Today the Nonprofit Millennial Bloggers Alliance is writing about how our organizations have been doing more with less, thanks to some great inspiration by Do Something CEO Nancy Lublin’s recent book, Zilch: The Power of Zero in Business. (Nancy Lublin, by the way, is one of my favorite nonprofit writers. Check out her monthly column in Fast Company.)

Let’s step back a little and highlight the obvious: Zero in this context refers to zero money. Not zero talent. Not zero determination. Not zero creativity. My experience in the nonprofit sector over the last year has focused on the work of start-up nonprofits, where people are doing a lot with little to no budget. It is absolutely amazing the things people will come up with, how they will leverage existing low cost technologies, seek out free networking opportunities, utilize connections and so on. One project I’ve been especially excited about, is Pipeline’s #womeninnovator video series which was started by Strategic Initiatives Associate Claire McGovern just this summer. The costs are low (one-time flip cam cost + volunteer hours + free vimeo account) and the returns are high (recognizing, highlighting, and promoting women innovators + creating buzz + fulfilling the org’s mission). The ROI is totally measurable in this context too, as long as we place a dollar value on the social returns.

The only aspect of this equation that is difficult for start-up nonprofits is the sustainability of volunteer (or in other cases underpaid) staff. But, even here there are some great opportunities for non-financial compensation. Providing professional development opportunities, sharing professional contacts, writing letters of recommendation, flexible work schedule, more vacation days, etc. Thanks to the growing interest in high quality-of-life jobs, there are lots of ways nonprofits can satisfy their loyal staff that don’t include big end of year bonuses and tickets to sports games.

Nancy says it best in Zilch:

The misconception is that not-for-profits don’t have to be innovative, that we aren’t ambitious, and that we can simply rely on hard work and commitment and we’ll do just fine…Instead, [innovation is] an integral aspect of out daily functioning. Not-for-profits have to be innovative continuously in order to survive. We need to be creative in order to keep costs down, to find fresh sources of funding, to energize our own over-worked, underpaid staffers, and to figure out an original way to put on an annual event. Without an abundance of resources or manpower, innovation is a way of life.

Furthermore, part of the nature of the nonprofit sector is not only questioning but also rethinking the status quo. This in and of itself requires a great deal of creativity and innovation!

As an artist, I’ve always found that I produce my best work when constraints are applied.The smaller a box you are given to work with, the more things you will be able to discover you can do within that box. Think of kids: One of the most amazing things about kids is they can have every toy in the world, their bedrooms overflowing with expensive dolls, blocks, cars, science sets, video games, etc. but they are bored and “have nothing to play with.” And yet, those same kids can spend an entire afternoon fabulously entertained with just a bucket and a shovel. Or a piece of chalk. Or a stick. The same is absolutely true of nonprofit, or any company for that matter. We just have the good luck to have self-imposed creativity demands.

I’m not really a big quote person, but I think this one deserves the deviation.

(via Mekaelia–YNPN-NYC Partnerships Chair)

I was on vacation with my family in Vermont on January 12th– mostly concerned with sledding as much as possible and eating buffalo wings and s’mores. So, upon my return to civilization I was caught off-guard by the whirlwind of the Haiti earthquake. I saw on CNN the announcement that 50,000 people were presumed dead. “What?! That cannot be right.” I could not comprehend the number of human lives lost or wrap my head around what was going on. But the number has only continued to rise and fatalities are now estimated at over 200,000. It is beyond staggering.

I find it very difficult to understand what it going on and so, I do what most people do when trying to comprehend a difficult situation: I try to empathize. Although, of course in this case that is impossible–I try my best.

I was 10 years old when Hurricane Andrew–a category 5 hurricane–hit South Florida in 1992. I remember the day before the hurricane hit: our house was boarded up with plywood, we brought all the backyard toys into the living room, I took breaks from pulling down grapefruits and avocados from our trees (so they wouldn’t break windows when the wind picked up) by jumping in the pool. We were in an evacuation zone, so we left in the early evening for my grandmother’s house. We passed the night 6 of us in my grandmother’s closet sitting on shoes.

And the next day our house–along with every other one in my neighborhood–was completely destroyed and uninhabitable.

We spent the next couple of months as vagabonds. I remember sleeping in sheets that were unknowingly covered in fiberglass and itching uncontrollably, moving from one person’s house to another, feeling lucky that my grandmother had a gas stove so we could cook and boil water. My mother, meanwhile, was literally excavating our home for anything she could find to salvage, trying to process our insurance (and document every single thing we lost) so we could have a place to live, and just making sure we had the basic necessities. Businesses and schools were closed for months–the economy obviously under duress–as residents tried to piece their lives together and make sense of a life-changing catastrophe.

Hurricane Andrew resulted in $40.7 billion (2008 USD) in property damage and 69 fatalities [Hurricane Katrina resulted in $89.6 billion (2008 USD) in property damage and 1,836 fatalities]. Fatalities from Hurricane Andrew and Hurricane Katrina are each less than 1% of the current estimated fatalities in Haiti. These numbers only just begin to put the extreme devastation in Haiti into perspective. Wyclef Jean, who has been in Haiti recovering dead bodies, very appropriately describes it as the apocalypse:

What does this mean for aid? For disaster preparation? For emergency response? For sympathy? For empathy? But maybe more importantly, for collective action?

The truth of the matter is that it is impossible to understand what is happening in Haiti without being there–you can only imagine, and I know my imagination is not even scratching the surface despite my experience with a destructive natural disaster. But that doesn’t prevent action. Today the YNPN-NYC listserv has been full of benefit events from various nonprofit organizations to raise money for relief efforts in Haiti. The Nonprofit Millennial Bloggers Alliance committed to writing about the topic. Individuals around the world are donating money and raising awareness–text message donations alone have already raised USD$22 million in a week. Celebrities, including Sandra Bullock and Gisele Bundchen who have donated USD$1 million and USD$1.5 million respectively, are also making major financial contributions to the relief effort.

But perhaps the real action is a long-term commitment to relief, development, and moral support. It took South Florida years to fully recover Hurricane Andrew, New Orleans still continues to struggle post-Katrina–and this disaster is far, far worse. Young nonprofit leaders, get ready. Now is the time to step up.

I want to preface my answer by saying that I am a total nerd–so looking at numbers, evaluating statistical relationships, and quantifying values are all very exciting to me. But why do these things matter to nonprofit organizations which are providing social good? If Girls on the Run (GOTR)–”a nonprofit prevention program that encourages preteen girls to develop self-respect and healthy lifestyles through running”–provides a great after-school program, does it really matter what the impact is? Shouldn’t we just be glad that they are providing this service?

The State of Measuring Social Impact

One of the main reasons that social impact measurement is not very well developed is that oftentimes nonprofits are granted a sort of amnesty from evaluation and critique because of their mission-based structure. There is an attitude of: “If you are doing something good, we really aren’t going to be too hard on you.” The second reason is that quantifying the value of social goods is a very difficult and often contentious issue. Your Economics 101 class will always bring up the “how much is a human life worth?” argument. Most people would say “priceless,” but health insurance companies have a real dollar amount they ascribe to the value of human life which is what they base their premiums off of.This is obviously an ethical and moral issue for many people and has been the source of much academic debate.

In the case of Girls on the Run a question might be: (a) How do you measure the self-respect of preteen girls?  and, (b) How much is that self-respect worth?

Defining Social Impact

How a nonprofit defines social impact must relate back to its mission statement. Let’s look again at Girls on the Run’s mission:

Girls on the Run is a non-profit prevention program that encourages preteen girls to develop self-respect and healthy lifestyles through running. Our curricula address all aspects of girls’ development – their physical, emotional, mental, social and spiritual well-being.

Based on their mission, does it make sense for GOTR to do a study to see how many of their participants end up competing in college-level sports? Although an effect of the program may be to encourage more girls to participate in athletics that is not the mission of the organization nor the goal of its programming; therefore, this is not a good definition of the program’s social impact.

What would be an appropriate definition of effectiveness? GOTR’s mission implies that “self-respect and healthy lifestyles” encompass several factors: physical, emotional, mental, social and spiritual well-being. While all of these things will probably mean different things to different girls, this will be the basis of how the organization will define the impact of its programs. They may define positive impact as girls who have high self-esteem, are proud of themselves, are empowered and actively empower others. How they actually define social impact is rather more dire:

Some Sad Facts For Today’s Girls:

• Three million young Americans seriously considered suicide in 2000 and of those, over 1 million actually tried to kill themselves.
• Girls were twice as likely as boys to report contemplating suicide.
• Body dissatisfaction and dietary restraint are predictors of depression in girls.
• Almost two-thirds of girls in 5th-12th grades are dissatisfied with their body shape and want to lose weight.
• Girls as young as five form negative self-images based on their weight.
• Among girls, an emphasis on popularity and slimness along with increased television viewing are linked to low self-esteem.

If You Want To Help Change That, Here Is Some Good News:

• Girls who participate in physical activities are 40% less likely to smoke, have higher levels of self-esteem, better body images, and lower levels of depression.
• Girls who have experienced emotional trauma respond positively to physical fitness programs.
• Girls who participate in physical activities are less likely to engage in risky sexual behavior during adolescence.
• Girls who participate in physical exercise have better relationships with parents, get better grades, are less likely to use drugs and are less depressed than girls who don’t.

By defining their social impact, GOTR has made a very strong case for why its after school running program is necessary. Now the trick will be ensuring that the program is actually impactful.

Measurement: Why bother?

If it seems clear that you are doing something beneficial, why do you need to bother investing time, money, and energy in determining how to measure something as abstract as self-respect?  It’s a good question and I have two answers.

1.) You are in the business of being an expert in _________ (fill in the blank). In this case, girls’ self-respect. Therefore, it’s your responsibility to be not just a program administrator, but also a thought leader–which includes researching, deconstructing, and analyzing the issue you are addressing. Or, if being a thought-leader is beyond the scope of your mission or services, you need to be connected with people who are the thought-leaders in your area.

2.) By better understanding the mechanisms and variables you are working with, you can better serve your population and achieve your mission. Look at this example:

You have high cholesterol and your doctor advises that you switch to a diet of only Cheerios. Two months later you go back and still have high cholesterol. Are you going to keep forgoing other foods in favor of Cheerios? Hopefully not. Hopefully you either (a) get a new doctor or (b) you and your doctor devise Plan B and will have another follow-up to re-evaluate your progress.

Evaluation, trial-and-error, and analysis make so much sense in the case of health, why not social impact? The only difference here is that centuries of medical research give doctors the sophisticated ability to measure cholesterol and provide baselines for comparison. In the Middle Ages, I doubt you would have stopped eating those Cheerios. As far as social impact measurement goes, this won’t require centuries of work but rather a commitment to the importance of social impact metrics, some experts, and some creativity.

GOTR has defined the impact they want to have, but now they want to measure their impact. So what do they do? Call in an expert and get creative:

And The Best News? If She’s Involved With Girls On The Run:

• she has higher self-esteem;**
• she has improved eating attitudes;**
• she has an improved body image;** and
• she has a positive peer group and positive role models for her future.

**According to research conducted by Dr. Rita DeBate, Ph.D., MPH, CHES, assistant professor in the department of Health Behavior at UNC-Charlotte, the Girls on the Run Curricula improve girls self-esteem, body image and eating attitudes to a “statistically significant” extent.

How else are they (unofficially) measuring success? The had an essay contest (sponsored by Secret, all winnings went to the winner’s GOTR chapter) asking each girl to explain “How has Girls on the Run helped you to be more fearless?” Hannah, a 3rd grader from Chicago wrote:

“Through Girls on the Run I learned that I’ll never reach my goal unless I take a chance. I know if I try my best and put my heart into it, I can do anything. I never thought I could finish a 5K but I practiced and worked very hard until I reached my goal. Even though I wasn’t first, in my mind I was a winner, because I tried my best and had fun.“

(I imagine that there are a lot of adults who wished they had that perspective.)

Valuing Social Impact

In the Cheerios example, how highly you value health and longevity will directly correlate with the amount of time, money, and effort you invest in lowering your cholesterol (which in turn relates to what you expect your return on investment, or ROI, to be).

In terms of GOTR, what is the value of girls’ self-respect? What does that translate into in terms of quantitative impact? Do self-respecting women lead more productive and successful professional careers (income is quantifiable), have less health issues (health care costs are quantifiable),  provide better educational opportunities for their children (tuition is quantifiable)? Are there other proxies for the value of self-respect?

Social Impact Investing

Not only does measuring social impact give us great feedback in terms of performance and areas for improvement, but it also helps us evaluate ways to maximize social return on investment. In the end, as a sector,  we want to get as much social bang for our buck. What does that require? Constantly looking for ways to achieve our missions more efficiently and effectively and having a clear understanding of the measurable value of our social impact.

Check out how some of the other nonprofit millenial bloggers view this issue:

Colleen, Does Writing a Check Equal Social Change?
Elizabeth, What is Social Impact?
Alison, Five Problems with How We Measure Social Change
Elisa, Measuring Social Impact
Tracey, The Meaning of Social Impact
James, Measuring Social Impact

Competition: Nonprofits are constantly targeted by the business-minded as lacking efficiency due to the fact that NPOs are not competing in an open market. As a result, the need for innovation is removed. Which is not to say that innovation isn’t necessarily occurring in the nonprofit world, but it tends to be driven internally (as in, “Hey we feel like we want to do this”) rather than externally (as in, “Hey we have to do this if we want to survive”). The competition element is increasing, however, as nonprofit watchdogs, like Charity Navigator, and private foundations are relying on industry best-practices to evaluate the relative effectiveness of nonprofit organizations. This in turn is informing where foundations invest their funding and encourages individual donors to also do their research when giving.

Collaboration: There seems to be two main camps of nonprofits: those who play well and those who don’t–and these two are often easy to distinguish. Nonprofits who play well with others collaborate with complementary organizations in order to better achieve their mission and further define their social niche. For these organizations, there are formal and informal partnerships, co-sponsored events, etc. Those who don’t play well tend to feel threatened by organizations who are “encroaching” on their funding territory and will not only avoid any sort of collaboration, but may even try to sabotage their competitors’ efforts (yikes!).

Communication: Talking with folks in the social enterprise and nonprofit world, something you hear all the time is the lack of communication happening between organizations. Maybe part of that is related to the competition element, where NPOs feel like they only need to communicate with their funders. Maybe part of that is related to the collaboration element, where NPOs don’t feel like sharing what is working well for them because it may threaten their  success relative to others. Either way, the lack of communication is decidedly a factor leading to many organizations simultaneously inventing the wheel…and maybe even simultaneously re-inventing the wheel. Both of these scenarios are pretty inefficient.

What does this mean? In the business world a lack of communication (like trade secrets) are part of what give businesses their advantage over others (for example, Coca Cola’s secret formula). But Coke’s competitors are using private investor money to develop their competing product and  (assuming they believe in the product otherwise they wouldn’t be investing in it) are expecting a return on investment (ROI).

In the social sector, does it make sense to fund Organization A with $10,000 to learn how to best to do X and also to fund Organization B with $10,000 to learn how best to do X? It sounds really obvious, but it happens all the time.

Furthermore, what are the ethical implications of inefficiently (or maybe even irresponsibly) using funding? How can we reduce a lack of communication and collaboration to encourage more efficiency? If Organization A learns how best to do X  with its $10,000 and shares this information with Organization B, then Organization B can learn how to do Y (the next step after X) with its $10,000 and in turn share that information.This would lead to a higher social ROI, because now, instead of having 2X for $20,000 we would have 2X+2Y for $20,000.

“Wait wait! This sounds crazy! But then they would be direct competitors and one would clearly fail!” Well, yes that would happen if they both provided the exact same service. The trick is for these organizations to find niches–which can be geographic, programmatic, population-based, etc. For example, maybe Organization A works in San Francisco and Organization B works in South Africa. Or, Organization A works with environmental issues and Organization B works on hunger issues. Or, Organization A works with elementary school children in NYC and Organization B works with college students in NYC.  Rather than spending time co-learning how to do X+Y, both organizations can now spend the rest of their time perfecting their program based on their niche.

“This sounds like a horrible idea.” Well, it may be a horrible idea, BUT! Look at what open source has done for the mobile technology community. Apple could have made its API a “trade secret” and have a monopoly on the applications that were sold for the iPhone. However, they made it open source and the number of iPhone apps has exploded because individual developers can create applications for the iPhone that they can then sell to iPhone users. So, while Apple isn’t solely benefiting from the income from app sales, they have dramatically increased the value of their product by passive collaboration and communication via open sourcing. [You can also look at WordPress the successful open source blogging platform--which I am currently using .]

Kiva has taken a hint from this and has open sourced their API in order to speed up the development of their online micro-finance program. They even include a list of things that they would love to see someone develop, including:

• An application for iPhone or Blackberry that let’s you keep up with Kiva on the go
• A service where lenders can register for alerts on new entrepreneurs they want to fund
• Integration into a social network where friends can engage around each others’ activity and loan updates on Kiva
• A map that simulates the realtime transfer of funds across the globe

The take-away: Open sourcing is a great way to share information, increase efficiency, and increase innovation because it offers others incentive (whether that is bragging rights and exposure or actual monetary benefit) to participate in your larger development process. It also naturally increases communication, collaboration, and competition (which of course feedback into increased efficiency and innovation). So, the next question is: What are ways that the nonprofit sector can open source?

After 10 summers of living in rustic cabins, prowling around after dark without a flashlight, going on daily hikes, hauling boats around, wrestling with campers’ massive Kmart sleeping bags on overnight trips, and living exclusively in Chacos and Patagonia, it was hard not to laugh at myself. Here I was in my American Apparel get-up, periodically checking my Blackberry to make sure everything was fine at home with my dog, and very cautiously treading on the “uneven” and “rugged” camp trails I had spent years recklessly barreling down.

When I had worked at Rockbrook, in addition to being a cabin counselor, I was on the Outdoor Staff. I led both overnight and day hiking trips, raft guided, belayed climbers, and even drove the bus. I was outside doing stuff everyday. One thing I particularly enjoyed was hiking up to Castle Rock, a rock bald on the camp property, which was a picturesque destination proceeded by a steep climb punctuated with Rhododendrons. Campers usually insisted on stopping several times for breaks on the way up, and on the way down counselors usually encouraged campers to take it slow as the steepness and slipperiness of the trail often resulted in dirt-covered shorts. But once at the top, campers were lead out to the rock bald and helped across a slight gap by counselors, to see a beautiful lookout of the camp property and the French Broad River below.

Castle Rock as seen from camp

So, while on my weekend reunion, my friends and I naturally wanted to go on the hike to Castle Rock we knew so well. Laughing all the way up and telling old stories, I was not-so-silently dismayed at my fatigue (I used to do this hike multiple times a day sometimes) but was relieved to know that all the twists, turns, trees, and rocks were the same as they had always been.

When we got to the ridge, we ducked under low-hanging mountain laurel until the path came to an end at Castle Rock. My throat closed up bit as I saw the gap between the path and the rock bald that I would have to jump over. “That is bigger, and scarier, than I remember,” I thought to myself. Things started to move in slow motion, my senses were heightened, the fight-or-flight response kicking in. “You can do this. You’ve done this one-hundred times. Don’t look like a chicken.” I watched as Molly, who had been hiking in front of me, gracefully hopped over. I looked down at the rock: it seemed so curved, how could you stand on that without plummeting to your death? “A group of 50-year old women just hiked up here this morning. And they were all at lunch—still alive.” I stepped closer, casually of course. My eyes darted to the few trees and shrubs clinging to the edge of the woods, reaching out to the rock bald. They were not going to be of any help. “7-year olds do this! You used to help them do this! On a daily basis!” I was trying to reason with myself, but all my body wanted to do was stay put.

And then…I just took one big step and was on Castle Rock.

On Castle Rock. Check out that gap!

I sat down and looked out over the beautiful view and thought about my 5-second trauma as a city-girl in the woods. I had encountered something, that upon initial evaluation, I thought was impossible to accomplish. Ludicrous even. The rationale I used to convince myself of its possibility was that (a) people of all ages can do this and (b) I myself had done this, not once, but many times. I had known both of these facts before I reached the rock bald, but none of that seemed to matter. All I could think about was, “This is CRAZY!” Believing in yourself in the face of perceived impossibility I think involves four elements (1) practice, (2) a little bit of blind faith, (3) just “be the counselor” mentality, and (4) good friends. Futhermore, I think this applies not just to hiking but also to entrepreneurship–another risk taking venture that involves taking big leaps.

Practice: If you are never outside of your comfort zone, you won’t know what that feels like and the only thing you will be experiencing is some type of hysteria. When I was hiking up to Castle Rock every day, hopping across that gap onto the rock was something I did without thinking about it. When you are used to doing things that make might you a little uncomfortable, like taking risks, speaking in public, networking, making pitches…each task does not seem like a big deal. But if you aren’t doing these things on a regular basis, each incident can get blown out of proportion—and will ultimately take more out of you, preventing you from reaching your ultimate goal.

Blind Faith: Just do it. Don’t think too much about it. (Of course, I am not endorsing reckless behavior on mountains J). You are more likely to spend way too much time sweating over the details than necessary. Sometimes you just have to jump right in and see what happens.

The Counselor: At camp, from one Summer to the next you go from being the camper to being the counselor. In 1998, if there was a snake in the cabin I could still scream for help and run away. In 1999, other girls got to scream for help and now I was the one who had to deal with the snake. In 1998, I was the one being encouraged to climb to the top of the Alpine Tower and given advice from a belayer. In 2000, I was the one encouraging girls reach the top (I had seen it a hundred times, I knew they could!) and giving them advice on “trusting their footing.” On one hand, you rise to the responsibility and you are able to handle situations with grace that you never thought possible. On the other hand, you are a mentor to others—which gives you a unique perspective on possibility. Whether that means you are the CEO or the secretary, the power of responsibility and mentorship is already within you…you just have to find a way to put it to good use.

Good Friends: I’ve always really liked this quote musician Matt Singer gave in an interview:

You seem content where you are currently as a musician. Would you shy away from fame if it comes?

Are you implying that I’m not famous? Anyway, seriously…No. Bring fame on. I’m a big boy now and I think I know real friends from fake ones. And if fame means that I can afford to eat sushi more than once every two weeks, then Fame is my middle name.

Now, to finish up the story on Castle Rock: I had made it across (sweating bullets, of course), Anne hopped over, followed by Ann Marie. My sister (who did not have the good fortune of being on the Outdoor Staff), lingered on firm ground “to photograph.” “Come on!” We urged. But my sister didn’t have that menacing inner dialogue to give her that final big push. So we shouted it out to her: “You can do it! 7-year olds do it! We all did it! It’s not as scary as it looks!” At camp we had grown up in a culture of encouragement and possibility, we all were used to helping others learn new things, overcome their fears, or accomplish something great. After about five minutes of exclaiming that this was just way too scary and laughing at the fact that I was wearing acid-washed jean shorts, my sister made it across, her hands a little shaky.  We all laughed at our own ridiculousness, the time that had passed since we had last been up there, and our choice words of encouragement (“Mom could do it!”).

Know who your real friends are. They will always be there to encourage and support you in any endeavor you pursue, and they will be the ones to make you laugh throughout the process.

(via Wesley)

One such “other” is business center companies (also known as executive suites) which offer small office spaces or even cubicles for rent—for both short and long term lease—and usually offer Internet and telephone access as well as other support services.  Some of these companies include: Green Desk, Wurk Environments, Rockefeller Group Business Centers, and Regus Group.

A NY Times article’s title on the growth of this sector during the recession, “For Tight Times, Office Space on Flexible Terms”, says it all: due to a new set of circumstances (i.e., lack of financial and job security), businesses and entrepreneurs are looking to low risk, low investment, creative, and affordable solutions to their everyday business operations.

Green Desk “really simplified the process of opening an office,” Mr. [John] Humphrey [co-founder of Sustainable Energy Partners, which operates out of Dumbo's Green Desk] said. “Sizing is flexible–if I grow, I can move into a larger space. And they handle office stuff, like receiving packages and making sure the Internet and phone work.”

Green Desk’s other tenants include “a calligrapher, a tour operator, an investment manager and a fashion designer.” Flexible office space is an obvious choice for entrepreneurs and new small business owners–whose numbers have been growing due to large layoffs. Small Business Labs’ top ten list, “2009 Top 10 Small Business Trends”, includes (#1) The Recession Drives Small Business Innovation and (#7) Generation Y Will Turn to Small Business, as well as:

(#4) The Number of Small Businesses Will Increase in 2009: With job losses high and traditional employment options limited, many will turn to self-employment and small business in 2009. The prior three recessions have seen small business formation rates increase. And with it easier and cheaper than ever to start small or personal businesses, we expect a strong year for small business formation – especially personal businesses. Failure rates will also increase, but not enough to offset the number of new small and personal businesses.

These three factors contribute to a growing market for flexible and affordable, yet modern office space. (See the rest of the top 10 for more information on small business trends during the recession.) Not only are these trends indicators of what small businesses should be doing now (for example, being innovative), but they also provide a description of a new, perhaps more resilient business market: (in the case of the three listed above) a potential business client in 2009 is innovative, young, and small.  So what should businesses be doing? After begrudging the fact that business is bad, unemployment is high, layoffs are occuring left and right, real estate is down, and the business next door shut its doors–businesses should re-calibrate in order to take advantage of the new opportunities and trends that have grown out of the recession.

This is the reason why I am particularly interested in organizations that have inserted “coolness” into their equation for addressing youth development. Being cool does two things: (1) It’s great marketing. Everyone wants to be a part of something that is cool. (2) It’s great program development. It shows that your organization is carefully listening to its audience. Things are considered “cool” because people are interested in them and therefore more likely to be invested in participating, resulting in service delivery and mission fulfillment.

I first read about Stoked in Time Out New York’s Cause of the Week (which, as a side note, I think is an awesome feature). Stoked is a “nonprofit action sports organization for at risk youth with the mission of developing successful teens with opportunity, knowledge, experience, and determination through the use of action sports, mentoring, and coaching.”

Stoked offers a one-year program that matches pre-screened mentors and mentees–who agree to meet a minimum of 4 hours per month and receive ongoing training and coaching by Stoked Program Managers. During the year, mentoring pairs skateboard, surf, and snowboard–what could be cooler than that? Operating out of both Los Angeles and New York City, Stoked gives urban American youth an opportunity to participate in very cool, skill-based, and age-appropriate activities that often have barriers to entry (i.e., equipment, transportation, knowledge).

On the other side of the Atlantic Ocean, a 34-year-old Aussie skateboarder, Oliver Percovich, unintentionally discovered, while skateboarding around Kabul, that Afghan youth think skateboarding is cool too. The New York Times article, “Skateboarding in Afghanistan Provides a Diversion from Desolation,” describes Percovich’s mentorship to Afghan youth who have shown an interest in skateboarding. After a couple years of showing up to an empty concrete fountain with half a dozen skateboards strapped to the back of his motorcycle, Percovich started Skateistan, Afghanistan’s first co-ed skateboarding school that “engages the growing numbers of urbanized youth through skateboarding and provides new opportunities in cross-cultural interaction and education.”

The construction of Skateistan’s 1,750 square meter indoor skate complex is underway and will include professionally-manufactured ramps, two classrooms, girls’ and boys’ locker rooms, an office, and a canteen. Skateistan’s “About Us” page is particularly impressive and clearly outlines the organization’s mission and philosophy as well as the need for youth development programming in Afghanistan. They also nail the question “What are the benefits of skateboarding to youth?” right on the head:

Skateboarding in a non-competitive global sport requiring minimal supervision and resources. Achievements in skateboarding are individual and depend on balance, creativity and personal expression. Skating can be practiced anywhere there is a smooth surface and gets young people active and engaging with each other.

Both Skateistan and Stoked are using skateboarding (and in Stoke’s case snowboarding and surfing) as a means to an end: the positive development of youth. And, much of the brilliance in this approach is its irony: that skateboarding for a long time was associated with a subversive, delinquent and rebellious subculture–which made it cool.

Zappos.com is an  internet retail site most widely known for selling a wide variety of shoes, but has expanded to include accessories and bags.  You may ask, “Why is customer service important if all people have to do is surf the internet and enter their credit card information to make a purchase?” Beacuse customer service is always important–and Tony Hsieh knows that. Interestingly, customer service is one of the first things businesses are encouraged to focus on during a recession (See this MSNBC article).

Known for its unconventional and maybe at times quixotic office culture–Zappos strives to “‘create fun and a little weirdness.’” (See the rest of their Core Values.) “Zapponians” (the affectionate term for Zappos employees) even publish an annual Culture Book, explaining what Zappos culture means to them. The Culture Book provides qualitative, subjective information about the Zappos company–and, it is written by Zappos employees. A recent post in the Zappos blog advertises that the next Zappos Culture Book will feature submissions from customers as well. What is the value added of this publication? It gives employees (and now customers) a voice, adds value to their input, increases transparency, and provides a positive and fun qualitative analysis of how the company is operating.

Zappos’ zany office culture extends into its hiring practices.  A hiring policy mentioned in The Economist article that I found particularly interesting was:

[I]n their first weeks with the company, new employees are offered $2,000 to quit—a significant sum for call-centre trainees who start on $11 per hour.

That is a significant sum! But, more interestingly,  is employing basic economic principles in nontraditional ways and means two things: (1) In offering the money, Zappos really doesn’t want people working there who don’t want to be. And, (2) in forgoing the money, new hires (at least call-center trainees) demonstrate that they would rather work for free for over a month (at $11 per hour and 40 hour weeks, monthly salary before taxes is $1,760) than give up their job at Zappos. This begins to outline a quantifiable reservation price for employment at Zappos and serves as  a nice psychological reminder to employees that they are financially invested in their career at the company.

Is this off-the-wall approach successful? It sounds like it:

Last year it [Zappos.com] rang up a record $1 billion in sales even as other retailers were struggling.

Also,  Tony Hsieh twitters! As of right this second he has 519,390 followers, and uses this social media tool to educate others about his company’s unusual practices, increase corporate transparency, and give his employees a voice.  Follow him here.