Risk & The Relentless Pursuit of the New

There is a lot of talk about innovation in public service media these days. It is hard to even have a conversation about the use of technology or digital media without tying it back to the development or adoption of a new innovative technology or practice.

Before I go on further I should make sure that I am defining my terms. When I reference 'innovation' there is a whole continuum of what could be construed innovative or more properly put, perceived as innovative. (What is innovative to one person is old hat to...yeah, you know.) The innovation stretches from adoption of new practices to new insights within established systems to the adoption of new technologies.

Today, it seems that most of the time we use "innovation" as a blunt instrument within public purpose media. I think we generally define innovation with the following formula:

Leading Edge Technology + Repurposed Information = Innovation

I feel we have put a premium on the use of technology applications that re-serve information - data points, content, transactions...in new and newer ways. (Is this innovation? Yes, through a particular lens.) In fact, I think we are in the "pile-on" phase of this type of innovation, where we are getting 64 flavors of community tweets, events, opinions, news mash-ups, etc.

And this premium of this particular type of innovation is often times amply rewarded.

For example, just the other day the James L. and John S. Knight Foundation just recently announced over $2.7 million in grants to the Knight News Challenge winners in 2010. This is the [Correction: fourth] year of the funding that will eventually invest $25 million over five years into innovative journalism tools, platforms and technologies. While Knight is the core funder of journalism-technology innovation, they are joined by the Ford Foundation, the Pew Center for Civic Journalism, the William Penn Foundation, the McCormick Foundation, among others.

Now this starting to sound that I am cynical to innovation. That I am complaining about Innovation for Innovation's Sake. I am not!

I saw the evolution of technology and digital media tools in my own work. I remember early on quite diligently researching and manually entering the addresses, hours of operation and description of resources in The Beehive. Then we built an API and a robust database service called the Resource Locator. And now Mark Murphy and the Technology Team the team at One Economy recently launched the Resource Locator as a virtual reality service on Layer. This is good stuff and I really applaud how they have taken the basic foundations we laid and made it into something experimental, interesting and unique.

And when I look at the Knight NewsChallenge winners I am excited to see what they are going to roll-out in the next several months. It is a very, very exciting time to be a part of digital media and in particular public service media.

The Challenge of Risk

However, I am also a bit concerned about the LACK of conversation about risk, and in particular the management and sustainability of continuing this relentless innovative focus.

While innovation has clearly created mission value, there is also a question of how it will create lasting (asset or income) value. There is little discussion or analysis paid to the life cycle of the technology innovation, the maintenance/operating costs of the programs or the total cost of ownership.

This is not an argument against taking innovation or slowing it down, but an argument that inherent in the act of innovation is the need for intentional risk assessment and management. I have increasingly been seeing stories about the "future skills of journalists" such as this story here and this one here. And while I think these articles make great points (love that MediaShift), I worry that I am not reading more about urging the adoption of the "business skills" within journalism or digital media.

I am not suggesting every digital media practitioner learn "managerial accounting" and "financial analysis." But we sometimes seem to treat digital media as either a playground - an earnest and serious one - or as a something that has to be done because everyone else is or that it is expected of us. (Sigh...there is always an implied sigh at the end when someone expresses this thought.)

This is a disservice to what is an essential element of digital media, which is that it is a business.

A nonprofit is still a business, and frankly one that requires staff to be more entrepreneurial than most companies. I should know since I have been working at nonprofits for the past - oh God, don't say it - 14 years.

Public service media does not have an innovation problem...or at least one anymore. What we have is a risk management problem. As a group, an industry, a system...we are not properly arming ourselves with the necessary enterprise skills, tools and perspective to make our efforts sustainable.

One of the fundamental facts of working in public service media is that the mission attracts,

drives and sustains you. Another fundamental fact is that if you don't manage your cash flow, watch your balance sheet, look for operational efficiencies and diversify your revenue you are going to fail.

When we fund or lead innovation we are often looking at the wrong thing. Or perhaps more aptly put, we are not looking at the full picture. Innovation is a shiny object. What we should be paying attention to is a portfolio of assets, liabilities and the transactions that connect the two.

While overly simplistic, below are some broad

areas that hold the keys to proper analysis of return on innovation. Within these areas we should be building both metrics and analysis that tie traditional business financials with the increasingly sophisticated digital media analytics. We need an Innovators Dashboard that enables both funders and managers to understand the risk and rewards of building and implementing innovative digital media practices.

This type of rigorous analysis is just emerging and there has not been to date a concerted effort at building the type of best practices needed. When I speak to senior managers at public purpose media companies I often ask the question "what metrics do you look at on a regular basis?" The unfortunate answer is that they hardly look at any metrics; more often than not they are guiding themselves and their small companies forward by feel, grit and determination. It is a worrying trend that I, as both a funder and digital media person, should start to address. My hope is that there others out there who want to help out.

The starting point is well away from the funder's decision-making process. It needs to start at the most basic level, and that is the innovator him/herself. We can and should continue to innovate, but every innovator should also take the time to learn the skills they need to make that innovation sustainable. Any entrepreneur has multiple personalities: artist, hustler, visionary, salesperson... Now is the time to add one more: business person.