Academic journal article Journal of the Community Development Society

Community Innovation through Entrepreneurship: Grantmaking in Canadian Community Economic Development

Academic journal article Journal of the Community Development Society

Community Innovation through Entrepreneurship: Grantmaking in Canadian Community Economic Development

Article excerpt

ABSTRACT

This paper examines the relationships among community innovation, entrepreneurship, knowledge, and grantmaking in the field of community economic development. The paper assesses the experience of the Community Economic Development Technical Assistance Program (CEDTAP), a bilingual grantmaker operating in rural and urban Canada, in combining small-grant funding with knowledge management methods to support community innovation. The CEDTAP experience illustrates how the multiple roles played by individual entrepreneurs and the social entrepreneurship of the local CED organization combine to drive the innovation process. Mature CED organizations are found to pursue innovation in order to achieve performance gains to better achieve their mission. While information technology is of some interest to these groups, they are increasingly active in applying new production technologies to strengthen their business enterprises. The CEDTAP experience highlights the potential of grantmakers to enhance their impact and reach through such knowledge-management tools as electronic portals, action-research and mutual learning within thematic clusters of grantee projects. The paper calls for practitioners and scholars to better understand the nature of, and interrelationships among, community innovation, entrepreneurship, knowledge and grantmaking in community economic development.

Keywords: community economic development, entrepreneurship, grantmaking, innovation, knowledge management, social entrepreneurship

INTRODUCTION

What does community innovation look like, and what is the role of entrepreneurship in producing it? Furthermore, how can knowledge management enable grantmakers to broaden and deepen community innovation? Some answers to these questions are suggested in the experience of the Community Economic Development Technical Assistance Program, a foundation-funded grantmaker working across Canada. Lessons are drawn from this experience for practitioners and scholars.

Innovation, Knowledge and Grantmaking

Nearly two decades ago, management theorist Peter Drucker (1986), widely recognized for his work in management by results, first highlighted the connection between innovation and performance. Organizations operating in all sectors, Drucker (1995) argued, must develop the core competence of innovation, and be able to measure its results. In the case of civil society, Drucker (1995, p. 276) came to define innovation as "change that creates a significant new dimension of nonprofit performance." He and his colleagues subsequently applied this framework to the nonprofit sector, creating foundations, awards and publications to encourage the deepening and broadening of innovation in the third sector as a means of responding to the rapidly changing needs of modern society (Hesselbein et al., 2000).

Meanwhile, in the business sector, the latter half of the 1980s saw the concept of innovation largely captured by those, like management guru Tom Peters (1987), who exhorted managers to "thrive on chaos" by embracing continuous change and relentlessly inventing new products and services at an ever faster pace. More soberly, but no less intensely, consulting and accounting firms such as Arthur Young (1986) advised their clients to step up investments in research and development and seek inspiration for innovation among their customers, employees, and the broader public.

However, by the 1990s, amidst the technology boom, the innovation paradigm was appropriated by the new economy. Scholarly and business literature trumpeted innovation through science and technology as the key driver of company success. Knowledge--both explicit or codified, and tacit or uncodified--was heralded as one of the most important forms of wealth created by companies (Stewart, 2001). The theory and practice of knowledge management was born (see, for example, O'Dell et al., 1998; and Breakspear, 2003). …

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