Show Me the Money!

 

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It’s All About the Cash

     Social innovation is about new solutions to old problems.  Innovators develop programs and plans to attack social issues from different angles and solve health issues both large and small.  The limiting factor in nearly every developing program is funding.  Ask any program planner what their biggest obstacle is, and the answer will likely be “money.” 

     Even the best social innovations require an initial investment of capital to get off the ground.  Most require ongoing infusions of funding until they can build income and become self-supporting.  Facilities and supplies cost money, staff must be paid, permits are not free, and the focus of the program, solving a public health problem, is a large drain on the organization’s resources. 

     There are several resources available for funding a social program, but they all carry challenges and obstacles.  Government and local grants can be a good source, but they require complicated applications and documentation to support both need and outcome.  Loans help, but without income growth the organization will be unable to repay the loan.  Private donations are easier to obtain, but rarely add up to amounts needed to sustain the organization.  Using a combination of financial resources can build a more reliable foundation, allowing the organization to develop self-supporting program elements to augment and eventually replace outside funding.  By incorporating profitable business elements into a social program, the organization can reinvest profits into the program and become increasingly self-supporting.

     Sometimes, all it takes is someone noticing the potential of the program and investing in it.  A good example of this is the Associação Saúde Criança Renascer, founded by Vera Cordeiro, a physician in Rio de Janeiro, Brazil.  Cordeiro developed a program to provide followup and support services to impoverished families living in the slums of Rio.  She observed that although the government funded hospital care for children living in poverty, there was no program to follow them after discharge and a cycle of illness, hospitalization and return to the situation that caused the illness was ongoing.  Building on a volunteer-based program housed in a dilapidated horse stall, Cordiero eventually partnered with a large consulting firm, McKinsey and Company, who recognized Renascer’s potential for growth and profitability as a social innovation.  Since 1991, Cordiero and McKinsey’s partnership has grown Renascer from a 10-person volunteer program to a streamlined operation serving 16 hospitals and providing support to over 20,000 children and their families. 

     Money, or lack thereof, can be a primary obstacle to developing socially innovative programs; however, it is not the most important element.  The human element, from the initial spark of an idea to full development of the social business, is the driving force behind every successful social innovation.  The cliché’ “money can’t buy happiness” holds true both in life and in social innovation.  Money alone will not solve public health problems, as is evidenced by society’s tendency to just “throw money at a problem,” hoping it will go away.  Using a homeless population as an example, local organizations can spend millions providing food, housing and health services to the homeless; however, unless programs are developed to assist the people in becoming self-supporting, the population will continue to sink into poverty and homelessness and their self-esteem, confidence and sense of self-efficacy will deteriorate even further.  Financial resources are necessary for social programs to succeed, but a program cannot truly change the world on money alone.  Human innovation, creativity and empowerment are necessary for true change to occur.