Getting on Board the Solution Revolution

‘You say you want a revolution

Well, you know

We all want to change the world….

You say you got a real solution

Well, you know

We'd all love to see the plan

You ask me for a contribution

Well, you know

We're doing what we can…’

These lyrics may have been penned and immortalised by four lads from Liverpool over 45 years ago, but after an hour on the phone with Bill Eggers they spring to mind with as much relevance today as they no doubt had back then.

Because, according to Eggers, one of the world’s pre-eminent thought leaders on the subject of public sector reform, we’re in the grips of a revolution right now – a ‘Solution Revolution’.

And as he and co-author Paul Macmillan explain in their new book The Solution Revolution:  How Business, Government and Social Enterprises are Teaming up to Solve Society’s Toughest Problems, it’s a revolution in which the community sector is not merely a bystander or service provider, but a critical problem solver.

The book emphasises the existence and growth of a fourth sector – the hybrid social enterprise model of doing business; one which aims to solve societal problems while at the same time trying to make a profit.

“Despite the economic downturn, we've seen a massive growth of entrepreneurial activity targeted at solving larger social problems,” explained Eggers. “This new solution economy has players from across the spectrum of business, government, philanthropy and social enterprise converging to solve big problems and, in the process, create tremendous public value and new wealth.”

Whether it’s overcoming seemingly intractable global problems such as human trafficking and  poverty, localised problems of traffic congestion and food waste, or pressing scientific questions like how to measure the way dark matter distorts the image of galaxies, there’s a burgeoning new solution economy with a myriad of players who are up for the challenge.

They may be millionaire philanthropists, app developers, data scientists with transferable knowledge, charities with street cred, public servants, or businesses with R&D capability.

Regardless of who they are, if their resources can be pooled to serve a common purpose, there may be no limit to what solutions they can achieve.

“The solution economy is spawning hundreds of new ecosystems, exchanges and currencies  that collectively are creating entirely new forms of economic organisation and shifting problem- solving away from a 20th century government-only model," Eggers said. “The results are better, the innovations are smarter and the costs are lower than traditional models.

“Digital technology means you can involve thousands or millions of individuals at one time, with everyone doing a little bit to solve a problem. It’s the kind of large scale coordination that was previously impossible in human history, and its free!" he said. “This model is more resilient and successful at solving problems than anything in the Industrial Era.

“And if you look at these ecosystems, it’s hard to imagine them being effective without that Not for Profit role involved. They are already playing every role from advocacy to awareness raising, to service delivery; sometimes they are the pressure organisations, or helping to convene forums of business and governments to discuss issues.

“Not for Profits can understand the problem in a deeper way than many others can; they can  bring a sense of mission and passion to the problem,” Eggers said. “And they’ll often be lean,  mean and agile in their approach.

“However, they can have problems with the scale and the capital necessary to scale up, and  that’s where incentives and investment from other sectors can help.”

Eggers and Macmillan have dubbed these new problem solvers ‘The Wavemakers’: those organisations and individuals who make the biggest impact by thinking holistically about their  role and their relation to other players. They don’t act as competitors fighting over turf or resources, but as potential collaborators, sharing in the rewards of achieving greater outcomes than any single entity could achieve on their own.

“Our goal in writing Solution Revolution was to lay out this major paradigm shift that’s occurring around the world,” Eggers explained. “There’s been a huge growth in this new cadre of problem solvers, most of whom didn’t exist a decade ago. We examine how they can work together to solve problems in new ways, and how governments can support this.”

“We wanted to lay out the landscape for this new approach, and strategies for how to pull all  the sectors together in a way that hasn’t been done before, as well as showing the tremendous opportunities for government that this presents.”

Eggers, the Global Research Director for Deloitte’s Public Sector practice, based in the USA, believes the boundaries between public, private and Not for Profit are blurring as governments face up to their limitations when it comes to solving tough societal problems.

“We’ve got governments facing their limits right now in terms of citizen demands being insatiable and at the same time government revenues are falling; there’s an increasing gap between the two,” he explained.

“When you look at the limits of government…we just keep on asking them to do more and more things: health care, education, welfare, preventing global meltdowns…and at some point it just reaches an impossible level, and the result is that you just don’t get anything done very well.”

This is even more evident in developing countries, where governments cannot be relied on to provide even the most basic services, let alone solve entrenched, cross-cutting problems. In these countries, there is an even greater need to nurture alternative models for solving these problems.

“Added to this is that across the world you’re seeing a huge intergenerational transfer of wealth…resulting in more money going into foundations and Not for Profits,” Eggers said.

“We are seeing a rise in a new class of impact investors and investing in social change and infrastructure.

“The fact that you’ve got a new asset class around impact is a pretty big change, and then you have the rise of conscious consumers who are often voting with their pocketbooks and investing in and wanting to buy goods and services that they really believe in.”

According to Eggers, this paradigm shift has been gradually taking place over the past several years, and is now rapidly gaining momentum. He said governments in the United Kingdom and USA are leading the charge to increase the supply side and provide incentives for problem solving organisations and ecosystems to start up and grow.

It’s a change Eggers believes will transform the role of the community sector worldwide.

Arriving in Australia this Sunday for his almost-annual public sector tour of the Antipodes, Eggers will be addressing a number of major public sector forums, as well as engaging with senior representatives from the Not for Profit sector at two invitation-only boardroom Think Tanks hosted by Deloitte in Melbourne and Sydney.

The aim of the Think Tanks will be to brief NFP leaders about the emerging solution economy and what they can do to build their capacity to maximise their contribution within the new paradigm.

Eggers said a key issue for Australia is how government can support the NFP sector to grow its capacity to be a major player at the solutions table.

“Australia, like many countries around the world, is trying to figure out how to leverage the Not for Profit sector, social enterprise, business and other avenues to help solve problems and achieve greater public value,” he said.

“A lot of governments are really embracing this and playing an active role in developing the Solution Revolution now, because they understand that their role is becoming the facilitator or the ‘solution recruiter’ to help others to solve problems, or providing funding to seed solution-oriented projects and initiatives. And the best governments are creating environments where these problem-solving ecosystems can flourish.”

Eggers said Australia is in an excellent position to become a world leader in this area, having a strong history or embracing public sector reform and innovation. “I expect the Australian Government and state governments will be very active on this front,” he said, although he added that, to date, the Australian Government hasn’t been as active as its UK and US counterparts in creating the necessary institutional infrastructure for an engaged and active social economy.

For example, there needs to be a legal definition for businesses that pursue social returns in addition to financial gain. In the US they are referred to as ‘benefit corporations’. This widens the scope for investors, he said.

“There’s a whole variety of strategies and changes that governments can introduce to encourage and grow the social economy, including opening up procurement, creating markets for outcomes, extending citizen choices, and shifting power through co-creation.”

If only John Lennon was alive – one can’t help thinking this latest revolution would be worth writing another song about.

The Social Revolution, published by Harvard Business Review Press, was named one of the 10 most notable books of 2013 by Business Digest.