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Responding to the Challenges of the 21st Century
November 2006The mission of the Rockefeller Foundation, set out by John D. Rockefeller, Sr. to “promote the well-being” of humanity, has guided the work of the Foundation since it was formed in 1913. This mission has not changed, nor has our steadfast commitment to achieving it by addressing the “root causes” of some of the world’s largest problems.
Our values, likewise, endure.
But the world in which the Foundation operates has changed considerably, and the ways in which the Foundation must operate have been transformed.
Mr. Rockefeller’s contributions to the Foundation’s endowment totaled about $240 million. In today’s dollars, this would amount to about $2.8 billion. Our endowment, even after distributing the modern equivalent of $13 billion, is actually more than 10 percent higher, in current dollars, than what Mr. Rockefeller contributed.
But the world—or at least the world as it is understood—has changed and grown enormously. For instance, in 1929, when it absorbed the Laura Spellman Rockefeller Memorial, the Rockefeller Foundation was one of the few – and by extension – one of the largest foundations. Today, we are the fifteenth largest foundation in the United States. Philanthropy itself has grown exponentially in recent decades. Today there are more than 68,000 foundations in the United States, providing more than $33 billion in grants in 2005 alone.
The Foundation funded the majority of early work in public health in the United States, and in many places around the world. Today Harvard’s School of Public Health alone has an endowment of about $850 million. The Foundation led the way in funding basic research that eradicated yellow fever. Today, the World Heath Organization spends $900 million a year, while the National Institutes of Health spend $28 billion annually.
One could react to these facts by echoing the old plaint of the fisherman that “the sea is so wide, and my boat is so small.” But that is not how we see it.
We see, instead, powerful allies that have joined the fights we pioneered. We see opportunities everywhere for new partnerships and networks. We see, in short, greater chances to promote the well-being of humanity. And we inherit a very powerful legacy, providing us with standing—and inspiration.
These new opportunities will require new endeavors on our part, and new ways of working.
First is the imperative of focus. We must be more strategic in our grant-making, which means being equally thoughtful about what we can’t attempt as about what we can. We must concentrate our resources where they will have the greatest impact, such as by kick-starting new ideas, or breaking through bottlenecks. We must avoid the temptation to engage in areas where others are more appropriately involved -- in many cases public entities (especially where large sums are required). We must recognize that our resources alone are insufficient to adequately support basic research, or to take innovations to scale.
Next we must be rigorous in our understanding of the systems that create conditions we seek to change, and of the networks already engaged in seeking to change them. We need to be more nimble in forging alliances, and marshalling resources other than our own.
Third we must relentlessly press our advantages. Among these: our capacity for the risk that underlies most innovation, for venturing where others remain reluctant to go; our ability to be patient in developing sustainable solutions rather than illusory quick-fixes; and our “brand,” the embodiment of our heritage, including not just our convening power, but also the ability to move not just money but minds and policies.
We need to change internally as well, reducing complexity and simplifying processes, cycling decisions more quickly, communicating more clearly. We need to reduce our internal focus, and pay more attention to the imperatives of grantees and ultimate beneficiaries. We must also foster a shared culture within the Foundation that is guided by a passion for excellence and a search for impact in everything we do.
In the end, it is not the investments that determine how any great organization is judged, but the outcomes of those investments. For us, those outcomes will be guided by our ability to innovate, influence, and generate impact.
Innovation, Influence and Impact
Our ability to execute the “three I’s” is crucial to achieving the type of successes in the 21st Century that were the hallmark of Rockefeller Foundation philanthropy in the previous century.
By innovation, we mean the ability to identify more than just what is new. It means being both creative and expansive in how we identify and understand deep contextual challenges and in how we devise and deploy potential solutions. We will need to improve our capacity to assess complex issues and conditions that slow progress - and become more imaginative (including identifying innovative people and organizations) in seeking potential avenues to break bottlenecks and foster transformative change.
Influence is a critical currency in today’s rapidly changing world, where the complexities of market systems, governmental structures and cultures interact and compete for limited resources and advantage, and where the risks of people falling further behind are increasing. We will need to achieve greater leverage in shaping and informing ideas, fostering debate, and focusing public attention. We will need to think and act more strategically to build influence, by expanding our relationships and partnerships, convening with greater purpose, and better utilizing multiple channels of advocacy and engagement.
Impact is tangible, identifiable and in many cases, measurable. Achieving it will require greater focus - in how we target our resources, our time and our energy. We need to focus our attention on issues and places not only where we know that change is needed, but where we have a real ability to affect change. This will also require continuous assessment and learning, and having the flexibility to change course when necessary.
We also need to change how we operate the Foundation. Here we have three guiding principles:
- Flexibility balanced by risk management. Our operations need to be efficient and flexible. This will allow us to respond quickly and strategically to new opportunities, changing environments and a rapidly globalizing world. Our flexibility needs to be balanced against a prudent approach to risk—taking risk when it is strategically important, while managing our overall risk exposure.
- Building a strong center that adds strategic management and cohesion. By “center” we mean the strategic functions outside of program (e.g. communications, operations, etc.). A strong center can be involved across programs, leveraging initiatives pursued by each program to create greater overall value for the Foundation. We want the center to be involved in a way that genuinely adds value to the initiatives, and early enough so that we can avoid wasted time on less valuable opportunities or on the wrong priorities.
- Cost justified by our objectives. We do not have a cost reduction target. Rather we are looking at the spending of the Foundation in the context of our overall objectives. Expenditures need to be justified by what we are trying to achieve.
Our Work in 2006
To achieve these goals, we must combine changes to what we do in our programs, with how we work in our operations. While change is necessarily an ongoing process, we have set some clear objectives for 2006 that will guide our work moving forward.
This year, we will:- Develop and refine program strategy
- Better align our organizational structure and operating model to advance our strategies
- Continue to build a strong team of people
- Streamline and improve our processes and procedures
- Clearly communicate our changes internally and externally
Our challenge now is to accomplish each objective using the best thinking from staff, partners and external experts. For many of these objectives the process is iterative -- creating the best answer given what we know today, and testing, learning and refining as we go forward.
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