The fine folks at Istituto Europeo di Design proposed me to join the faculty of a new Master course called Design for Social Business (D4SB) (info). It’s quite a visionary idea: they selected eight students from all over the world, found them scholarships and put them to work. The course is taught in English, and it includes two field trips to see social business in action, one in Bangla Desh and the other in Colombia. My contribution will be:

1. teaching them to design and use online collaboration environment, an ever more important tool for social business and especially social innovators (they need it to compensate the competitivity deficit in other areas, like finance).
2. dare loro un quadro su ciò che si muove nel loro ambiente competitivo, proprio nel momento in cui in Europa si stanno prendendo le decisioni strategiche sulle politiche per il welfare dei prossimi annigive them an overview on what’s cooking in their competitive environment, at a time when the strategic decisions are being made on redesigning the welfare state in Europe
3. share methods for writing and evaluating business plans for social enterprise

I am grateful to course director Jürgen Faust, coordinator Massimo Randone and IED for the opportunity to structure my thinking around these issues in the forms of lectures and workshops, and run them in front of such a high level classroom.

In 2005 the municipality of Verona was doing consultation on its strategic plan, and the young Veronese were not buying. They thought the administration (four years into its term) was simply not credible: “we are forever stuck in the first meeting”, as a young man told a senior officer to his face and in public (I was there). In this context, I was asked to help the city’s culture-related nonprofits to get together and deliver an event that was to symbolize the municipality’s new commitment to treating youngsters as partners. They were willing to invest a small sum, 30K euro.

Cultural operators in Italian small and medium sized towns almost invariably hate each other. Makes sense: their environment is one of zero-sum competition for funding, allocated with criteria that are not always transparent. Every cent I get is a cent you won’t get. This creates a climate of mistrust. Involving an outsider like me was to be a sign that in this case things would be done differently: this small additional fund was conditional to the creatives being able to design and deliver a common project.

This was my first true community fostering and management. I created a mailing list (hey, we had no cool web 2.0 stuff back then) and demanded everybody used it to communicate, no private emails; bullied the municipality’s stuff into sitting in meetings that started at 7 p.m., so that the creatives could attend without conflicts with their day jobs); and even talked the two main city officials into going to the local winery after each meeting with the creatives. I discovered the power of transparency and informality: the most important progress was almost always made in the winery, not at meetings. In the end the event did happen: it reclaimed derelict spaces like the former zoo; embodied a more free, creative idea of Verona, with the Africal fashion catwalk shows, the writers contests and the mythical dance bus you see in the video. They called it VRBAN, and it was a roaring success. Many people who participated in the process discovered in each other competent colleagues worthy of respect, with whom collaboration could be a pleasure.

Recently I went back to Verona for a concert and –surprise – VRBAN is still there, and it has become the main event of the Verona summer, with thousands of participants. It is now in its sixth year; is entirely funded by private investors and own revenue (the new center-right administration does, however, supply some services); is run by some of the kids of 2005, that meanwhile have become professionals of cultural event organization (Alessandro and Fabio) and communication (Ale); has even generated a spinoff, the Italian network of ecologically sustainable music festivals. It is a piece of the city’s economy and culture. I am so proud of it! Of course, they were the ones who did it. But the city’s authority did its part, and I think I helped.

So, if you go to Verona in July, go to VRBAN, ask for Alessandro Formenti, Fabio Fila or Ale Biti and ask them to give you their stories. And drink one to my health.

Sorry, this post in Italian only. As always, click the “Translate” link for an automated translation.

Molte persone mi hanno scritto lamentandosi perché il mio libro Wikicrazia era praticamente introvabile in libreria – e ci sono stati problemi anche con IBS e Amazon Italia, dimostrando che fare un sito di e-commerce e gestire la logistica sono due cose molto diverse. Adesso, però, il problema è risolto: da fine febbraio il mio editore, Navarra, verrà distribuito da NDA, uno dei più importanti distributori italiani. Questo significa, finalmente, essere presenti nelle maggiori catene di librerie del paese, incluso Feltrinelli, Mondadori Franchising, Librerie.Coop e Ubik, quelle del Circuito Interno 4, nelle librerie indipendenti e in molti circoli culturali. Tra i primi titoli in distribuzione ci sarà appunto Wikicrazia. Se usate PayPal, avete sempre la possibilità di usare un circuito più personale, cliccando su “Buy” qui sotto (powered by Blomming).

Siccome questa è quasi una seconda uscita, la festeggiamo con una raffica di presentazioni. Tra fine febbraio e fine marzo parlerò del mio libro a: Rovereto – TN (26 febbraio), Reggio Emilia (7 marzo), Venezia (10 marzo), Bologna (13 marzo), Roma (21 marzo) e Cagliari (25 marzo). Ci vediamo in giro?

After a long new year festivity pause, the Spaghetti Open Data is back with a vengeance. These days everyone is playing around with a WordPress plugin coded by Vincenzo Patruno, a developer working for ISTAT, very active among us spaghetti and open data lovers. The plugin is a widget that taps into ISTAT’s data warehouse and returns real-time demographic data on a municipality, province or region of our choosing (installation, supereasy, is explained here).

Seeing this, another mailing list participant, Paolo Mainardi got the idea to do the same thing for Drupal. So he asked Vincenzo for the code, promptly got it, and just a few hours later he released a similar plugin, that taps into the same data, that runs on Drupal (get it here). Kudos to Vincenzo and Paolo: clearly the Italian open data movement has all the technical skills it needs.

Then, of course, we’ll need to build a community of open data re-users, with both the drive and the ability to tell stories grounded in data; stories that we can use to better understand our common life as citizens, from integration policies to the State’s accounting, and redesign them as needed. But that’s a completely different ballgame, and we are not there yet. But we will. A first step in that direction might be an initiative of the city of Torino, which just launched this call for ideas (hat tip: Lorenzo Benussi, on the same mailing list).

Daniel Kaufmann had some fun compiling a list of the authoritative commentators that predicted that – unilke in Tunisia – in Egypt the disgruntled population would not take to the street, or anyway not in such a way to threaten the regime. Everybody seems to have fallen for it, from Foreign Policy to the BBC, from Time magazine to the Economist.

Forecasting was always tricky business, and is getting more so. In a society as complex as ours, even the best analyst are lousy at prediction. In an entirely different context, David Lane and others (yours truly included) are suggesting that in some cases prediction might be replaced by a system of early warning, that spots emergent social dynamics in its early stages, when correction is still possible. This would be done by combining and filtering large masses of data, many of which collected on the web. The idea — which might ring familiar to those who use the Internet as a social filtering device for information, is that the global conversation is an entity that exists at a level superior to ours, and as such might know things that none of us, mere participants, know.

To describe this hypothetical system, David likes to quote post-marketing surveillance on pharmaceuticals after the Thalidomide scandal. This drug used to be prescribed to pregnant women in the 1950s, and it could induce terrible deformities in newborn children, but only combining in exquisitely nonlinear ways with other agents: it was cleared for rollout because the lab tests did not allow to discover the problem. It was the doctors treating the mothers of deformed or sick children that discovered, in the ocean of statistical noise, the weak signal of taking Thalidomide during pregnancy. As a consequence of this story, pharmaceutical companies now work with physicians to spot correlations to weak to be spotted in the lab, but that might be revealed by processing the mass of data obtaiend by tapping all doctors.

It is a fascinating topic, at least for me. And — going back to Egypt — it leads to an unexpected conclusion: it suggests another way that Wikileaks might be a good thing. Laks feed the global conversation, and thereby increase the probability that bloggers, citizens and activists poolf their knowledge and discover emergent trends. It has been argued that Wikileaks is nefarious, because it might hinder the work of diplomacy: but without better analysis, diplomacy cannot do an acceptable job anyway.

On Tuesday, February 15th, here in Milan, I will take part in two events I find interesting from the point of view of wikicracy, that is collaborative redesign of the world we live in.

The day (starting at 9.30) is to be dedicated to a conference on service design organized by the Association of Industrial Designers and Milan Polytechnic (info). I am even a speaker: Kublai is, in this context, treated as a well-designed service, and my team and I as its designers. We are even metadesigners, because another of the services showcased is to be CriticalCity Upload, that was incubated from within Kublai.

The evening is dedicated to an intriguing experiment. Pietro Speroni, mathematician and supergeek, has invented a way to find shared answers to open questions, based on what he calls “human genetic algorhythms”, and is going to test it with the help of whoever shows up. The idea is this: we start with a question. Anyone can offer an answer. Then everyone votes each answer (only “yes” and “no” votes allowed). A software looks at the votes and extracts its Pareto front, i.e. the set of non-dominated answers: it means that an answer voted by Alice and Bob will be discarded if there is at least one other answer voted by Alice, Bob and Chuck. Mathematically, this second answers dominates the first one, because it has all of its voters plus at least one. Then, everyone is asked to write new answers, feeling free to use bits and pieces from the ones in the first-round Pareto front. This gives rise to a second generation of answers, which use the “genetic material” already selected by the first iteration; then a new vote is called, the software computes the Pareto front and on it goes until a unique dominant answer evolves. The software, naturally, is called Vilfredo.

Pietro and his group have been experimenting, and so far the human genetic algorhythm always converges. In a way it converges too fast: Vilfredo gets to an unique dominant answer in ten generations or less, whereas non-human genetic algorhythms need more like ten thousands generations to converge. Makes sense: evolution has to blindly try every conceivable mutant and let genetic cul-de-sacs go extinct, whereas human discussion can discard a priori a lot of unpromising alternatives. If the question is “what shall we do tonight?”, answers like “let’s declare war to Guatemala or “let’s all go bathe in molten lead” don’t need to be discussed and discarded: they just never come up. This should teach us that emergence in the natural world (where agents are dumb, like neurons or ants) is very different from emergence in the social world (where agents are smart, like people or companies). At 8 p.m. at Via Boifava 29/A (Facebook event). You can say anything, but not that we don’t live in interesting times.

About a year ago I got curious about finance. Money, whatever else it is, is an infrastructure (like a road) enabling economic activities; furthermore, it is a platform (like the Internet), in the sense that it can be reconfigured ad infinitum, and that you can combine finance to make more finance, layer upon layer, just like this blog is made of code sitting on top of a network protocol.

I am doing work on public policy for social innovation, and social innovation has an access to capital problem. Makes sense: social innovators, even though they might generate revenues and even profit, care mostly about producing social benetits. Capital, on the other hand, is out for monetary returns, not social ones. An investiment’s social benefits, even when enlightened investors care about them (when they do they are said to do impact investment), are subordinate to financial returns.

Last week, in London, I had a long chat on this topic with Karl Richter, a young architect turned financier through urban regeneration. He and others have been designing financial instruments for social enterprises and social innovation. For example, a line of work is to bundle two different financial sources: a core of “philantropic capital”, for which social returns are the main concern, and an outer layer of impact capital, looking for market returns on socially responsible investments. Bundling happens in a way that lets philantropic capital carry the loss (or the less-than-market-level returns) if the investments turns sour. In this way, non-philantropist investors are guaranteed; and the benefits of philantropic capital are greatly augmented, because an euro of philantropic capital activates three euro of credit.

This kind of work is important in the context of the fledgling European strategy on social innovation. However, there is a side to this story that no one is looking at, and that’s the emergent consequences of digging new financial channels for this kind of enterprise. History teaches us that financial innovation often has completely unintended consequences, and some of those are truly evil. For example, stock exchange markets were a great idea, because they allow savers to participate to the risk capital of public companies. Since the return on investment depends on profit, risk is shared across shareholders. Since buying and selling shares is cheap and easy, companies can get cheap access to capital and money flows to those firms that invest wisely, securing high returns and low risk. Over time, though, the existence of stock markets transformed the savings and investment landscape. Individual investors keeping part of their saving in blue chips over the long term went extinct: participants in the stock market are now mostly fund managers, continuously redeploying their money as they try to secure a marginally higher rate of return. Unintended consequence #1: top managament’s obsession for the short term of the quarterly result. Unintended consequence #2: stock market bubbles. Both pretty bad.

You see, channeling finance onto social innovation, difficult as it is, is not going to be enough. We need to do it without distorting the incentives that makes social innovators so good at what they do. For this we need a much better understanding of emergence in the social and economic world than we presently have, and we need it now. I have started doing work on this theme with David Lane’s group at the European Centre for Living Technology, and I really hope I can dig out something to contribute.

In the last year, as I took part in a Council of Europe workgroup that tries to make sense of some emergent phenomena in the economy, I got the idea that social innovation is really, really important. Certainly important enough to curve the mental space I inhabit: whatever I do I seem get more and more entangled into it. The latest news – though not the last, I have a feeling – is that the Young Foundation, a British think tank close to the European Commission’s President Barroso and the single most active organization on the social innovation front, has enrolled me for the advisory board of the new Social Innovation Initiative for Europe. The projects’s objective is to create a social innovation community hub that, among other things, will provide input into the design of a new European social innovation fund.

European funds are large scale financial instruments for public policy. They are measured in hundreds of millions of euro, if not billions. Their allocation criteria among and within member states are the object of thorough negotiations, led by the highest ranking European public officials. The Commission does not design new funds every day: clearly, someone at the top thinks this is a very important matter.

From my vantage point as a Council of Europe advisor it is not hard to figure out what’s going on. The representative of the States in our group are worried silly: the welfare state, keystone of the European social model and staple ingredient of the Old Continent’s humanized version of capitalism, is crumbling before an irreversible fiscal crisis. No one believes the current level of public service provision is defensible within the current model. And no, it can’t be put down to ineffective management. We are not talking about Italy or Greece here: the most worried people I talked to come from advanced welfare countries like Austria or Norway, in which the public would never accept a retreat from the current service level – a retreat that, nevertheless, is coming.

Interestingly, though, no one is talking about privatization. We learned a lesson in the 80s, and that is that privatized public services are not necessarily any cheaper than those directly provided by the State. There are many reasons for this, and an important one is that the private for-profit sector wants to, well, make a profit. And that means high margins: if they are not there, private business is simply not interested. Here’s where social innovators gets to be given a chance; their blend of social economy (i.e. weak orientation to profit) and disruptive innovation borrowed from their Silicon Valley brethren is the only candidate for providing solution to turn public services around the way Wikipedia did with encyclopedia writing, defending the level of service while driving costs way down.

It does not take a genius to figure out where this is going. It leads to public services that are redesigned from the ground up, and that will look nothing like what we are used to. School? YouTube videos (Khan Academy style) instead of teachers in classrooms. Health care? Online fora instead of queing up at your local doctor for most less serious conditions. University? A badge system for informal learning on the open web instead of degrees (the Mozilla Foundation is working on it already). Policy design? Wikicracies instead of professional weberian bureaucracies. It’s safe to predict that the transition to such a scenario will be problematic, and it will imply very many people who are working in the public sector becoming — to put it bluntly — completely useless, because we can’t use what they can do and they can’t do what we need done.

The fund that the European Commission is designing can address at best half the problem; enabling social innovators to rethink radically public services. The other half is to make sure that the social contract holds, and that scared, enraged Europeans do not take to the street to set fire to cars, ATMs or their slightly different-looking neighbours. For this we need a high level political leadership: the present system was conceived by giants like Bismarck (the pension system) and Lord Beveridge (modern welfare). Let’s hope we find comparably enlightened leaders for the current phase.