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The Fourth Sector
Tags:NCTI Conference '07, NewsDuring the final session, NCTI conference speaker Al Miller presented a vision of cross-sector collaboration (profit, non-profit and government) to create solutions that are both more effective and less costly.
Fourth Sector enterprises, as he calls them, take the best of each sector to maximize social good (what NCTI Keynote speaker, Jim Fruchterman calls ROH - Return on Humanity), low cost / economies of scale ROI - Return on Investment, and sustainability.
Because non-profits, for-profits and government groups measure success differently, Fourth sector partnerships often need to be evaluated for success by the standards of each one. This creates for each partner, new needs for accountability and may require changes in the way each partner operates. For example, non-profits have begun to become more efficiency/cost minded than ever before.
Partners in a Fourth Sector effort also face some key challenges in communication between partners - different worlds/different vocabularies, legal/regulatory issues and in other areas.
Organizing a fourth sector enterprise focuses attention on several key questions. For example:
What is philanthropy’s role?
How can giving bring about sustained growth?
How to find best balance between sectors
Will public policy change as a result of the shift?
How will partner organizations have to change?
To be effective, developing fourth sector enterprises should consider which blend of entitites — public, private and non-profit — is likely to create the greatest ROI, ROH and sustainability. Panel participants offered some ideas on how to achieve this, for types of needs and in individual cases:
Venture Capitalist Barry Fingerhut, expressed the perspective that approaches to help people with special needs, traditionally served by government and foundataions do not allow for long term planning and investment in assistive technology. He suggests that that venture capital will bring entrepreneurs into the marketplace, just the opposite of the traditional model.
Changes in market needs must be reflected in solutions and in the nature of partnerships created to address them. MacArthur Foundation’s Benjamin Stokes offers the example of educational needs. Due to societal shifts, related to technology, schools must shift from the notion of educating (fixed set of skills) to a more exporative form of learning.
Sylvia Clark, of the NEC Foundation suggests that, “there is so much good stuff out there.” Foundataions can have a role in supporting projects of national reach and impact. Nonprofits should be able to focus on what they do best and use the strengths of other sectors that make sense.
John Kemp expresses the concern that with exciting new technologies getting lots of attention, there is a chance that some disabled populations may fall farther behind. Can Government and Foundataions use grants to encourage advances in areas of greatest need?
Key point: Innovation applies not just in research and product development, but also in the commercialization of new solutions. Organizations in all sectors must ask, what’s the best way to achieve AT gains and ease of use? Can government or non-profits do the job alone? What is the role of private capital? To provide ROI, ROH and sustainability, solutions must come from the right balance of for-profit, non-profit and government participation.
