Updates Continued: Mo Ibrahim Prize/Food Security/Participatory Innovation

Stephen DeAngelis

October 26, 2009

This is the fourth in a series of posts that update past blogs.

The Mo Ibrahim Prize

In a post entitled Leadership and Good Governance in Africa, I discussed the Mo Ibrahim Foundation and its annual prize for good leadership in Africa. The Mo Ibrahim Prize for Achievement in African Leadership, which can be awarded annually, recognizes a former executive Head of State or Government who has demonstrated exemplary leadership. Winning the prize sets up a leader for life. As the world’s biggest prize, it provides US$500,000 per year for a period of ten years, and US$200,000 annually thereafter. The big news (even though it’s not good news) is that the prize won’t be awarded this year [“African leaders’ failure to win prize seen as rebuke,” by William Wallis, Financial Times, 20 October 2009]. Wallis reports:

“Mo Ibrahim, the Sudanese telecoms magnate, will not award his $5m African leadership prize this year, a decision seen as a rebuke to the former presidents of Nigeria, South Africa and Ghana, among others. The prize, now in its third year, is given to heads of state who rule wisely and hand over power to elected successors. Mr Ibrahim launched the award, along with a related index on African governance, after concluding that poor governance was the biggest impediment to Africa’s development, and deciding to devote the fortune he made selling Celtel, his telecoms company, to the promotion of leadership. … Thabo Mbeki, the former South African president; Olusegun Obasanjo, Nigeria’s leader between 1999 and 2007; and John Kufuor of Ghana were all eligible having stood down within the past three years. The decision not to reward them was made by a panel including Kofi Annan, the former UN secretary general, Salim Ahmed Salim, former chairman of the Organization of African Unity, Mary Robinson, Ireland’s former president, and Mohamed ElBaradei, the outgoing director general of the International Atomic Energy Agency.”

Mr. Ibrahim indicated that people could draw their own conclusions from the fact that a winner was not designated. Like Mr. Ibrahim, I think the conclusions are obvious.

Food Security

Since food security is a critical part of sustainable development, I have written a number of posts on the subject (see, for example, Gates & Rockefeller Foundations Tackle Food Security in Africa, Buying the Farm, Food Crisis and Recession, New Approach to Food Security Applauded, and Urban Farmers). In the first of those posts, written over three years ago, I discussed the fact that the Bill and Melissa Gates Foundation was teaming with the Rockefeller Foundation to create a new “green revolution” in Africa. Up to that point, the Gates Foundation had concentrated mostly on dealing with diseases like malaria in the developing world. Recently, Bill Gates announced that he is refocusing more intensely on food security [“Gates’ charity to focus on food security,” by Javier Blas, Financial Times, 16 October 2009]. Blas reports:

“Bill Gates, the Microsoft founder turned philanthropist, has put the focus of his multi-billion-dollar foundation firmly on food security, saying … that making poor farmers more productive will have a ‘massive impact’ on hunger. The move by the Bill and Melinda Gates Foundation into food security after an emphasis on health issues such as malaria signals how agriculture has become a global preoccupation as the number of chronically hungry people tops 1bn. ‘Helping the poorest smallholder farmers grow more crops and get them to market is the world’s single most powerful lever for reducing hunger,’ Mr Gates said as he announced $120m in one-off grants for research and development. While the foundation has already provided $1.4bn (€939m, £861m) to food security projects, the new grants and Mr Gates’s speech point to a bigger prominence for agriculture. … Roy Steiner, who oversees the foundation’s agricultural projects, told the Financial Times the current political climate was a ‘defining moment for global food security’. … Mr Gates said efforts to help small farmers were endangered by an ideological wedge between those supporters of a ‘technological approach that increases productivity’, such as the use of genetic modified organisms, and an environmental approach that promotes sustainability. ‘It’s a false choice,’ he said. ‘The fact is we need both productivity and sustainability.”

In the weeks to come, I will be writing a number of posts about food security and the challenges that lie ahead. In one post, I will discuss the fact that some analysts believe the world will have a very difficult time feeding itself by 2050. As Gates noted in his address, this year the number of people suffering from hunger rose to over 1 billion [“Experts Worry as Population and Hunger Grow,” by Neil MacFarquhar, New York Times, 22 October 2009]. MacFarquhar reports:

“Scientists and development experts across the globe are racing to increase food production by 50 percent over the next two decades to feed the world’s growing population, yet many doubt their chances despite a broad consensus that enough land, water and expertise exist. The number of hungry people in the world rose to 1.02 billion this year, or nearly one in seven people, according to the United Nations Food and Agriculture Organization, despite a 12-year concentrated effort to cut the number. The global financial recession added at least 100 million people by depriving them of the means to buy enough food, but the numbers were inching up even before the crisis, the United Nations noted in a report last week. ‘The way we manage the global agriculture and food security system doesn’t work,’ said Kostas G. Stamoulis, a senior economist at the organization. ‘There is this paradox of increasing global food production, even in developing countries, yet there is hunger.’ Agronomists and development experts who gathered in Rome [in early October] generally agreed that the resources and technical knowledge were available to increase food production by 50 percent in 2030 and by 70 percent in 2050 — the amounts needed to feed a population expected to grow to 9.1 billion in 40 years. But the conundrum is whether the food can be grown in the developing world where the hungry can actually get it, at prices they can afford.”

It doesn’t take an agronomist with a PhD to know that when large numbers of people live on lands on which crops are difficult to grow hunger is going to result — even in good times. Too often, those hard scrabble lands are found in places where good times are hard to find. Answers to these challenges aren’t easy. MacFarquhar continues:

“The so-called green revolution of the 1960s and ’70s ended the specter of mass famines then, but the environmental cost of chemical fertilizers and heavy irrigation has spurred a bitter divide over the right ingredients for a second one. In addition, the demand for biofuels may use up crop land. And as scores of food riots in 2008 showed, oil prices and other income shocks can quickly drive millions more people into hunger, sending ripples of instability around the world.”

Even though world leaders have agreed that the international community needs to shift focus away from food aid toward food production, they don’t agree on how that should be done.

“World leaders often evoke the green revolution of the 1960s and ’70s as an inspiration for future progress. The original revolution employed new seeds, fertilizers and irrigation in Asia and Latin America to stave off famines affecting millions. But the green revolution’s concentration on wheat and rice would be impossible to copy in parts of Asia and in Africa, experts say, noting that Africa has seven or eight staple crops, wildly varied growing conditions and only an estimated 7 percent of farmland irrigated. Then there is the question of genetically modified crops. No issue provokes such an emotional division among agronomists, who debate whether they constitute the building blocks of a second green revolution or a health menace.”

I’ll touch on many of these issues in the weeks ahead.

Participatory Innovation

Back in January 2007, I wrote a blog entitled A New Approach to Innovation that talked about company called InnoCentive. InnoCentive makes money by charging clients looking for solutions (“the seekers”) to post problems on a Web site where problemsolvers are offered cash — usually less than $100,000 — to solve them. The Economist recently updated how the company (and participatory innovation) are faring [“A market for ideas,” 19 September 2009 print issue].

“A problem shared is a problem solved: that is the belief that inspired InnoCentive, a firm that describes itself as the ‘world’s first open innovation marketplace’. Conceived in 1998 by three scientists working for Eli Lilly, a big drug company, InnoCentive was spun off as an independent start-up three years later. It is based on a simple idea: if a firm cannot solve a problem on its own, why not use the reach of the internet to see if someone else can come up with the answer? … Around 900 challenges have been posted so far by some 150 firms including big multinationals such as Procter & Gamble and Dow Chemicals. More than 400 have been solved. InnoCentive reckons the approach can work for innovations in all sorts of fields, from chemistry to business processes and even economic development. It has formed a partnership with the Rockefeller Foundation, a charity, to help solve problems posted by non-profits working in poor countries, with some initial success.”

I believe the combination of participatory and reverse innovation (i.e., innovations coming from the developing world to the developed world) will make the developing world a hotbed of innovation in the years to come. As I noted in my earlier post, “This ‘prize’ approach to innovation means that companies (the seekers) don’t have to spend huge sums for headhunters to search out creative people, especially when they are searching for answers to a single problem. For their part, the solvers are often happy with their current employment status and are just looking for interesting challenges to satisfy a deep, internal creative itch.” Case studies have underscored the financial benefits of this approach.

“Forrester, a consultancy, studied a pilot partnership between InnoCentive and SCA, a Swedish maker of personal-hygiene products with over 50,000 employees and annual sales of €10 billion ($14.6 billion). It found that challenges posted by the firm generated an average return on investment of 74%, with a payback period of less than three months. Forrester also found cost savings, a faster research process and a more innovative culture.”

Any good analyst knows that asking the right question is critical to getting the right answer. SCA certainly found this to be true.

“According to one SCA executive, the firm piloted the relationship by posting several chemistry challenges, ‘some of which worked and some didn’t.’ Phrasing the challenge turned out to be key. Rather than posting a problem specific to the firm, SCA got much better results when it posed a general problem (how to make a material more absorbent, say). That way the potential network of experts was wider. So far the challenges have been small: the largest prize paid was $25,000. But SCA now expects to expand its use of InnoCentive into the mainstream of its innovation process.”

I was surprised to read that InnoCentive’s process has skeptics. According to the article, skeptics “worry that its success on incremental, scientific challenges may not extend to broader, more substantial innovation because the research culture in most firms is incapable of posing the right questions or knowing what to do with the sort of answers produced by InnoCentive’s solvers.” Who cares if the solutions are incremental or limited? Surely, the company’s founders didn’t believe that its approach would replace basic research or other forums for innovation. There is no one best approach. The article continues:

“A recent innovation may help. Called InnoCentive@Work, this replicates the solver network inside a firm, so that challenges are first offered to ‘seeker’ companies’ own employees. Only if they cannot help is the outside network brought into play. ‘Companies often don’t know how much they already know,’ says Dwayne Spradlin, InnoCentive’s chief. An early challenge at one firm was to find a source of some data, which, it turned out, had already been acquired by another division. One of the first firms to test the @Work model was InnoCentive’s mother ship, Eli Lilly. … The fact that Eli Lilly is making ever more use of InnoCentive to drive innovation even as it is making cuts elsewhere proves that it pays, says Mr Spradlin.”

Participatory innovation is a perfect tool for the information age. As broadband connections reach more and more people, the number of solvers will only grow. The meteoric rise of social networks attests to the power and importance of connectivity. InnoCentive is like a social network for solvers.