Over at Brewed Fresh Daily, a comment by John Polk triggered these thoughts:

Metrics and why we measure.– We are moving from an industrial world that relied on stable, deductive models to a world of networks that relies on continuously shifting inductive models. Our economy exists as a shifting pattern of networks embedded in other networks.

In a world of networks, metrics help us learn “what works”.

This attitude toward metrics contrasts with an industrial mindset which presumes hierarchical command and control. In this world — in which most of us grew up — metrics provide simple ways to respond to weak performance and reward superior performance.

I suspect that this view explains why the staff at the Greater Cleveland Partnership has been so sloppy in its deployment of metrics. It’s hard to spot underperformance when you do not measure it consistently. (At the same time, the GCP staff is equally careless in claiming that its efforts create extraordinary “returns on investment”.)

The Fund for the Future has fallen into a different trap. It’s Dashboard is, in my view, a useless management tool. The problem arises for a simple reason. The Fund did not sufficiently distinguish among the different types of metrics: resource (or input) metrics, outcome metrics, process metrics, and impact metrics. The Dashboard compiles an opaque set of indexes of impact metrics and presents them in simple-minded gauges.

Strategic thought and action.– Metrics, to be a useful management tool, need to be tied to a strategy: a set of strategic outcomes. A strategy draws logical links between action, outcomes and impacts. In other words, a strategy defines a “theory of change” in the parlance familiar to foundations. (Funders routinely request grantees about their “theory of change”.) In business, this theory of change finds itself as the core precepts of a business model.

Open networks similarly pose major challenges to how we think and act strategically. In the past, models of strategic planning made sense. No longer. Now, we need a practice of strategy that emphasizes iteration, flexibility, experimentation.

Strategic Doing, the discipline we are developing at Purdue, compiles a set of models, tools and practices designed to guide our strategic thinking and quickly translate ideas into action, in order to learn “what works.”

In my view, neither the GCP or the Fund have a clear, concise strategy. Both largely ignore the key driver of economic prosperity: educational attainment. I suspect that neither wants to venture into education politics. Sadly, though, they have no real choice. The social and economic costs of Cleveland’s drop-outs will swamp any glimmer of economic development coming from their current pattern of investments.

The bigger weakness, though, comes in that neither the GCP nor the Fund ties its strategy to a stable, simple process of civic engagement. In other words, there is no mechanism to adjust to new realities or spot new opportunities and respond quickly.

Engagement, open networks and authenticity.– It’s no secret to most of us that we live in a world of open networks. This transformation is fundamental to our economic, social and civic life. In the old industrial world, civic engagement represented an event in a linear process. It took various forms: a public hearing, a public comment period, a citizen forum, a town meeting.

Now, though, the Internet means that citizen engagement can be — and often is — always on. We need new tools to deal with this complexity. Pretending that old approaches will work does no good. Trying to turn away is even more foolish.

The Fund stumbled badly in trying to adjust to these new realities by investing $3 million in their ill-fated Voices and Choices initiative. There are a number of reasons V&C did not work, but here’s the good news: Authentic civic engagement can be fast, inexpensive and fun. We are demonstrating this with our Strategic Doing workshops around the country now.

To be effective, the Fund still needs to make this adjustment to open networks. The first challenge (and this one might just be the the real stumper) will come in changing mindsets. From its conception, the Fund was designed to limit engagement (no unsolicited proposals) and maintain control over its agenda. (Over the years, it seems to me, the purpose of the Fund has become clearer. It, in effect, serves as the financing arm of the GCP’s Cleveland-centric “strategy”. )

Moving toward a more open, stable and simple process of civic engagement need not inspire fear of a “bottom up” revolt. In the world of open networks, there is no top or bottom; only nodes and links. Authenticity and the ability to inspire by words linked to deeds creates the energy that powers these networks.