Stephen Konya - Social Innovation


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Mr. Konya's presentation before the Illinois Task Force on Social Innovation, Entrepreneurship, & Enterprise

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  • Also serve on the Illinois Commission to Eliminate Poverty, Budgeting For Results Health Team, among others. HRC – CFO - Oversaw operations, which included my first exposure to the wonderful world of State Government procurementDCEO - COS– Spent most of my time working on initiatives within the office of entrepreneurship, innovation and technology, as well as our State energy office (renewables, energy efficiency, and recycling programs) IDPH – COS/COO/CRO – in addition to overseeing day to day operations, charged with developing innovation agenda and management of strategic partnerships
  • While at DCEO, my first endeavor working to support social enterprises was with this former men's underwear factory. The Green Exchange is the country’s largest sustainable business community that only houses tenants offering green products and services. designed to house more than one hundred eco-friendly businesses and organizations within a single building, Developers of the building (Baum development),decided to pursue LEED Platinum status for their rehabilitation of this historic landmark/four-story manufacturing facility originally built in 1914. This project was finally realized with support from City and State Govt, related to gap financing assistance, tax breaks, and energy efficiency incentives.
  • My second “ah-ha” moment with Social enterprises, was attending a presentation by the Acumen Fund, which the Clean Energy Trust hosted. I took this quote from their website, which sums up the types of entrepreneurs they seek to invest in (patient capital). The ROI is amazing, and their investment strategy should be a model for governments to embrace (i.e. leading to performance based budgeting or BFR).
  • In reverse order from the advertisement, here is what I plan to cover today. First, my goal is to create a sense of optimism, that Govt is trending in the right direction towards supporting social enterprises. Then, submit some recommendations related to expanding state government contracting and grant opportunities specifically for SEs. And finally, close with the “business case” for why my current agency is supporting social innovation, entrepreneurship, and enterprise.
  • Similar to the Acumen fund…. In the future, The State of IL will be funding “or investing” only in initiatives that can measure their impact on a specific/desired outcome (or social benefit).
  • Report to BFR Commission Steering Team on Sep. 2012;Under additional budget strategies (#6 out of 10 recommended budget strategies)
  • Access to safe and clean water, economic opportunity, quality healthcare, adequate and safe food, social support network, early education, housing, etc..
  • So again, hopefully I’ve raised your level of optimism, that Govt is working to align its future funding, with similar missions embodied by Social enterprises.
  • So now that we know State $ will be targeted to making the biggest impact, the next logical step is to ensure the state contracting and granting mechanisms work in concert with this goal. And I believe one of those ways is to encourage state agencies to work specifically with social enterprises.
  • There are 3 set aside “buckets,” if you will, which establish goals state agencies must pursue. The first is the Business Enterprise Program. Il agencies must set aside a minimum of 20% of the total $ amount of state contracts (subject to goal) for firms owned by minority, women, and persons with disabilities. LY, state agencies as a whole, nearly doubled that goal.
  • And of course there are specific criteria to determine who meets the definition for the purposes of this program.
  • The second bucket is the SBSP. Separate from the BEP program, the SBSP mandates that state agencies must “set-aside” specific contracts and portions of larger contracts for small businesses only. Small business are a driver of our economy, so this program is designed to support small business growth through ensuring a Govt marketplace where they can compete.
  • And of course, there are specific/defined criteria an IL business must meet in order to qualify for this program.
  • Finally, and perhaps the most closely related to Social Enterprises, the Veterans Business Program was created by law to “encourage” state agencies to spend at least 3% of their procurement budgets on certified Veteran Owned businesses.
  • (1) Empower state agencies to leverage external resources. IDPH strategic plan (expand partnerships with traditional and non-traditional organizations) – be open to have the conversation and explore mutually beneficial opportunities. (2) entrepreneurship breeds innovation and (3) knowledge is power - spur innovation through increasing the public’s access to information – Businesses will be built around it, and more oftenthan not, for the benefit of society.
  • Finally, I wanted to cover the impact Social innovation, entrepreneurship, and enterprise is having on Public Health…but, first, I should probably clarify what Public Health actually is.Differentiating Factor – Population based approach (all 12.2 million residents of IL) Here are 10 categories APHA uses to define Public health. Our agency has nearly 300 programs, which again, I will try to place in 3 buckets with the visual assistance of Hollywood.
  • The first, think Contagion. Epidemiological surveillance working to get to the source of infectious/communicable diseases and food borne outbreaks. Disaster preparedness and response from a health perspective. And we also collect and analyze health data, reported from local health departments, hospitals, and birth/death records, looking for adverse health trends in IL, and benchmark that data against other states. This includes tracking leading causes of pre-mature death, chronic disease rates, newborn screenings for genetic disorders, an infant mortality rates.
  • For our second bucket, we have a significant regulatory function. We license, permit, monitor, and/or inspect numerous entities across the state. To name a few; all hospital construction and operation, long term care facilities, public swimming pools (water parks, hotels, etc.), plumbing and plumbers, restaurants, schools cafeterias, food and dairy manufacturing facilities, EMTs, and many other areas.
  • And finally, we have a strong health promotion and awareness agenda. We educate the public about health and wellness lifestyle choices, getting routine screenings for conditions that are preventable and/or treatable if detected early enough (and even provide those screenings for uninsured that meet certain criteria), issue public health alerts and advisories, and seek interventions to unhealthy behaviors.
  • Read slideFor example, Acumen targets products that are affordable to individuals who make less than $4/day.
  • I also wanted to provide a few examples of local start-ups that our agency is exploring partnerships with, or have a potential to impact Public Health. I feel each of these could be viewed as “Social Enterprises”The first is Purple Binder; (read slide)GoalsShare data Promote relationship through our websiteIntroduce to sister IL HHS agenciesUtilize community feedback to ensure database remains up-to-date
  • The second is a partnership we’re exploring to increase “regulation through prevention” - ConnectFoodSharing of best practices for local food safety, processing and manufacturers. Our Food and Dairy division is very intrigued by this platform’s ability to help educate regulatory compliance issues with the entities we inspect.
  • And the final example didn’t start in IL, but the City of Chicago is currently partnering with them on 311 data use, etc..Yelp partnership with San Francisco, restaurants “scores.”
  • In closing, I’d like to discuss social responsibility. If you look at the Wikipedia definition, it reads as follows.
  • On Monday, most Government offices were closed as we celebrated the life and work of Dr. Martin Luther King, Jr.. The man who led the Civil Rights Movement, fighting for civil liberties and social justice. He believed we had a social responsibility to address the racial inequities in the some of those same areas we today view as social determinates of health (built environment, education, access to quality health, poverty, employment, shelter, etc.). In fact, in 1966 he moved into the slums of North Lawndale, right here in Chicago to raise awareness about poverty and housing discrimination. Although this social movement took place before my time, his devotion to social responsibility led to the establishment of the first Govt agency I worked for (HRC), which helps to ensure his legacies of equal rights, diversity, and inclusion live on today.
  • Since then, we’ve seen pursuits of social responsibility related to the Environment. Which developed into programs for recycling, and other environmental protections.
  • Over the past decade, we’ve seen an dramaticrise in public support for expanding our energy portfolio to develop more sustainable energy resources. Our society has recognized the responsibility we have to move towards more efficient, cleaner, and renewable sources of energy. Fossil fuels not only pose a risk to the environment in most cases, but they are also a scarce resource. The scarcity of theses traditional sources is directly tied to the rise and fall of gas prices, energy dependence on foreign sources, and inefficient energy use. The key differentiating factor here, is the opportunity we have leverage technology and innovation to create new markets for businesses to be built around.
  • And now, what's on the horizon??? Only the transformation of a multi-trillion dollar industry, which has been ripe for innovation for years. This will take the creation of new businesses (patient navigation, IT platforms, EHRs, etc.), led by those with a social midset to ensure successful implementation. And therefore, its Government’s responsibility to support social Innovation, Entrepreneurship, and Enterprise whenever and wherever it can.
  • Stephen Konya - Social Innovation

    1. 1. Social Innovation, Entrepreneurship, and Enterprise Stephen J. Konya III January 2013
    2. 2. Government Experience • Illinois Human Rights Commission, 2006-2008 • Agency mission: Adjudicate Violations of the Human Rights Act • Illinois Department of Commerce and Economic Opportunity (DCEO) 2008-2011 • Agency mission: Job Creation, Job Retention • Illinois Department or Public Health (IDPH) 2011-2013 • Agency mission: Prevent, Promote and Protect
    3. 3. 2545 West Diversey, Chicago, IL
    4. 4. Acumen Fund “The entrepreneurs Acumen Fund supports are focused on offering critical services – water, health, housing, and energy – at affordable prices to people earning less than four dollars a day.” – Acumen website • 72 enterprises funded • $81 million portfolio • 55,000 jobs created and supported • 86 million lives impacted
    5. 5. Agenda 1. How the State’s “Budgeting for Results” initiative aligns government funding with a social agenda. 2. Considerations to expand government contract and partnership opportunities for social enterprises. 3. Public Health benefits from embracing social innovation, entrepreneurship, and enterprise.
    6. 6. Budgeting for Results (BFR) • Led by Governor’s Office of Management and Budget • Integrate BFR planning w/ annual budget cycle (FY15/16) • Target/increase state funding to areas with greatest impact • Reduce/eliminate funding for programs with little to no measurable impact
    7. 7. BFR (Impact Indicators vs. Outcome Indicators) • An “impact indicator” - common, well-understood measure of state- level performance such as life expectancy, unemployment rate, school success, etc. Impact indicators tend to change slowly over time, and are influenced by many forces, including state government. • An “outcome indicator” is a more specific measure of state government’s effectiveness, and is sometimes referred to as a “leading indicator” because it is a near-term indicator of improvement or decline in the overall impact indicator. * An “impact indicator” is a common, well-understood measure of state-level performance such as life expectancy, unemployment rate, school success, etc. Impact indicators te
    8. 8. BFR – Health Strategy Team “Invest in programs and public, private, and non-profit partnerships that improve the social environment” * An “impact indicator” is a common, well-understood measure of state-level performance such as life expectancy, unemployment rate, school success, etc. Impact indicators te
    9. 9. Virginia Performs
    10. 10. Budgeting for Results (BFR) • Led by Governor’s Office of Management and Budget • Integrate BFR planning w/ annual budget cycle (FY15/16) • Target/increase state funding to areas with greatest impact • Reduce/eliminate funding for programs with little to no measurable impact
    11. 11. Government Contract and Partnership Opportunities The State of Illinois purchases more than… $10 billion worth of products and services each year to run social service facilities, office buildings, garages, state parks and more.
    12. 12. Business Enterprise Program (BEP) Council • Established by the IL Business Enterprise for Minorities, Females, and Persons with Disabilities Act (30 ILCS 575/) • Under this Act, the Business Enterprise Program Council is required to ensure that businesses owned by minorities, females, and persons with disabilities are awarded at least 20% of the total dollar amount of State contracts • In FY2011, BEP vendors received over $274 million in state contracts or 37.55% of total state funding, subject to goal.
    13. 13. Business Enterprise Program Who qualifies for the BEP Program? • At least 51 percent owned and controlled by persons who are minority, women or designated as disabled • Must be a United States citizen or resident alien • Annual gross sales of less than $75 million
    14. 14. • The SBSP promotes the economic development of small Illinois businesses by setting aside millions of dollars worth of contracts exclusively for small businesses. • The SBSP allows for the Chief Procurement Officer (CPO) of the State of Illinois to allocate a portion of contracts so that small Illinois businesses only can compete for them. • Further legislation significantly increased the number of small Illinois firms eligible to compete for these contracts. The number of categories of goods and services set-aside for small businesses is now up 44%, providing even more opportunities. Small Business Set-Aside Program (SBSP)
    15. 15. Small Business Set-Aside Program (SBSP) • Last year, nearly $57 million awarded to small Illinois firms through the SBSP. • 65 supply/service classifications set-aside • All awards under $50,000 set-aside for certified small businesses • All State procurements considered for set-aside program
    16. 16. Small Business Set-Aside Program (SBSP) Who qualifies for the SBSP? • Must be an Illinois business • Annual gross sales must be: • Retail/Service - less than $6 million • Wholesale - less than $10 million • Construction - less than $10 million • Manufacturing - less than $10 million and less than 250 employees
    17. 17. Veteran-owned Businesses • Through the Veterans Business Program (VBP), state agencies and universities are encouraged to spend at least 3% of their procurement budgets with certified Veteran- owned businesses. • Who qualifies? - Illinois businesses with annual gross sales under $75 million that are 51% owned by one or more qualified service-disabled veterans or qualified veterans living in Illinois.
    18. 18. Direct Support Recommendations • Introduce “Set Aside” state legislation related to Social Enterprises • establish qualifying criteria • option #1 - individual goal category • option #2 – cross cutting category for “extra credit” • Amend IL Procurement Code to mirror legislation • Encourage SE set aside goals for small purchases • Seek social enterprise inclusion in grant requirements • Rulemaking (agencies submit to JCAR)
    19. 19. Indirect Support - Partnerships • Establish guidelines for agencies to pursue public/private partnerships • Specifically encourage all agencies to engage with the entrepreneurial community in IL • Government commitment to the Open Data Movement
    20. 20. What is Public Health??? Source: American Public Health Association (APHA)
    21. 21. #1 Health Surveillance and Analysis
    22. 22. #2 Health Regulation
    23. 23. #3 Health Promotion and Awareness
    24. 24. Public Health Benefits Social Enterprises often address social determinants of health: • Environment (both natural and built) • Poverty • Employment • Education • Access to quality healthcare
    25. 25. Public Health Benefits • Multiplier effect of investing in Social Enterprises • Increased innovations in Health IT platforms/solutions • Increased access to local health services • Safer and cleaner environment • Lower cost of “quality of life” solutions for those in poverty
    26. 26. Purple Binder A one-stop shop • Search a database of social services in Chicago, with entries from real people in the field. Collaborate with colleagues • Organize community programs and notes into binders. Share with your teammates so that everyone's on the same page. Build relationships • Talk to other social workers with our secure messaging system. Make new connections and strengthen old ones. Programs that fit your client • Use Purple Binder's eligibility search to find the programs that best suit your client's needs.
    27. 27. Connect Food • A community-based, Farm-to-Fork knowledge exchange platform and learning destination for local food safety, processing, and manufacturing.
    28. 28. Code For America “Cities are under greater pressure than ever, struggling with budget cuts and outdated technology. Code for America believes that instead of cutting services or raising taxes, cities can leverage the power of the web to become more open and efficient. And we want to help them do it.” - CFA website • Recruits talented web developers, designers, and entrepreneurs into a year of public service • Recruits both the development teams and the participating cities through competitive application processes • 11-month development cycle for IT web solutions. • Code for America built applications include the following characteristics: 1) Web applications 2) Enable cities to connect with their constituents in ways that reduce administrative costs and engage citizens more effectively 3) Support the move toward transparency and collaboration 4) Shareable – which means that an application built for one city can be used by any other city
    29. 29. Social Responsibility “Social responsibility is… an obligation to act to benefit society at large. Social responsibility is a duty every individual or organization has to perform so as to maintain a balance between the economy and the ecosystem… It pertains not only to business organizations but also to everyone whose any action impacts the environment.” - Wikipedia
    30. 30. Civil Rights
    31. 31. Environmentalists
    32. 32. Clean Energy
    33. 33. Healthcare Reform