Theory of the business and theory of change

In my previous post on “Building a theory of change or an organisation that creates change” I talked about successful businessmen who in Philanthropy to support an organisation that creates change rather than specific programs that support a theory of change in a complex social environment that is constantly changing.

On further thinking, I think there is a role for both. In essence, Organisations need support to build and expand their theory or what Drucker would call the “Theory of the Business (PDF)” and each program would have in effect a “theory of change” even if its just a hypothesis.

Duncan Curtis suggested that the The Science of Entrepreneurship is:

So two things.

I think to build a great company you need to have a well defined hypothesis based on a theory for a market’s evolved future.

And I think the most effective way to enter that market is to build a company like a scientist testing the theory. As an experiment.

An organisation like TACSI will need to experiment and find out what it takes to create and expand the “theory of the business” around social innovation while a program/project like Family By Family needs to test and ensure that the original hypothesis driving the program or its theory of change will work in the future.


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