technology from outside. Residual attention is given to end-users, including individuals (in
their jobs), customers and organizations other than firms. There is nothing on end users, the capacity users
have to use invention, how a (potential) user like a developed country comes to know (foreign) knowledge
and technology, what mechanisms it has to this end, what supporting infrastructures, etc.
What would a survey of innovation look like if one starts with a user-based view? It would:
Address and focus on specific and precise problems or areas of development – like one does in the
case of specific surveys, like ICT, biotechnology – not innovation in general and broad terms
(“percentage of enterprise that introduced innovation”).
Survey end-users, not just producers.
Cover individuals, groups, organizations and government.
Measure diverse kinds of innovation: ideas, behaviors and things (and compared the new to the
old). Where does the innovation come from?
What use, if any, is made of the innovation? By whom?
Identify the mechanisms through which innovation diffuse and their presence or absence in a
developing country: Do and how knowledge about X gets into country Y? What lags? Why?
What effects (quality of life), including the bad ones? To what extent is the innovation adapted to a
country’s needs?
Evaluate the role of government as innovator in matter of policies (not only as “hampering factor”):
what infrastructures, policies and programs exist in country Y for supporting innovation? Moreover,
in order to increase its relevance, a survey of innovation (be it supply-based or user-based) should
look for facts rather than rely on questions with answers of a subjective nature.
A Radical Proposal
Forget OECD’s frameworks and statistics and start anew
Back to basic concepts: invention, diffusion and use
Very interesting Challenge, why don’t accept it ? How can we proceed and try to solve it ?
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Part 1 - Basic Research
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What is Innovation ?
Godin’s challenge requires a New Innovation Framework based on forgetting OECD’s frameworks2 (and it’s
statistics / measures) and to go back to basic concepts. But if we have to forget something we need, first of
all, to understand what we have to forget and it’s basic concept.
Therefore, it is necessary to point out:
what Innovation means
how Innovation meaning have been influenced by the OECD firm vision
To reach out these objectives some of Godin’s concepts3 are presented.
Innovation is everywhere … (and) is also a central idea in the popular imaginary, in the media, in public
policy and is part of everybody’s vocabulary. … To many, innovation is a relatively recent phenomenon and
its study more recent yet: innovation has acquired real importance in the twentieth century. In point of fact,
however, innovation has always existed. … Many people spontaneously understand innovation to be
technological innovation. The literature itself takes this for granted. More often than not, studies on
technological innovation simply use the term innovation, although they are really concerned with
technological innovation. However, etymologically and historically, the concept of innovation is much
broader. … (Moreover) innovation generally understood, in many milieus, as commercialized innovation …
but other types of innovation are either rapidly forgotten or rarely discussed. By contrast, every individual is
to a certain extent innovative; artists are innovative, scientists are innovative, and so are organizations in
their day-to-day operations. …
A genealogical history of the category “innovation” … concentrates on the “creative” dimension of
innovation … (and) identifies the concepts that have defined innovation through history, and that have led
to innovation as a central category of modern society.
Innovation … does not exist as such, it is constructed through the eyes and through discourses. The
genealogical study … (is analyzed) by three hypothesis:
Innovation is about novelty (arising from human creativity), as etymology, dictionaries and history
suggest. As such, innovation is of any kind, not only material or technological. In this sense,
innovation as category has a very long history. …
History of innovation as “creativity” is that of three concepts and their derivatives … (seen as)
sequential steps in the process leading to innovation:
Imitation → Invention → Innovation
2 As Godin point out in his communication “This is no judgment on OECD works, but its relevance to development” 3 Godin, B. (2008), Innovation: The History of a Category, Project on the Intellectual History of Innovation, INRS:
Montreal, Forthcoming
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Innovation as a break with the past… in the sense that it suggests that invention per se is not
enough. There has to be use and adoption of the invention, namely innovation, in order for benefits
to accrue.
Imitation
Imitation is a concept of Greek origin … (and) Plato’s philosophy is entirely concerned with imitation and its
many senses and opposites: appearances (or images) – versus reality; falsity – versus truth. To Plato, even
physical objects are imitations, compared to God and true nature. But it is through Aristotle that the
concept of imitation got its main influence. To Aristotle, (practical) arts imitate nature (mimesis). Such an
understanding of art gave rise to imitatio as the central problem of art, with pejorative overtones, then to
imitation as inspiration. … The mimetic orientation was the most primitive aesthetic theory, art imitates the
world of appearance. The “artist” extracts the form of the natural world and imposes it upon an artificial
medium. … However, according to most theories, imitation is only instrumental toward producing effects, …
a literary mechanism for the production of difference.
Until the mid-eighteenth century, imitation was presented as a positive practice, not one that was
distrusted or pejorative (… a method for teaching, … selective borrowing and creative copying, … enriches
the tradition focusing on interpretation, … a way to come closer to real knowledge of nature by imitating
nature, … as a substitute for imported commodities): … briefly stated, imitation is taken for granted and is a
common practice. …
Imitation has often been portrayed as being invention itself. The view in the Middle Ages of the work of
artisans is that of art learned by imitating nature, but in so doing, the artisan changes nature, as claimed by
the alchemists. Equally, in Renaissance literary theory and visual arts, one finds recurrent descriptions of
imitation as rediscovery of the old, as something “new” to copy, as something never seen before. … An
argument frequently evoked is that imitation requires work, experimentation, judgment and imagination.
All these descriptions in literature, arts and crafts generally refer to an idea that has been very influential
among many authors in defining invention, and subsequently innovation: that of combination. Imitation is
invention because, when combining elements from nature, it combines the best of them, and by so doing
improves nature. Combination “creates a whole that is more perfect than nature”. Equally, in combining
previous schools of thought, the combination surpasses the work of past authors. Compilatio, a “wide
literary activity which encompassed various genres in the Middle Ages” and after, is combination of others’
material into a new work, a unio. … In the sixteenth and seventeenth centuries, patents and their precursors
in the fifteenth century like letters and privileges, were not granted to inventors, as they are today, but to
importers of existing inventions … Now, if we turn to the twentieth century, we clearly observe that
imitation gave rise to, and was often used as a term for, diffusion. … Contemporary theories on innovation
now include diffusion (or use) as a step in the innovation process. In summary, imitation has rarely been
separated from invention. To many, imitation has close links to invention, and even constitutes invention
itself. However, with time imitation came to be contrasted to invention. Starting from the mid-eighteenth
century, imitation was regarded as mere copying, while originality became the criterion for real invention.
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Invention
Invention is a term that comes from rhetoric. In classical rhetoric, invention was the first of five divisions of
the rhetorical art. Invention is composed of guidelines to help speakers find and elaborate language. In De
Inventione, Cicero (106-43 BC) defined invention as the “discovery of valid or seemingly valid arguments to
render one’s cause probable”. However, in the history of rhetoric, invention as so conceived has been
eclipsed by one or more of the four other divisions (arrangement, style, memory and delivery).
Invention as a term in other domains really came to be used in the mid-fourteenth century as finding or
discovery, namely with regard to knowledge, or science (knowing). It came to be applied to making as well,
in poetry then in visual arts. From the sixteenth century, invention was used more and more to apply to
newly-created things (artifacts). … From late medieval Europe, the idea of invention spread everywhere, to
different degrees and under different terms. … In the Renaissance, there was “no unanimity in usage of
divino, ingegno, fantasia, immaginazione and invenzione”, … (and) the idea of progress is a major one
during the Renaissance. … In the sixteenth and seventeenth centuries, the idea of novelty is everywhere and
becomes very much a (positive) cultural value: nowhere is the idea of novelty more presents than in science,
… frequently discussed as an active search or hunt (venatio), a very old metaphor. … One thing is clear: in
the sixteenth and seventeenth centuries, the idea of novelty is everywhere and becomes very much a
(positive) cultural value:
Philosophy: praxis4
Literary theory and visual arts: imagination, originality, creation
Arts and crafts (engineering): ingenium, invention
(Natural Philosophy and) science: discovery, experiment, scientific change
History: change, revolution, progress
“Evolutionists”5: growth, development, evolution, variation, mutation
Anthropology: culture (or cultural) change
Sociology: action, social change
Psychology: attitude change; creativity
Management and politics: organizational change
Economics: entrepreneurship, technological change, innovation
Change became a preoccupation of study in many emerging scientific disciplines, from sociology and history
to natural philosophy, or the sciences: … from the eighteenth century are the “men of science” who have
taken change most seriously. …
Whatever its name, the new is not without its opponents: the Querelle between the ancients and the
moderns, in literature and philosophy but also in science and education, is that between imitating (and
surpassing) the ancients versus a totally new enterprise, … perhaps the first systematic debate in history
4 In philosophy, praxis has not really been theorized because of the emphasis on mind. It slowly begins to be become an issue, quite imperfectly according to many, with expressiveness, utilitarianism (free will), existentialism (life, will, consciousness), pragmatism (experience, inquiry), and the philosophy of action 5 Evolutionists: early geology, early paleontology, natural history, and biology
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about the new as opposed to tradition. … The defenders of invention often have an ideological aim: to
distinguish oneself (identity) and to justify one’s activities (image of scientists, inventors and writers), for
purposes of patronage, among other things. Hence, the construction of oppositions portraying tradition and
the like as static (transmission from generation to generation: irrational and arbitrary) versus invention and
the like as cumulative and progressive. Over time, invention in science came to share the vocabulary of
writers with the term discovery: … for some time, invention meant finding as well as making, and was
applied without qualification to both activities. … Later, a distinction was made between the two concepts:
discovery referred to facts or things that already exist out there and that one finds out, while invention
combines and makes new things, including scientific theories. … Literature and visual arts are other fields
where the idea of novelty is widespread. Contrary to science, with its emphasis on facts and method and its
negative assessment of imagination, the “power of imagination” is rehabilitated. In fact, literary theory and
visual arts (painting, sculpture) in the Renaissance adapted invention from the literature on rhetoric to a
psychological process of imagination. …, (and) originality came to define the artist and the metaphor of
creation (already present in Greek mythology). … Certainly, originality, as with imitation and invention,
plays his important role: … originality means origin, or source (authorship), … and a distinctive quality of
work, or novelty, as well. … As such, originality came to characterize the genius, an important figure in the
Renaissance, … and a concept with a long history: first defined as spirit (which gave inspiration), it came to
mean innate talent or ability (ingenium), then a person with superior creative powers. … (So), the term
invention was applied to ingenious things like “machines, artifices, devices, engines, methods”.
Ingenuity was also a key concept for the artisan from the Middle Ages onward: … the artisan, first of all
alchemists, through their art created new things in their opinion, and for the first time made art a creative
force rather than only an imitative entity. Equally, in Renaissance painters, ceramists and sculptors really
thought they were creating new things, not only practicing an imitative art. This creative power over nature
gave rise to the figure of the inventor, a genius or hero who, as to scientists and artists, was not without
opponents. As a matter of fact, it took time for inventors to be admitted to the pantheon of great men. Up
to the beginning of the nineteenth century, and again after the commercialization of technological
inventions on a large scale at the end of this same century, the inventor was anonymous.
The alignment of the term invention with technological invention was helped by the conventionalization, or
institutionalization, of technological invention through privileges and patent laws from the late fourteenth
and fifteenth centuries onward. … As patents attest, the qualities previously attributed to the genius or
artist (like originality) become those attributed to the commodity. Over time, technological invention
obtained a relative “monopoly” in the vocabulary of invention because of the culture of things, or material
culture, and patents are witness to this phenomenon. Over time, the culture of things has developed and
owes its existence to many factors. One such factor is the “consumer revolution”, … a second factor is what
came to be called the “industrial revolution” and the use of technologies in industrial processes, … (a third
factor), or innovation, occurred at the end of the nineteenth century and the beginning of the twentieth
century: (large) firms began setting up research laboratories as a way to accelerate industrial development.
As A.N. Whitehead put it long ago, “the greatest invention of the nineteenth century was the invention of
the method of invention”, (in fact) men have invented a method for (systematic and cumulative) invention.
… Along with the patent system discussed above, the development of industries based on the research
laboratory and the commercialization of technological inventions on a large scale were major factors
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contributing to a conception of invention as technological invention. Briefly stated, technological inventions
got increased attention because they have utilitarian value as opposed or contrasted to Ancient knowledge,
as it was often said from Bacon onward … Things, and utility, have a place in science too: … for F. Bacon, the
main exponent for more useful knowledge in science, namely for the mechanical arts and artificial objects,
“the real and legitimate goal of the sciences is the endowment of the human life with new inventions and
riches”.
Innovation
Novation is a term that first appeared in law in the thirteenth century. It meant renewing an obligation by
changing a contract for a new debtor. … Until the eighteenth century, a “novator” was still a suspicious
person, one to be mistrusted, … and the term was rarely used in the various arts and sciences before the
twentieth century. … Until innovation took on a central place in theories on social and economic change,
imitation and invention (under different terms, as discussed above) were seen as opposites, as was the case
in social practices. … While previous theories of invention were of a “psychological” kind and focused on
inspiration, imagination and genius, the end of the nineteenth century saw the emergence of new theories
for explaining novelty, and these were of a social kind. The first such theories arose in anthropology.
anthropology made very few uses of the term innovation. Innovation was nevertheless what
anthropologists of the late eighteenth and early nineteenth century studied as culture change: changes in
culture traits, but also inventions in agriculture, trade, social and political organizations (law, customs,
religion, family) and technology. …
Many anthropologists framed the discussion in terms of invention versus diffusion (as imitation) to explain
stages of civilization. This gave rise to what came to be called the diffusion controversy. On one side were
evolutionists, to whom invention stems from multiple centers and occurs independently in different cultures:
parallel inventions, as they were called, reflect the psychic unity of human nature, and differences in culture
reflect steps of the same process, or varying speeds of evolution. … At the opposite end were diffusionists, to
whom man is essentially uninventive: culture emerges from one center, then diffuses through borrowings,
migrations and invasions. … Until about the mid-twentieth century, evolutionism was the framework
anthropologists used to study culture change. Then acculturation, as the study of cultural change resulting
from contacts between different cultures, developed. Anthropologists stopped looking at diffusion as mere
imitation contrasted to invention: diffusion is inventive adaptation. Barnett (an anthropologist) developed a
comprehensive theory of innovation, defined as “any thought, behavior, or thing that is new because it is
qualitatively different from existing forms”, … and everyone is an innovator. … We have to turn to
sociologists, and then economists, to find the systematic development of studies on innovation. What place
doe the term and category of innovation take in sociological theories? In studying the literature, one
observes a move from multiple terms used interchangeably to innovation: the most frequent terms are the
combined one invention/discovery and technology. …
The first theory of innovation comes from the French sociologist Gabriel Tarde (who) was interested in
explaining social change (or social evolution): grammar, language, religion, law, constitution, economic
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regime, industry and arts. … The success of an invention (i.e.: imitation) depends on other inventions (or
opposition between inventions) and social factors. To Tarde, invention is the combination of previous or
elementary inventions …. Invention comes from individuals (not necessarily great men), and is socially
influenced. … Invention is the driving force of society, but society is mainly imitative. … However, to many
critics over time sociologists have been concerned with imitation (as socialization) rather than with creative
action: the study of individual creativity was left to psychology. … Ogburn and Gilfillan started looking at
inventions, above all technological inventions, as causes of cultural change or social change (social
organizations and behaviours). To Ogburn, “the use of material things is a very important part of the culture
of any people”. What he observed was the growth and acceleration of material culture. … Ogburn
developed the concept of the cultural lag to account for this process. There is an increasing lag between the
material culture (technology) and the rest of culture (adaptive culture) due to inertia and lack of social
adaptation. …
To the sociologists, technological invention is … a social process rather than an individual one. Certainly
“without the inventor there can be no inventions”, but “the inventors are not the only individuals
responsible for invention”: social forces like demographic (race) and geographic factors, and “cultural
heritage” play a part. Secondly, technological invention is social because it is cumulative (or evolutionary),
namely the result of accumulation and accretion of minor details, modifications, perfectings, and minute
additions over centuries, rather than a one-step creation. Finally, technological invention is social in a third
sense: it is more and more systematic, it comes from organized research laboratories specifically dedicated
to this end. … This meaning of innovation as technological invention used and adopted is the common
sociological understanding of innovation, although a fourth meaning would soon be used as well, following
the economists’ definition: technological invention as commercialized by industry. … Despite this
understanding, explicit definitions of innovation are rare among sociologists. The early few definitions that
exist differ considerably. Certainly, they all refer to the idea of novelty, but they differ in the sense that some
include the act itself (combination), others the impacts of innovation, still others the subjective perception of
it. … Innovation as process is also how economists understand the category. However economists add their
own stamp to the idea: innovation is the commercialization of (technological) invention. And unlike the
definitions of sociologists, this definition came with time to be accepted among economists, and by others,
including the sociologist.
Tarde (1820): Invention, imitation, op position
Ogburn (1920): Invention(and diffusion), maladjustment (lag)/ adjustment
Bernard (1923): Forumula, blue print, machine
Chapin (1928): Invention, accumulation, selection, diffusion
Ogburn and Gilfillan (1933): Idea, trial device (model or pl), demonstration, regular use, adoption
Gilfillan (1935): Idea, sketch, drawing; model, full-size experimental invention, commercial practice
Gilfillan (1937): Thought, model (patent), first practical use, commercial success, important use
US National Resources Committee (1937): Beginnings, development, diffusion, social influences
Ogburn and Nimkoff (1940): Idea, development, model, invention, improvement, marketing
Ogburn (1941): Idea, plan, tangible form, improvement, production, promotion, marketing, sales
Ogburn (1950): Invention, accumulation, diffusion, adjustment
Rogers (1962): Innovation, diffusion, adoption
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Rogers (1983): Needs/problems, research, development, commercialization, diffusion and adoption,
consequences
The study of change is not the traditional concern of economics. Historically, economics is concerned with
equilibrium rather than dynamics. Although the concepts of work (labor), production and growth held
central place in early economic theories, the study of economic change is not a fundamental concept in
economics, as culture change is in anthropology or as social change is in sociology: change really got into
economics with the study of technology as a cause of economic growth, … called technological change, as
the use of technological inventions in industrial processes. …
Increased interest in technological change can be traced back to the years following the Great Depression,
where the bicentenarial debate on the role of mechanization on employment reemerged, … (and) the study
of technology developed via the measurement of productivity: increases in productivity as an indicator of
technology usage. … Subsequently, the formalization of the measurement developed through what was
called the production function, … an equation … that links quantity produced of a good (output) to
quantities of inputs. … Economists interpreted movements in the curve of the production function as
technological change (the substitution of capital for labor). … Then economists started correlating R&D with
productivity measures: beginning in the late 1950s, a whole literature developed, analyzing the contribution
of research to industrial development, and to performance, productivity and economic growth, first from
mainstream economists.
It is through evolutionary economics, among them J.A. Schumpeter, that innovation really got into
economics. To Schumpeter, capitalism is creative destruction: disturbance of existing structures, and
unceasing novelty and change. In his view, innovations are responsible for this phenomenon. Schumpeter
identified five types of innovation: 1) introduction of a new good; 2) introduction of a new method of
production; 3) opening of a new market; 4) conquest of a new source of supply of raw materials or half-
manufactured goods; and 5) implementation of a new form of organization. Part of the explanation for the
use of the term innovation in the economic literature has to do with a reaction against historians and
against the term invention. Following others, Schumpeter distinguished innovation from invention. To
Schumpeter, “innovation is possible without anything we should identify as invention and invention does not
necessarily induce innovation”. Invention is an act of intellectual creativity and “is without importance to
economic analysis”, while innovation is an economic decision: a firm applying an invention or adopting an
invention. However, it took time for the category to gain acceptance. In the early 1960s, the category was
still not widely accepted. … In the 1970s, the skepticism continued: the “use of the term innovation is
counterproductive”, … because each individual has his or her interpretation. … Schumpeter is usually
credited in the economic literature, particularly by evolutionary economists, as being the first theorist on
technological innovation: … Schumpeter did develop influential ideas on technological innovation as a
source of business cycles … (where) the entrepreneur (and, in a next stage, the large firm) is responsible for
technological innovation. But how? …
Over time, authors from business schools and economists developed theories or conceptual models of
technological innovation as a process from invention to diffusion, similar to those of the sociologists. In
these theories, technological innovation was defined as a step (the ultimate step) of a process starting with
invention – and defined as commercialized innovation. … The most popular and influential … theory
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combining both production (of goods) and distribution … is what came to be called the “linear model of
innovation”: … technological innovation starts with basic research, then goes through applied research, then
development, and then production and diffusion. Such an understanding of technological innovation has
been very influential on science policy after 1945.
While innovation as technological innovation and as commercialized innovation came to dominate the
literature, other conceptions of innovation developed elsewhere. Inside the category of social innovation we
can include political innovation (innovation in public institutions such as schools and government agencies),
… organizational innovation (… study of innovative behaviors of research activities, … of organizations
developed such as organizational structure and management style).
What role did policy play in all this? A major one, indeed. Over the twentieth century, innovation was in fact
a policy-driven concept. Psychologists, sociologists, economists, including “evolutionary” economists, and
researchers from management, business schools and economics acted as consultants to governments, and
were concerned with offering policy recommendations for “social engineering”, productivity and economic
growth based on their theories, the more recent ones being conceptual frameworks like the knowledge-
based economy, the information economy, the information economy, the new economy, and national
innovation system. …. However, there has never been a “policy for science” period, as many authors argue,
only a “science for policy” one, during which public research and universities were urged to contribute to
technological innovation. Science policy has always been concerned with applying science to public goals.
From its very beginning, science policy, whether implicit or explicit, was constructed as a means to achieve
social, economic and political goals.
Conclusion
… Innovation as a (widely-used) category during the twentieth century is witness to a certain context or era
- capitalism - and to changes in political values. As J. Farr put it, “to understand conceptual change is in
large part to understand political changes”. Until early in the twentieth century, invention, ingenuity and
imagination were discussed as symbols of civilization and as attributes of geniuses, and their contribution to
the progress of the race. Then, the growing role of organizations in the twentieth century led to changes in
values. If there was to be increasing economic efficiency, there had to be innovation - through organizations
and the mobilization of their employees’ creative abilities. Such were the discourses of managers as well as
policy-makers. Theorists from many disciplines started studying innovation in terms of the effects of
technological innovation on the economy and society. To sociologists, gone was the lonely inventor as a
hero or genius. It was a myth created by past authors. Innovation is rather a social process. To economists,
gone was invention without market value. It is a subject for the historian. To the policy-maker, gone was (or
should be) research with no application. The golden age between the state and the funding of the basic
scientist, although short-lived, is finished. Innovation as a category in the twentieth century expresses
precisely these political changes: a demarcation with past understandings, values and practices. The
category’s previous meanings or predecessors (invention, ingenuity, imagination, etc.) came to be subsumed
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under “innovation”, and the creative abilities of an individual placed in the service of organizations,
industrial development and economic growth.
Innovation is the last of a series of terms imagined to give meaning to modern practices. Certainly,
innovation is, to a certain extent, continuity with the past, in the sense that more often than not it refers to
technological invention. However, it is also a break with the past: invention per se is not enough. In fact,
many ideas and inventions fail, according to the history of technology. There has to be use of the invention,
namely innovation, in order for benefits to accrue. This is the first aspect of the break. Another concerns the
production of invention. While it was the individual, or genius, who was the source of invention in previous
representations, innovation places emphasis on the firm. And there is a third aspect of the break: benefits
deriving from invention concern economics, not culture or civilization.
There are now many people trying to broaden the understanding of innovation as technological innovation.
One now hears discourses on “social innovation”, meaning either major advances in the social sciences,
policy/institutional reforms for the betterment of society, or solutions to social needs and problems, coming
from the community sectors among others. Calls for do-it-yourself innovation, user-led innovation, open
innovation and “democratizing innovation” are in the same vein: technological innovation comes from many
sources, not only the research laboratory, but also users. … The OECD Oslo Manual itself, in its latest edition,
has broadened the definition of innovation to include organizational and marketing innovation, although
this is limited to firms. However, projects are now in progress for measuring innovation in the public sectors
in the near future.
The main goal of the promoters of these new ideas is ensuring that policy-makers takes account of non-
technological aspects of innovation in their policy. Whether the ideas will have an impact on the current
understanding of innovation remains to be seen. For the moment, they certainly contribute to extending the
discourses on, and the fascination with, innovation to more spheres of society, and mobilizing more people
in the name of innovation.
What we learned ?
How can we define a new paradigm for Social Innovation ? Thanks to Godin’s research presentation it is
possible to fix some starting points.
The XX Century
The last Century represented a turning point for invention and innovation concepts, seen as the
commercialization of invention and the use of invention in industrial production: this fact got to a new
capitalistic metric where technology and things culture lead science for policy and, as a consequence, for
human being. This revolution has radically influenced, and maybe substituted, the natural fulcrum of the
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history of humanity: the human being. The humanity development, thanks to the central role of human
being, allowed during centuries flow an holistic vision of the word, where the different needs of human
being have been compared, from time to time, to individual or collective values “immanent” at the
belonging cultures: the apogee of human being centrality date back to Renaissance. The capitalism, and its
role in the transformation of innovation concept, took to a time continuum where the measure unit is
assumed “transcendent” to human being, the capital, which in turn standardize and trivialize human life to
a monetary value that follows a necessary and continuous growth in its material measure. The concept so
important for the economy for which “Invention is an act of intellectual creativity and is without importance
to economic analysis, while innovation is an economic decision” fully represents the paradoxical necessity
to take the capitalistic economy, “transcendent”, at being the only material asset that could measure and
substitute individual and collective values, which are “immanent”. The perversion of this model permeating
the XX Century is faithfully shown by recent facts where finance and world crisis that we are living and
subject to nowadays, as evolution and representation of a necessary and continuous growth, has become
itself “transcendent” with respect to capitalistic economic, which is in turn “transcendent” to human being.
To conclude we can say that this vision concerning with human being, capitalistic economy and at last
finance, for sure stressed but not so far from reality, remembers very well the poem by Goethe “The
Sorcerer’s Apprentice” where, for our case, the Sorcerer could be no other than the human being.
Research and Development - How the “D” got into R&D
One of the main issues raised by Godin is the role of Development as a firms’ domain.
R&D6 is a central component of official definitions of Science & Technology (S&T). Decades of work on
taxonomies and statistics on research are testimony to the construction behind the definition.
We can identify three stages in the construction of development as a category for statistical purposes:
1° Development was only a series or list of activities without a label, but identified for inclusion in questionnaire responses.
2° Development came to be identified as such by way of creating a subcategory of research, alongside basic and applied research. This was Huxley’s innovation, and Anthony was influential in its measurement.
3° Development became a separate category, alongside research. It gave us the acronym we now know and use: R&D.
The category had three main purposes:
1 Organizational. It corresponded to the type of research conducted in industry, to research divisions in firms, and to entire organizations that defined themselves according to both research and development.
6 B. Godin (2006), Research and Development - How the “D” got into R&D, Science and Public Policy, volume 33, number 1, February 2006, pages 59–76, Beech Tree Publishing, 10 Watford Close, Guildford, Surrey GU1 2EP, England
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2 Analytical. Here, it was industrialists, consultants and academics in business schools who developed models identifying development as a separate and decisive step in the innovation process.
3 Political. The category served political ends, among them the greater amount of money firms could obtain from public funds by including development in research expenditure.
Despite its widespread use, the category was not without its methodological problems. Early on, these
problems were discussed at a meeting organized by the National Science Foundation (NSF) in 1959, and at
the OECD meeting that launched the Frascati Manual in 1963. Most of the problems concerned the
demarcation between development and other activities, and the absence of precise accounting practices to
distinguish types of activity properly. This was an additional factor explaining the inclusion of development
in statistics on research.
Methodological difficulties also explain the exclusion of development from more recent statistics on S&T.
Development as an activity is in fact located somewhere between two other activities: research and
production. We have already alluded to the difficulty of separating applied research from development. This
became even more pronounced when the category was used for research other than industrial research. As
W H Shapley from the US Bureau of Budget commented at the NSF meeting in 1959:
“The practical problem results chiefly from the fact that a distinction between research and development is not recognized in the way Government does its business … Projects and contracts cover both research and development, and the distinction is usually not made even in the financial records at the local operating level … because of the large number of projects”.
The other demarcation problem concerned development and production. Since, for example, minor
developments can also occur during this later stage, “the main difficulty arises in determining the point at
which development work ceases and production begins” (OECD). This is particularly important in the case of
military research, because R&D is not a separate entity, but part of general expense appropriations or
procurement contracts. This practice has enormous consequences on statistics: many different statistical
estimates frequently coexist for measuring the same phenomenon. As a National Research Council report
(known as the Frank Press report) argued in the mid-1990s:
“Nearly half of traditional federal research and development spending involves initial production, maintenance, and upgrading of large-scale weapons and space systems … Those activities are neither long-term investments in new knowledge nor investments in creating substantially new applications. If they were excluded, the research and development investment budget — called the federal S&T (FS&T) budget in this report — would be between $35 billion and $40 billion annually”.
As a consequence, and in line with the Frank Press report, the US Government started compiling a Federal
Science and Technology Budget in 1999, different from Federal Research and Development Spending. The
two now appear in the Budget. Federal Research and Development Spending, on one hand, is the
conventional way of counting R&D expenditure, and amounted to over US$117 billion in 2003. Here,
expenditure is broken down according to the standard three categories — basic research, applied research,
and development — to which ‘facilities and equipment’ is added. The Federal Science and Technology
Budget, on the other hand, is a collection of federal programs designed to be easy to track in the budget
process, rather than constituting a comprehensive inventory of federal S&T investments. The budget for
these programs amounted to nearly US$60 billion in 2003.
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The main difference between this and the Federal Research and Development Spending budget is that it
excludes most development, such as Department of Defense weapons systems development, and includes
some scientific and technical education and training activities.
The Federal Science and Technology Budget presents a new concept in measuring S&T, and allows no
comparisons with other countries’ statistics. It differs from both the OECD definitions and the Press report
suggestion. Since its first introduction in 1999, the definition has also changed regularly. It is the most
recent official response to the statistical challenges of measuring development: not abandoning the
historical and traditional methodology, but adding a second series of numbers. At the same time, it is a
(timid) acceptance of the decades-old complaint, initially offered by Bernal: the statistics on money spent on
research “is delusive because it includes money spent on non-profit making plant on a semi-industrial scale,
an expense far greater than that of scientific research proper”.
Research and Development - World’s top 10 leaders statistics
Fig 1 - World’s top 10 leaders in gross domestic expenditure on R&D (GERD) by type of R&D activity, 2009
or latest available year7.
Notes:
Source: UNESCO Institute for Statistics, UIS database, June 2011, Science and Technology Statistical
table 30.
Source for PPP conversion factor (local currency per international $): World Bank; World
Development Indicators, as of April 2011.
7 UNESCO Institute for Statistics
Basic
research
(%)
Applied
research
(%)
Experimental
development
(%)
Unknown
(%)
United States 2008 398.194.000 17,4 22,3 60,3
Japan 2008 148.719.235 11,4 21,7 62,6 4,3
China 2008 121.369.732 4,8 12,5 82,8
France 2008 46.262.320 25,4 39,0 35,6
Republic of Korea 2008 43.906.413 16,1 19,6 64,3
United Kingdom 2008 40.096.350 8,8 40,6 50,6
Russian Federation 2009 33.368.083 21,0 20,1 58,9
Italy 2008 24.510.194 27,0 45,6 27,4
Spain 2008 20.434.838 20,9 43,3 35,8
India 2005 19.617.935 18,1 25,1 22,0 34,8
89.647.910 17,1 29,0 50,0
Expenditure on R&D (GERD)
by type of R&D activity
Country
Latest
available
year
Expenditure
on
R&D (GERD)
in '000
current PPP$
Total Average
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Fig 2 - World’s top 10 leaders in gross domestic expenditure on R&D (GERD) by type of R&D funding, 20088.
Notes:
Source: UNESCO Institute for Statistics, UIS database, June 2011, Science and Technology Statistical
table 30.
“NA” – Data not available
“Business enterprise” - R&D expenditure in the business sector, where the business sector in the
context of R&D statistics includes (Source OECD - 2002, Frascati Manual):
o All firms, organizations and institutions whose primary activity is the market production of
goods or services (other than higher education) for sale to the general public at an
economically significant price.
o The private non-profit institutions mainly serving them.
“Government” - R&D expenditure in the government sector, where the government sector in the
context of R&D statistics includes (Source OECD - 2002, Frascati Manual):
o All departments, offices and other bodies which furnish, but normally do not sell to the
community, those common services, other than higher education, which cannot otherwise
be conveniently and economically provided, as well as those that administer the state and
the economic and social policy of the community. Public enterprises are included in the
business enterprise sector.
o The non-profit institutions (NPIs) controlled and mainly financed by government but not
administered by the higher education sector.
“Higher education” - R&D expenditure in the higher education sector, where the higher education
sector in the context of R&D statistics includes (Source OECD - 2002, Frascati Manual):
o All universities, colleges of technology and other institutions of post-secondary education,
whatever their source of finance or legal status.
8 UNESCO Institute for Statistics
By
Business
enterprise
%
By
Government
%
By
Higher
education
%
By
Private
non-profit
%
By
Abroad
%
United States 2008 67,3 27,1 2,7 3,0 NA
Japan 2008 78,2 15,6 5,1 0,7 0,4
China 2008 71,7 23,6 NA NA 1,2
France 2008 50,7 38,9 1,2 1,1 8,0
Republic of Korea 2008 72,9 25,4 1,0 0,4 0,3
United Kingdom 2008 45,4 30,7 1,2 4,9 17,7
Russian Federation 2008 28,7 64,7 0,5 0,2 5,9
Italy 2008 45,2 42,9 1,3 2,8 7,8
Spain 2008 45,0 45,6 3,2 0,6 5,7
India 2008 NA NA NA NA Na
56,1 34,9 2,0 1,7 5,9
Latest
available
year
Expenditure on R&D (GERD)
by type of R&D funding
Country
Total Average
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o It also includes all research institutes, experimental stations and clinics operating under the
direct control of or administered by or associated with higher education institutions.
“Private non-profit” - The Private non-profit sector in the context of R&D statistics includes (Source
OECD - 2002, Frascati Manual):
o Non-market, private non-profit institutions serving households (i.e. the general public).
o Private individuals or households.
“Abroad” - In the context of R&D statistics, abroad refers to (Source OECD - 2002, Frascati
Manual):
o All institutions and individuals located outside the political borders of a country; except
vehicles, ships, aircraft and space satellites operated by domestic entities and testing
grounds acquired by such entities.
o All international organizations (except business enterprises), including facilities and
operations within a country’s borders.
Research and Development - Regional average statistics
Fig 3 - Gross domestic expenditure on R&D as a percentage of GDP, 2009 or latest available year
The previous Fig 3 illustrates the percentage of GDP devoted to R&D activities. This indicator reflects
national R&D intensity by presenting gross domestic R&D expenditure relative to the size of the national
economy.
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The 2007 regional averages, in descending order, are:
2.6% for North America;
1.9% for Oceania;
1.6% for Europe;
1.6% for Asia;
0.6% for Latin America and the Caribbean;
0.4% for Africa.
Conclusion
What we learned ?
Development has been a Research practice from the beginning
Development original mission has been modified for firm’s interests
The average of world’s top 10 leaders in gross domestic expenditure on R&D activity is assigned for
50% to Development
The average of world’s top 10 leaders in gross domestic expenditure on R&D funding is assigned for
56,1% to business enterprise
The so called “developing countries” present the lowest level of percentage of GDP devoted to R&D
activities
Guilds
Guilds have contributed at patent laws but they indicated an interesting approach to social organization as
well.
A guild9 is an association of craftsmen in a particular trade. The earliest types of guild were formed as
confraternities of workers. … An important result of the guild framework was the emergence of universities
at Bologna, Paris, and Oxford around the year 1200; they originated as guilds of students as at Bologna, or
of masters as at Paris. … The structures of the craftsmen's associations tended everywhere in similar
directions: a governing body, assisting functionaries and the members' assembly. The governing body
consisted of the leader and deputies. … The guild was made up by experienced and confirmed experts in
their field of handicraft. They were called master craftsmen. Before a new employee could rise to the level of
mastery, he had to go through a schooling period during which he was first called an apprentice. After this
period he could rise to the level of journeyman. Apprentices would typically not learn more than the most
basic techniques until they were trusted by their peers to keep the guild's or company's secrets.
9 Guild - Wikipedia
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Like journey, the distance that could be travelled in a day, the title 'journeyman' derives from the French
words for 'day' (jour and journée) from which came the middle English word journei. Journeymen were able
to work for other masters, unlike apprentices, and generally paid by the day and were thus day labourers.
After being employed by a master for several years, and after producing a qualifying piece of work, the
apprentice was granted the rank of journeyman and was given documents (letters or certificates from his
master and/or the guild itself) which certified him as a journeyman and entitled him to travel to other towns
and countries to learn the art from other masters. These journeys could span large parts of Europe and were
an unofficial way of communicating new methods and techniques, though by no means all journeymen
made such travels - they were most common in Germany and Italy, and in other countries journeymen from
small cities would often visit the capital. After this journey and several years of experience, a journeyman
could be received as master craftsman, though in some guilds this step could be made straight from
apprentice. This would typically require the approval of all masters of a guild, a donation of money and
other goods (often omitted for sons of existing members), and the production of a so-called masterpiece,
which would illustrate the abilities of the aspiring master craftsman; this was often retained by the guild.
The medieval guild was established by charters or letters patent or similar authority by the city or the ruler
and normally held a monopoly on trade in its craft within the city in which it operated: handicraft workers
were forbidden by law to run any business if they were not members of a guild, and only masters were
allowed to be members of a guild. Before these privileges were legislated, these groups of handicraft
workers were simply called 'handicraft associations'. The town authorities might be represented in the guild
meetings and thus had a means of controlling the handicraft activities. This was important since towns very
often depended on a good reputation for export of a narrow range of products, on which not only the
guild's, but the town's, reputation depended. Controls on the association of physical locations to well-known
exported products, helped to establish a town's place in global commerce — this led to modern trademarks.
The economic consequences of guilds have led to heated debates among European historians. Ogilvie
argues that their long apprenticeships were unnecessary to acquire skills, and their conservatism reduced
the rate of innovation and made the society poorer. She says their main goal was rent seeking, that is, to
shift money to the membership at the expense of the entire economy. Epstein and Prak's book rejects
Ogilvie's conclusions. Specifically, Epstein argues that guilds were cost-sharing rather than rent-seeking
institutions. They located and matched masters and likely apprentices through monitored learning. Whereas
the acquisition of craft skills required experience-based learning, he argues that this process necessitated
many years in apprenticeship.
Conclusion
What we learned ?
Guild played an important role to support knowledge and skills of a specific social domain
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Guild formalized an organizational approach based on different levels of knowledge and skills, and
on three concepts seen as sequential steps in the process leading to innovation:
o imitation (as demanded to apprentice)
o invention (as demanded to journeyman)
o innovation (as demanded to craftsmen)
Guild, made up by experienced and confirmed experts in their field of handicraft called master
craftsmen “applied” what we know as the linear model of innovation:
o research (as knowledge)
o development (as apprenticeship)
o production (as journeyman)
o diffusion (as journey)
The Italian Renaissance
The Renaissance10 was a cultural movement that spanned roughly the 14th to the 17th century, beginning in
Florence in the Late Middle Ages and later spreading to the rest of Europe. The term is also used more
loosely to refer to the historical era, but since the changes of the Renaissance were not uniform across
Europe, this is a general use of the term. As a cultural movement, it encompassed a flowering of literature,
science, art, religion, and politics, and a resurgence of learning based on classical sources, the development
of linear perspective in painting, and gradual but widespread educational reform. Traditionally, this
intellectual transformation has resulted in the Renaissance being viewed as a bridge between the Middle
Ages and the Modern era. Although the Renaissance saw revolutions in many intellectual pursuits, as well
as social and political upheaval, it is perhaps best known for its artistic developments and the contributions
of such polymaths as Leonardo da Vinci and Michelangelo, who inspired the term "Renaissance man".
The Italian Renaissance11 began the opening phase of the Renaissance. Although the origins of a movement
that was confined largely to the literate culture of intellectual endeavor and patronage can be traced to the
earlier part of the 14th century, many aspects of Italian culture and society remained largely Medieval; the
Renaissance did not come into full swing until the end of the century. The word renaissance (Rinascimento
in Italian) means “rebirth”, and the era is best known for the renewed interest in the culture of classical
antiquity after the period that Renaissance humanists labeled the Dark Ages. The Italian Renaissance is best
known for its cultural achievements. Accounts of Renaissance literature usually begin with Petrarch (best
known for the elegantly polished vernacular sonnet sequence of the Canzoniere and for the craze for book
collecting that he initiated) and his friend and contemporary Boccaccio (author of the Decameron). Famous
vernacular poets of the 15th century include the renaissance epic authors Luigi Pulci (author of Morgante),
Matteo Maria Boiardo (Orlando Innamorato), and Ludovico Ariosto (Orlando Furioso). 15th century writers
such as the poet Poliziano and the Platonist philosopher Marsilio Ficino made extensive translations from
both Latin and Greek. In the early 16th century, Castiglione (The Book of the Courtier) laid out his vision of
10 Renaissance - Wikipedia 11
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the ideal gentleman and lady, while Machiavelli cast a jaundiced eye on "la verità effettuale della cosa"—
the actual truth of things—in The Prince, composed, humanist style, chiefly of parallel ancient and modern
examples of Virtù. Italian Renaissance painting exercised a dominant influence on subsequent European
painting (see Western painting) for centuries afterwards, with artists such as Giotto di Bondone, Masaccio,
Piero della Francesca, Domenico Ghirlandaio, Perugino, Michelangelo, Raphael, Botticelli, Leonardo da
Vinci, and Titian. The same is true for architecture, as practiced by Brunelleschi, Leone Alberti, Andrea
Palladio, and Bramante. Their works include Florence Cathedral, St. Peter's Basilica in Rome, and the Tempio
Malatestiano in Rimini (to name a only a few, not to mention many splendid private residences: see
Renaissance architecture). Finally, the Aldine Press, founded by the printer Aldo Manuzio, active in Venice,
developed Italic type and the small, relatively portable and inexpensive printed book that could be carried in
one's pocket, as well as being the first to publish editions of books in Ancient Greek.
Lorenzo de' Medici12 was an Italian statesman and de facto ruler of the Florentine Republic during the
Italian Renaissance. Known as Lorenzo the Magnificent (Lorenzo il Magnifico) by contemporary Florentines,
he was a diplomat, politician and patron of scholars, artists and poets. His life coincided with the high point
of the early Italian Renaissance; his death marked the end of the Golden Age of Florence. The fragile peace
he helped maintain between the various Italian states collapsed with his death. Lorenzo de' Medici is buried
in the Medici Chapel in Florence. Lorenzo's grandfather, Cosimo de' Medici, was the first member of the
Medici family to combine running the Medici bank with leading the Republic. Cosimo, one of the wealthiest
men in Europe, spent a very large portion of his fortune in government and philanthropy. He was a patron of
the arts and funded public works. Lorenzo's father, Piero 'the Gouty' de' Medici, was also at the center of
Florentine life, active as an art patron and collector. His mother Lucrezia Tornabuoni was a poet and writer
of sonnets. She was also a friend to figures like Luigi Pulci and Agnolo Poliziano and became her son's
advisor when he took over power. Lorenzo's court included artists such as Piero and Antonio del Pollaiuolo,
Andrea del Verrocchio, Leonardo da Vinci, Sandro Botticelli, Domenico Ghirlandaio, and Michelangelo
Buonarroti who were involved in the 15th century Renaissance. Although he did not commission many
works himself, he helped them secure commissions from other patrons. Michelangelo lived with Lorenzo and
his family for five years, dining at the family table and attending meetings of the Neo-Platonic Academy.
Lorenzo was an artist himself, writing poetry in his native Tuscan. Cosimo had started the collection of books
which became the Medici Library (also called the Laurentian Library) and Lorenzo expanded it. Lorenzo's
agents retrieved from the East large numbers of classical works, and he employed a large workshop to copy
his books and disseminate their content across Europe. He supported the development of humanism
through his circle of scholarly friends who studied Greek philosophers, and attempted to merge the ideas of
Plato with Christianity; among this group were the philosophers Marsilio Ficino, Poliziano and Giovanni Pico
della Mirandola.
Renaissance humanism13 was an intellectual movement in Europe of the later Middle Ages and the Early
Modern period. The 19th-century German historian Georg Voigt (1827–91) identified Petrarch as the first
Renaissance humanist. Paul Johnson agrees that Petrarch was "the first to put into words the notion that
the centuries between the fall of Rome and the present had been the age of Darkness.” According to
Petrarch, what was needed to remedy this situation was the careful study and imitation of the great
12 Lorenzo de’ Medici - Wikipedia 13
Humanism - Wikipedia
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classical authors. For Petrarch and Boccaccio, the greatest master was Cicero, whose prose became the
model for both learned (Latin) and vernacular (Italian) prose. Once the language was mastered
grammatically it could be used to attain the second stage, eloquence or rhetoric. This art of persuasion
[Cicero had held] was not art for its own sake, but the acquisition of the capacity to persuade others — all
men and women — to lead the good life. As Petrarch put it, 'it is better to will the good than to know the
truth.' Rhetoric thus led to and embraced philosophy. Leonardo Bruni (c.1369–1444), the outstanding
scholar of the new generation, insisted that it was Petrarch who “opened the way for us to show how to
acquire learning". The line from a drama of Terence, “Homo sum, humani nihil a me alienum puto”,
meaning " I am a man: and I deem nothing pertaining to man is foreign to me", known since antiquity
through the endorsement of Saint Augustine, gained renewed currency as epitomizing the humanist
attitude. The influence of Terence’s felicitous phrase on Roman thinking about human rights can hardly be
overestimated.
Two hundred years later Seneca ended his seminal exposition of the unity of mankind with a clarion-call:
“There is one short rule that should regulate human relationships. All that you see, both divine and
human, is one. We are parts of the same great body. Nature created us from the same source and
to the same end. She imbued us with mutual affection and sociability, she taught us to be fair and
just, to suffer injury rather than to inflict it. She bid us extend or hands to all in need of help. Let that
well-known line be in our heart and on our lips: Homo sum, humani nihil a me alienum puto."
It was in education that the humanists' program had the most lasting results, their curriculum and methods
“were followed everywhere, serving as models for the Protestant Reformers as well as the Jesuits. The
humanistic school, animated by the idea that the study of classical languages and literature provided
valuable information and intellectual discipline as well as moral standards and a civilized taste for future
rulers, leaders, and professionals of its society, flourished without interruption, through many significant
changes, until our own century, surviving many religious, political and social revolutions. It has but recently
been replaced, though not yet completely, by other more practical and less demanding forms of education”.
Just as artist and inventor Leonardo da Vinci — partaking of the zeitgeist though not himself a humanist —
advocated study of human anatomy, nature, and weather to enrich Renaissance works of art, craft, and
practical techniques to improve the formal teaching of Aristotelian philosophy at the universities, helping to
free them from the grip of Medieval Scholasticism. Thus, the stage was set for the adoption of an approach
to natural philosophy, based on empirical observations and experimentation of the physical universe,
making possible the advent of the age of scientific inquiry that followed the Renaissance.
Conclusion
What we learned ?
Italian renaissance played an important role to support culture as knowledge and skills of human
domain
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Italian renaissance based its innovation on three sequential concepts:
o imitation (as study of the great classical authors)
o invention (generated by the common and central role of human being)
o innovation (best known for its cultural achievements)
Italian renaissance, made up by experienced and confirmed experts in their field of handicraft
called master craftsmen “applied” what we know as the linear model of innovation:
o research (based on studies and empirical observations)
o development (as common ingenium)
o production (as personal ingenium)
o diffusion (as adoption of an approach to natural philosophy)
Leonardo da Vinci
One of the most known and important man of the Italian Renaissance is Leonardo da Vinci.
Leonardo di ser Piero da Vinci14 (April 15, 1452 – May 2, 1519) was an Italian Renaissance polymath:
painter, sculptor, architect, musician, scientist, mathematician, engineer, inventor, anatomist, geologist,
cartographer, botanist and writer. Leonardo has often been described as the archetype of the Renaissance
Man, a man of "unquenchable curiosity" and "feverishly inventive imagination". He is widely considered to
be one of the greatest painters of all time and perhaps the most diversely talented person ever to have
lived. According to art historian Helen Gardner, the scope and depth of his interests were without precedent
and "his mind and personality seem to us superhuman, the man himself mysterious and remote". Marco
Rosci points out, however, that while there is much speculation about Leonardo, his vision of the world is
essentially logical rather than mysterious, and that the empirical methods he employed were unusual for his
time. Renaissance humanism saw no mutually exclusive polarities between the sciences and the arts, and
Leonardo's studies in science and engineering are as impressive and innovative as his artistic work. These
studies were recorded in 13,000 pages of notes and drawings, which fuse art and natural philosophy (the
forerunner of modern science), made and maintained daily throughout Leonardo's life and travels, as he
made continual observations of the world around him. Leonardo's notes appear to have been intended for
publication because many of the sheets have a form and order that would facilitate this. In many cases a
single topic, for example, the heart or the human foetus, is covered in detail in both words and pictures, on a
single sheet. Why they were not published within Leonardo's lifetime is unknown. A recent and exhaustive
analysis of Leonardo as Scientist by Frtijof Capra argues that Leonardo was a fundamentally different kind
of scientist from Galileo, Newton and other scientists who followed him. Leonardo's experimentation
followed clear scientific method approaches, and his theorizing and hypothesizing integrated the arts and
particularly painting; these, and Leonardo's unique integrated, holistic views of science make him a
forerunner of modern systems theory and complexity schools of thought. Giorgio Vasari, in the enlarged
edition of Lives of the Artists (1568), introduced his chapter on Leonardo da Vinci with the following words:
14
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“In the normal course of events many men and women are born with remarkable talents; but
occasionally, in a way that transcends nature, a single person is marvelously endowed by Heaven
with beauty, grace and talent in such abundance that he leaves other men far behind, all his actions
seem inspired and indeed everything he does clearly comes from God rather than from human skill.
Everyone acknowledged that this was true of Leonardo da Vinci, an artist of outstanding physical
beauty, who displayed infinite grace in everything that he did and who cultivated his genius so
brilliantly that all problems he studied he solved with ease.”
Conclusion
All these quotations and historical references imply a vision toward the past ?
Sure not. The choice to present some historical events is finalized to increase the value of what already
have been done in the history, from human being for human being. If so, which is the role of present ?
Present has a fundamental role because complementary and son of the past. In other words would mean
no sense try to propose a new model of Social Innovation without considering nowadays real life and the
concrete opportunities available today. Godin’s and Carty’s concepts, beyond historical examples, show us
a pre-existing alternative at the role of research “subordinated” at capitalistic economy. In fact the
proposed vision about basic and applied research is here revised to underline how “policy for science” can
trigger infinite capabilities if compared at the value model of human being as Subject of a culture like
Renaissance one. On the contrary “science for policy”, as we noted based on capitalistic economy values,
does not allow the same opportunities due to the capitalistic concept and aim, whether seen as
“transcendent” to human being, or as advocate of a “thing culture” more and more perceived as a status
symbol and an expression of money power.
For all these reasons we can affirm that a paradigm shift from capitalistic economy to social economy does
not require a change in the meaning of research concept, both basic and applied. This for sure obvious for
basic research (in the meaning of knowledge), the same we can state for applied research where, according
to Carty the latter “is always conducted with the purpose of accomplish some utilitarian end”15, where
utilitarian does not imply “market value” but, from latin “that for can be usable”, individually or socially.
If these arguments are true the Godin’s linear model of innovation maintain its soundness, because the
sequential association of Development and (Production and) Diffusion at the previous Research steps refers
to the social values of reference (see Fig 4).
15 J.J. Carty (1916), The Relation of Pure Science to Industrial Research, Reprint and Circular Series, No. 14, National Research Council
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Fig 4 – The Linear Model of Innovation driven by Social Value
Next steps requires an analysis concerning with:
the identification of the Social Economy, as defined nowadays
the check if there are Social Values that drive Policy for Science, that in turn drive Social Economy
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The Social Economy - a common point of view
What is Social Economy ?
Social economy16 refers to a third sector in economies between the private sector and business or, the public
sector and government.
Economies may be considered to have three sectors:
1. the business private sector, which is privately owned and profit motivated;
2. the public sector which is owned by the state on behalf of the people of the state;
3. the social economy, that embraces a wide range of community, voluntary and not-for-profit
activities.
Sometimes there is also reference to a fourth sector, the informal sector, where informal exchanges take
place between family and friends.
The third sector can be broken down into three sub-sectors; the community sector, the voluntary sector and
the social enterprise sector:
The community sector includes those organizations active on a local or community level, usually
small, modestly funded and largely dependent on voluntary, rather than paid, effort.
The UK's National Council for Voluntary Organizations describes the voluntary sector as including
those organizations that are: formal (they have a constitution); independent of government and
self-governing; not-for-profit and operate with a meaningful degree of volunteer involvement.
According to the UK government's definition, the social enterprise sector includes organizations
which "are businesses with primarily social objectives whose surpluses are principally reinvested for
that purpose in the business or in the community, rather than being driven by the need to maximize
profit for shareholders and owners".
The social economy spans economic activity in the community, voluntary and social enterprise sectors. The
social economy usually develops because of a need to find new and innovative solutions to issues (whether
they be socially, economically or environmentally based) and to satisfy the needs of members and users
which have been ignored or inadequately fulfilled by the private or public sectors. By using solutions to
achieve not-for-profit aims, it is generally believed that the social economy has a distinct and valuable role
to play in helping create a strong, sustainable, prosperous and inclusive society.
Defining the limits of the social economy sector is made especially difficult by the ‘moving sands’ of the
political and economic context. Consequently organizations may be ‘part in, part out’, ‘in this year, out the
next’ or moving within the social economy’s various sub-sectors. There is no single right or wrong definition
of the social economy. Many commentators and reports have consciously avoided trying to introduce a tight
definition for fear of causing more problems than they solve.
16
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The Social Enterprise Compass
One solution can be to locate organizations in the Social Enterprise Compass17. The Social Enterprise
Compass locates enterprises and organizations in the field between the business private sector and the
public sector. The social enterprise compass is easily illustrated (see Fig 5.):
Fig 5 – The Social Enterprise Compass
The horizontal axis
On the horizontal axis each enterprise / organization is categorized by its ownership. On the left side the
ownership lies with the public authorities whereas on the right side the ownership lies with private people.
So the distinctive feature is the ownership of the enterprise:
Is it private? Def.: The term “private industry” contains all economic activity that deals with the
capital of one or many private owners with a view to making profits. The capital owners bear the
risk.
Or is it public? Def.: The term “public authorities” contains all economic activity where the public
authorities possess the capital on either European, federal, regional or local level. That includes all
nationalized and public industries.
17
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The vertical axis
On the vertical axis, each enterprise / organization is categorized by the primary objective of the enterprise.
The dimensions range between social purpose on the top and commercial purpose at the bottom of the axis.
On the vertical axis an organization reaches the top, i.e. the social purpose is the primary objective of the
enterprise, if you fulfill the following criteria:
A. Ethical concept - core definition for enterprises / organizations of the social economy:
this core definition is the ideal of an enterprise / organization. Only these enterprises / organizations
belong to the social economy whose ideal is a clearly defined ethical concept.
B Mission - (key identification):
the primary objective of the enterprise is the improvement of the life situation and the chances of
disadvantaged people as well as social cohesion and support.
C Social economic creation of value and appropriation of earnings - qualitative key identification:
the profits and the resources are verifiably reinvested for the benefit of disadvantaged people.
If the criteria A, B and C are totally fulfilled, an organization can locate itself on top of the vertical axis.
There is one last criteria which is not definitional but a describing feature:
D Intermediary function - Social economical enterprises / organizations have an intermediary function
between public and private.
If none of the criteria above is fulfilled or the primary object of the enterprise is the commercial purpose
then an enterprise / organization is located on the bottom of the vertical axis.
Location between social and commercial purpose
If the criteria above are only partly fulfilled the enterprise is located between the top and the bottom of the
vertical axis according to its self-definition.
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The Social Economy - a new point of view
Thanks to a major study18 being done by a team at the Young Foundation with support from NESTA, on the
methods being used to generate and grow social innovation around the world, we can fix some key points
on Social Economy and Innovation:
Background
The architecture of the social economy
The process of social innovation
Methods and supports
Background
We are currently in the midst of a period of transformative innovation. Two sometimes clashing, sometimes
coinciding, themes give it its distinctive character. One comes from technology: the spread of networks and
global infrastructures for information and social networking tools. The other comes from culture and values:
the growing emphasis on the human dimension, on putting people first, giving democratic voice and
starting with the individual and relationships rather than systems and structures. … For most of the 20th
century innovation policy and practice was primarily concerned with hardware and with the market
economy. Social innovation took place – in daily life, social movements and around the state. But it has only
recently come to be a conscious concern of policy discussion for three main reasons:
1. There are a range of problems that existing structures and policies have found it impossible to crack
– such as climate change, the world wide epidemic of chronic disease, and widening inequality.
These are all issues that cut across boundaries, between the state, the market and the household,
between different parts of the state, and between national states themselves. As a result the classic
tools of government policy on the one hand, and market solutions on the other, have proved
inadequate.
2. The prospective cost of dealing with these (quite apart from the rising costs of other social issues)
threatens to swamp public budgets … but effective prevention has been notoriously difficult to
introduce, in spite of its transparent economic and social benefits.
3. As in earlier technological and social transformations, there is a disjunction between the structures
and institutions formed in a previous period and the requirements of the new. This is as true for the
private as for the social economy. New paradigms tend to flourish in areas where the institutions
are most open to them, and where the forces of the old are weak. …
18 Murray R, Mulgan G, Caulier‐Grice J (2011), How to Innovate: the tools for social innovation, The Young Foundation, NESTA (Work in progress – circulated for comment)
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We are currently at one of the rare moments when a new set of paradigms challenges the previous ones. In
place of the old world of mass production, with its standardized products and services, its reliance on
deskilled labour, its cumbrous system of innovation, its focus on scale and all that enables it, its centralized
structures of organization and information, and the long standing disjunction of home and overseas
markets, we have seen the emergence of a new world. This new world is one formed around distributed
systems as much as centralized structures. It handles complexity not by standardization and simplification
imposed from the centre, but by distributing complexity to the margins – to the local managers and workers
on the shop floor, as much as to the consumers themselves. Those at the margins have what central
managers can never have – knowledge of specificity ‐ specificity of time, of place, of particular events and in
the consumer’s case of need and desire. We enter a world of differentiation and the dissolution of the norm.
The micro can now be aggregated to the macro. In place of scale (which is the simple issue) the new
concerns are with economies of scope, of information, and most strikingly of trust.
In factories and workshops we have witnessed over the past twenty years a radical reorientation of the
governing principle of production – something like a magnetic reversal – from a push‐through to a
pull‐through economy: … this is itself a revolution within a revolution, enabling a whole productive system
to meet a differentiated demand. The role of the consumer changes as a result, from a passive to an active
player, not only as a navigator and even shaper of the emerging kingdom governed by the tyranny of
choice, but as a producer in their own right. … Firms that have failed to adapt to this new world have either
gone out of business or shifted production to the zones of cheaper labour in Eastern Europe and Asia
Similar shifts can be seen in the social economy. The mechanisms of service and institutional transformation
are different within government and in grant funded economies from those in competitive markets. They
also differ around the world, shaped by institutional, political and cultural histories which have lent very
different roles to the state, civil society and the market. … In both the market and the state, the rise of
distributed networks has coincided with a marked turn towards the human, the personal and the individual.
This has brought a greater interest in the quality of relationships: it has led to lively innovation around
personalization and to, a new world rich in information and feedback…. Some of what is happening in the
market entails the adoption of ideas from the social sector – collaboration, cooperation, trust‐based
networks, user involvement in service design, for example, are all familiar concepts in the social field and
are now seen as on the cutting edge of business.
A Hybrid Economy
So how can the innovations needed to address ever more pressing (and costly) social and environmental
demands be generated in the social economy, and grown in ways that spread power rather than
concentrating it?
Traditionally, those social tasks for which the private market is inadequate have fallen to three quite
different economies, the state, the household, and the grant economy. Each has its own means of obtaining
resources, each its own structures of control and allocation, its own rules and customs for the distribution of
its outputs, and its principles of reciprocity. In the industrial economies of the twentieth century, nations
reached different settlements about the border lines and responsibilities of each. In Western Europe and
Canada, the state played the leading role. In the USA a tradition of resistance to ‘big government’ left
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households to manage as best they could, with a greater role played by charitable foundations (though still
with a large state by historical standards, and one that has played a role in funding a number of major
commercial innovations).
Social innovation, in this context, refers not to any particular sector of the economy, but to innovation in the
creation of social outputs and outcomes regardless of where they spring from. This is illustrated by the
shaded area in Fig 6. None of the four economies is wholly concerned with the social economy as defined
above ‐ production oriented to social needs and aspirations. The market economy itself, although largely
private, nevertheless engages in the social economy in the form, for example, of corporate social
responsibility or movements like fair trade. The household, like the market, is in part purely private, but
forms a critical part of the social economy both through labour in the household, and via the contribution to
the substance and direction of social production of informal networks, associations and social movements.
The grant economy, on the other hand, is by its nature largely concerned with the delivery of services as a
counterpoint to the private market, as is much state spending. The shaded area therefore represents those
parts of each of the four sub economies that together constitute the social economy.
Fig 6 - The Social Economy
The boundaries and responsibilities of each of these social sectors as established in the period of mass
production are being brought into question, as is the distinction between the market and the social
economy. The binary opposition between the market and the state, which was the fulcrum of twentieth
century politics (and its ideologies), is being contextualized into a more complex set of relations as the
market reaches into the state, and the state into the market, and as both find new accommodations with
civil society and the grant economy.
The old boundary criteria of private and public goods, the one being assigned to the market and the other to
the state, is no longer adequate. It is not just a question of the characteristics of a good or a service and its
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intrinsic capacity to be commodified that determines whether it should be undertaken in the private or the
public sphere. It is also a question first of the kind of market, the kind of state, and the nature of the
interface between them, and second of how the state and the market relate to those two other economic
types, the household and the grant economy.
When it comes to considering social innovation, therefore, the inquiry can in no way be confined to any one
sector – such as the so called third sector. It has to cover all these sectors, and the dynamics of the relations
between them. Its capacity to innovate will depend as much on innovation in the structures, the goals and
the cross border relations of each of the four economic spheres, as on any specific role that each has
traditionally played. Reaching beyond the limitations of categories allows us to explore how markets can be
re-institutionalized so that they meet the goals of the social economy – so those operating in the market can
include in their goals and their calculus what was previously excluded. This is the burden of much recent
environmental policy that seeks to redefine the responsibilities of private property, to internalize costs and
benefits that were previously external, reframing regulations and incentives to this end. It runs in parallel
with the question of how to re-institutionalize the state, including transforming concepts of public property
and the means of ‘commensurating’ social production, and reshaping the state’s methods of allocation and
control.
Considering social innovation as stemming from multiple sources encourages us to recognize emergent
trends from outside the state and the private market. One is new forms of mutual action between
individuals within the household economy – whether in the form of open source software, or web based
social networking around specific issues. … The implications of peer‐to‐peer collaboration of this kind for
many of the contemporary social economic issues have only begun to be explored, and prompt the question
of whether and how such systems of highly distributed innovation and mutual support can be encouraged –
how do they relate to the state and the market, and to their terms of funding and employment. Who will
provide the necessary tools and platforms? Who will determine the protocols? Can they be self managed, or
will they need hosts and intermediaries? These are some of the questions thrown up by this explosive area
of innovation.
Another striking development has been the growth of social enterprise operating within the market. These
are companies with a social mission, often socially owned and investing their profits in pursuit of their
mission. One of the most visible examples of social enterprise is the Grameen Bank and its network of 27
enterprises and imitators, whose driving goal is to improve the incomes and well being of the poorest. The
rural villages of Bangledesh, where its work is centered, could hardly be farther from Silicon Valley, yet
Grameen has many of the characteristics of the new paradigm – a highly distributed credit network in
39,000 villages, by far the most extensive in the country, a method for personalizing loans and easing their
repayment, and a support structure based on networks of women. As a social enterprise, it is majority
owned and governed by its borrowers, 98% of them women. Significantly it calls its lending ‘micro’ credit
and it has grown both by the spread of its model internationally. … How this is done and its underlying
economic and organizational model has a significance that extends well beyond the rural poor of
Bangladesh. Here the point is that Grameen operates in the market with the same freedom and discipline as
a private company, but with a social goal, social ownership and a social distribution and re‐investment of
profits.
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The economics of social innovation
Over the past twenty five years the predominant economic discourse in relation to the social economy has
been a modern version of the classical debate between Smith and Ricardo, the one emphasizing micro
commodity exchange through the market, the other macro distribution through the agency of the state. In
modern dress, the former has been applied to the public sector as a means of reducing costs and increasing
efficiency. It has been advanced through the actual or simulated commodification of what had previously
been commensurated and distributed according to the non market conventions of public finance. The latter
has struggled with the question of state led redistribution in the context of the international mobility of
capital and entrepreneurial labor. Yet neither of these traditions adequately addressed the economy wide
issues of accumulation and what Schumpeter later called capitalism’s process of creative destruction, with
its focus on the material characteristics of production and technological innovation. We want to suggest a
Schumpeterian approach to social innovation, that is, examining what type of economy can generate and
accumulate social innovation, and what if any are the processes of creative destruction in the social
economy that allow new ways of meeting social needs to supersede or reconstitute the old. Traditionally,
the primary site of innovation has been taken to be the private market because it has well developed
structures, mechanisms and incentives that drive innovation. States and the grant economy still dominate
fundamental research into new cures and new technologies. But they cannot match the scope and diffusion
of innovation seen in the market. The household – that most distributed of economic systems – generates
ideas but on its own lacks the capital, surplus time and organizational capacity to fully develop them. The
question suggested by developments such as social networking, open source software, and Grameen, is
whether the social economy can develop a capacity to foster and generalize innovations that matches the
private market. Can it move from a responsive filling of the gaps left by the private market, to generate an
economic dynamic of its own?
Posing the issue of social innovation in this way suggests, in order to mark three areas of social innovation,
that there are three principal levels of inquiry that we need to pursue:
1° The institutional conditions: a macro one about innovations in the structures and mechanisms of
the social economy, that would strengthen its capacity to develop and diffuse innovation. It asks
what types of institutions and modes of economic operation are necessary to generate adequate
responses to the social imperatives now confronting us.
2° The distinct processes: a micro enquiry into the process of social innovation, also in the
Schumpeterian tradition, about how new ideas are generated and tested out in practice, how they
can establish themselves sustainably, how they extend and spread, and how they can confront,
by‐pass or transform the restrictive structures of the old order.
3° The systemic innovations: an inquiry into innovation in productive systems. What are the
strategies and processes that lead to the re‐shaping of the complex topography of critical areas of
social production and distribution ‐ of who does what, how and with whom – in ways that reflect the
changing paradigm.
The three levels of inquiry mark three areas of social innovation.
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The architecture of the social economy
Here, we outline the architecture for three principal levels of the inquiry, and our analysis of the shape of
the social economy. The next three diagrams deal with the reconfiguration of the first of these spheres (the
institutional conditions for Social innovation) of the social economy. In Fig 7, we set out the four sub
economies and suggest some of the key areas of change for the promotion of endogenous innovation.
Fig 7 - The architecture for the analysis of social innovation
These sub economies are not in any way isolated. Though they have their own distinct economic
mechanisms, they form part of an inter‐connected system, and it is the relationships between them which
are as significant as the relationships within them. The enquiry will consider the key interfaces and how they
can be modified in order to promote innovation.
Formally, if there are four sub economies, there will be six interfaces, as shown in Fig 8 below.
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Fig 8 - The six key interfaces of the social economy
State Grant
State Market
State Household
Central to these interfaces is the way finance crosses the borders, inwards in the form of taxation
and fees, outwards in the form of grants, procurement and investment. There are many others,
including the regulatory, fiscal and legal conditions determined by the state, and the platforms and
tools provided by the state for the actors in other parts of the social economy. Each of these can be
critical for innovation (for example changes in personal tax to allow new forms of caring) and are
subject to innovation in themselves (for example the creation of community interest company status
as an element in company law).
Market Grant
These relations include, for example, corporate sponsorship, charitable donations, mentoring and
various types of corporate social responsibility. There are also emergent forms of productive
collaboration between private corporations and NGOs,...combining commercial provision of goods
and services with mutual support and roles for NGOs.
Market Household
This is of course the space where firms operate, selling products and services to households and
engaging individuals as workers. In some cases firms have used the particular relations that
characterize households as a channel for selling. The extent to which social networks and a gift
economy operate in the sphere of consumption has long been remarked on by anthropologists for
example. … But there are broader connections as in the way social movements have allied with
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sections of the private sector to press for systemic changes – for example the current political
economy of environmental change.
Household Grant
Between the grant and the household economies there are also two way movements, of donations
and volunteering from one direction to a multitude of services from the other. One of the most
sensitive areas of this interface is when associations and movements from the household economy
partially transfer themselves into the grant economy, appointing professionals paid for by
subscriptions or grants.
These examples are the tidy, analytical depiction of the interfaces. In practice, however, each sub economy
may relate simultaneously to a number of the others. For example, the state can promote social innovation
in the market as well as the grant economy by applying certain policy and regulatory levers such as
minimum trading standards and compulsory targets for the employment of people with disabilities. This is
also the case with household generated innovation; there are a number of areas to explore that cut across
and apply to the three interfaces between the household and the other sub economies. … For example the
development of new systems of support economy … closely linked to the development of co‐creation and
co‐production representing a partnership between households and professionals…. There is then the whole
subject of household time and how it relates to social production and innovation. One of the questions here
is how if at all it would be possible to acknowledge the voluntary time contributed by the household sector,
either individually or collectively, in some form of credits for cash or public rights and reduced obligations.
This is already becoming a key issue in relation to ageing – how to recognize and reward different types of
care and volunteering. Finally, there is the complex issue of managing space – moving beyond the sharp
public/private distinction, to degrees of the social, and how public space is allocated and administered. This
question is of course central to current discussions of urban and rural policy (from lighting, to curfews, to
concierges and street wardens, and of course to many aspects of urban transport). Here we want to focus
on how spatial issues of this kind bear on the capacity for the household sector to innovate – for example in
forms of recreation
In the following Fig 9, we have picked out a couple of key examples for each of the six interfaces. These
examples are illustrative rather than exhaustive but are meant to highlight the issues of relevance to the
present enquiry.
Fig 9 – Example of the six key interfaces of the social economy
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Conclusion
What we learned ?
Social economy definition has evolved from the previous identification with the third sector
Social economy evolution and growth must be holistic with reference to all its sub-economy
The different sub-economies composing social economy have equal rights and duties
Social economy so defined doesn’t include a clear definition of the social value that in turn drive
the policy for science pushing the social economy itself
So, the previous figure of the linear model of innovation for social economy, which should be driven by
social value, should be updated like this
Fig 10 – The Linear Model of Innovation for Social Economy
What about Social Innovation ?
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Part 2 – Applied Research
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The Social Economy - the institutional conditions for Innovation
The following sections cover some of the key enablers, methods or tools for social innovation – the
background conditions, funding flows and institutions that support the emergence of new ideas in the four
sub economies of the social economy, illustrated by the shaded area in the diagram below: the public, grant,
market and household economies. We examine these sub economies one by one.
Fig 11 - The Social Economy
The Public Economy
A key to transforming the conditions for encouraging the generation and adoption of innovation within the
public sector and through its procurement, grants and investment programs is a change in the tax
relationship, in public budgeting and in the structure of financial accountability. Where the sources of funds
and accountability shift from upwards to outwards there is greater scope for innovation and for the
prompting of innovation.
Fig 12 - The Public Economy
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Public Finance: methods to generate internal innovation
Changing the tax relationship
Voluntary taxes (es: Community Pledgebanks, public subscriptions, lotteries, and competitions)
Local bonds (es: Tax Increment Financing - TIF, Business Improvement Districts - BID)
Quasi Currencies and environmental permits (es: Packaging Recovery Notes, emissions trading,
targets, rewards and penalties)
Hypothecated taxes and obligations for households and corporations (es: BBC license fee, London
Congestion Charge, Climate Change Levy, Extended Producer Responsibility)
Socializing risk (es: new forms of social insurance for long term care to create incentives for
providers to develop innovative solutions which will reduce demand for services)
Budgetary practice to promote internal innovation
Top slicing (es: departmental budgets for innovation)
Dedicated innovation funds and internal public venture funds (es: the UK’s ‘Invest to Save’ budget
for cross‐cutting innovations, The Enterprise Challenge in Singapore)
Outcome based budgets which can be used to promote innovation (es: cross cutting outcome based
budgets)
Ring fencing financial gains from innovation (es: for initiators and developers)
Innovation‐related pay (es: institutional, team and personal performance bonuses linked to
innovation)
Distributed accountability and democratic innovation
Participatory budgeting (es: citizens define local priorities and allocate public money accordingly)
Large scale government‐led exercises (es: involve the public in generating ideas and possibilities)
Citizen petitions (es: citizen online petitions, the petitioners who receive the most support get the
chance to discuss their ideas in parliament)
Parliamentary structures to develop citizen ideas (es: Korea’s Tribunis Plebis a committee of senior
legislators committed to putting ideas into legislation)
Methods for participation and ideas generation and deliberation (es: the methods promoted by
AmericaSpeaks, as well as Deliberation Days, Consensus Decision‐Making, Fishbowls)
Online petitions (es: the No 10 website in the UK which allows citizens to petition the Prime
Minister)
‘Open’ Government (es: including open forms of consultation and participation)
Ideas and imagination Banks (es: to draw in public ideas for improving public services like Seoul
Metropolitan government launched its Imagination Bank in 2006 and in 2007 received 74000
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proposals, 140 per day. All have to receive a reply within a week. 1300 were adopted wholesale and
many others partially)
Processes for involving children (es: in generating innovations, decision‐making, urban design,
planning, school management)
Opt out rights for communities (es: to design and run their own services)
Audit and inspection regimes (es: assess and support innovation)
Open source auditing (es: a mechanism for public accountability)
Tracking the public finances (es: public balance sheet accounting, the transparency of public finance
in Estonia)
User feedback on service quality (es: web based models such as patientopinion.org.uk and
Iwantgreatcare.org that hold service providers to account, or the Kafka Brigades in the Netherlands)
‘Open Politics’ (es: online platforms such as MoveOn.org and MeetUp.org which mobilize and
galvanize grassroots support for political parties)
A public medium of exchange
Direct payments and personal service budgets (es: the UK’s In Control, which enable people to
choose, arrange and pay for their own care and services)
Personal public accounts for credits and debits (es: the Danish Nemkonto Easy Account where
Danish citizens and companies nominate one of their bank accounts as their Nemkonto Account into
which all payments to and from public institutions are transferred directly. Such accounts would
enable the design of new public products, including loans and payments)
Smart cards (es: an extended version of the Oyster Card which would enable innovation by
connecting service users with multiple providers and by enabling improved data flows)
Transaction charges and payments (es: fees, variable charges, penalties, rewards, discounts, and
hypothecated fees for services by the state such as the transportation, waste and local food
transactions scheme in Curitiba, Brazil)
Public investment, loans and means of payment
Hybrid financing and joint ventures (es: the finance models used by Woking Borough Council and
the London Climate Change Agency (LCCA) to develop sustainable energy programmes)
Differential tax, credits, allowances and estate duties for personal public investment (es: those for
higher education, elder care and environmental investment)
Valorizing public investment by internalizing public returns (es: Community Land Trusts)
Financial instruments for preventative and service investment (es: the UK ‘Invest to Save’ budget,
the US Justice Re‐Investment programme and contingent revenue bonds such as the proposed Social
Savings or Social Impact Bonds)
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Public labor: redesigning the labor contract
Public sector unions (es: the Fire Brigades Union in the UK which helps firemen find part time
employment as benefits advisors alongside their roles as firemen)
Front line workers as innovators (es: the nurses as social entrepreneurs program developed at
Oxford University’s Saïd Business School)
Tithes of working time (es: to generate collaborative public innovation, as extension of the Google
model whereby staff spend one day a week developing their own projects. The parallel in the public
sector could include making it easier to take sabbaticals to work on socially innovative projects)
Incentives for successful innovation (es: pension increments for proven innovation)
Secondments (es: public sector employees into skunk works, innovation teams and projects to
develop service innovation)
New professional definitions (es: to promote service innovation to include intramediaries,
intermediaries and innovation managers)
New funding and management methods (es: to separate project failure from redundancy including
a move from project to career employment terms and conditions)
Accreditation, search and recruitment of public innovators (es: commercial head hunters or
government agencies)
Innovation experience (es: a requirement for public advancement and formally integrated into the
appraisal process)
Formation and training (es: National School of Government – NSG, the Improvement and
Development Agency for local government – IdeA)
Organizational forms
Internal
Individuals (es: innovation champions and entrepreneurs, or individual consultants working as sole
traders)
Specialist innovation units (es: skunk works)
In house innovation and spin off teams (es: the Innovation Unit in the UK or Mindlab in Denmark
which was set up by the Ministry of Economic and Business Affairs, the Ministry of Taxation, and the
Ministry of Employment to bring together government, private enterprises and the research
community under one roof to promote user‐centered innovation)
Quality circles (es: to drive continuous improvement)
Innovation agencies (es: the NHS Institute for Innovation and Improvement in the UK)
Public venturing (es: the venture capital fund to promote green technologies being considered by
the Indian government)
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Brokers & intermediaries
Intermediaries (es: Innovation Xchange in Australia and the Innovation Exchange and Innovation
Unit in the UK)
Mobile innovation units (es: specialised consultancies or service design agencies such as RED at the
Design Council)
Innovation accelerators (es: NESTA’s Public Services Innovation Laboratory)
Inside/outside grant administration and commissioning bodies (es: Futurebuilders which offers
financial support to third sector organizations to deliver publics services)
Bridging foundations (es: NESTA and Edge that aim to connect research and practice)
Sector specialist institutions and academies (es: WRAP and sectoral training colleges)
Professional collaboratives
Communities of practice (es. bring together practitioners in formal mutual learning)
Service collaborative (es: health collaborative)
Professional action learning groups (es: the Innovation Unit’s Next Practice model)
Metrics and assessment
Operational metrics (es: for statistical production control to spot emergent problems as prompts for
innovation, including the example of renal treatment in the US)
Comparative metrics (es: benchmarking to identify sources for learning)
Financial metrics (es: granular metrics of conventional methods and services)
Social and environmental metrics (es: Social Return on Investment - SROI, methods for measuring
Social Impact and cost/benefit analyses)
User oriented and generated metrics (es: surveys used to gather chronic disease data in Sheffield
and metrics geared to self‐monitoring such as those used by Activemobs in Kent)
Cross government innovation metrics (es: the Government Innovation Index developed by the
Government of South Korea to measure current levels of innovation, and the results of new
innovation)
Multi‐stakeholder dialogue and other forms of stakeholder assessment.
Assessment as learning (es: peer reviews and real time evaluation methods to promote
cross‐pollination such as NESTA’s evaluation of Health Launchpad)
Mission guardians, golden shares and independent reporting
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The circuit of information
Integrated user centered data (es: Electronic Patient Records in the UK)
Electronic data bases (es: the Electronic Court Records for King County, Washington)
Search services for user and professional accessibility (es: platforms such as NHS Direct)
User generated feedback systems and response (es: fixmystreet.com and
petitions.number10.gov.uk)
Citizen led traffic planning (es: the use of web tools for changing travel patterns)
Practitioner networks and communities of practice (es: those organized by the Improvement and
Development Agency for local government - IDeA)
Information brokers, editors, intermediaries and scouts (es: to search out and highlight innovative
practice)
Engaging contributors and recipients in service innovation (es: the work undertaken by design
consultancies like Think Public, Participle, Live Work and RED at the Design Council, or the Hope
Institute’s citizen teams around public service improvements)
The Grant Economy
Transforming the conditions for encouraging the generation and adoption of innovation within the grant
economy requires new kinds of finance, platforms, packages of support, and regulatory, governance and
accountability frameworks. There is a key role to be played by government and charitable foundations in
re‐shaping these structures.
Fig 13 - The Grant Economy
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Generation of Innovative projects
Competitions for technology ideas (es: Innocentive, X prizes, The Big Green Challenge and NESTA’s
Innovation Challenge in Mental Health)
Open Source soliciting of ideas for strategy, projects and grantees (es: Ashoka Changemakers, the
Case Foundation’s Make It Your Own Awards, the Nevada Community Foundation and the Omidyar
Network)
Community Angels for project generation (es: those supported by A Glimmer of Hope in Austin,
Texas)
Ideas banks (es: the Global Ideas Bank and the Hope Institute’s many methods for engaging citizens
in promoting ideas)
Finance
Grant giving
Direct funding for individuals (es: the grants given by UnLtd, The Skoll Foundation and Ashoka)
Fast grants (es: those distributed by the Sobrato Family Foundation)
Donor platforms (es: Kiva, GlobalGiving, Donors Choose, Altruistiq, Network for Good, Brazil’s Social
and Environmental Stock Exchange)
Initial Public Offerings – IPOs (es: Do Something or Teach for America)
Creative destruction: term limited charities and spending down assets (es: the John M. Olin
Foundation)
Competitions, prizes and challenge funds (es: the Community Development Fund’s Grassroots
Grants program in the UK)
Grant allocation through public voting (es: the ITV/Big Lottery Fund competition ‘The People’s 50
Million)
Grant recipient circles.
Micro grants for R&D (es: for concept development and prototyping)
Grants as investment (es: tapered grant funding, public equity and preference shares)
Grants as complements to innovation investment packages. (es: grant funding for off balance sheet
expenditure, for example Cordaid’s investment and development packages for commodity
development projects, or the UK’s DFID Frich grant program for UK market development for African
supply chains)
Inverse tapering (es: grant growth based on performance)
Endowment finance (es: the National Endowment for Science, Technology and the Arts – NESTA in
the UK)
Social innovation partnerships (es: tax holidays and contributions in kind)
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The grant relationship
Intermediaries for contributions in kind (es: labour and skills matching for volunteering, such as the
Taproot Foundation’s Service Grant program which provides not‐profits with pro bono marketing,
human resources and IT consulting services)
Philanthropic eBays (es: philanthropic platforms such as Volunteer Match)
Purchasing and commissioning
Outcomes based commissioning
Procurement as collaborative venturing (es: promoting disruptive innovation through public
procurement)
Collaborative procuring (es: for search, diversity, prototyping and scale)
Public contracting methods (es: enablement of small scale and innovative commissioning and
sub‐contracting)
Pre‐finance of service innovation development
Contestability and multiple providers to promote diversity of innovation
Exploratory service contracts to ensure overt funding of innovation discovery.
Secure service contracts as a basis for collateral.
Independent progress review bodies as safe ‘holders’ of innovation
Investment
Investment guarantees with future year payment of guarantees (es: the Sheffield model)
Public venture funding
Public investment aimed at social innovation growth strategies (es: the Social Investment Bank, the
Toronto Atmospheric Fund and Enterprise Boards)
R&D tax credits for the design and development of innovations.
Venture philanthropy focused on innovation in particular sectors (es: the Robert Wood Johnson
Foundation’s Pioneer Portfolio which specializes in health and IT)
Philanthropic mutual funds (es: the Acumen Fund and the Global Fund for Women)
Strategic investments to transform social sector provisioning (es: the Bill and Melinda Gates
Foundation’s investment in High Schools across America)
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Packages of Support
Support services for innovators (es: mentoring, information and advice, connections and networks,
public visibility, such as Cleveland’s Civic Innovation Lab in Michigan and the Social Innovation
Generator in Toronto, Canada)
R&D mentored funding prior to start up lending (es: Mondragon’s Caja Laboral)
Platforms, tools and protocols for innovation
Tools (es: Diabetes Agenda cards that help people imagine innovative alternatives)
Interactive platforms (es: internal platforms such as intranets, external platforms such as the BBC’s
Community Channel, hosted chronic conditions networks, the Open University and Enabled by
Design)
Service infrastructure (es: digital spines)
Support services (es: personal health and fitness coaches)
Found in translation (es: language facilities as sources of innovations for access and service design)
Physical incubators and co‐housing to promote cross‐pollination (es: the Mezzanine in the UK and
the Centre for Social Innovation in Toronto)
Governance and accountability
User and beneficiary representation on management boards (es: board champions for innovation
and pipeline reviews)
Innovation assessments commissioned by users and beneficiaries.
Members and associates as sources of innovation and review.
Metrics for venture philanthropy (es: those developed by Homeward Bound, a project to end
homelessness in the US, or ‘blended value’ measures and Social Return on Investment measures
used for stakeholder communications)
Regulatory, fiscal, legal and other conditions for extending the social economy
Planning and tax rules to promote creative economies (es: subsidized rent in arts districts including
SoHo in New York)
Legal forms and requirements (es: Community Interest Companies - CICs and the Charity
Commission’s public benefit test)
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Local public currencies (es: the Wörgl in Austria during the 1930s, or more recently, the Patacón in
Argentina)
New forms of property ownership (es: communities owning their assets such as the Goodwin Trust
in Hull, and Community Land Trusts, enabling new uses of land and buildings)
The Market Economy
Fig 14 - The innovation in the Market Economy
Generation and value creation
Pro‐ams as social innovators.
Social markets (es: Slivers of Time)
CSR and social uses of marginal business assets.
Finance
Micro credit for micro production (es: Grameen and BRAC in Bangladesh, and the multiple versions
of micro credit inspired by them, as well as much older traditions of micro‐credit in Europe)
Planning gain and other devices for generating commercial funding for social value.
Social stock markets (es. the subject of an ongoing Rockefeller Foundation study, and the Brazilian
social stock market which provides an online platform linking donors with projects).
Commercial investment aimed at social targets (es: Bridges Community Ventures in the UK)
Bank‐based funding for social enterprises and not‐for‐profits (es: Banca Prossima in Italy)
Philanthropic investment for growth (es: the CAN Breakthrough Social Investment Fund)
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Crowd funding (es: Myfootballclub.com as a web based co‐op to purchase and run a football club)
Organizations and ownership
Foundations as owners of corporations (es: the Bertelsmann Foundation and the Robert Bosch
Foundation)
Social enterprises, especially those with a strong asset base.
Businesses with social missions built into governance (es: Banca Intesa, the Coop Bank and Welsh
Water)
Extending the co‐operative economy in production (es: the ‘Third Italy, Mondragon and Peruvian
coffee co‐ops)
Consumer co‐ops (es: the Japanese food co‐ops)
Consumer shareholding as an instrument of social policy including (es: Cafédirect)
Social enterprise mutuals as aggregators of service provision from small social enterprises (es:
WorkVentures)
Socializing intellectual property (es: social needs in the case of AIDS drugs in Africa)
Social enterprise partnerships between corporations and not‐for‐distributed profits (es:
Grameen‐Danone)
Corporate not for profit management of social provision (es: Academy Schools in the UK and Charter
Schools in the US)
Information
Improving market information to achieve social goals (es: better food labelling, environmental
performance ratings and carbon footprints)
Social marks and brands to secure a premium for social innovation (es: ‘organic’, ‘forest
stewardship’ and ‘fair trade’)
Consortia for co‐operatives to search out innovative practice and support its dissemination and
adoption.
Social movement campaigns around corporate conduct (es: the Nestle baby milk campaign,
MacLibel).
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Regulatory, fiscal, legal and other conditions for generating innovation in the
social economy
Policy instruments to re‐make markets in order to promote the social economy (es: compulsory
targets including the employment of people with disabilities, regulations for renewable energy,
fiscal measures and planning conditions)
Exemptions and assistance (es: tax relief along the lines of the Enterprise Investment Scheme - EIS
for social enterprises)
Obligations and expectations (es: focused CSR)
The Household Economy
Fig 15 - The innovation in the Household Economy
Public spaces for social innovation
Mobilizing the street as a unit of innovation (es: concierges, guardians and wardens)
Extending public spaces for domestic production (es: allotments, parks, the new doctor’s surgeries,
street markets, community centers, internet libraries and street festivals)
Reclaiming the streets and managing public spaces with multiple uses (es: the Night for Women’ in
Bogotá, Columbia, or car free periods in Canadian cities)
Protests through activity (es: guerrilla gardening, or reverse strikes such as road building by the
unemployed in Sicily)
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Complaints Choirs – which gather groups of citizens to discuss complaints and turn into lyrics and
then perform as songs. The idea was first conceived in Finland; first put into practice in Birmingham
in England, and has now spread around the world.
Valorizing household time
Recognizing household time for social production by valorizing voluntary work and support (es:
public tax credits, community commissioning and grant supported projects)
Inter household reciprocity and forms of exchange including time banks (es: SPICE, Local Exchange
Trading Systems - LETS, local currencies and airtime as currency)
Creating productive time (es: social sabbaticals)
Flexible terms of formal employment to enable a sustainable informal economy.
The volunteer economy (es: organization, training, meaning and incentives for volunteers)
The New Mutualism
Enabling the informal social economy (es: mobs and mutual support services, local networks like
free cycle or lift share networks such as liftshare.org)
The support economy (es: advising, coaching, mediating, supplementing and communicating for
household production. This could include educational coaching service, relief and back up for home
careers, health coaches, birthing and post birth support and support teams for end of life care)
User groups (es: rail user groups or park user associations)
Informal‐formal partnerships (es: Green Communities, a national network of not for profit
organizations developing and delivering innovative green solutions to households and communities
across Canada.
Constructed households as sites of innovation
Residential communities for care and cure (es: moving beyond addiction at San Patrignano)
Group services for networks of households, generalizing the principle of sheltered accommodation.
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Social Movements
Social movements focused on lifestyle innovation and transformation (es: the feminist and green
movements but also including, for example, transition towns. There is a key role for pioneers, the
media and web‐based groupings)
Our Space: web based platforms for the household economy (es: freecycle.org)
The Social Economy - the process roots for Innovation
Between the policy and its realization lies the shadow. For many years politics centered on the content of
policy. In the past 20 years it has been forced to turn its attention to the shadow, and recognize that policy
and its means of realization are interwoven. We live in a post‐Enlightenment world, where the pragmatic
tradition of the interplay between thinking and doing, between theory and practice, offers an approach
appropriate to the inquiry outlined here.
We are, in other words, working in the tradition of John Dewey (and more recently of figures such as
Roberto Mangabeira Unger) rather than that of social engineers and planners. Who are these persons ?
John Dewey
John Dewey19 (October 20, 1859 – June 1, 1952) was an American philosopher, psychologist and educational
reformer whose ideas have been influential in education and social reform. Dewey was an important early
developer of the philosophy of pragmatism and one of the founders of functional psychology. He was a
major representative of the progressive and progressive populist philosophies of schooling during the first
half of the 20th century in the USA.
Although Dewey is known best for his publications concerning education, he also wrote about many other
topics, including experience, nature, art, logic, inquiry, democracy, and ethics.
In his advocacy of democracy, Dewey considered two fundamental elements—schools and civil society—as
being major topics needing attention and reconstruction to encourage experimental intelligence and
plurality. Dewey asserted that complete democracy was to be obtained not just by extending voting rights
but also by ensuring that there exists a fully formed public opinion, accomplished by effective
communication among citizens, experts, and politicians, with the latter being accountable for the policies
they adopt.
19
John Dewey - Wikipedia
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On Education
Dewey's educational theories were presented in My Pedagogic Creed (1897), The School and Society (1900),
The Child and the Curriculum (1902), Democracy and Education (1916) and Experience and Education
(1938). Throughout these writings, several recurrent themes ring true; Dewey continually argues that
education and learning are social and interactive processes, and thus the school itself is a social institution
through which social reform can and should take place. In addition, he believed that students thrive in an
environment where they are allowed to experience and interact with the curriculum, and all students should
have the opportunity to take part in their own learning.
The ideas of democracy and social reform are continually discussed in Dewey’s writings on education.
Dewey makes a strong case for the importance of education not only as a place to gain content knowledge,
but also as a place to learn how to live. In his eyes, the purpose of education should not revolve around the
acquisition of a pre-determined set of skills, but rather the realization of one’s full potential and the ability
to use those skills for the greater good. He notes that “to prepare him for the future life means to give him
command of himself; it means so to train him that he will have the full and ready use of all his capacities”. In
addition to helping students realize their full potential, Dewey goes on to acknowledge that education and
schooling are instrumental in creating social change and reform. He notes that “education is a regulation of
the process of coming to share in the social consciousness; and that the adjustment of individual activity on
the basis of this social consciousness is the only sure method of social reconstruction”.
In addition to his ideas regarding what education is and what effect it should have on society, Dewey also
had specific notions regarding how education should take place within the classroom. In The Child and the
Curriculum (1902), Dewey discusses two major conflicting schools of thought regarding educational
pedagogy. The first is centered on the curriculum and focuses almost solely on the subject matter to be
taught. Dewey argues that the major flaw in this methodology is the inactivity of the student; within this
particular framework, “the child is simply the immature being who is to be matured; he is the superficial
being who is to be deepened”. He argues that in order for education to be most effective, content must be
presented in a way that allows the student to relate the information to prior experiences, thus deepening
the connection with this new knowledge.
At the same time, Dewey was alarmed by many of the "child-centered" excesses of educational-school
pedagogues who claimed to be his followers, and he argued that too much reliance on the child could be
equally detrimental to the learning process. In this second school of thought, “we must take our stand with
the child and our departure from him. It is he and not the subject-matter which determines both quality and
quantity of learning”. According to Dewey, the potential flaw in this line of thinking is that it minimizes the
importance of the content as well as the role of the teacher.
In order to rectify this dilemma, Dewey advocated for an educational structure that strikes a balance
between delivering knowledge while also taking into account the interests and experiences of the student.
He notes that “the child and the curriculum are simply two limits which define a single process. Just as two
points define a straight line, so the present standpoint of the child and the facts and truths of studies define
instruction”. It is through this reasoning that Dewey became one of the most famous proponents of hands-
on learning or experiential education, which is related to, but not synonymous with experiential learning. He
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argued that “if knowledge comes from the impressions made upon us by natural objects, it is impossible to
procure knowledge without the use of objects which impress the mind”. Dewey’s ideas went on to influence
many other influential experiential models and advocates. Many researchers even credit him with the
influence of Project Based Learning (PBL) which places students in the active role of researchers.
Dewey not only re-imagined the way that the learning process should take place, but also the role that the
teacher should play within that process. According to Dewey, the teacher should not be one to stand at the
front of the room doling out bits of information to be absorbed by passive students. Instead, the teacher’s
role should be that of facilitator and guide. As Dewey (1897) explains it:
“The teacher is not in the school to impose certain ideas or to form certain habits in the child, but is
there as a member of the community to select the influences which shall affect the child and to
assist him in properly responding to these influences.”
Thus the teacher becomes a partner in the learning process, guiding students to independently discover
meaning within the subject area. This philosophy has become an increasingly popular idea within present-
day teacher preparatory programs.
Roberto Mangabeira Unger
Roberto Mangabeira20 Unger (b. March 24, 1947, Rio de Janeiro) is a Brazilian politician, social theorist,
and Harvard Law School faculty. He was a co-founder of the Critical Legal Studies movement, and his
subsequent writings on philosophy and social theory have been widely influential. His theories of false
necessity, formative context, and negative capability have laid the philosophical and theoretical
groundwork for reimagining and remaking social and political order.
The theory of false necessity claims that our social worlds are the artifact of our own human endeavors.
There is no pre-set institutional arrangement that our societies adhere to, and there is no necessary
historical mold of development that they will follow. Rather we are free to choose and develop the forms
and the paths that our societies will take through a process of conflicts and resolutions. However, there are
groups of institutional arrangements that work together to bring out certain institutional forms, liberal
democracy, for example. These forms are the basis of a social structure, and which Unger calls formative
contexts. In order to explain how we move from one formative context to another without the conventional
social theory constraints of historical necessity (e.g. feudalism to capitalism), and to do so while remaining
true to the key insight of individual human empowerment and false necessity, Unger recognized that there
are an infinite number of ways of resisting social and institutional constraints, which can lead to an infinite
number of outcomes. This variety of forms of resistance and empowerment (i.e. negative capability) make
change possible. Negative capability does not reduce the individual to a simple actor possessing only the
dual capacity of compliance or rebellion, but rather sees him as able to partake in a variety of activities of
self empowerment
20
Roberto Mangabeira Unger - Wikipedia
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Unger has long been active in Brazilian politics, working in opposition groups, advising presidential
candidates, and serving as the Minister of Strategic Affairs under Luiz Inácio Lula da Silva. He was an advisor
to Mexican president Vicente Fox,[1] and also taught Barack Obama at Harvard.
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The Social Economy - the process for Innovation We have identified six stages21 that take ideas from inception to impact. These stages are not always
sequential (some innovations jump straight into ‘practice’ or even ‘scaling’), and there are feedback loops
between them. They can also be thought of as overlapping spaces, with distinct cultures and skills. They
provide a useful framework for thinking about the different kinds of support that innovators and
innovations need in order to grow.
1. Prompts, inspirations and diagnoses
2. Proposals and ideas
3. Prototyping and pilots
4. Sustaining
5. Scaling and diffusion
6. Systemic change
Prompts, inspirations and diagnoses
In this stage we include all the factors which highlight the need for innovation – such as crisis, public
spending cuts, poor performance, strategy – as well as the inspirations which spark it, from creative
imagination to new evidence. This stage involves diagnosing the problem and framing the question in such a
way that the root causes of the problem, not just its symptoms, will be tackled. Framing the right question is
halfway to finding the right solution. This means going beyond symptoms to identifying the causes of a
particular problem.
Framing the question
All innovations start with a central idea. But the idea itself is often prompted by an experience or event or
new evidence which brings to light a social need or injustice. Some organisations initiate the prompts
themselves – using feedback systems to identify possible problems. Creative leaders can use symbols and
demonstrations to prompt social imagination. In many cases, research, mapping and data collection are
used to uncover problems, as a first step to identifying solutions. One of the critical challenges at this stage
is in identifying the right problem. A ‘good’ problem contains within it the seeds of the solution. The trick is
in framing the question.
21
Murray R, Caulier‐Grice J, Mulgan G (2010), The Open Book of Social Innovation, The Young Foundation, NESTA
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Triggers and inspirations
Here we describe some of the triggers and inspirations that prompt innovation, that demand action on an
issue, or that mobilize belief that action is possible.
Some examples include: Crisis, Efficiency savings, Poor performance, New technologies, New evidence,
Urban acupuncture.
Recognizing problems
Problems need to be recognized. Too often they are hidden, or marginalized. Or there is a belief that
nothing can be done about them. Much research is about bringing problems to light. A lot of politics is
about getting problems a hearing.
1. Research and mapping
Many innovations are triggered by new data and research. In recent years, there has been a rise in the use
of mapping techniques to reveal hidden needs and unused assets. The Latin origin of the word evidence
(evidentia) is to make clear and visible, and visibility generates ideas.
Some examples include: Mapping needs, Identifying differential needs and capacities, Mapping physical
assets, Mapping systems, Mapping flows, Communities researching themselves, Participatory Rural
Appraisal, Ethnographic research techniques, Action research, Literature surveys and reviews
2. The circuit of information
New needs can also be brought to the fore through effective feedback systems. Such systems can help
practitioners and front line staff understand the needs of users and better tailor services accordingly.
Some examples include: Feedback systems, Integrated user-centered data, Citizen-controlled data, Holistic
services, Tools for handling knowledge across a system
3. New perspectives
New ideas are often prompted by new ways of seeing that put familiar things in a new light. These may be
paradigms or models, and may be encouraged by formal roles that are designed to help organizations think
in fresh ways.
Some examples include: Generative paradigms, Generative ‘scripts’, Changing roles, Thinkers in Residence,
A-teams
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4. Making problems visible and tangible
Social phenomena are not automatically visible. One of the crucial roles of social science, and of statistics, is
to bring patterns to the surface that are otherwise invisible to people living within them, or governing them.
Seeing an issue in a new way can then prompt more creative thinking about alternatives.
Some examples include: Tools for visibilità, Walking, Media Spotlight
5. Commanding attention
In today’s media-intensive environment, one of the most valuable resources is attention. Without it, social
change is painfully slow. A key stage in many innovations is securing people’s attention – particularly of
those with power.
Some examples include: User and public pressure, Campaigns
From symptom to cause
Diagnosing problems is a first step to developing solutions. A key challenge is to get to the underlying causes
of a problem. To a hammer every problem looks like a nail. It’s always easier to deal with symptoms rather
than causes. Some of the methods for digging deeper involve the analysis of systems while others involve
mobilizing people’s own experiences and perspectives.
Some examples include: The diagnostic process, Diagnostic professions, Systems thinking models
Proposals and ideas
This is the stage of idea generation. This can involve formal methods – such as design or creativity methods
to widen the menu of options available. Many of the methods help to draw in insights and experiences from
a wide range of sources.
Imagining Solutions
There are a series of methods, especially within the field of design, which bring people together to develop
solutions. Often this is called ‘co-design’. Increasingly, some of these approaches are being used within the
public sector to re-design services.
Some examples include: User-led design, Re-designing services with users and producers, Engagement of
ex-users, Web-based tools for co-design, Creative thinking methods, Forum theatre, Continuous
improvement methods, Quality circles, Applying proprietary knowledge to social issues, Engaging citizens
through media,
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Thinking differently
New solutions come from many sources – e.g. adapting an idea from one field to another, or connecting
apparently diverse elements in a novel way. It’s very rare for an idea to arrive alone. More often, ideas grow
out of other ones, or out of creative reflection on experience. They are often prompted by thinking about
things in new or different ways.
Some examples include: Starting with the user, ‘Positive deviance’, Reviewing extremes, Rethinking space
Open innovation
Open innovation describes the process of harnessing the distributed and collective intelligence of crowds. It
is based on a number of principles, including: collaboration, sharing, self-organization, decentralization,
transparency of process, and plurality of participants. The term was first used by Henry Chesbrough to
describe a new model of product development based on the free flow of information and ideas across
departments and organisations.5 It has taken on a wider meaning and application thanks to the internet,
which has enabled large numbers of people to interact and participate at a relatively low cost.6 Over the
last few decades, there has been an explosion of methods designed to tap the public’s imagination for ideas,
perhaps in part a reaction against excessive deference to professions, and the idea that ‘the expert knows
best’. Many of these methods have been greatly helped by the ability of the internet to draw in a far wider
range of people and ideas.
Some examples include: Calls for ideas, Ideas marketplaces, Competitions and challenges, Ideas banks, City
ideas banks, Video booths, Suggestion boxes
Participation
Many governments, at every tier, are now trying to find ways of engaging the public in shaping what they
do, not just through elections every few years. These methods are still being experimented with, and are as
much about creating a culture of openness to ideas as they are about generating ideas themselves.
Some examples include: Large scale government-led exercises, Platforms for engaging citizens, Methods for
participation, idea generation and deliberation, Processes for involving children, ‘Wiki government’,
Participatory planning, Parliamentary structures to develop citizen ideas, Citizen petitions, Citizen juries,
Citizen’s panels, Legislative theatre,
Facilitating participation
There are also a range of techniques – widely used in the developing world – for engaging participants in
more effective and meaningful ways. Many meetings remain unproductive and uncreative they may not
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always be the place where new ideas first come into people’s heads, but they play a crucial role in
innovation. However they are decisive in shaping ideas and building support. Much attention is now being
given to meetings to make them more effective – sometimes with much more open processes, sometimes
with much more formal structures. Face to face meetings remain the most important in generating
commitment to innovations, but increasingly technologies of all kinds are helping to transform meetings,
enabling people to interact verbally, visually, and through simulations.
Some examples include: Events and conferences for networking and learning, Seedcamp, Virtual meetings,
Webinars, Dialogue Café, Open space events, Participatory workshops, Seating arrangements,
Institutions
There are a range of organizations and multidisciplinary teams involved in the generation of workable ideas.
Elsewhere, we look at institutions involved in all stages of innovation and across all sectors, but here we
look at the innovation animators, those who can bring in different perspectives, and come up with
innovative solutions.
Some examples include: Think tanks, Do tanks, Design labs
Prototyping and pilots
This is where ideas get tested in practice. This can be done through simply trying things out, or through
more formal pilots, prototypes and randomized controlled trials. The process of refining and testing ideas is
particularly important in the social economy because it’s through iteration, and trial and error, that
coalitions gather strength (for example, linking users to professionals) and conflicts are resolved (including
battles with entrenched interests). It’s also through these processes that measures of success come to be
agreed upon.
Prototypes, pilots and trials
As an idea progresses through multiple stages of rapid prototyping, it faces many challenges: the feasibility
of making the product, delivering the service, how to deal with particular issues, what the economics look
like, and how it could be made cheaper. The driving principles at this stage are speed, keeping costs low,
tangibility and feedback loops from users and specialists.
Some examples include: Prototyping, Fast prototyping, Slow prototyping, Proof of concept testing, Beta
testing, Partnership pilots, Public pilots and experiments, Randomized Controlled Trials, Whole System
Demonstration Pilots, Open testing
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Finance for emerging ideas
A wide range of financial tools can be used at these early stages: small grants, convertible loans, to quasi
equity, prizes, direct commissions, and tendering. Some of the most useful approaches link money to
development.
Some examples include: Grants and support for early ideas, Small grants, Challenge funds, Prizes and public
challenges, Funding of networks, Funding for incubation, In-house venturing capacities, Paying for time,
Vouchers, Collective voice and credits, Funding public private social partnerships, Direct commissions,
Tendering for results, Creating new markets through procurement
Sustaining
This is when the idea becomes everyday practice. It involves sharpening ideas (and often streamlining
them), and identifying income streams to ensure the long term financial sustainability of the firm, social
enterprise or charity, that will carry the innovation forward. In the public sector this means identifying
budgets, teams and other resources such as legislation.
Outside the public sector, sustaining an innovation will involve six key things:
A business model that runs parallel to the core idea of the venture and which sets out how it can
become sustainable
A governance model that provides a clear map of control and accountability, as well as protective
safeguards (not least to protect it from predators if the project is a success)
Sources of finance, both start-up capital in the short term and income streams over the longer term
A network and communications model to develop what we refer to as the venture’s ‘relational
capital’
A staffing model including the role of volunteers
A development plan for operational systems – including management information, reporting and
financial systems, IT, supply chain systems and systems for risk management
These will be translated into an economic or business plan, which details the service or initiative, how it will
be provided, by whom, with what inputs, how much it will cost, and how it will generate income.
Creating a business
Turning a good idea into something sustainable outside of the public sector depends on a business model –
a clear idea of how it will generate a sufficient income stream that covers more than costs. Effective supply
and effective demand need to be brought together. Effective supply means that whatever is being provided
has been shown to work and to be cost-effective. Effective demand refers to the willingness of someone to
pay for what’s on offer, which may be a public agency or the public themselves.
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Some examples include: Innovative business models, Business strategies, Incomes and outcomes, Business
plans, Business plan assessment methods
Ownership and organizational form
There comes a point when every venture has to decide what organizational form to take, what kind of
decision making and accountability processes to adopt, and which kinds of information and financial
management systems to put in place. These decisions can be costly and time consuming. But getting it right
early on provides structures and systems which act as skeletons that help hold the organization together.
Forms of ownership set out rules related to an organization’s mission, its governance structures, and how its
yield is distributed. But ownership can also be how a project mobilizes support, encouraging a sense in
others that the project is theirs. In the social economy, ownership is an ambiguous concept. Its
organizational structures are the site of contending pressures of goals and interests. The organization may
have a social goal of benefitting others, but to do so it involves those with some measure of private interests
– finance, staff, suppliers, and purchasers. Some may exercise their interests at arm’s length – and their
market or financial power may be such as to reduce the social project to little more than a sub-contractor or
agent, severely restricting the autonomy of the owners. But others may seek closer involvement in the
project’s direction. How can the forms of ownership and governance accommodate these pressures and turn
them to good account?
Some examples include: Informal structures, Private companies, Adapted private companies, Limited
Liability Partnerships, Co-ops and Associations, Mutuals, Partnerships, Charities, Community Interest
Companies
Governance
Ownership structures bring with them important dynamics that may help or hinder the organization in
realizing its mission. The best forms of ownership and governance reinforce relational capital, creating a
source of resilience for when the enterprise goes through difficult times.
Some examples include: Boards, Boards for innovation, Membership involvement, Stakeholder governance,
Open guides, Consumer shareholding, Gold Standards and Golden Shares
Organization and management models
Some examples include: Hierarchical organizations committed to social purposes, User orientation and
autonomous work groups, Distributed organizations, Dimensions of management, Managing systems and
structures to maintain innovation
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Operations
The distinctive value and values of a social venture show up not just in its structures but in its operations –
how it works with others, uses technologies or works in partnership.
Some examples include: Socially-oriented supply chains, Socially-oriented demand chains, Shared backroom
economies, Collaborative technologies
Relational capital
New ventures put much of their energy into securing financial capital – money to invest in fixed assets on
the one hand, and working capital on the other. But relational capital is just as important. This is both the
knowledge and trust built up between a venture and its users and suppliers, and the relationships between a
venture and its staff and volunteers. Conventional accounting takes little account of this intangible capital,
yet in all social ventures it is the foundation of their strength, and of their distinctiveness. We use the
concept of relational capital to capture the quality of relationships
within which economic exchanges take place. This is the issue of greatest relevance for a social venture, as
its fortunes depend on the range and depth of its relationships that. These relationships are multifaceted.
They include the nature of its connections: to users and investors; to suppliers and distributors; and with its
own staff, board and volunteers. With many of them there will be formal agreements, but whereas in the
private market economy relationships take place across a territory demarcated by the interests and
boundaries of private property and contract, for a social venture the boundaries are more porous – internal
and external interests mesh. It is one of its greatest potential assets that a social venture can attract
support and resources from outside itself, as well as motivation from within, on the basis of its ideas and the
way it works to realise them. This creates particular issues for management.
Some examples include: Keeping it ‘open’, Systems for user feedback, Web presence, Marketing and
branding, A working museum, Open events, Open forms of intellectual property, Formation for developing
skills and cultures, Values-based policies for people and pay, Valuing the voluntary
Venture finance
Every innovation process requires some finance. For social ventures it is key that the sources of finance
should share the venture’s social goals as the primary driver of the enterprise. This may not always be
possible. Raising capital may involve some compromise with the providers of capital, but the goal should
always be to find ways for the core finance to come from those who share the venture’s mission. … To
finance new ventures there are a range of ethical banks and social funding agencies devoted to supporting
new and expanding ventures. All forms of finance bring with them power relationships, which can
sometimes threaten the values and relationships which the venture is built on. To guarantee that the initial
venture funding remains subordinate to the values of the social mission, enterprises can raise social equity,
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limit the quantity of common shares, and seek subordinated loans from sources ready to share early risk
without demanding a counterbalancing share in the project’s equity.
Some examples include: Grant funding, Loan finance, Equity, Crowdfunding, Public share issues, Social
Impact Bonds, Venture philanthropy
Sustaining innovations through the public sector
Sustaining ideas in the public sector involves different tools to those needed in markets or for social
ventures. There are similar issues of effective supply (the proof that a particular model works) and effective
demand (mobilizing sources of finance to pay for the idea or service).
Some examples include: Business cases within the public sector, Public policy, Public programs, Public
regulations
Scaling and diffusion
At this stage there are a range of strategies for growing and spreading an innovation – from organizational
growth, through licensing and franchising to federations and looser diffusion. Emulation and inspiration also
play a critical role in spreading an idea or practice. Demand matters as much as supply: how market
demand, or demand from commissioners and policymakers is mobilized to spread a successful new model.
This process is often referred to as ‘scaling’, and in some cases the word is appropriate, as the innovation is
generalized within an organization or the organization itself expands. But scaling is a concept from the mass
production age, and innovations take hold in the social economy in many other ways, whether through
inspiration and emulation, or through the provision of support and know-how from one to another in a
more organic and adaptive kind of growth.
Generative diffusion
There are marked differences in the spread and diffusion of innovations between the social and market
economies. The private economy is structured to reserve the benefits of an innovation to its own
organization or to those licensees or franchisees willing to pay for it. The social economy – being primarily
oriented around social missions, favours the rapid diffusion of an innovation, rather than keeping it private.
This is one reason why the social economy has less compulsion to organizational growth and more towards
collaborative networking as a way of sharing innovation. As a result of these differences, the spread of a
social innovation tends to be a more complex flow-like process of interaction and modification. We refer to
it as ‘generative diffusion’ – ‘generative’ because the adoption of an innovation will take different forms
rather than replicate a given model, ‘diffusion’ because it spreads, sometimes chaotically, along multiple
paths. Irrespective of the particular type of growth, the successful diffusion of an innovation depends on
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effective supply and effective demand: effective supply refers to the growth of evidence to show that the
innovation really works. Effective demand refers to the willingness to pay. Both are needed – but sometimes
the priority is to prove effectiveness while in other cases the priority is to create demand – both by
persuading people that there is a need to be met, and then persuading people or organizations with the
ability to pay that they should do so.4 This is rarely easy – people usually have good reasons to resist
innovations, and only adopt them if there are strong pressures (from competitors, peers, consumers,
bosses), strong incentives (clear advantages over what went before), or strong emotional motivations.
The spread of an idea also often depends on stripping out whatever is inessential. Ideas spread more easily
if they are simple; modular; and don’t require new skills. But complex ideas can also spread on a wide scale,
though this generally takes longer, and requires more investment in professional skills.
Inspiration
Some ideas spread because of their qualities as ideas – they are inherently inspiring, arresting, and
engaging. Relatively few, however, spread on their own – more often clusters of ideas spread together, each
creating the conditions for others to be received more easily.
Some examples include: Inspiration, Distributed diffusion through provision as a social movement
Diffusing demand
The promotion of social innovation has tended to focus on the supply side and how innovations can be
diffused among service providers through experts, intermediaries, and collaboration. However, we argue
that the design of services should start from the user, and that its diffusion should be approached from the
perspective of users, not least because they are in many cases also co producers. We also argue that a
distinction should be made between services where demand can be expressed in the market (for fair trade
or green goods, for example), those where demand is expressed through the state (lobbying for disability
provisions or swimming pools, for example), and those involving intermediate demand (public
commissioning on behalf of citizens).
Some examples include: Information for consumers, User groups and their campaigns, Promotion and
marketing of innovative services and programs, Brands and marks, Financial or other inducements, Social
targets
Scaling and diffusion in the public sector
Scaling in the public sector has some overlaps with other fields but also important differences. Governments
can grow an idea simply by legislating it, or turning it into a program. Or they can encourage it by
persuasion, or through the influence of regulators. The methods described above for sustaining an idea are
also key to spreading it, including defining the idea in policy or programs.
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Some examples include: Distributed diffusion through public policy, Endorsement by regulators, Creating
intermediate demand, Dissemination of best practice, Global diffusion and encouragement, Change through
standards
Commissioning and procurement
Governments are big customers of goods and services. Alongside initiation, escalation and embedding,
public procurement plays a role in relation to consolidation by purchasing services at scale.
Some examples include: Commissioning innovative services, Outcomes based commissioning, Developing
new markets, Contestability, Practice-based commissioning, Payment by results, Exploratory service
contracts, E-procurement, E-auctions, Framework contracts, Commitments from commissioners, Joint
commissioning, ‘Share in savings’ contracts, Personalized budgets
Suppliers of innovation
In particular, we will look at how the organizational structure can remain open and innovative, and reduce
the overhead costs of centralized production.
Some examples include: Developing organizational capacity, Growth through people, Mobilizing existing
organizational capacity, Support structures, Securing adequate supply chains for expanded production,
Adapting models, Open brands
Transmitters
We look at platforms as the nodes of the new economy, and at other ways in which users and originators
can engage in the evaluation and adaption of innovation.
Some examples include: Platforms, Diffusion through events, Trade fairs, , Diffusion through media,
Associations and quasi-professional bodies, Growth through intermediaries, Diffusion through the web,
Handbooks and how to do it guides, Barefoot consultants
Organization and scale
There are currently pressures to promote mergers and takeovers within the grant economy. However, we
suggest that in a distributed economy a different conception of scale is needed, one that focuses on
economies of information and communication, and structures that can deliver that. Organizations within
the social economy have less compulsion to organizational growth and more towards collaborative
networking as a means of sharing innovation.
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Some examples include: Organizational growth, Growth through collaboration, Small units in large systems,
The consortium model, Federations, Licensing, Social franchising, Mergers and acquisitions
Metrics to show what works and what deserves to be grown
There are many metrics for judging whether innovations are working – at various stages of development.
Metrics can play a decisive role in determining whether innovations are scaled up, or deserve to be. Over
several decades a great deal of work has gone into the design of measures of social value. A recent survey
found 150 different metrics in use in the non-profit sector. However, relatively few of these are actually used
to make decisions. One reason why this field has failed to make progress is that there is often confusion
between three different tasks performed by metrics: to provide funders or investors with data on impact;
and to provide a tool for organizations to manage their own choices internally; to better understand long-
term processes of social change and impact. Although these purposes overlap, any one metric cannot do all
three of these tasks simultaneously, and there are direct conflicts of interest between the players involved in
each of these. Here we list a few of the methods currently in use – most of which fall into the first category –
or provide a means for providers of money to judge between alternatives.
Some examples include: Standard investment appraisal methods, Cost-benefit analysis, Stated preference
methods, Revealed preference methods, Social accounting matrices, QALYs and DALYs (Quality- and
Disability-Adjusted Life Years), Patient-Reported Outcome Measurements, Value-added measures, Social
impact assessment, Social Return on Investment, Social accounting methods, Blended value methods,
Measuring public value, Life satisfaction measures, Methods within the built environment, Operational
metrics, Comparative metrics, Balanced scorecards, User-oriented and user-generated metrics, User
Experience Surveys, Outcome benchmarks, Assessment as learning
Systemic change
This is the ultimate goal of social innovation. Systemic change usually involves the interaction of many
elements: social movements, business models, laws and regulations, data and infrastructures, and entirely
new ways of thinking and doing. Systemic change generally involves new frameworks or architectures made
up of many smaller innovations. Social innovations commonly come up against the barriers and hostility of
an old order. Pioneers may sidestep these barriers, but the extent to which they can grow will often depend
on the creation of new conditions to make the innovations economically viable. These conditions include
new technologies, supply chains, institutional forms, skills, and regulatory and fiscal frameworks. Systemic
innovation commonly involves changes in the public sector, private sector, grant economy and household
sector, usually over long periods of time.
Systemic innovation is very different from innovation in products or services. It involves changes to concepts
and mindsets as well as to economic flows: systems only change when people think and see in new ways. It
involves changes to power, replacing prior power holders with new ones. And it usually involves all four
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sectors – business, government, civil society, and the household: models for thinking about innovation that
only look at one sector miss the crucial ways in which they interact. …
Systemic innovations can be suddenly pushed forward by a crisis or a disruptive technology. More often,
they are the result of slow but cumulative processes entailing changing infrastructures, behaviours, and
cultures. …
The very complexity of systemic innovation makes it hard to define specific tools which can advance it. Every
system has some unique properties, and unique power structures. But there are some common elements,
and looking back through history it is clear that strategies for systemic innovation usually include:
The formation of progressive coalitions that bring together different partners
Intensive processes to build up shared diagnoses and visions
Efforts to grow a critical mass of practical examples
New rights
Training a group of professionals and practitioners with both new skills and attitudes
Pre-empting inflexible conventional technologies that freeze disruptive forms of innovation.
Accessing professional and other expertise for the contest of evidence.
Implementing legal and regulatory devices to embed change.
Empowering the beneficiaries of the new system.
Such top-down efforts succeed only to the extent that they mobilize the enthusiasm and commitment of
thousands of practitioners.
Ideas that energize systemic innovations
We have shown how new frames and ideas can prompt innovation. These can be even more important in
giving shape to systemic changes – helping the participants to make sense of their changing roles. Here we
list a few of the generative paradigms that are prompting systemic innovation in some fields.
Some examples include: Distributed production, Changing the ‘scripts’ around services, Prevention,
Investing early, New models of the support economy, Low or zero carbon living, Holistic support models for
services, Personalized support services, Support models that mobilize citizen energy, Systemic drives to
energize and empower marginalized groups, Post-chronologism, Radical democratization, Trust-creating
devices
Infrastructures and interstructures to support new systems
Some new systems depend on infrastructures. Widespread broadband infrastructures, for example, are the
precondition for some new models of care in the home; mobile phone infrastructures may be the
precondition for organizing new models of low-cost banking.
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Some examples include: Creating new infrastructure, Data infrastructures, Platform infrastructures,
Rewiring economies, Technical innovations for key points in the chain
Formation of users and producers
Users and citizens often need to play a part in the design and implementation of new systems. They may
require new skills and approaches (what the French term ‘formation’) as may professionals and managers.
Some examples include: Innovation academies, Mutual help and mentoring by users, Engaging citizens in
whole system change processes, Support for new patterns of power and responsibility
Strategic moves that accelerate systems change
Every story of systemic innovation involves key moments when the tables are turned on older models and
incumbents.
Some examples include: Creating new evidence, Establishing working prototypes of the new system,
Designing and trialling platforms to trigger systemic innovation, Comprehensive pilots, Blocking technology,
Frames for change
Regulatory and fiscal changes
Almost every systemic change involves legislation and the state at some point. There are a few exceptions,
such as the rise of new online infrastructures for retailing. But every movement involved in profound
change, from the environment to equality, has depended on recognition of its principles in law. New
legislative and regulatory architectures can be the keys to unlocking systemic change, whether through new
rights or new trading or building standards, social and environmental performance requirements, or new
ways of handling or measuring value.
Some examples include: New rights, New responsibilities, New forms of property, Legal bans, Enforcement,
Formal classifications, Targets with penalties, Regulatory requirements, Tax and fiscal structures
Information, accounting and statistics
Information and accounting systems can block innovation – in many cases, they will need to be reorganised
to enable or reinforce systemic change. What gets measured shapes what gets done. In many fields,
attempts are underway to reshape measurement to better handle holistic systems effects. So while familiar
data on income, employment, diseases or educational achievement continues to be gathered, there is
growing interest in other types of measurement that may give more insights into what needs to be done
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Some examples include: Information systems that reinforce systemic change, Restructured public
accounting, Measures of true progress
Progressive coalitions and social movements
Social movements often act as champions of systemic alternatives, for example mobilising people with
disabilities to engage in the redesign of cities, and lobbying for reforms to legislation and regulation.
Progressive coalitions play a critical role in mobilizing support for systemic changes.
Some examples include: Social movements focused on lifestyle innovation and transformation, Growing
self-organizing social movements, Organizing formal coalitions for change
Systemic finance
We describe many different finance tools in other sections which can contribute to systemic change. For
investment funds to finance truly systemic ideas they need different methods to those used for investment
in established systems. At an early stage there is unlikely to be any clear revenue model, or any benchmarks
to draw on. Instead, assessments need to include some judgement of the broader direction of change in the
field as a whole; some judgement about the qualities of the key individuals; and some rough assessments of
the relational capital they bring. Not surprisingly, these tools and approaches are rare – and require a great
deal of confidence in the funding agency as well as in those receiving funds.
Some examples include: Public finance for systems change, The creation of new investment flows, Finance
for systemic prevention
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The Grant Economy – an economic evaluation
With respect the four sub-economies presented in previous sections only the grant economy has a partial
evaluation of his economy.
The Johns Hopkins Comparative Nonprofit Sector Project
The Johns Hopkins Comparative Nonprofit Sector Project (CNP)22 is a systematic effort to analyze the scope,
structure, financing, and role of the private nonprofit sector in a cross-section of countries around the world
in order to improve our knowledge and enrich our theoretical understanding of this sector, and to provide a
sounder basis for both public and private action towards it.
This project has increased the visibility of the civil society sector in policy debates worldwide. It grows out of
the increased need for basic information about civil society organizations as a result of a dramatic
"associational revolution"; the reappraisal of the respective roles of the market and the state that lies
behind it have focused new attention on the role of private, nonprofit organizations. Despite their growing
importance, however, these organizations remain poorly understood almost everywhere, making it difficult
to determine what their capabilities really are or to attract attention to the challenges they face.
The Johns Hopkins Comparative Nonprofit Sector Project was designed to fill these gaps in knowledge by
developing the first systematic body of information about this crucial, but long-overlooked, set of
institutions at the international level.
Objectives
More specifically, the Johns Hopkins Comparative Nonprofit Sector Project seeks to:
Document the scope, structure, financing, and role of the nonprofit sector for the first time in solid
empirical terms in a significant number of countries scattered widely throughout the world;
Explain why this sector varies in size and character from place to place and identify factors that
seem to encourage or retard its development;
Evaluate the impact these organizations are having and the contribution they make;
Publicize the existence of this set of institutions and increase public awareness of them; and
Build local capacity to carry on this work into the future.
Approach
To pursue these objectives, the Project utilizes a comparative empirical approach that features heavy
reliance on a team of Local Associates in the target countries, a common framework, set of definitions, and
22
Center for Civil Society Studies at the Johns Hopkins Institute for Policy Studies
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information-gathering strategies; and a network of national and international advisory committees to
oversee progress and help disseminate results.
Coverage
Project work began in 1990 in 13 countries and now extends to more than 40 countries spanning all the
regions of the world:
Fig 16 - The Johns Hopkins Comparative Nonprofit Sector Project Coverage
The Global Civil Society - Statistics23
Background
Work in 26 countries under the Johns Hopkins Comparative Nonprofit Sector Project has unveiled important
new information about the private, nonprofit sector throughout the world.
This set of organizations has attracted increased attention in recent years, but solid empirical information
on them has long been lacking. This “brief” summarizes some of the most salient findings from the work we
have undertaken to close this gap in Austria, Belgium, Finland, France, Germany, Ireland, Italy, the
Netherlands, Norway, Spain, Sweden, and the U.K. in Western Europe; the Czech Republic, Hungary, Poland,
Romania, and Slovakia in Central Europe; Argentina, Brazil, Colombia, Mexico, and Peru in Latin America;
and Australia, Israel, Japan, and the United States.
23 Johns Hopkins University (1999), Global Civil Society At-a-Glance, Major Findings of the Johns Hopkins Comparative Nonprofit Sector Project, Institute for Policy Studies Center for Civil Society Studies
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The focus of this work is on entities that are:
Organizations, whether formal or informal;
Private, i.e., not part of the apparatus of government;
Not profit-distributing, i.e., do not distribute profits to their owners;
Self-governing; and
Voluntary, i.e., non-compulsory.
Here are the key findings
1. A Major Economic Force
The nonprofit sector is a major economic force in the world. In the 26 countries for which we have
assembled data, nonprofit organizations as of the mid-1990s accounted for:
$1.2 trillion in expenditures;
31 million full-time equivalent workers, or 6.8 percent of the nonagricultural workforce including:
o 19.7 million full-time equivalent paid workers and
o 11.3 million full-time equivalent volunteer workers;
Six times more paid employees than work in the largest private firm in each of these countries, as
noted in Fig 175
Fig 17 - Paid employment in nonprofits vs. largest firm (26 countries, ca 1995)
2. A Truly Global Presence
Nonprofit organizations are not restricted to any one country or region: they are present in virtually every
part of the world. In particular, as noted in Fig 18:
In 4 of the 26 countries we examined (the Netherlands, Ireland, Belgium, and Israel), nonprofit paid
employment is a larger share of total employment than it is in the United States, long regarded as
the country with the most advanced nonprofit sphere.
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In 7 of the 26 countries, nonprofit paid employment alone exceeds 5 percent of the nonagricultural
workforce, and in 10 of these countries, nonprofit paid and volunteer labor exceeds 9 percent of the
nonagricultural workforce.
Generally speaking, the nonprofit sector is larger in developed countries than in developing ones,
but it still constitutes a significant force in parts of the developing world. Thus:
o Nonprofits employ 6 percent of the paid and volunteer labor force in Argentina and 4
percent in Peru;
o The nonprofit sector in the developing world goes well beyond the “NGOs” that have long
attracted the bulk of the attention and includes schools, hospitals, and other organizations.
Fig 18 - Nonprofit share of total employment, with and without volunteers, by country (ca 1995)
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3. Welfare Services Dominate
On average, two-thirds of all nonprofit paid employment is concentrated in the three traditional fields of
welfare services: education, health, and social services. But this pattern varies by country and region. In
particular, as reflected in Fig 19:
Education, social services, and health account for 73 percent of total nonprofit paid employment in
Western Europe;
In Central and Eastern Europe, by contrast, these fields account for only 40 percent of total
nonprofit employment while professional, cultural, and recreational activities absorb 45 percent;
In the other developed countries (Japan, the U.S., Israel, and Australia), health is by far the largest
component of the nonprofit sector;
In Latin America, nonprofit employment is concentrated most heavily in education.
Fig 19 - Composition of nonprofit paid employment, by region (ca 1995)
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4. Volunteer Involvement
On average, volunteers account for 2.4 percent of total nonagricultural labor, or over one-third of
nonprofit labor (see Fig 18)
In three countries (Sweden, Norway, and Finland) volunteers account for over half of the nonprofit
workforce (see Fig 18).
As shown in Fig 20, two major fields, social services and culture/recreation absorb more than half of
all volunteer time accounted for by nonprofits. The remaining fields account for roughly 5 to 8
percent each.
Relative to paid employment, volunteer labor is especially important in the field of environment and
advocacy.
In contrast, in the fields of health and education, volunteer involvement is considerably lower than
paid employment
Fig 20 - Composition of volunteering for nonprofit organizations, except places of worship (25 countries, ca 1995)
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5. Revenue Sources
Fees and charges, not philanthropy, are the major source of nonprofit income, followed closely by
government.
As shown in Fig 21, private philanthropy—from individuals, corporations, and foundations
combined— accounts for only 10 percent of nonprofit cash income on average.
By contrast, fees and other commercial income account for about half (51 percent) of all nonprofit
revenue.
Public sector payments account for 39 percent of total nonprofit revenue.
Fig 21 - Sources of nonprofit revenue, 1995 (26-country average)
These revenue patterns vary considerably among regions. Thus, as shown in Fig 22:
Public sector payments account for half (50 percent) of nonprofit income in Western Europe, but
only 15 percent in Latin America;
In Latin America, fees and charges account for 74 percent of nonprofit revenue;
In only one region (Central Europe) does private giving comprise significantly more than 10 percent
of nonprofit income, though with volunteering included, such income exceeds 20 percent of the
total in 19 of the 26 countries.
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Fig 22 - Sources of nonprofit revenue, by region (ca 1995)
With the value of volunteer work included, private philanthropy’s share of nonprofit income jumps from
10 percent to 28 percent, but the relative ranks of the three sources do not change (see Fig 23).
Fig 23 - Sources of nonprofit revenue with volunteers, ca 1995 (26-country average)
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6. Growth
Nonprofit organizations have been an important source of employment growth in recent years.
Employment in nonprofit organizations grew three times faster than overall employment in the
early 1990s in the eight countries for which time series data are available.
Fig 24 - Growth in nonprofit employment vs. total employment, 1990-1995 (8 countries)
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From Social Economy to Social Innovation
In conjunction with the previous documents I would like to conclude the 2° part of this project research
with a final presentation of the main issues faced by Innovation in Social Economy24. As the Social Economy
sections, most of the work that have been presented till now is mainly based on European experience but
most of the references can be applied at a more global level, also for the main meaning and impact of the
words Social, Economy and Innovation.
What is social innovation?
Definitions of social innovation abound and a casual observer can quickly become entangled in a debate
over meaning and nuance. In general, social innovation can be defined “as new responses to pressing social
demands, which affect the process of social interactions. It is aimed at improving human well-being”. …
Amongst other recent definitions, the suggestion made in the study commissioned for this report is short
and universal: Social innovations are innovations that are social in both their ends and their means. It is
complemented by the following: Specifically, we define social innovations as new ideas (products, services
and models) that simultaneously meet social needs (more effectively than alternatives) and create new
social relationships or collaborations. They are innovations that are not only good for society but also
enhance society’s capacity to act. The process of social interactions between individuals undertaken to
reach certain outcomes is participative, involves a number of actors and stakeholders who have a vested
interest in solving a social problem, and empowers the beneficiaries. It is in itself an outcome as it produces
social capital.
Why social innovation?
The need has emerged for major societal trends such as progress in the level of education, greater
awareness of the environment, claims for gender balance and the development of local responses to global
issues as part of a wider movement to promote autonomy as a key driver for the welfare of citizens. The
level of well-being and social cohesion that ultimately provide the conditions of economic growth are also
linked with the value of non-market goods and services, natural resources and other informal and unpaid
activities which are not included in the composition of GDP. Social innovation is precisely about the
development of what are currently viewed as assets for sustainable development: environmental, human
and social capital. …
24 Bureau of European Policy Advisors at the European Commission (2010), Empowering people, driving change: Social innovation in the European Union
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Nonetheless, social needs are growing in importance for a number of reasons. Combined with globalization,
rapid technological change has wide-ranging impacts on society and profound implications on
unemployment profiles. It increases the demand for skills, widening the gap between the skilled and
unskilled. The overriding social issue for the longer term is how to equip individuals with the right skills to
give them the best chance in the modern economy as workers, entrepreneurs and consumers….
Despite the economic benefits of migration, the social benefits of diversity and migrants’ contributions to
the social welfare of society — in the caring services and performing the essential public service jobs that
might otherwise go unfilled — the treatment of migrants in society leaves a lot to be desired. Although
some progress has been made in tackling overt racism and intolerance, there remain huge problems of
discrimination, unemployment and access to decent public services such as housing, health and good
schools. The number of people who are inactive or unemployed is dramatically increasing. … The financial
crisis has changed the overall perspective dramatically. … The problem with respect to youth unemployment
is particularly acute. … Too many people live in poverty and social isolation. … Among these, an increasing
number of children and young people are living in poverty.
World’s future depends on its youth. However, the life chances of many young people are blighted — they
lack the opportunities and the access to education and training to realize their full potential. The last three
decades have seen a pervasive increase in child poverty rates. … In an increasingly individualistic society, the
risks of isolation and social exclusion for the elderly increase, while the burden on social security systems
poses fundamental issues of intergenerational sustainability and even social justice…. Climate change will
require major changes: new sources of energy, new infrastructures, working patterns, methods of
production, distribution and transport, new forms of interaction, behaviors and beliefs. Beyond these
economic consequences (which are indeed economic if we consider unemployment risks), those of a social
nature are just as relevant. Climate change will result in unprecedented migration flows and increase the
risks of poverty for those that will be more exposed to its effects, while impacting labor markets through the
reorientation of skills and jobs towards new technologies and sectors. …
On top of this far-reaching set of societal changes, the worst economic and financial crisis in decades has hit
the world hard with a sharp economic recession. … Collective action to save the financial system and to
boost demand and confidence through public intervention has helped to prevent an economic meltdown. In
responding to the crisis, governments have implemented major fiscal stimulus packages, but have also
introduced major budgetary constraints. … At a time when resources are limited, new solutions must be
found to respond to these demands, making better use of existing resources and transforming them into
sources of growth. …
In most Member States, civil society organizations play an important role in meeting social needs. They
provide both niche and mainstream services meeting social needs alongside public sector providers and
often offer innovative solutions to the problems concerned. However, most of these institutions are small
and underfunded: consequently, the services they can provide on their own are often short-lived,
fragmented and patchy. Furthermore, many of the organizations concerned are solely dependent on public
funding, which can create tension between what they perceive to be their mission and the aims of the
government funders. Moreover, the crisis is likely to have a paradoxical effect: while it may prompt civil
society social actors to devise, out of necessity, more innovations and more solutions to difficult situations, it
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will also cause them to suffer badly due to the public expenditure cuts made in its wake. … Firstly, solutions
must be found, in a time of major budgetary constraints, to deliver better services making more effective
use of available resources. Second, the traditional ways in which the market, the public and the civil sector
have provided answers to social demands are no longer sufficient. In this context, social innovation
represents an important option to be enhanced at different levels (local, regional, national, international)
and sectors (public, private, civil) as its purpose is to innovate in a different way (through the active
engagement of society itself) and to generate primarily social value. … It is argued that change is systemic
and policy-makers would benefit from a general theory of social innovation to respond to major structural
adjustment challenges of the current historical paradigm shift. They argue that many countries have
responded to this shift by increasing their investments in research, education and new infrastructures, but
that, ‘as important as these policy measures are, they will not be sufficient for securing good economic
performance and social welfare in the coming decades’. This perspective places social innovation not only as
a way to respond to new social problems that cannot be fixed with old policy instruments but also as a tool
to address global challenges (for instance climate change) and ensure economic performance during major
structural transformations.
‘Social innovations in organizations, policies, rules and regulations as well as in collective norms,
values and cognitive frames are needed to complement the more traditional technological and
economic innovations, in order to reach systemic synergies, productivity growth, increasing returns
and steadily growing incomes’.
They underline the interdependence of systems at different levels and in different sectors, arguing that
narrowly focused or partial innovation only produces growing contradictions, poor productivity, decreasing
returns and stagnating incomes.
Process dimension
Examples25 of characteristics that highlight the change in the process dimension implied by social innovation
are the following:
Solutions must focus on the beneficiaries and be created with them, preferably by them, and never
without them
Focusing on the strengths of individuals and communities rather than on their weaknesses
Capitalizing on the diversity of ethnicities, ages, religions, gender, etc. and not just combating
discrimination
Developing a holistic approach rather than fragmented responses to people’s diverse problems
Reinforcing and extending partnerships rather than having each organization individually handling
‘its’ services and ‘its’ responsibilities
Collaborative working and networking as ways to stimulate social innovation
25
Social Innovation, New Perspectives by Ana Vale, Societade e Trabalho Booklets 12- 2009
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Creating outreach solutions based in the local community rather than global solutions, remote from
people and communities
Investing more in cooperation than in competition
Mainstreaming and sustaining social innovation in order to optimize investment in new solutions
and multiply their added value
Valuing not only certifiable skills but also new skills associated with the innovation and the
discovery of what’s new, what has future and what works
Recognizing and valuing social artists
Putting in place a new governance for learning
In this sense, the concept of social innovation stems from the need for change both in terms of the outcomes
that innovation is expected to deliver and the process through which these outcomes are generated. As it is
used now in public and scientific debates, it relates not only to developing innovative solutions but also to
new forms of organization and interactions to tackle social issues.
Risks associated with the concept, and what social innovation is not
Like every new attractive concept, social innovation holds some risks. We examine below the four main
types.
1 To view social innovation as renaming or relabeling all those initiatives and practices carrying some
social dimension: … social innovation cannot be seen simply as a rebranding of current programs. As
social innovation has been defined here, the social outcome is a necessary, but not sufficient,
component. However, the process that leads to the outcome should also carry elements of novelty
in reshaping social interactions.
2 The respective roes of the private, public and third sectors. Of course, the private sector has an
important role to play not just in the need for additional resources in a time of limited public
budgets, but also for injecting the creativity, flexibility and innovativeness that characterize the
business world. However, such an involvement also raises issues of ethics, responsibility, quality of
services, and access. In this sense, social innovation should not be seen as simply a way of
privatizing social services. It is intended to rather encourage an existing change of behavior by
people and institutions regarding the responsibility of finding the most appropriate solutions to
respond to unmet social demands.
3 To confine social innovation to bottom-up or grassroots initiatives. Social innovation is not
necessarily about bottom-up initiatives that stem at the micro level from the activities of
autonomous individuals and groups. Often, social innovation emerges at the local level from sharing
and networking between a wide range of actors; it can also be generated by market initiatives with
a social concern. … Social innovation can also stem from the macro/policy level, when policy-
makers, public administrators, business and opinion leaders or academics reflect, propose and
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implement new ways to address social issues. Moreover, social innovation places an increased role
on the involvement of citizens in the design and implementation of solutions to social needs,
encouraging participatory processes, the empowerment of social actors and users, and a focus on
learning. But vis-à-vis policy-makers, such a role shall not be seen as a substitution, but rather as a
means to support policy-making bodies in being more effective.
4 Last, as for any new concept, one should avoid seeing social innovation as a panacea for solving all
problems.
A working definition
It is now clear that social innovation, as a new and emerging concept, cannot be encapsulated within a tight
definition with strictly designated actors, objectives and means. It is also clear that social innovation is part
of a broader movement towards a knowledge-based society where innovation is widely shared and enriched
by its very sharing. Nevertheless, if, as was advocated by stakeholders …social innovators should be
recognized and valued, a working definition is essential. Moreover, for designing more systematic policies to
promote social innovation and to measure its impact, it is important to agree upon a definition that includes
objectives which have to be met according to the approach which frames social innovation. The general
definition proposed earlier — ‘social innovations are innovations that are social in both their ends and their
means’ — expresses the necessary condition to recognize a social innovation in terms of both process (it
affects the process of social interaction) and outcome (it produces social return). However, it needs to be
complemented by a further articulation of what we mean by ‘social’ (in its strictly social or broad societal
definition) and of the scope of change in social interactions that is specifically implied. …
Social Innovation relates to the development of new forms of organization and interactions to respond to
social issues (the process dimension). It aims at addressing (the outcome dimension):
1 Social demand approach: social demands that are traditionally not addressed by the market or
existing institutions and are directed towards vulnerable groups in society. This approach seems to
be more appropriate when dealing with concrete grassroots cases.
2 Societal challenges approach: societal challenges in which the boundary between ‘social’ and
‘economic’ blurs, and which are directed towards society as a whole. This approach seems to be a
trend in the policy-making world towards broadening the concept towards the idea of ‘societal’
especially in innovation, research, and education policies.
3 Systemic change approach: the need to reform society in the direction of a more participative arena
where empowerment and learning are sources and outcomes of well-being. This approach gains
increasing attention in policy-making as the benefits of a network society emerge.
These approaches are not mutually exclusive, but rather interdependent: the first approach is the
foundation for the second which creates the conditions for the third — an innovation that addresses a social
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demand (e.g. care of the elderly) contributes to addressing a societal challenge (ageing society) and,
through its process dimension (e.g. the active engagement of the elderly), it contributes to reshape society
in the direction of participation and empowerment. This could signal a development of social innovation
from a phase in which it is viewed as dealing with those issues not dealt with by traditional economics, to a
phase in which, on the one hand, the very concept of what is economic is reviewed, criticized and reformed,
and on the other, the transformation of modern societies into more user-centered, open and participative
models is actively supported.
Barriers to social innovations
Up to now, these innovation and social policies have been developing almost independently from one
another. …
Social innovation is a risk-taking operation that requires imagination, perseverance and confidence to
develop a creative idea of a product or service, and then implement a participative process and establish
strong partnerships for its implementation and subsequent scaling-up. Social innovators are confronted with
barriers that are often linked to an incompatible audit or regulatory culture. …A number of obstacles to the
development and mainstreaming of social innovations, including the traditional risk-averse and cautious
organizational cultures of administrations, closed systems which favor single-issue solutions developed
within clusters of organizations lacking mutual awareness, communication, networking and trust,
fragmented capacities (resources, infrastructures and intermediaries) and skills (training, design tools,
monitoring, validation and evaluation) preventing the development of a rich ‘eco-system’ for enabling social
innovations, and insufficient stable, seamless and sustainable funding throughout all stages of the
innovation cycle.
The issues of funding, governance, skills and measurement of social innovation are the most commonly
raised. … Furthermore, while financing is a key issue at the different process development stages, there are
also clear gaps in other types of support needed by individuals and organizations working in the field. Few
robust models for scaling up social innovations exist, due to the fact that few commissioning and
procurement structures are suited to social innovation ventures. In addition, there is a dearth of skills across
sectors and relating to all stages of the innovation lifecycle. This situation is partly due to training programs
lacking coherence, comprehensiveness or a global outlook, and also due to there being few developed
channels for spreading skills, knowledge and experience. The field of social innovation remains fragmented
and there is a need for more developed networks as well as innovation intermediaries for brokering the
connections needed to nurture and scale up social innovations….
Barriers are identified in this section according to three different approaches (the ‘social demand’ approach,
the ‘societal challenges’ approach, and the ‘systemic change’ approach) put forward to define social
innovation. The type of challenge presented in order to overcome barriers varies according to the
broadness/narrowness we give to the concept of social innovation: while the first approach calls for
schemes and actions aimed at creating framework conditions to support the development of innovations
which are not supported by state or market mechanisms, the societal challenge approach leads to a deeper
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reflection on the distinction between what is social and economic, calling into question fundamental issues
such as sustainability, intergenerational justice and the very meaning of growth and wellbeing. Finally, a
systemic approach to social innovation questions the way in which the traditional welfare state has been
designed and incrementally adapted up to now, allowing for social learning and citizens’ involvement,
empowerment and participation.
Barriers from the perspective of the ‘social demand’ approach
Financing and scaling up
According to the ‘social demand’ approach, the main barriers are generally considered to be the difficulties
associated with accessing finance, risk capital and scaling up for social enterprises. The issue of finance is
particularly critical for social innovation, mainly due to its particular nature.
From an individual or small group perspective, apart from some exceptions promoted by foundations, there
is little equivalent to the angel finance that plays a critical role in business and technology-driven
innovation, and neither are there forms of finance currently provided in ways that make it possible for
groups of citizens, or coalitions of service providers and users, to apply for small sums of money to develop
concepts. Such a gap is particularly critical in the flow and development of good ideas and concepts in their
early stage, up to a point in which these take the form of a viable model.
Indeed, as many examples of social innovation have shown, it should also be underlined that many of those
did not depend on new technological developments but rather on a better use of existing technologies. In
this sense, a focus on technological advancement as a value per se could represent an obstacle to social
innovation as many groups and users are unable to afford the adoption of new-generation technologies.
Governance and coordination
Beyond financing and scaling up, social innovation faces a series of barriers which are rooted in a lack of
coordination between the various actors engaged in social innovation within the policy domain (policy
coordination), but also among the various players (networking between social innovators, financing
institutions, incubators, etc., referred to here in below as ‘operational coordination’).
Governance: there are few examples of institutions or institutional roles which have a specific responsibility
in this field. In general, policy competences linked to social innovation are spread and scattered among a
wide range of institutional actors and levels, which generates overlaps, lack of coordination, or even
inconsistencies (e.g. technologies which do not fit a social demand). While this situation also finds its roots
in the transverse nature of social innovation and the many policy fields concerned (ranging from social,
environmental and innovation policies), such a lack of coordination nonetheless often leads to subcritical
interventions, or policies that might be inconsistent or overlapping with each other. Indeed, the value of the
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heterogeneous fields and competences at stake suggests not to centralize the governance of social
innovation in a single institution (which would replicate a silos approach), but rather to increase
coordination while conjugating it with a higher level guidance able to sketch the line of a common strategy
and to ensure consistency of actions. Such a view is applicable at regional, national and international level
and, in this sense, actions to promote coordination among these levels is essential.
Operational coordination: highly innovative fields are strongly networked, aiding the spread of learning, and
sharing and disseminating best practice and new models. Many have already underlined the role of
clustering, networking and proximity in creating innovation ecosystems able to promote innovation at all its
stages. While such networks are emerging in the field of social innovation … the field remains largely
fragmented within silos, existing between sectors and sub-sectors, disciplines, stages of innovation and
routes to innovate, and characterized by a lack of mutual awareness, trust and communication
Legal and cultural recognition
Another barrier to social innovation lies in the weak recognition of social entrepreneurs and enterprises and
their concrete contribution in generating innovations to address social demands. Such a lack of recognition
is rooted in both legal (the status of social entrepreneurs) and cultural dimensions (the idea that innovation
is confined to the business domain). From the first perspective, there is not a common framework to define
important sectors and players such as social entrepreneurs and enterprises, or third-sector or non-profit
sectors. Moreover, those concerned with addressing social demands are not necessarily innovators, while
many business innovators do address social demands. Such a lack in definition leads both to a lack of data
to assess the size and impact of the social innovation sector, and a lack of recognition of social innovators
which are often seen as being at the boundaries of other well-defined sectors. This again impacts social
innovation at many levels, ranging from access to finance (as social innovators are not seen as socially
recognized operators) to education (as education demands are often led by the needs of established roles
and professions). Finally, and related to this, social innovators are not seen as part of our innovation culture.
Skills and training
Related to recognition, the issue of skills and training has to be underlined. Indeed, the lack of skills, training
and skills-development for social innovators leads not only to an issue of human resources availability and
professionalism, but also to a weak recognition of social innovators as a recognized ‘profession’ and
structured around a well defined CV. Indeed, the transverse nature of social innovation requires new skills
and curricula that are able to connect the various sectors, policy domains and interests at stake.
Furthermore, it requires an ability to cross the boundaries between domains that were traditionally
separated. If such a boundary spanning skill has already been needed in recent innovation developments, it
has now become even more important as social innovation broadens and expands the number and
heterogeneity of the actors involved. There are many existing courses and programs for social
entrepreneurship and a few for social innovation. However, while some existing training programs have
some good elements, many lack coherence, comprehensiveness or a global outlook. There are scattered
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elements of what is needed in civil service colleges … and most practitioners learn on the job, through trial
and error, and with the help of the networks they themselves create. No existing training provision makes
use of the full range of learning tools now available. Thus, there are few developed channels for spreading
skills, knowledge and experience. … Such an issue goes beyond a mere call for interdisciplinary training to
supply the workforce for an emerging sector. As is known, the professionalization and legitimacy of a group
also depends also on the availability of recognized skills-development and training, both for academics and
practitioners. In this sense, the availability of dedicated training and skills development paths could play the
important role of making the ‘social innovator’ a recognized role and skill.
The lack of data and measurements
Data: The lack of data on the social innovation sector has various causes — first and foremost, as we have
shown, the very concept of social innovation is far from having a clear definition. In this sense, the difficulty
in categorizing a social innovation as such depends on the broadness/narrowness of the definition. Related
to this, the boundaries and players of the sector are not homogeneously defined, and even those major
sectors traditionally related to social innovation lack comprehensive and homogeneous data. Indeed, there
is a lack of data on the social sector itself (which, incidentally, does not necessarily imply the innovation
component) whose scale and scope across Europe remains somewhat of an unknown factor. In part, as
mentioned above, this is due to issues of legal and cultural recognition. As social enterprises are not
homogeneously defined and could take different legal forms, most countries do not collect information on
the number of social enterprises; instead, they collect data on the number of organizations with particular
legal forms. … As a result, only a small proportion of social enterprise activity is collected in official statistics.
In this sense there are some proxy measurements — such as the size and scope of the non-profit sector and
the social economy — but clearly, it is not possible to extrapolate information on social innovation directly
from these proxies.
Measurement: The large array and variety of actions and projects which relate to social innovation have
given a rather dispersed knowledge about policies and practices that work and at what cost. Nevertheless,
lessons are difficult to draw in a transversal way for three reasons in particular.
1 The real impact of social innovations is hard to evaluate in quantitative terms. When estimated, the
numbers of initiatives and of participants or beneficiaries are used, but these will most often be poor
indicators of the real contribution of a social innovation to resolve a specific social problem or
respond to a societal challenge or, more difficult still, to produce changes in behaviors. This is often
due to the very nature of the phenomena in which the innovation is occurring. Many important
benefits that accrue from effective social programs are rarely monetized. If evaluation of the policy
itself is hardly achievable, then neither is the impact and extent of the innovation. …
2 There seems to be an insufficient culture for ex-post evaluation in the operators involved in the
implementation of projects related to social innovation. … Where social innovation is not amongst
the explicit objectives, it will not be evaluated specifically. Indeed, much of the evaluation is carried
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out through questionnaires or cost-benefit analysis. While the first instrument requires extreme care
in the drafting of the questionnaire, the second one leaves much space for subjectivity in the
analysis (how can one identify the real costs and benefits of the policy? What is the right discount
rate for their evaluation?). This lack of evaluation tools, however, is not specific to the European
Institutions alone, as it reflects a generalized delay in the development of a social outcome
evaluation infrastructure by the social sector with respect to corporations. The Return-on-
Investment (ROI) calculations have taken a long time to affirm themselves as best practice for
corporate investment assessment, and debates still rage today on the best ways to measure
economic value generated by a company. Indeed, such a need is also witnessed by the many
ongoing reflections on the new ways and approaches of measuring the social, besides the economic,
return on investment.
3 The same reasons, combined with a weak attitude towards ex-ante and ex-post assessment, pose
an issue of measurement of impact. This is usually based on anecdotal evidence or success stories.
While such evidence can trigger public and policy curiosity, it risks confining social innovation as
simply being one of those practices able to refresh the look of older policies. However, new ways of
conceiving, measuring and evaluating the efficacy and success of social ventures, initiatives and
services, which incorporate social as well as financial impact, are also coming into play, as
encompassed within the concept of Blended Value, and practical applications in the form of tools
such as Social Returns on Investment (SROI) and Multi-Criteria Decision Analysis methods.
Barriers from the perspective of the ‘societal challenges’ approach
When considering a broader approach (the societal challenges) the same barriers apply. However, due to
the blurring boundary between what is social and what is economic, these barriers may be of a greater
magnitude than before, and new barriers may also come into play.
Measurement
A major consequence is in terms of measurement, both in term of ex-ante and ex-post impact. Indeed, such
an issue is twofold. In terms of process, the very nature of innovation is changing. Innovations in the public
sector, together with new trends in open and user-led innovation, are highlighting the need for new metrics
to measure innovation performance. From a process perspective, they also call for a broader view of
innovation, encompassing dimensions that go beyond the traditional view in which R&D is the main driver.
Around the world, policy-makers are demanding new ways to measure this new face of innovation, and
much work is currently underway in developing better indices for innovation. … The issue of measuring
societal innovation is even more complex when considering the outcome dimension, namely the ‘social’. As
we have shown, according to the societal challenges approach, the boundary between what is economic
and what is social (see climate change or ageing) poses the imperative of rethinking the way in which we
conceive wealth and well-being through new parameters and indices able to make marketable — i.e.
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‘valuable’ — the capacity to address new demands (such as quality of life). However, it poses fundamental
questions such as how to define sustainability, intergenerational justice, resource consumption and
efficiency, etc. In a sense, the measurement issue becomes key, as new definitions of well-being would drive
the way in which resources are allocated and its use is evaluated.
The Stiglitz-Sen-Fitoussi Commission on the Measurement of Economic and Social Progress, created in 2008,
has also made significant progress in this area. The final report by the commission stresses the need for our
measurement system to ‘shift emphasis from measuring economic production to measuring people’s well-
being’ and that measurements of well-being should be put in the context of sustainability. Additionally, the
report recognizes the need for a multi-dimensional definition of well-being and stresses that measuring all
of these dimensions of well-being requires both objective as well as subjective data.
Financing
According to this broader view, financing social innovation becomes a synonym of financing innovation in
general rather than a subset of innovations. This is because according to the societal challenges approach,
innovation is intended as a major instrument to address the socio-economic challenges ahead.
Governance
Indeed, the governance issue becomes even more complex and systemic. The call to address societal
challenges requires even stronger coordination and integration among different policy streams and levels of
governance. In terms of policy fields, while the first approach requires better collaboration among those
public and private bodies concerned with pressing social demands, the second requires a general and
deeper rethinking of policy-making in general; namely, a view of policy-making as an intrinsically
transversal activity in which decisions taken in a field deeply affect and constrain those taken in others (see
energy and environment). Taking climate change as an example, it is rather obvious that decisions related
to the environment have dramatic impacts on issues such as fiscal policy, energy security and R&D. In terms
of levels, the systemic nature of societal challenges imposes coordinated actions at local, regional, national
and global levels. Indeed, if there is a common feature that characterizes the challenges ahead, it is that
they can be addressed only through globally concerted action (see climate change).
Education
As far as education and skills-development are concerned, the societal challenges approach demands a
deeper reform of education systems. This implies a call for greater interdisciplinarity, a stronger interplay
between basic and applied research, and greater accountability and a deeper understanding of the social
impacts of technological developments, both in terms of opportunities but also in terms of threats. Issues
such as social responsibility, the critical impacts of technological developments, and a fundamental
rethinking of growth models would be part of this. From a methodological perspective, the participatory
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and active learning approaches become more important. These needs are up against the barriers of an
education system still heavily based on a disciplinary orientation and a view of learners as passive
knowledge receivers. Moreover, for the importance that education plays in providing the skills needed to
address societal challenges, issues such as underfunding and lack of accountability call for structural
reforms.
Barriers from the perspective of the ‘systemic change’ approach
Finally, new barriers to social innovation emerge when considering a systemic approach — the approach
that aims to reshape society towards greater empowerment and participation. The first such barrier is an
administrative culture that is still rooted in a top-down approach whereby policies are designed and tested
at the political level, then applied and used at the citizens’ level. Only the failure of a policy leads to its
revision. Another such barrier lies in a general culture that views the solution to social demands as a
prerogative of public institutions, thereby giving only a passive role to citizens, stakeholders and users, who
thus are not involved in defining and designing social policies. This leads to a lack of education needed to
foster active citizenships, awareness of the role of empowerment, mutual learning, and participation in
reforming society. Furthermore, this also reinforces the lack of recognition of those civil society
organizations and initiatives that aim to improve the capacity of citizens to take an active role in policy-
shaping and local development. This is confirmed by reviews and evaluations … which have highlighted
severe barriers to the development and mainstreaming of social innovations, notably:
The traditional risk-averse and cautious organizational cultures of the relevant administrations,
which is linked to a lack of political will and leadership, a sub-critical mass of social innovators in the
public sector, and an audit-driven implementation of programs and actions;
Closed systems which favor single-issue solutions developed within clusters of
administrations/organizations or sectors lacking mutual awareness, communication, networking
and trust;
Fragmented capacities (resources, infrastructures and intermediaries) and skills (training, design
tools, monitoring, validation and evaluation) preventing the development of a rich ‘eco-system’ for
enabling social innovations;
Insufficient stable, seamless and sustainable funding throughout all stages of the innovation cycle
(made worse by the absence of robust scaling-up models that might act as benchmarks).
In terms of governance, the third approach to social innovation itself requires a change on how policies
should be formulated, proposed, tested and implemented. Needless to say, the social innovation philosophy
underscores the role of citizens, stakeholders, users and target groups in the definition and implementation
of new policies, challenging the traditional view of policy-making as a top-down process. In this sense, the
major barriers are a political culture based on a clear-cut distinction between policy-makers and policy
users, and a general view of politics as a process that puts citizens in a reactive and passive position. In this
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sense, policy education, experimentation and cultural change all become essential ways of overcoming
these barriers.
Social enterprise
A recent phenomenon has been the growth of social enterprises from and within the social economy sector
which lies between the market and the state and is often associated with concepts such as ‘third sector’ or
‘non-profit sector’. Social enterprises are new types of business which may earn profit but are focused on
their social goal. Social enterprises will take different organizational forms according to existing legal
frameworks, on the political economy of welfare provision and on the cultural and historical traditions of
non-profit development in each country. This variety makes it difficult to identify as a sector.
‘Social enterprises include new types of organizations as well as traditional third-sector
organizations refashioned by a new entrepreneurial dynamic. In this respect, the social enterprise
concept does not seek to replace concepts of the non-profit sector or social economy. Rather, it is
intended to bridge these two concepts, by focusing on new entrepreneurial dynamics of civic
initiatives that pursue social aims’ OECD, Leed programme
Social enterprise activity falls mainly into two categories. The first is social service provision — childcare,
elderly care, care for the disabled and so on. The second is ‘work integration’ or ‘work insertion’ —
integrating the long-term unemployed or disadvantaged and marginalized groups into the labour market.
Definitions of social enterprise vary, but the main features are the primacy of the social mission, the
presence of trading income and the provision of services (i.e. they do more than campaign, lobby or
advocate). …
Social enterprises can also be identified by the types of relationships they have with their beneficiaries, the
way in which they are able to attract voluntary support or the way in which they are embedded within their
local communities. For example:
‘the key feature of social enterprises seems to be their ability to strengthen the fiduciary relationship
within and around the organization, and to mobilize resources from individuals and from the local
community (social capital). They do so using institutional and organizational mechanisms that rely,
inter alia, on the forceful and broader representation of the interests of stakeholders, on a
participatory and democratic governance system, and on the use of volunteer labor.’26
As a result of these relationships, social enterprises are often embedded within their local communities.
Consequently, they are attuned and responsive to the needs of beneficiaries. Social enterprises tend to be
relatively small, although some have established themselves in the mainstream.
26 A. Bacchiega & C. Borzaga, ‘Social enterprises as incentive structures: an economic analysis’ in C. Borzaga & J. Defourny (eds.) (2001)
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Conclusion 2° part – Applied Research
What we learned ?
Considered the big part dedicated to Social Innovation I prefer to split the final summary of the main
concepts with respect to the linear model of innovation for social innovation, which replaces the one for
social economy.
Fig 25 – The Linear Model of Innovation for Social Innovation
The following are the main entities:
Social innovation
Social economy
Policy for science
Social value
The linear model of innovation
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Social innovation
1) Social innovations are innovations that are social in both their ends and their means. It is
complemented by the following: Specifically, we define social innovations as new ideas (products,
services and models) that simultaneously meet social needs (more effectively than alternatives) and
create new social relationships or collaborations. They are innovations that are not only good for
society but also enhance society’s capacity to act.
Social innovation has a definition
Social innovation is focus on people for people, in term of human being, of knowledge, of skills,
of action
2) Social innovation is important because:
is precisely about the development of what are currently viewed as assets for sustainable
development: environmental, human and social capital
social needs are growing in importance for a number of reasons, among them:
o globalization
o technological change
o the gap between the skilled and unskilled
o huge problems of discrimination
o unemployment
o access to housing, health and schools
o people in poverty and social isolation
o an individualistic society
o social justice
o climate change
o unprecedented migration flows
o the worst economic and financial crisis in decades
o major budgetary constraints
o civil society organizations dependent on public funding
o market, public and civil sector answers to social demands no longer sufficient
o different scopes (local, regional, national and international)
o benefit from a general theory of social innovation
o the interdependence of systems at different levels and in different sectors
3) Social innovation relates not only to developing innovative solutions but also to new forms of
organization and interactions to tackle social issues:
Solutions must focus on the beneficiaries and be created with them, preferably by them, and
never without them
Focusing on the strengths of individuals and communities rather than on their weaknesses
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Capitalizing on the diversity of ethnicities, ages, religions, gender, etc. and not just combating
discrimination
Developing a holistic approach rather than fragmented responses to people’s diverse problems
Reinforcing and extending partnerships rather than having each organization individually
handling ‘its’ services and ‘its’ responsibilities
Collaborative working and networking as ways to stimulate social innovation
Creating outreach solutions based in the local community rather than global solutions, remote
from people and communities
Investing more in cooperation than in competition
Mainstreaming and sustaining social innovation in order to optimize investment in new
solutions and multiply their added value
Valuing not only certifiable skills but also new skills associated with the innovation and the
discovery of what’s new, what has future and what works
Recognizing and valuing social artists
Putting in place a new governance for learning
4) Social Innovation addresses outcome dimensions rather interdependent:
Social demand approach: social demands that are traditionally not addressed by the market or
existing institutions and are directed towards vulnerable groups in society. This approach seems
to be more appropriate when dealing with concrete grassroots cases.
Societal challenges approach: societal challenges in which the boundary between ‘social’ and
‘economic’ blurs, and which are directed towards society as a whole. This approach seems to be
a trend in the policy-making world towards broadening the concept towards the idea of
‘societal’ especially in innovation, research, and education policies.
Systemic change approach: the need to reform society in the direction of a more participative
arena where empowerment and learning are sources and outcomes of well-being. This
approach gains increasing attention in policy-making as the benefits of a network society
emerge.
5) Social innovation barriers from the perspective of the ‘social demand’ and ‘societal challenges’
approach
difficulties associated with accessing finance, risk capital and scaling up for social enterprises
the flow and development of good ideas and concepts in their early stage, up to a point in which
these take the form of a viable model
a better use of existing technologies
the transverse nature of social innovation and the many policy fields concerned
a lack of coordination that might be inconsistent or overlapping
a common strategy and a consistency of actions
the role of clustering, networking and proximity in creating innovation ecosystems
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a lack of mutual awareness, trust and communication
cultural dimensions, for which the idea that innovation is confined to the business domain
the lack of skills, training and skills-development for social innovators
the transverse nature of social innovation requires new skills and curricula
few developed channels for spreading skills, knowledge and experience
a lack of data to assess the size and impact of the social innovation
the boundaries and players of the sector are not homogeneously defined
the real impact of social innovations is hard to evaluate in quantitative terms
an insufficient culture for ex-post evaluation in the operators involved in the implementation of
projects related to social innovation
6) Social innovation barriers from the perspective of the ‘systemic change’ approach
The traditional risk-averse and cautious organizational cultures of the relevant administrations,
which is linked to a lack of political will and leadership, a sub-critical mass of social innovators in
the public sector, and an audit-driven implementation of programs and actions;
Closed systems which favor single-issue solutions developed within clusters of
administrations/organizations or sectors lacking mutual awareness, communication,
networking and trust;
Fragmented capacities (resources, infrastructures and intermediaries) and skills (training,
design tools, monitoring, validation and evaluation) preventing the development of a rich ‘eco-
system’ for enabling social innovations;
Insufficient stable, seamless and sustainable funding throughout all stages of the innovation
cycle (made worse by the absence of robust scaling-up models that might act as benchmarks).
Social economy
1) Social economy is composed by four sub economies with six interfaces
2) The institutional conditions for Public Economy innovation
changing the tax relationship
budgetary practice to promote internal innovation
distributed accountability and democratic innovation
a public medium of exchange
public investment, loans and means of payment
redesigning the labor contract
internal organizational forms
brokers & intermediaries
Professional collaboratives
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metrics and assessment
the circuit of information
3) The institutional conditions for Grant Economy innovation
generation of Innovative projects
grant giving
grant relationship
purchasing and commissioning
investment
packages of support
platforms, tools and protocols for innovation
governance and accountability
Regulatory, fiscal, legal and other conditions for extending the social economy
4) The institutional conditions for Market Economy innovation
Generation and value creation
Finance
Organizations and ownership
Information
Regulatory, fiscal, legal and other conditions for generating innovation in the social economy
5) The institutional conditions for Household Economy innovation
Public spaces for social innovation
Valorizing household time
The New Mutualism
Constructed households as sites of innovation
Social Movements
6) The process for Social Economy Innovation:
Prompts, inspirations and diagnoses
o Framing the question
o Triggers and inspirations
o Recognizing problems
o From symptom to cause
Proposals and ideas
o Imagining Solutions
o Thinking differently
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o Open innovation
o Participation
o Facilitating participation
o Institutions
Prototyping and pilots
o Prototypes, pilots and trials
o Finance for emerging ideas
Sustaining
o Creating a business
o Ownership and organizational form
o Governance
o Organization and management models
o Operations
o Relational capital
o Venture finance
o Sustaining innovations through the public sector
Scaling and diffusion
o Generative diffusion
o Inspiration
o Diffusing demand
o Scaling and diffusion in the public sector
o Commissioning and procurement
o Suppliers of innovation
o Transmitters
o Organization and scale
o Metrics to show what works and what deserves to be grown
Systemic change
o Ideas that energize systemic innovations
o Infrastructures and interstructures to support new systems
o Formation of users and producers
o Strategic moves that accelerate systems change
o Regulatory and fiscal changes
o Information, accounting and statistics
o Progressive coalitions and social movements
o Systemic finance
7) The process for Social Economy Innovation is at the base of Social Innovation
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Policy for science
1) Both social economy and social innovation have policy for science that are:
Not driven by specific, formalized and shared social values
Not perceived so “tangible” because mostly referred to the demand side of innovation
Not perceived so important as quick win solutions, because the return of investment apply on
medium – long period
Heterogeneous in term of legislations and countries
Not funded as industrial “science for policy”
Social value
1) For social economy the social value has been driven by:
the lack of business return for market economy
the lack of budget or competencies by the public economy, or the effects of political choices by
the public institutions
2) The definition of social innovation itself doesn’t help to understand the underline social value because:
“social in both their ends and their means”
“new ideas (products, services and models)”
“simultaneously meet social needs and create new social relationships or collaborations”
“not only good for society but also enhance society’s capacity to act”
all previous terms show the effects of social innovation but it’s not clear which are the value of
reference
3) For social innovation the social value is not clearly formalized
The linear model of innovation
1) The common linear model of innovation, for social economy and social innovation, have some
similitude’s with the process of social economy innovation in term of sequential steps:
from analysis, which correspond to Prompts, inspirations and diagnoses
to diffusion, which correspond to Scaling and diffusion
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2) The Prototyping and pilots stage of social economy innovation reflect some influence and
characteristics presented for the Development category of industrial Research and Development
After the final summary and the considerations dedicated to Part 2 of this document it is possible to update
the linear model of innovation for Social Innovation, which replaces the one for social economy.
Fig 26 – The Linear Model of Innovation for Social Innovation
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Part 3 – Development
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A new model of Social Innovation
Object of this final Part 3 is to provide the reader with a new model of Social Innovation based on:
the genealogical history of Innovation and his linear model of Innovation
the latest research and definitions for Social Economy
a new Social Value framework driving the Social Innovation model proposed
The new model, in my opinion, could be object of a project research and development, creating a new
starting point for subsequent future researches and implementation.
Enhancement of previous Social Innovation model
Let’s start from the last figure of Part 2 purged by the part concerning capitalistic economic.
Fig 27 – The Linear Model of Innovation for Social Innovation
As mentioned in the conclusion of part 2 some of the problems for Social Economy and Social innovation
are derived from:
Social value For social economy the social value has been driven by:
o the lack of business return for market economy
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o the lack of budget or competencies by the public economy, or the effects of political
choices by the public institutions
The definition of social innovation itself doesn’t help to understand the underline social value
because:
o “social in both their ends and their means”
o “new ideas (products, services and models)”
o “simultaneously meet social needs and create new social relationships or collaborations”
o “not only good for society but also enhance society’s capacity to act”
o all previous terms show the effects of social innovation but it’s not clear which are the
value of reference
and
Policy for science
Both social economy and social innovation have policies for science that are:
o Not driven by specific, formalized and shared social values
o Not perceived so “tangible” because mostly referred to the demand side of innovation
o Not perceived so important as quick win solutions, because the return of investment apply
on medium – long period
o Heterogeneous in term of legislations and countries
o Not funded as industrial “science for policy”
For social innovation the social value is not clearly formalized
For these reasons we have to start from social values definitions which aggregate the social innovation
chain: which values can be of reference for human being and the environment where all of us live ?
Two are the categories for the proposed social values:
Human rights
Environment rights
Human Rights
The human rights choice as social value setting social innovations is given by two simple reasons:
Human rights are human being focused
Human rights have universal value
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In particular we refer to the Universal Declaration of Human Rights27 of UN (10/12/1948). The declaration
does not represent itself a legal instrument binding nations that have signed it: the binding issue, which is
not retroactive, is specified in the rules that are contained in the different covenants signed by nations and
applying the principles of the declaration itself.
There are nine core international human rights treaties28: each of these treaties has established a
committee of experts to monitor implementation of the treaty provisions by its States parties. Some of the
treaties are supplemented by optional protocols dealing with specific concerns:
21/12/1965 - International Convention on the Elimination of All Forms of Racial Discrimination
16/12/1966 - International Covenant on Civil and Political Rights
16/12/1966 - International Covenant on Economic, Social and Cultural Rights
18/12/1979 - Convention on the Elimination of All Forms of Discrimination against Women
10/12/1984 - Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or
Punishment
20/11/1989 - Convention on the Rights of the Child
18/12/1990 - International Convention on the Protection of the Rights of All Migrant Workers and
Members of Their Families
13/12/2006 - Convention on the Rights of Persons with Disabilities
20/12/2006 - International Convention for the Protection of All Persons from Enforced
Disappearance
In addition to the Universal Declaration of Human Rights and the core human rights treaties, there are
many other universal instruments relating to human rights. The legal status of these instruments varies:
declarations, principles, guidelines, standard rules and recommendations have no binding legal effect, but
such instruments have an undeniable moral force and provide practical guidance to States in their conduct;
covenants, statutes, protocols and conventions are legally-binding for those States that ratify or accede to
them.
Environment Rights
There are three main dimensions of the interrelationship between human rights and environmental
protection:
The environment as a pre-requisite for the enjoyment of human rights (implying that human rights
obligations of States should include the duty to ensure the level of environmental protection
necessary to allow the full exercise of protected rights);
27 The Universal Declaration of Human Rights – United Nations 28 The core international human rights instruments and their monitoring bodies – Office of the United Nations High Commissioner for Human Rights
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Certain human rights, especially access to information, participation in decision-making, and access
to justice in environmental matters, as essential to good environmental decision-making (implying
that human rights must be implemented in order to ensure environmental protection); and
The right to a safe, healthy and ecologically-balanced environment as a human right in itself (this is
a debated approach).
For environment rights there are different declaration to which make reference:
the Stockholm Declaration of the United Nations Conference on the Human Environment (1972)
the Rio Declaration on Environment and Development (1992)
the United Nations Millennium Declaration (2000)
the Johannesburg Declaration on Sustainable Development (2002)
If we consider Human and Environment Rights as the founding social values for Social Innovation we can
modify the previous model obtaining the following figure:
Fig 28 – The Linear Model of Innovation for Social Innovation
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What can we point out from previous figure ?
Human and Environment Rights are the specific social values drivers for Social Innovation
The Social values influence the linear model of innovation composed by the four macro phases
The linear model of innovation based on social values guides and is guided by “policy for science”,
having as common values Human and Environment Rights
The Research and Development social taxonomies
Let’s see now the macro phases composing the linear model of innovation:
Basic research
Applied research
Development
(Production and) Diffusion
As we argued in the second part of this document the main issues, compared to the classification and
evolution of innovation concept, raised against the first three phases (Research and Development). To
overcome issues and to propose a new role for research and development, according to the new model of
social innovation, let’s start with a common definition for all of them.
Basic research:
Theoretical analysis, exploration, concepts or measures that impact, or are impacted by, social and/or
environment phenomena and directed:
to the extension of knowledge of the general principles,
to provide a foundation for subsequent research,
to provide reference data.
As reference see the 1° part – Basic Research of this document
Applied research:
Research projects that represent investigation directed to the advancement of basic research, or discovery
of new scientific knowledge, and have specific useful objectives or practical aims, that impact, or are
impacted by social and/or environment phenomena.
As reference see the 2° part – Applied Research of this document
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Development:
Technical activity concerned with non-routine problems that are encountered in translating research
findings or other general scientific knowledge into one or more useful:
models,
processes,
techniques,
products,
services,
or the improvement of existing ones, with respect to social and/or environment phenomena.
As reference see the 3° part – Development of this document
Production and Diffusion, at the moment, remain concepts that do not need to be explained, due to the
fact that are more intuitive than the previous and, moreover, don not request a different taxonomy than
the common ones.
Now, which would be the role of research for the new model of Social Innovation based on Human and
Environment Rights ?
The Research role
Due to the spirit and the reference values of Renaissance, which the contribute offered by research to the
Social Innovation of XXI century, based on Human and Environment Rights ?
Starting from the linear model of innovation, for which innovation itself happens step by step through:
Basic research Applied research Development (Production and) Diffusion
it is necessary to take back the aims of research not in the service of capitalist economy, but in the service
of knowledge per sé and of his utilitarian end application with respect of human being value, so important
and productive as we saw in the Renaissance.
J.J. Carty, Vice-President American Telephone and Telegraph Company, speaking before the US Chamber of
Commerce in 1924, expressed so deep and important concepts that seem prophetic in nowadays
situation29:
29
J.J. Carty (1924), Science and Business, Reprint and Circular Series, No. 24, National Research Council
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So much has already been said and so much remains to be said urging upon us the importance of scientific
research conducted for the sake of utility and for increasing the convenience and comfort of mankind, that
there is danger of losing sight of another form of scientific research which as for its primary object none of
this things. I refer to pure scientific research conducted for the sake of extending the boundaries of
knowledge. Pure scientific research is conducted with a philosophic purpose, for the discovery of truth, and
for the advancement of learning. The investigator in pure science may be likened to explorers who discover
new continents or islands, or hitherto unknown territories. They are continually seeking to push forward the
frontiers of knowledge. ….. The pure scientist is the advance guard of civilization. …. Unless the work of the
pure scientist is continued and push forward with ever increasing energy, the achievements of industrial
scientist will diminish and degenerate. Many practical problems now confronting mankind cannot be solved
by the industrial scientist alone, but must await further fundamental discoveries and new scientific
generalizations. When considered with reference to a single branch of industry, no particular discovery in
pure science appears as a rule to be of appreciable benefit. When, however, the total contributions of pure
science are reviewed with regard to the industries as a whole, it is found that they have become of
incalculable value through adaptation to practical uses by the industrial scientist … While the discoveries of
the pure scientists are of the greatest importance to the higher interest of mankind, the practical benefits
flowing from them, though certain, are usually indirect, intangible or remote. From its very nature pure
science cannot support itself. Nevertheless it must be conducted regardless of its lack of pecuniary returns.
Which is, for Carty30, the difference between Basic research (called “Pure research”) and Applied research
(called “Industrial scientific research”) ?
In the minds of many there is confusion between industrial scientific research and this purely scientific
research, particularly as the industrial research involves the use of advanced scientific methods and calls for
the highest degrees of scientific attainment. The confusion is worse because the same scientific principles
and method of investigation are frequently employed in each case and even the subject matter under the
investigation may sometimes be identical. The misunderstanding arises from considering only the subject
matter of the two classes of research. The distinction is to be found not in the subject matter of the
research, but in the motive. … Industrial research is always conducted with the purpose of accomplish some
utilitarian end. Pure scientific research is conducted with a philosophic purpose, for the discovery of truth,
and for the advancement of the boundaries of human knowledge.
These inspiring words sustain and push the fundamental role of research: which is the deputy institution31 ?
In matters of science the function of university is two-fold, the discovery of the unknown and the teaching of
known. It is a high function of the universities to make advances in pure science, to test reported new
scientific discoveries and to place upon those which are found to be true the stamp of their approval. In this
way they can determine what shall be taught as scientific true to those who, relying upon their authority,
come to them for knowledge and believe what they teach.
30 J.J. Carty (1916), The Relation of Pure Science to Industrial Research, Reprint and Circular Series, No. 14, National Research Council 31
J.J. Carty (1924), Science and Business, Reprint and Circular Series, No. 24, National Research Council
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To emphasize the University role, as institution for knowledge, it is important to remember that the first
university of “the west world” as a center of knowledge discovery and diffusion has been founded in 1088
in Bologna (Italy), nearly 400 years before Renaissance. For sure, nowadays, there are others important
institutions for knowledge, for example research centers that are “not under or part of” industrial or
political framework. In any case from now on Institutions for Knowledge, based on the presented social
values, will be referred to as “High Education”.
How can we leverage the linear model of innovation with the innovation process for Social Economy, at the
base of Social Innovation, presented in previous chapters ?
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The process for the new model of Social Innovation
The innovation process for Social Innovation, as a consequence of Social Economy, is composed by six
macro activities: how can we merge these macro activities with our discourse about the new model of
Social Innovation ? If we start from the meanings of all of them compared to the linear model of
innovation, based on Human and Environment Rights, we can focus on the following features. To each of
the previous macro activities we can associate different concepts, like:
WHY ? Prompts, inspirations and diagnoses
WHAT ? Proposals and ideas
HOW ? Prototyping and pilots
WHERE ? Sustaining
GLOCAL ? Scaling and diffusion
WHO ? Systemic change
The last three questions (“Where ?” “Glocal ?” and “Who ?”) explain a deep focus on innovation dimension
measured in term of localization, span, impact. In fact, with respect to the theory of innovation diffusion32
we can add a new dimension, and modify the axis reference from the capitalistic economy market share to
the new Social Innovation knowledge share, as depicted in the next figure.
Fig 29 – The Diffusion of Innovation for Social Innovation
32
Diffusion of innovations - Wikipedia
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The first three questions can be matched with the previous taxonomies of research and development and,
the result is the following:
WHY ? Basic Research Prompts, inspirations and diagnoses
WHAT ? Applied Research Proposals and ideas
HOW ? Development Prototyping and pilots
What about the other two steps of linear model of innovation ?
WHERE ? Production Sustaining
GLOCAL ? Diffusion Scaling and diffusion
As we see we have split the previous “(Production and) Diffusion” in two distinct steps, as depicted in the
next figure. The resulting model is the linear process model of innovation.
Fig 30 – The new Linear Process Model of Innovation for Social Innovation
But what about the “systemic change” ? In this case, considering the associated question “Who ?” the only
possible answer can be structured in term of Actors, or sub-economies as mentioned in Social Innovations
part:
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WHO ? Social Innovation sub economies Systemic change
The social innovation economy
Compared to the sub economies of Social Economy there are two new sub economies to add (see next
figure).
Fig 31 - The Social Innovation Economy
The central role of High Education is justified by:
the preeminence research role in the new linear model of innovation
the theories of Roberto Mangabeira Unger and John Dewey
the historical examples provided us by Italian Renaissance and Guilds
the issues and the accomplishments requested by Human and Environments Rights
The new role of International Institutions is justified by:
their guiding role in nowadays life
their political and economical role
the representation and advocacy role of different interest
Going back to the previous question about “systemic change” we can say that the only possible answer is
structured in term of Actors, or Social Innovations sub-economies:
WHO ? High Education The Household The Grant Economy
Systemic change
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The Market The State The International institution
What are the consequences due to the new actors, their role and the new meaning of “systemic change”
for the new model of Social Innovation (see the next figure) ?
Fig 32 - The new model for Social Innovation
In this model is interesting to see that:
“systemic change” is connected with Social Innovation sub economies by “Policy for science”
“systemic change” identifies the real impact of change toward the Social Innovation operative
schema (composed by the linear process model of innovation driven by Human and Environment
social values)
the arrow connecting the Social Innovation operative schema is bi-directional
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the sub economy main interface for “Policy for science” is High Educational, which emphasize the
role of the deputy institutions for research, first macro activity triggering the linear process model
of Social Innovation
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LEONARDO for Human and Environment Rights
What is LEONARDO for Human and Environment Rights ? LEONARDO is a proposal whose aim is to develop
an operative project for the implementation of the new Social Innovation model.
In other words, compared to the steps of the linear process model of innovation we can say that the
following paragraphs constitute the “Development” part of a Social Innovation project: the hope of doing
this is to find a Research center interested and cooperating in:
the review and the enhancement of the previous steps of the project itself (basic research, applied
research and development)
the implementation of the subsequent steps (production and diffusion)
Why do I choose the name LEONARDO ? What does it mean this term ?
First, the name is a tribute to the genius of Leonardo Da Vinci and, as one of the most famous
representative of Italian Renaissance, I thought that this name could have been the best testimonial for a
project on the new model of Social Innovation.
Second, the name Leonardo can be seen as an acronym whose meaning is:
Learning
Environments
Orienting
New
Approaches to
Research and
Development
Objectives
Moreover, adding at LEONARDO the terms “for Human and Environment Rights” was clear to me that I
have found the right name to the project for the proposed model of Social Innovation.
As we can see, with this project name, we have some specific features like:
Learning environments, with a focus on cooperation, networking, knowledge and skills
New approaches, with a focus on distributed cooperation driven by human being demand
Research and development, with a focus on the demand side of the new linear model innovation as
a bridge toward production and diffusion
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First we have to better specify how are connected the single Actors defined for the new model of Social
Innovation (see next figure):
Fig 33 - The LEONARDO project architecture for Social Innovation
LEONARDO project architecture benefit
The architecture covers three principal levels of social innovations:
o The institutional conditions: a macro one about innovations in the structures and
mechanisms of the social economy
o The distinct processes: a micro enquiry into the process of social innovation
o The systemic innovations: an inquiry into innovation in productive systems
The architecture, thank to the six sub economies, covers all the key interfaces of social innovations
Policy for science could include the most part of methods defined in previous chapter (Institutional
conditions for Innovations)
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The Learning Environments
The main reference for the learning environments of LEONARDO project, whose aim is to be a point of
reference for local needs thanks to global cooperation from people spread all over the world, is based on
Connectivism theory. Briefly we can affirm that:
Connectivism33 was introduced as a theory of learning based on the premise that knowledge exists in the
world rather than in the head of an individual. Connectivism proposes a perspective similar to the Activity
theory of Vygotsky as it regards knowledge to exist within systems which are accessed through people
participating in activities. It also bears some similarity with the Social Learning Theory of Bandura that
proposes that people learn through contact. The add-on "a learning theory for the digital age", that appears
on Siemens paper indicates the special importance that is given to the effect technology has on how people
live, how they communicate, and how they learn.
One aspect of connectivism is the use of a network with nodes and connections as a central metaphor for
learning. In this metaphor, a node is anything that can be connected to another node within a network such
as an organization: information, data, feelings, images. Connectivism sees learning as the process of
creating connections and developing a network. Not all connections are of equal strength in this metaphor;
in fact, many connections may be quite weak. The idea of organizations being cognitive systems where
knowledge is distributed across a network of nodes can be traced back to the work on the Perceptron….
Principles of connectivism
Learning and knowledge rests in diversity of opinions.
Learning is a process of connecting specialized nodes or information sources.
Learning may reside in non-human appliances.
Capacity to know more is more critical than what is currently known
Nurturing and maintaining connections is needed to facilitate continual learning.
Ability to see connections between fields, ideas, and concepts is a core skill.
Currency (accurate, up-to-date knowledge) is the intent of all connectivist learning activities.
Decision-making is itself a learning process. Choosing what to learn and the meaning of incoming
information is seen through the lens of a shifting reality. While there is a right answer now, it may
be wrong tomorrow due to alterations in the information climate affecting the decision.
For learning framework we can make reference to the Graphic Map of Learning34 derived by the
Connectivism theory (see next figure).
33 Connectivism - Wikipedia 34
G. Siemens – (http://octette.cs.man.ac.uk/jitt/images/0/06/Siemens_learning_ecology_large.jpg)
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Fig 35 – Graphic map of learning
As we see the depicted learning environment is design for maximum flexibility that meets the LEONARDO
operative process needs.
For the ICT platform, which can be identified with a Personal Learning Environment, some features can be
identified:
Learning scope:
o Why ? What ? Basic and applied research: research content
o How? Development: research content, instruments, template and content for
business
o Where ? Production: research content, instruments, template and content for
business
o Glocal ? Diffusion: research content, instruments, template and content for
business feedback
o Who ? Social Innovation sub economies: research content
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Learning design:
o The proposed design is based on the PENTHA ID Model35 (Personalization, Environment,
Networks, Tutoring, Hypermedia, Activity ID Model) that is a multi perspective Instructional
Design model based on five dimensions (see next figure)
Fig 36 – The PENTHA dimensions
Learning environments:
o In particular we can imagine so many learning environments as much are the themes
defined for Human and Environment Rights (see next figure).
Fig 34 – Example of learning environments scope
35 Dr. Luisa dall’Acqua - Epistemological Base and Didactical Characteristics of aDynamic Hybrid Intelligent e-Learning Environment (DHILE) – Sie-L 2011
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Orienting New Approaches
Which are the main features of the new approaches oriented by learning environments ?
Learning environment is a dynamic hybrid intelligent platform driven by a mix of:
User needs
Knowledge champion objectives
This specific mix can be different in function of:
the linear process model of social innovation: different macro activities mean different mix
human and environment social innovation values: different macro activities mean different
operative application of values
networking degree: different macro activities mean different level and span of cooperation among
actors
the span of social innovation: different macro activities mean different boarders of innovation
Let’s see next figure for a synthetic schema:
Fig 37 – The new approaches features
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The beneath idea is that the flexibility of learning environment should be aligned to the different aims and
features of the macro activities composing the new linear process of innovation for Social Innovation. A
more detailed explanation of the previous figure will be hold in the next paragraph.
Research and Development Objectives
In previous chapters we presented the following associations:
WHY ? Basic Research Prompts, inspirations and diagnoses
WHAT ? Applied Research Proposals and ideas
HOW ? Development Prototyping and pilots
WHERE ? Production Sustaining
GLOCAL ? Diffusion Scaling and diffusion
As presented in previous figure we can focus some peculiar features of singles macro activities.
Basic research
Question
o Why ?
Aim
o Knowledge for knowledge
Human and environment social innovation values
o Basic research is based on pure knowledge about principles of human and environment
rights; there is no specific meaning in real application and, for this reason, we can say that
are static values because there is no constrain in basic research that is based on specific
and real social innovation requests or needs
Networking degree
o The assigned value is high, because pure research needs a cooperation with all possible
institutions and people in order to discover and share new knowledge
Social innovation span
o The assigned value is global, because pure research and knowledge should be shared all
over he world and in attendance of all people who care about social innovation and his
subsequent possible application in the real world
Required mix
o The mix for this macro activity is not homogeneous, because pure research and knowledge
aims are driven by knowledge champion, whatever they are institutions and/or people. The
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detachment from real social innovation applications put aside the role of the user. For
these reasons the involvement value for user is low and for knowledge champion is high
Sub economies / actors
o All sub economies should be involved in basic research, each one for different reasons and
in different modes, but all sharing the common human and environment values. So,
international institutions, the state, the market, the grant economy and the household are
“necessary” in basic research, all of them supporting high education institutions
Life cycle
o Long, depending on the type and scope of the pure research
Approach
o Imitation, as combination
Applied research
Question
o What ?
Aim
o Knowledge for the advancement of basic research, or discovery of new scientific
knowledge, and have specific useful objectives or practical aims
Human and environment social innovation values
o Applied research is based on knowledge that have specific useful objectives in human and
environment rights and, for this reason, we can say that are static or dynamic values
depending on the level of practical aim
Networking degree
o The assigned value is medium, because applied research needs a cooperation inside
specific institutions that are focused on the specific aim, in order to push research results
towards development macro activity
Social innovation span
o Global or local are the assigned values, because applied research and knowledge could be
shared or focused, respectively, to global or local practical aims
Required mix
o The mix for this macro activity is not homogeneous, because applied research and
knowledge aims are driven here as well by knowledge champion, whatever they are
institutions and/or people, maybe with some support from users who are interested in
possible evolutions of applying research discoveries to development and production macro
activities. For these reasons the involvement value for user is quite low and for knowledge
champion is high
Sub economies / actors
o All sub economies could be involved in basic research, each one for different reasons and in
different modes, and depending of the scope of the applied research. For global scope all of
them should be involved, for a more local scope (and depending on the criticality of the
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practical aim) maybe the sub economies more involved are the market, the grant economy
and the household, all of them supporting high education institutions
Life cycle
o Long or medium, depending on the type and scope of the applied research
Approach
o Imitation, as combination
Development
Question
o How ?
Aim
o Knowledge for practical usage, which means specific for solving something real or for
starting a social innovation non profit business
Human and environment social innovation values
o Development is based on dynamic knowledge where specific user needs are approached
and formalized in order to match social values with the specific social instance
Networking degree
o The assigned value is small, because development needs a cooperation among few persons
and the user, all of them focused on the specific need or instance, in order to push research
results towards as specific “how to” framework ready to be implemented or delivered in
production macro activity
Social innovation span
o Local is the assigned value, because development is focused on local user needs
Required mix
o The mix for this macro activity is homogeneous, because development is driven by few
knowledge champions and the user who is interested in applying research results in
concrete production. For these reasons the involvement value for user and for knowledge
champion is high
Sub economies / actors
o Not all sub economies are involved in development, due to the local scope of the user
need. For a more local scope (and depending on the criticality of the practical aim) the sub
economies more involved are the market, the grant economy and the household, all of
them supporting the user
Life cycle
o Medium or short, depending on the type and scope of the development macro activity
Approach
o Invention, as discovery, imagination, creation
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All previous macro activities (research and development) are the drivers and the main steps for subsequent
Production and Diffusion. In particular, the Development role is huge because is the bridge between
research and the real application for social innovation. In this model, differently from capitalism economy,
the development macro activity is not focus on prototype but on pure knowledge (tools, model, procedure
..) transfer about HOW to do something, it is a strong link between knowledge champion and user, is a way
to share and spread common knowledge, to transform knowledge in skills for all who care social innovation
and share common values.
Production
Question
o Where ?
Aim
o Knowledge and skills for practical usage, which means daily activities to realize what have
been specified in development macro activity, for solving something real or for a social
innovation non profit business
Human and environment social innovation values
o Production is based on dynamic and static knowledge and skills where specific user apply
and make what is necessary to match social values with the specific social instance
Networking degree
o The assigned value is small, because production needs a few cooperation among
knowledge champion and the user, both focused on the specific daily need or instance to
implement or deliver the product / service planned in development macro activity
Social innovation span
o Local is the assigned value, because production is focused on user need based on specific
location
Required mix
o The mix for this macro activity is not homogeneous, because production is driven mainly by
the user who is leading his social innovation non profit business
Sub economies / actors
o Not all sub economies are involved in production, due to the local scope of the user
activity. For a local scope the sub economies more involved are the market, the grant
economy and possibly the household, all of them interacting with the user
Life cycle
o Medium or long, depending on the type and scope of the production macro activity
Approach
o Innovation, as invention used and adopted
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Diffusion
Question
o Glocal ?
Aim
o Knowledge and skills acquired for research, which means measures and reporting about
what have been implemented in production macro activity
Human and environment social innovation values
o Diffusion is based on static knowledge and skills that were necessary to the user in
production macro activity to match social values with the specific social instance
Networking degree
o The assigned value is medium, because production results may needs some cooperation
among knowledge champions and the user, both focused on the results and feedbacks
raised from production macro activity to implement or deliver the product / service
planned in development macro activity
Social innovation span
o Global is the assigned value, because diffusion must impact on most people as possible,
regardless of the location of the production macro activity
Required mix
o The mix for this macro activity is not homogeneous, because diffusion is driven mainly by
the user who is leading his social innovation non profit business
Sub economies / actors
o Not all sub economies are directly involved in diffusion, due to the different needs of them.
High education is the natural and primary interface for diffusion, afterwards the other sub
economies could be involved depending on the type of feedback and measures performed
Life cycle
o Medium or long, according to the production macro activity
Approach
o Innovation, as cultural change, social change
Diffusion benefits
The survey of innovation would:
Address and focus on specific and precise problems or areas of development
o based on the local user need triggering the linear process model of innovation chain
composed by development, production and diffusion
Survey end-users, not just producers
o in extended chain where social innovator involves no profit end user
Cover individuals, groups, organizations and government
o going backwards towards the linear process model of innovation and analyzing the
feedback impact for the sub economies
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Measure diverse kinds of innovation: ideas, behaviors and things (and compared the new to the
old). Where does the innovation come from?
o from the linear process model of innovation and policy for science
What use, if any, is made of the innovation? By whom?
o this questions are answered by the log of social innovation no profit business along the
linear process model of innovation
Identify the mechanisms through which innovation diffuse and their presence or absence in a
developing country: Do and how knowledge about X gets into country Y? What lags? Why?
o it is a wider analysis made by historical data based on different projects
What effects (quality of life), including the bad ones? To what extent is the innovation adapted to a
country’s needs?
o effects and extent are analyzed at Development stage and measured at the Diffusion stage
Evaluate the role of government as innovator in matter of policies (not only as “hampering factor”):
what infrastructures, policies and programs exist in country Y for supporting innovation? Moreover,
in order to increase its relevance, a survey of innovation (be it supply-based or user-based) should
look for facts rather than rely on questions with answers of a subjective nature.
o this is specific of State and International Institution policies for science, and could be part of
an applied research project
Diffusion could include the most part of metrics and assessment defined in previous chapter
(Institutional conditions for Innovations)
Diffusion could feed the most part of information and tools defined in previous chapter
(Institutional conditions for Innovations)
Linear process model of innovation benefits
Solutions focus on the beneficiaries and be created with them, preferably by them, and never
without them
Focusing on the strengths of individuals and communities rather than on their weaknesses
Capitalizing on the diversity of ethnicities, ages, religions, gender, etc. and not just combating
discrimination
Developing a holistic approach rather than fragmented responses to people’s diverse problems
Reinforcing and extending partnerships rather than having each organization individually handling
‘its’ services and ‘its’ responsibilities
Collaborative working and networking as ways to stimulate social innovation
Creating outreach solutions based in the local community rather than global solutions, remote from
people and communities
Investing more in cooperation than in competition
Mainstreaming and sustaining social innovation in order to optimize investment in new solutions
and multiply their added value
Valuing not only certifiable skills but also new skills associated with the innovation and the
discovery of what’s new, what has future and what works
Recognizing and valuing social end-users
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Putting in place a new governance for learning
Social demand approach
Societal challenges approach
Systemic change approach
High Education
High Education has a central role for LEONARDO project because:
It represents the process innovation frame work
It is the administrator of the technological platform, assuring the correct flow of content inside
innovation process
It is the administrator of the learning content for the innovation process
It represents the leader role for basic and applied research activities
It is the collecting center, by the platform infrastructure, of all the measures and feedbacks raising
from Production and Diffusion macro activities
It is the focal point for collecting household and grant economy needs
It takes the advocacy role, because it is the reference point for sub economies requesting data and
information concerning with social and environment phenomena
It takes a provider role, because supply different learning environment necessary to the specific
macro activities aims, with respect to Human and Environment Rights social values
High education benefit
The proposed approach reflects the Academia institution of Italian renaissance: people with
different cultural extractions that cooperate for a common aim
To push an humanism intellectual movement
To propose a new value model that could match the most lasting results in obtain in the
renaissance humanists’ education, curriculum and methods program
To include the most part of information, tools and protocols features defined in previous chapter
(Institutional conditions for Innovations)
To valorize a Dewey’s democratic innovation based on two fundamental elements like schools and
civil society
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The target – the demand side
Who are the targets for learning environments ? According to the specific macro activity, all the PEOPLE,
not institutions, that:
Share Human and Environment Rights social value
Want to study / go in more depth in social innovation
Want to share and develop the results of a social innovation research activity
Want to start a social innovation non profit business
Want to develop, in a distributed and cooperative way, a project in social innovation
Want to be a part of a network composed by people caring for social innovation
Is available to share with the network his social innovation needs
The knowledge and skills champion – the supply side
Who are the knowledge champions for social innovation ? According to the specific macro activity, all the
PEOPLE, not institutions, that:
Share Human and Environment Rights social value
Want to study / go in more depth in social innovation
Want to be a part of a network composed by people caring for social innovation
Want to share a social innovation research activity
Is available to share with the network his social innovation knowledge and skills
Want to be a Tutor or Coach for people that want to study / go in more depth in social innovation
Want to help starting a social innovation non profit activity acting in a cooperative way with a user
around the world
Who could become a knowledge champion ? If we exclude the persons that are officially and
internationally recognized as such in specific matters, we can imagine that an initial user that approached
LEONARDO project as an apprentice (using the Guilds terminology of previous chapter), could rise to the
level of journeymen for other local no profit activities and finally could be received as master craftsmen,
thanks to the acquisition of specific experience-based learning.
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Conclusion - the Challenge
The Godin’s challenge identifies four assumptions and biases on which Innovation and the OECD
Development Agenda rests. Considering that the objective of the four assumptions is to suggest the
continuance of, and deeper thoughts on, what is certainly a beginning toward a broader understanding of
innovation, let’s review them by what we learned in previous parts.
The linear model of innovation, based on the three concepts seen as sequential steps (imitation
invention innovation) in the process leading to innovation itself, can be shifted from firms / capitalistic
view to human / social point of view, and the new model for Social Innovation has pointed out that:
Innovation is the (not-so) new (miracle) solution to development issues and the proposed new
model for social innovation propose a strategy for development, where “most current social,
economic and environmental challenges require creative solutions based on innovation and
technological advance”.
The new model of social innovation is not supply-side view and driven by firms, thanks to the
human and environment social values and the aim of the linear process model for innovation.
The new model of social innovation is based on user-side view, thanks to the following factors:
o the human and environment social values
o the aim of the linear process model for innovation
o developing technologies adapted to local needs
o the flows of scientific knowledge and how developing countries get and use scientific
knowledge from foreign sources
The great support for “people” as innovators (doing things differently), not discussed in term of
markets.
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References
This document had been issued only by Open Source Knowledge. The reasons for this were threefold:
to act as the LEONARDO Human Being Project has already started, as I believe it is
to propose that the Linear Model of Innovation can be a starting point for social innovation by
applying the Research Development (Production and) Diffusion approach to the concepts
Imitation Invention Innovation of knowledge
finally, I could not ask to someone else to pursue LEONARDO for Human and Environment Rights
Project without giving an example
Disclaimer The analysis contained in this document is personal to the author and does not necessarily reflect the views
of the sources or of the referenced authors.
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change: Social innovation in the European Union
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Godin, B. (2006), Research and Development - How the “D” got into R&D, Science and Public Policy, volume
33, number 1, February 2006, pages 59–76, Beech Tree Publishing, 10 Watford Close, Guildford, Surrey GU1
2EP, England
Godin, B. (2008), Innovation: The History of a Category, Project on the Intellectual History of Innovation,
INRS: Montreal, Forthcoming
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Their Relevance to Developing Countries, Communication presented at Expert Meeting on Innovation
Statistics, UNESCO, 8-10 March, 2011
Guild, Wikipedia
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Humanism, Wikipedia
Johns Hopkins University (1999), Global Civil Society At-a-Glance, Major Findings of the Johns Hopkins
Comparative Nonprofit Sector Project, Institute for Policy Studies Center for Civil Society Studies
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Institute for Policy Studies
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Rights
Human rights:
The Universal Declaration of Human Rights – United Nations
The core international human rights instruments and their monitoring bodies – Office of the United
Nations High Commissioner for Human Rights
Human rights international treaties:
21/12/1965 - International Convention on the Elimination of All Forms of Racial Discrimination
16/12/1966 - International Covenant on Civil and Political Rights
16/12/1966 - International Covenant on Economic, Social and Cultural Rights
18/12/1979 - Convention on the Elimination of All Forms of Discrimination against Women
10/12/1984 - Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or
Punishment
20/11/1989 - Convention on the Rights of the Child
18/12/1990 - International Convention on the Protection of the Rights of All Migrant Workers and
Members of Their Families
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13/12/2006 - Convention on the Rights of Persons with Disabilities
20/12/2006 - International Convention for the Protection of All Persons from Enforced
Disappearance
Environment rights international declarations:
16/6/1972 - Stockholm Declaration of the United Nations Conference on the Human Environment
14/6/1992 - Rio Declaration on Environment and Development
8/9/2000 - United Nations Millennium Declaration
4/9/2002 - Johannesburg Declaration on Sustainable Development
Roberto Mangabeira Unger - Wikipedia
Social Economy, Wikipedia
Social Innovation, Wikipedia
The Italian Renaissance, Wikipedia
The Young Foundation, institutional internet site
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Acknowledgements
This document would not be possible without some marvelous persons that I had the fortune to walk with
along this way of life:
My Wife and my Children, always patient with me, source of energy for my believes and bridge for
the future
Dr. Luisa dall’Acqua, the master who chose me to guide me, as Virgil, in the discovery of the ever
changing world of Innovation: fantastic Tutor, Coach and Person
Dr. Attilio Pedrazzoli, CEO of Gsi Research Group and Director of Managing Innovation Course 2011,
always supporting me with his deep professional experience, counseling and discussions on
Innovation themes during the Course
Dr Shyam Sundaram, the master of technology, the person who make you comfortable in
approaching new knowledge by providing me with the exactly amount of information and sources
necessary to start the required personal reflections
All researchers, persons and institutions that have shared their knowledge by Open Source
philosophy
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