| By: By Heidi M. Neck

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The Master Class

The Masterclass challenge our notion that the worlds of profit and purpose are separate, contradict current conversation about models and scale, disrupt our ideals of a market, and bring into question who gets to innovate.

I believe we need a new category to describe the group of entrepreneuring leaders who, in their work, and in the organizations they build, explore powerful new ways to create value. I think the termMasterclass most effectively captures what this group does: They challenge our notion that worlds of profit and purpose are separate, contradict current conversation about models and scale, disrupt our ideals of a market, and bring into question who gets to innovate.

The Masterclass is not bound by predominant business model design approaches. Nor do they focus exclusively on creating economic growth and sustainability through the lens of a single organization. Instead, in our Entrepreneur Experience Lab research, we observe the Masterclass operating in three paradigm-shifting modes, which I describe below.

1. Generate a Repeatable Approach and Adapt for Local Context

The Masterclass do not create a model for direct replication. Rather, the process, principles, and approach of their work remain consistent as it is adapted to meet the needs of local and situational contexts. Currently, most entrepreneurs experiment and iterate to arrive at one business model.

For the Masterclass, the business model is in a constant state of emergence. This approach does not inhibit scale and growth, but it changes the conversation around how to scale. Stepping away from a formulaic model creates a much more inclusive approach, as they take into consideration the unique nature and subtle differences of each context and social community.

Consider Shainoor Khoja, the principal of the Better Business Enterprise, which aims to drive entrepreneurship and development in “tough” places like Afghanistan. Her approach always starts with and responds to a deep understanding of the local context. Shainoor looks at each individual community and asks, “If we could provide a service, what could we do with it to address the need of the people?” An inclusive ecosystem is then built around the business, one that vertically integrates the community into their offerings.

Shainoor is constantly monitoring unintended consequences and how behavior is changing. Out of this complexity, the next layer of offerings is built, and, then, the next. This emergent model inherently has a much longer timeline and requires continual adaptation and responsiveness. It also looks vastly different in every country.

2. Combine Direct Action and Movement Building

The Masterclass entrepreneurs see future trends and set their sights on where they want to go. In order to get there, they don’t simply build one thing. They combine direct action (on their own or within an existing organization), and influence (think movements) with deep skills in relationship building to go beyond the execution of a value proposition. They also create ecosystem propositions.

This focus on the larger ecosystem requires them to create an assemblage of other people who are tackling components necessary to shift us into a new paradigm. As leaders, they see the entire landscape and assess what’s needed to get where they are heading. In the end (and throughout the process), it’s not just about their personal effort, but something much larger.

In the face of climate change, Robin Chase is shifting the world toward a new economy: one that takes advantage of excess capacity and changes our notion of what it means to be a consumer. As a pioneer of the shared economy, she successfully built Zipcar, and is currently working on her next venture, Buzzcar. In her words, leading these companies is like “exercising her own personal muscle.” But, in order to reach the end goal, she is incredibly active in thought leadership and influencing the powers that be. She classifies this part of her work as “moving planets.”

Another exemplar, Andrew Hessel lives five years in the future. He sees the convergence of trends moving society toward synthetic biology—a new paradigm for genetic engineering done with digital tools and open source practices—and takes action on several fronts to accelerate the formation of this revolutionary new technology field. Identifying a gap in the availability of tools within this space, Hessel began working with Autodesk to develop them. He also curates a community of people who are tackling different components of the synthetic biology ecosystem; facilitating communication and understanding of the changes ahead and diffusing ideas throughout the community.

Recognizing a powerful trend toward global citizenship, Kevin Thompson and his team launched the Corporate Service Corps (CSC)—a model that trains global IBM leaders through immersive experiences in emerging markets. Through direct action, Thompson was able to demonstrate impact on a fast timeline by making full use of IBM’s resources. Tapping into latent demand, this successful model is now the basis of a burgeoning movement to develop leaders through experiential learning.

3. Co-generate Innovation through Community Involvement

The Masterclass entrepreneurs do not operate solo. They defy a top-down approach. Rather than creating a single model and then scaling it, they co-generate experiences. The work is developed and completed by the community. Thought leadership takes on an ego-less form. Since success is inexorably bound to community participation, many Masterclass leaders talk about their role as a guide: monitoring and sharing future trends that the problem-solving community can draw upon.

Drupal is a community of collaborators, who are democratizing Web technology through open source software development. Where a proprietary software firm seeks out operational excellence in the form of maximum productivity, founder and lead developer Dries Buytaert collaborates with tens of thousands of volunteers who are creating new features and supporting the Drupal ecosystem.

What seems a wasteful process results in massive innovation where only the best of a set of similar solutions survive. Referring to themselves as “frenemies,” the community shares an interest in making Drupal successful, but compete to “make their own deals.” Leadership involves seeing patterns and painting a picture of where the group might head.

Another example is Purpose, which builds 21st century movements using the collective power of millions to enact change. They create a platform for participation through online campaigns and movement building. Purpose also is a certified b corp. To receive and maintain certification, Purpose must regularly assess and measure its impact on communities, employees, and place.

Purpose adheres to the values of transparency and co-participation: all employees have a voice in strategic decisions. Rather than operating with a “benevolent dictator,” who makes unilateral decisions in the best interest of the company, they regularly hold town hall meetings where employees are actively engaged in shaping the organization’s direction.

The Positive Deviance (PD) problem-solving approach builds on uncommon but successful behaviors and strategies that are identified from within the community by the very people whose behavior needs to change. The community owns the process. Discovered innovation is amplified by sharing results within the wider community and guiding the adoption of new behaviors.

Expanding the Class

The work of the Masterclass calls for a redefinition of the challenges facing entrepreneurs as well as the metrics used to capture and determine value. The Masterclass entrepreneurs harness the considerable talent and resources of themselves and others to solve intractable, consequential problems in the world. In the process, this group achieves significant and abiding outcomes that build socioeconomic value for the communities, markets, and organizations they serve.

The Masterclass entrepreneurs live and learn inside adaptive problem spaces—domains where complexity and unintended consequences are the norm. Lessons learned are used to shape a qualitatively different set of entrepreneuring practices: working with the long view; guiding the emergent; creating inclusive platforms for participation; and measuring success in terms of human capacity.

The language hardly exists to describe the practices of the Masterclass entrepreneurs, and yet they’re forging ahead with enormous problem-solving impact. They are bypassing the current thinking of models and scale, while education and organizational systems have yet to catch on. We must bring into focus, examine, and decode this work so that others can follow where the Masterclass leads.