How can we reward success without leaving anyone behind?- Should equality be a concern?

Unrestricted cash and unregulated funding in general is hard to come by in the nonprofit sector. Donors, grantees, and foundation members wanting to have a say in the spending of their dollar contribution may in fact be limiting the overall effectiveness of the very programs they seek to develop. This blog will examine the damaging impact of restricted funding (despite benevolent intentions), recommend methods for reducing "bureaucratic interference", and touch upon the limitations that may arise. Can we create policies to reward successful nonprofits while minimizing disruptions in service for those in communities deemed to have "less successful" programs?

Firstly restricted funding is a huge barrier to social innovation and efficiency in the nonprofit sector. People want their dollars doing the services; feeding children, providing healthcare, building homes. Unfortunately because of restricted funding, many resources are wasted. They are not spent in a way that is efficient. Maybe a nonprofit focusing on education would benefit greatly by hiring a professional curriculum writer to ensure tutoring is at a level that is appropriate for the children and thus improve learning. This is the exact issue that a nonprofit I was working at called Reading Partners encountered. They ended up having to hire someone within the nonprofit to work full time on curriculum development, when a more efficient method may have been to partner with a school district or other educational entity to find resources already available. With reduction in restricted funds, nonprofits will buy what they need and save money and time in the process.

Secondly the government should provide more options for outsourcing data analysis. Many nonprofits are capable of providing needed community services but unprepared and unable to compute the data relating to their programs. By outsourcing this to a government-contracted professional, time will be saved, data quality will improve, and the nonprofit will be free from the burdens of data analytics. At the same time, the government will have easy access to program data and replication among programs will be even easier. This replication will be key to scaling successful programs in the future.

Lastly, in the haste to innovate, we must develop a plan to include smaller communities that may fall through the cracks as innovation is encouraged and funding is allocated to programs based on their success. Yes, this model is more efficient but we must have a system in place to either provide replication assistance in areas which prove to have no "successful" nonprofits in a particular area or save some of the general fund for "target areas". Replication assistance and human capital training/development would be more successful than saving money for inefficient use but we must maintain a certain level of assistance even while encouraging innovation. Inequality may continue to rise if we pull the rug away too fast while certain sectors and regions are struggling to keep up.

All in all, social innovation is promising but the success or failure will lie in the developed policies and implementation strategies.