Adaptive Philanthropy in Practice

At a time when strategic philanthropy has become the industry standard, it is crucial to stress the importance of adaptive strategy. Strategic philanthropy—which attempts to help funders reach specific goals related to their mission or business model by predicting outcomes—has allowed funders to create bold programs with clear performance metrics. Strategic philanthropy looks great on paper, however the approach is largely focused on planning, with little attention to implementation. This is why so few strategic plans produce the outcomes they promote, and why so many funders spend a lot of time and money back at the drawing board. In comparison, adaptive philanthropy focuses on project implementation, creating structure and guidance for funders dealing with all the twists, turns, and obstacles that inevitably arise when ambitious ideas are tested in the real world.

An Adaptive Philanthropy Primer

At its core, adaptive philanthropy requires—allows—funders to incrementally adjust their impact strategies based on new information and changes in the field. Though most funders are adaptive in certain aspects, very few actually function in a way that allows adaptation to guide their decisions on a daily basis. This is because, in practice, adaptive philanthropy requires both a cultural and an operational shift in the industry. More specifically:

• It requires a learning culture that accepts failure as both likely and necessary. 
• It requires executives and trustees to entrust more decision-making power in those closest to the field, such as program staff, evaluators and grantees. 
• And it requires more nimble procedures for vetting prospective grantees, doing due diligence, processing grants, and evaluating both high-level strategy and specific programs.  

Adaptive philanthropy is not a new concept, per say. In 2011, Pawson, Wong, & Owen’s report, “Known Knowns, Known Unknowns, Unknown Unknowns: The Predicament of Evidence-Based Policy,” pointed out how strategy often clashes with the “dynamics of complex social programs.” In 2013, Patricia Patrizi and her colleagues at the Evaluation Roundtable followed up on the topic in “Eyes Wide Open: Learning as Strategy Under Conditions of Complexity and Uncertainty,” which outlined the three major traps confronting funders’ success: linearity and certainty bias (expecting a project to progress in a linear fashion and produce definitive outcomes), the autopilot effect (when funders disengage after the planning process), and indicator blindness (looking only at specific indicators as a means to gauge success). Though the article offered valuable suggestions for improving funders’ perspectives, they did not offer specific steps for implementing an adaptive approach through a project's lifecycle. A year later, Kania, Kramer and Russel, three FSG Directors, described the evolution of their own thinking with regard to philanthropic strategy in their SSIR piece, “Strategic Philanthropy for a Complex World”. In addition to echoing many of the points made, the authors recommended that funders substitute strategic plans, many of which FSG helped them create, with an “emergent model,” which can be supported with instruments such as “system maps,” “cultural frameworks,” “scenario planning,” and “active sensing”.

Still, very few funders have actually taken an adaptive or emergent approach to date. Why? Perhaps because “emergent model” sounds more like a vague idea than a concrete approach or because the term “adaptive” sounds like a direct contraction to “strategy,” requiring funders to discount the extensive work they’ve already devoted to strategic planning. This is why my consultancy, Adaptive Philanthropy, has created specific tools and frameworks to support funders in integrating adaptation into their existing programs. These tools don’t require funders to disregard goals or performance indicators, nor do they ask funders to start over. Instead, they allow foundations and family offices to integrate clearer—and leaner—feedback loops that incrementally translate learnings from implementation into better program strategy. 

For example, with my “Failscape" guide, I work with funders to explicitly identify how even the most fundamental components of their programs might fail and what learnings could come from each failure. Rather than simply listing foreseeable risks and assumptions or predicting all possible alternative strategies, the Failscape simply pre-determines who has the authority to take action should a failure occur and the boundaries within which that individual can operate. I also work with clients to formulate “IF, THEN Provisions,” which guide project implementors to troubleshoot issues as they arise. These simple actions can transform static strategic plans into living documents that grow alongside the programs they guide. 

An Adaptive Case Study: The Walton Family Foundation and the Delta Bridge Project

For a clearer example of how adaptive philanthropy can be practically applied to improve philanthropic programs, let’s examine the Walton Family Foundation’s involvement in the Delta Bridge Project, a promising program but one that the Foundation recently deemed a “philanthropic failure.”

In 2003, the Walton Family Foundation (WFF), in partnership with a Southern Bancorp Community Partners affiliate, launched the Delta Bridge Project, a “comprehensive community change” initiative in the Arkansas and Mississippi Delta to address poverty in the region by “pulling many social and economic levers at once.” The Walton Family Foundation committed $50 million to the initiative, which was based on community input and guided by a 10-year strategic plan containing 46 strategic goals and 200 action steps. Under the plan, six distinct committees were created to lead programs focused on education, housing, health care, economic and community development, tourism, and leadership, while a separate entity, led by community volunteers and made up of small issue “teams,” would manage the funding. To assess the program’s success, WFF tracked regional indicators such as emigration, poverty rates, tourism dollars, and academic performance. 

Over the course of the decade, WFF funded many programs, including a KIPP charter school, a blues festival, the Boys and Girls Club, Teach for America, and a downtown revitalization plan for Helena. But by tracking specific poverty indicators and surveying local residents, the Foundation realized that they were not having the impact they’d projected. After just one year, they asserted that they had missed crucial funding areas and were spread too thin among projects. As WFF admitted in an article on Philanthropy Roundtable, “The idea that one organization and one plan could succeed where both the private and public sectors have failed was perhaps too audacious. At the very least, our theory of change was wrong.”

In 2009, Delta Bridge Committees lead the process of creating a second generation 10-year plan for the region. Southern Bancorp touted the initial 10-year project as a triumph, and the new plan expanded the initiative to new counties in the Mississippi River delta region. But the Walton Family Foundation’s involvement changed dramatically.  While WFF recommitted to funding the region with an additional $50 million (around $2 million of which goes to Southern Bancorp annually), the Foundation shifted its focus to specific projects rather than fund the community-led initiative. This shift in WFF’s support appears to have dramatically slowed progress. Though the Delta Bridge Project has not publicly announced its closure, it does not appear that the initiative is still funding projects as part of its strategic plan. (The Delta Project has not responded to inquiries about its progress and the website has not been updated since 2014.) 

How an adaptive approach could have helped

In supporting the Delta Bridge Project, the Walton Family Foundation did many things correctly. They allowed a wide range of local stakeholders to guide planning and implementation. They identified indicators that would help them track success. And they publicly acknowledged that they made mistakes and recommitted to funding the region. 

But from an adaptive philanthropy perspective, WFF missed many opportunities to incrementally improve a promising community-led program. First, WFF was impatient with a large goal. While WFF eventually acknowledged that its approach was too ambitious, it laid blame on specific mistakes, not the overall timeline. Foundation staff reported that they saw shortfalls early on, and conducted an evaluation of the project after only one year. While monitoring performance throughout a project is a good thing, expecting to see change in the region’s poverty indicators after 12 months is fanciful. 

Second, WFF made a crucial mistake by supporting a static strategic plan, which supported the Foundation in taking a binary viewpoint (did it work or not). Acting as a passive observer, the WFF allowed the program to run its course, and ultimately discontinued funding based on the discrepancy between their predicted outcomes—drafted 10 years prior—and their actual outcomes. Using an adaptive approach, the Foundation and the implementing committees could have proactively improved the program in real time, by considering: how is this working, how is this not, and how can we refine this to work better?

Like most philanthropic efforts, the WFF’s well-researched and well-articulated strategic plan required the project to be not only implemented in the way it was originally outlined, but also effective in the way it was originally anticipated. The Walton Family Foundation recently acknowledged that early on in the project they realized that they needed to focus on public safety first, in order to gain traction on other initiatives. Yet, WFF wasn’t able to fund public safety measures until 2013, ten years after the project began. The Foundation also acknowledged that several committees were not functioning properly due to volunteer turn-over, yet volunteer turn-over is not a rare occurrence. The Foundation and its partners could have prepared for this by conducting a Failscape Analysis and including IF, THEN Provisions in the final plan have allowed the steering committee to restructure or dissolve the sub-committees as needed. Additionally, if WFF staff was allowed to refine the strategy within certain boundaries as the program progressed, rather than have to present a summation report to the Board of Trustees for their approval, the Foundation could have taken incremental action as opposed to dramatically changing course in the end.

To be fair, it’s easy to find fault in philanthropic strategy in hindsight and Adaptive Philanthropy will not help funders forecast the outcomes of their programs any better than other approaches. But that’s just the point. To embrace the Adaptive Philanthropy approach is to accept that strategy can never be perfect nor outcomes predicted with certainty. Ambitious ideas and strategic plans are a good start to addressing the world’s most pressing and complex issues, but positive outcomes are the result of proactive learning, refinement, and adaptation. 

Find out how you can build a more adaptive funding strategy with the support of Adaptive Philanthropy by emailing Hannah Erickson at [email protected].