Every truth passes through three stages. First, it is ridiculed. Second, it is
violently opposed. Third, it is accepted as being self-evident.
—Arthur Schopenhauer
Much of what we now take for granted in social life began as radical innovation. A
century ago, few believed that ordinary people could be trusted to drive cars at
high speed, the idea of a national health service freely available was seen as absurd-
ly utopian, the concept of “kindergarten” was still considered revolutionary, and
only one country had given women the vote. Yet in the interim, these and many
other social innovations have progressed from the margins to the mainstream.
During some periods in recent history, civil society provided most of the impe-
tus for social innovation (see box, facing page). The great wave of industrialization
and urbanization in the nineteenth century was accompanied by an extraordinary
upsurge of social enterprise and innovation: mutual self-help, microcredit, build-
ing societies, cooperatives, trade unions, reading clubs, and philanthropic business
leaders creating model towns and model schools. In nineteenth and early twenti-
eth century Britain, civil society pioneered the most influential new models of
childcare, housing, community development and social care. At other times gov-
ernments have taken the lead in social innovation—for example, in the years after
1945 democratic governments built welfare states, schooling systems, and institu-
tions using methods such as credit banks for farmers and networks of adult edu-
cation colleges. (This was a period when many came to see civic and charitable
organizations as too parochial, paternalist, and inefficient to meet social needs on
any scale.)
There is every reason to believe that the pace of social innovation will, if any-
thing, accelerate in the coming century. There is certainly more money flowing
into NGOs and civil society than ever before. Economies in both developed and (to
Geoff Mulgan
The Process of Social Innovation
Geoff Mulgan is director of the Young Foundation based in London (U.K). He previ-
ously worked in the U.K. government as director of the Strategy Unit and head of pol-
icy in the Prime Minister's office, and before that was founder and director of the
thinktank Demos. He is a visiting professor at London School of Economics,
University College London and Melbourne University.
This paper draws on a report titled “Social Silicon Valleys: A manifesto for social
innovation,” available for download from <http://www.youngfoundation.org>.
© 2006 Tagore LLC
innovations / spring 2006 145
innovations
TECHNOLOGY | GOVERNANCE |GLOBALIZATION
reprinted with permission from MIT Press
mitpress.mit.edu/innovations

Geoff Mulgan
a lesser extent) developing countries are increasingly dominated by services rather
than manufacturing. Over the next 20 years, the biggest growth for national
economies is likely to come in health, education, whose shares of GDP are already
much greater than are cars, telecommunications, or steel. These growing social sec-
tors are all fields in which commercial, voluntary, and public organizations deliv-
er services, in which public policy plays a key role, and in which consumers co-cre-
ate value alongside producers (no teacher can force students to learn if they don’t
want to). For all of these reasons, traditional business models of innovation are
only of limited use—and much of the most important innovation of the next few
decades is set to follow patterns of social innovation rather than innovation pat-
terns developed in sectors such as information technology or insurance.
Thousands of recent examples of successful social innovations have moved
from the margins to the mainstream. They include neighborhood nurseries and
neighborhood wardens; Wikipedia and the Open University; holistic health care,
and hospices; microcredit and consumer cooperatives; the fair trade movement;
zero-carbon housing developments and community wind farms; restorative justice
and community courts; and online self-help health groups.
Yet despite these trends, the process of social innovation remains understud-
ied. While processes of commercial innovation have been the subject of consider-
able academic research, the parallel field of social innovation has received little
attention and rarely goes beyond anecdotes and vague generalizations.1 This neg-
lect is mirrored by the lack of practical attention paid to social innovation. As com-
pared with the funds spend on commercial and military innovation, the amount
spent by governments, nongovernmental organizations, and foundations to devel-
146 innovations / spring 2006
What Is Social Innovation?
Social innovation refers to innovative activities and services that are motivated
by the goal of meeting a social need and that are predominantly diffused
through organizations whose primary purposes are social. Business innovation
is generally motivated by profit maximization and diffused through
organizations that are primarily motivated by profit maximization. There are
of course very many borderline cases, for example models of distance learning
that were pioneered in social organizations but then adopted by businesses, or
for-profit businesses innovating new approaches to helping disabled people
into work. But these definitions provide a reasonable starting point.
A good example of a socially innovative activity in this sense is the spread
of cognitive behavioral therapy, proposed in the 1960s by Aaron Beck, tested
empirically in the 1970s, and then spread through professional and policy
networks in the subsequent decades. A good example of socially innovative
new organizations is the Big Issue, which publishes Big Issue Magazine, and its
international successor network of magazines sold by homeless people.