Abstract
Positioned in the midst of the heated debate about the production of relevant and usable knowledge for practitioners in the nonprofit sector and a serious shortage of high-impact research that speaks to practice, the purpose of this Research Note is to direct nonprofit scholarship toward embracing “abduction,” which is the initial creative stage in scientific inquiry that facilitates the formulation of testable explanatory hypotheses and makes new discoveries in a sensory and logically structured way. We use an emerging interest in social innovation by the nonprofit sector as an illustrative example to show the advantages of using abductive reasoning as the primary method of reasoning for discovering new knowledge of a nascent but vital phenomenon. The novel contribution of this Research Note lies in encouraging scholarship on the nonprofit sector to an applied “practice-led” research process that is intellectually relevant and has the potential to bridge the scholar–practice divide.
Introduction
As the field of nonprofit studies seeks to enhance its impact and relevance within the fast-changing world of nonprofit organizations (NPOs), there is much to be gained and very little to lose by reigniting and deepening its ties to practice. The ways that nonprofit research can meaningfully connect with practice are manifold: by advancing theoretical understandings and uncovering new trajectories for policy making and leadership which addresses the broad-level systemic challenges faced by the sector; by supplying useful evidence and explanations to support practitioners within organizations so they can better understand and respond to locally occurring events that may otherwise seem inexplicable or insurmountable (Harris, 2015); and in turn, the domain of scholarship can learn from practitioners who are actively improving social systems and whose perspectives are vital to developing the field as a whole. Although influencing concrete and instrumental change in the “real world” of practice may not be realizable with every research endeavor, scholars of NPOs should not underestimate the potential of research to “manufacture both greater understanding and better realities” (Starbuck, 2004, p. 1250).
With these possibilities in mind, the production of relevant and usable knowledge for practitioners has been a foremost concern of research on NPOs, creating a fundamental tension between scholarship and practice (Bushouse & Sowa, 2012). This tension was raised and addressed in a 2000 Nonprofit and Voluntary Sector Quarterly (NVSQ) symposium entitled “Authority, Legitimacy, Voice, and the Scholar-Practice Question,” where its key goal was to reduce the divide between scholars and practitioners. Feeney (2000) referred to this divide as
a “sandbox problem” in which academics are smart and practitioners are not, where practitioners live in the real world and academics do not, and where theory is reified to the exclusion of practice, or practice is reified to the exclusion of theory. (p. 7)
The symposium’s reframing and repositioning of the scholar–practice question should have resulted in a significant boost in innovative, high-impact, and pragmatic research of relevance to the nonprofit sector, but this did not occur. In their examination of 408 articles published in NVSQ from 2000 to 2010, Bushouse and Sowa (2012) found that only 23% provided findings of relevance to practitioners. This suggests that scholars of the nonprofit sector have not yet made sufficient progress toward generating meaningful research discoveries that contribute positively to practice. This is arguably due in part to the core methods of reasoning and logical inquiry in use by nonprofit scholars; that is, the process of using existing knowledge to make predictions, construct explanations, and draw conclusions. Rethinking such “logical inquiry” methods forms the basis of this Research Note.
In the realm of nonprofit studies, we argue that a shortage of research that is not only intellectually stimulating but also potentially beneficial to practice is partly a result of the dominant reliance of scholarship on inductive and deductive reasoning, 1 while largely ignoring “abduction”—a method of reasoning for finding new knowledge, developed by the American philosopher Charles Sanders Peirce (1955) and recognized by Hanson (1958) as the logic of discovery. Peirce focuses on abduction as an initial creative stage in scientific inquiry, where researchers begin with closely observed “surprising facts” driven by a vital yet poorly understood phenomenon, comparing these facts to the existing body of theoretical knowledge, and proposing new hypotheses that are empirically testable and practically explainable (Hanson, 1958; Khachab, 2013). For researchers using abduction, it involves a deliberate and iterative process between actively studying the phenomenon at close range and thoughtful theory development via a frame-breaking mode of thinking whereby the researcher is receptive to divergent ways of understanding. These processes coalesce in the “creative leap” which lies at the heart of abduction and which has been attributed to many pioneering scientific discoveries as “ . . . advances in science are often achieved through an intuitive leap that comes forth as a whole” (Kovács & Spens, 2005, p. 136).
The purpose of this Research Note is to direct future nonprofit research toward embracing abduction as the primary method of reasoning for discovering new knowledge for “ill-defined” problems and to explicate its implications for methodology. In this Research Note, we use social innovation as an illustrative example to show how the process of an abductive logic can improve the understanding of a phenomenon. We select social innovation for three reasons. First, social innovation is a nascent area of research within the nonprofit sector (Jessop, Moulaert, Hulgard, & Hamdouch, 2013) that has yet to mark out its own theoretical territory. Second, despite the haziness surrounding the concept, social innovation has gained immense popularity and is recognized as a potential mechanism for addressing complex or wicked social problems (Mulgan, 2006; Pol & Ville, 2009). Finally, the intrinsically practice-led nature of social innovation points to the need for scholars to closely observe and carefully diagnose the phenomenon in its sociocultural contexts to avoid errors in interpretation (Nicholls & Murdock, 2012; Westley, Antadze, Riddell, Robinson, & Geobey, 2014). As researchers attempting to make sense of this pretheoretical phenomenon, which is seen to be full of promise and yet also highly elusive and contextually derived, we argue that abduction is the most promising logic for producing knowledge that can more accurately capture the reality of social innovation in the nonprofit sector and thereby advance nonprofit scholarship.
Abduction: A Promising Logic for Bridging the Scholar–Practice Divide
In his 1903 Harvard Lectures on Pragmatism, Peirce (1997, p. 230) made a crucial statement concerning the starting point of any scientific inquiry: “If we are ever to learn anything or to understand phenomena at all it must be by abduction that this is to be brought about.” Abduction is a method of reasoning for finding new knowledge that differs from, but complements, the traditional modes of deduction and induction (Svennevig, 2001). Table 1 gives a detailed comparison of these three “logical inquiry” modes that provide the foundations for the methodologies of research. 2
A Comparison of Methods of Reasoning.
The process of abduction contains three stages: abduction, abductory deduction, and abductory induction (see Figure 1 for more detail).
Although deduction starts with a general rule (theory) and applies the rule to derive a specific conclusion, and induction starts with a specific case and makes observations of the case to derive a generalized conclusion, abduction proceeds backwards by starting with a result (a surprising fact observed from a particular phenomenon) and hypothesizing something that best explains this surprising fact in light of the (limited) current knowledge base (Khachab, 2013; Svennevig, 2001). Deduction, given its presupposition of the existence of truth and falsity (proving that something must be), cannot lead to the discovery of new knowledge since the conclusion has already been embedded in the premise. As Andersen (1973) stated, “this is a natural corollary—if the premises are true, the conclusion is certain to be true” (p. 775). In this light, deduction can be applied to well-defined problems but not to ill-defined problems. The limitation of induction, on the contrary, is that it can only provide incomplete support for a general rule, due to a limited number of observations that are available to test a specific hypothesis. Since there exists no further evidence that might invalidate the hypothesis, induction (especially a single inductive study) can only produce superficial conclusions (showing that something actually is operative) but not the “bottom of things” (Peirce, 1934/1960, p. 878).
Abduction facilitates new knowledge discoveries based on a practice–theory iteration leading to “working hypotheses” (Frankfurt, 1958, p. 595) that “deserve detailed exploration and testing” (Gallie, 1952, p. 98) and that when verified and reconfirmed via subsequent empirical testing, provide “true explanations” (Khachab, 2013, p. 162). By suggesting that something may be (Peirce, 1934/1960), abduction produces the kind of daily decision making that works best with the information at hand, which often is incomplete. A medical diagnosis is a classic application of abductive reasoning (Magnani, 2001), where a medical practitioner tries her best to diagnose a patient based on the presence of incomplete evidence. For example, the patient may be unconscious or fail to report all symptoms, and thus the doctor needs to make the best guess (among alternative hypotheses) based on the evidence at hand. To guess correctly, the doctor must be well equipped with theoretical (i.e., a mind furnished with the existing set of known diagnostic entities) and practical (i.e., firsthand and experiential) knowledge.
As researchers “diagnosing” what are often opaque and complex organizational phenomena, the process of abduction enables researchers to deeply observe the patterns of phenomena, creatively devise various tentative explanations, and thoughtfully “abduct” only those that are most plausible for subsequent empirical testing. Uncertainty and imperfect information are typical within the abductive knowledge acquisition process—or to use Peirce’s point, researchers do not have to know everything in order to know something, and the discovery of knowledge results from the interplay between doubts and verifiable beliefs. Unlike inductive and deductive reasoning, abductive reasoning relies on the researcher’s creative–intuitive faculties (Taylor, Fisher, & Dufresne, 2002), much like a Sherlock Holmes-esque method of “connecting the dots” (Ginzburg, 1983), whereby “ . . . creativity is necessary to break out of the limitations of deduction and induction, which both are delimited to establish relations between already known constructs” (Kovács & Spens, 2005, p. 136).
An example of the use of abduction in nonprofit research can be seen in a recent study by Dey and Teasdale (2016) of NPOs in the United Kingdom. Initially, the researchers had set out to understand how NPO managers resisted the U.K. government’s increasing push for a socially entrepreneurial nonprofit sector through social enterprise–oriented policies and programs. Unexpectedly, however, the findings from their longitudinal case study of the NPO, Teak, uncovered a surprising behavior of “tactical mimicry.” The organization’s managers were “acting as” social entrepreneurs to gain access to important resources. This surprising fact came to light through direct field observations carried out by the researchers over multiple visits to the organization, whereby “unexpected observations, and an ensuing process of abductive reasoning” (Dey & Teasdale, 2016, p. 489) eventually resulted in their tactical mimicry hypothesis, the testable hypothesis that best explained the surprising fact. Arriving at this “best guess” is the point at which abduction draws its conclusions (Kovács & Spens, 2005). Such hypotheses are not conclusive however; they can be seen as “explanations of phenomena held as hopeful suggestions” (Peirce, 1934/1960, p. 196) that still need to be verified through subsequent empirical (qualitative and/or quantitative) testing.
Broadly speaking, the use of abductive reasoning in research involves gathering observations of practice, careful engagement in practice–theory bridging, and “abductively suggesting” hypotheses which aim at facilitating new knowledge discoveries and developing new theory. In turning our attention to abduction’s internal processes, we next consider the three temporal stages of “Firstness,” “Secondness,” and “Thirdness” that are driven by emotional, practical, and intellectual experiences and that culminate to fulfill abduction’s logical purpose as the “necessary condition for the truth of pragmatism” (Khachab, 2013, p. 162).
Connecting the Dots: Abduction’s Journey From Perception (Ideas) to Cognition (Inquiry)
The integrated elements of abductive reasoning, in which initial sensory and emotional experiences are understood in practical terms and eventually legitimized as intellectually relevant areas of inquiry, occurs over the three stages of Firstness, Secondness, and Thirdness (Atkins, 2006; Khachab, 2013). This three-staged process leads to the transformation of “perception” (idea) into “cognition” (inquiry). Each of these stages fulfills specific functions as follows:
The Firstness stage—also called abduction—corresponds to emotional experience (what is interesting), such as a sign, possibility, or feeling that is independent of anything else. Firstness aims at appraising or getting a sense of the importance of a given observed fact. According to Mintzberg’s (1979) method of “direct” research, as field researchers, we need to get a “ . . . ‘sense’ of things—how they feel, smell, ‘seem’. We need to be ‘in touch’ . . . To miss this in research is to miss the very lifeblood of the organization” (pp. 587-588). To illustrate Firstness as it occurred in the Teak study described above (Dey & Teasdale, 2016), the researchers gradually sensed that there was more to the story of the organization’s relationship with the government social enterprise policies than first supposed, leading them to search for more clues and to delve deeply into issues which “ . . . had initially been kept private” (p. 491).
The Secondness stage—called (abductory) deduction—corresponds to practical experience (what acts and reacts, or what is connected), such as an object, actual fact, or reaction in relation to something else. Secondness aims at creating a clear, testable statement or working hypothesis. Secondness applied to the Teak study involved the researchers articulating a testable hypothesis that in the United Kingdom tactical mimicry is an increasingly widespread strategy used by organizations working in the social realm (Dey & Teasdale, 2016).
The Thirdness stage—called (abductory) induction—corresponds to intellectual experience (what has a “law-like” character, or what is real) such as an interpretant or reality. Thirdness plays a role as a mediator that explains how Firstness and Secondness are deliberately and logically brought into relation. Generally speaking, this stage gives an explanation for why the working hypothesis deserves detailed study (Atkins, 2006; Khachab, 2013). For the researchers in the Teak study, Thirdness involved the tentative grasping of a reality which was that the managers were engaged in highly calculated implicit behavior that allowed the organization to create social value in a politicized and constrained environment (Dey & Teasdale, 2016).
Discoveries of new knowledge through the abduction process arguably require two essential conditions: the prepared mind filled with theoretical knowledge and direct field observations. Drawing on a famous quote by Louis Pasteur “Chance favors the prepared mind,” grounding discoveries should “not be rushed or taken for granted” (Van de Ven, 2015, p. 2). Rather, researchers need to have a deep appreciation of the existing body of knowledge in the literature with regard to a phenomenon of interest, even if the current knowledge base does not adequately explain the phenomenon (Van de Ven, 2015).
In addition to a prepared mind, the central role of context requires researchers to “get [their] hands dirty and closely observe and study, or even live with, people in organizations” (Birkinshaw, Healey, Suddaby, & Weber, 2014, p. 47). Getting out into the real world of practice through direct field observations fosters a researcher’s appreciative intimacy with the practical world under study, which in turn promotes the measurement of organizations in “real” organizational terms (Mintzberg, 1979). Researchers adopting an abduction-based practice orientation make use of a multifunctional toolkit of unobtrusive, prolonged, and on-site forms of data collection (i.e., observing activities from residing inside the organizational context). Such methodologies are arguably more suitable for developing a deeper understanding of natural field settings to uncover “how humans think and act in real-life” (Woodside, 2010, p. 406). In conjunction with direct field observations, interviewing a range of stakeholders in situ (at the locality in which they work or receive services) enables direct participation in the research by “those who live and breathe a ‘research field’” (Fox, 2003, p. 86). Their involvement may lead to the emergence of unique perspectives that are bound within specific discursive contexts, eventually revealing the often tacit system–level mechanisms that are at play within complex contexts such as NPOs (Watson, Wood-Harper, & Wood, 1995).
By undertaking an exploration in both a mind-based (theoretical) and physical world (practical) sense, researchers can carefully diagnose a given phenomenon in its context, develop deliberate research propositions that are practically and theoretically meaningful, and minimize the risk of interpretive errors. In this regard, an abductive method of reasoning should be thought of as an iterative but nonrecursive process of inserting, deleting, revising, and reconnecting theoretical ideas in the mind of the researcher as they move between a model world and an empirical world in an attempt to untangle and put pieces back together.
With abduction’s foundational logic and internal processes explained, we next turn to discussing social innovation, a perplexing phenomenon that nonprofit researchers and practitioners alike are seeking to better understand and for which abduction may offer a constructive way forward.
Social Innovation and Nonprofit Scholarship: The Current Knowledge Base
Definition and Concept of Social Innovation
In recent years, social innovation has garnered considerable attention in intellectual and practical discussions as an emerging paradigmatic phenomenon that holds great promise for addressing social problems (Chalmers, 2012; Mulgan, 2006). Despite its immense popularity and “buzzword status,” no universally accepted definition of social innovation has evolved (Phillips, Lee, Ghobadian, O’Regan, & James, 2014). Pol and Ville (2009) wrote that “social innovation is a term that almost everyone likes, but nobody is quite sure what it means” (p. 881). Even so, according to a systematic review of the social innovation literature by Phillips et al. (2014), the most widely cited definition of social innovation is that of Phills, Deiglmeier, and Miller (2008): “a novel solution [service or process] to a social problem that is more effective, efficient, sustainable or just than existing solutions and for which the value created accrues primarily to society as a whole rather than private individuals” (p. 39).
There is a general agreement in the literature that research on social innovation is still in its infancy (Caulier-Grice, Davies, Patrick, & Norman, 2012; Howaldt & Schwarz, 2010), with a fragmented variety of social innovation conceptualizations found across a wide-ranging disciplinary base. The diversity in the streams of the extant social innovation literature has led to the application of various theories to comprehend and gauge its potential for social value creation. These theories include, but are not limited to, the resource-based view (Sanzo-Perez, Álvarez-González, & Rey-García, 2015), organizational theories such as institutional, organizational identity, paradox, and stakeholder theories (Smith, Gonin, & Besharova, 2013), absorptive capacity (Chalmers & Balan-Vnuk, 2012), and critical theories of social exclusion (Byrne, 1999; Moulaert, Martinelli, Swyngedouw, & Gonzalez, 2005).
These multiple theoretical viewpoints, applications, and unique permutations of social innovation have led to context-specific descriptions of the phenomenon (Howaldt & Schwarz, 2010). Contextually derived meanings and judgments are thus a key facet of our understanding of social innovation (Caulier-Grice et al., 2012) and need to be included in theoretical thinking to capture and form questions of empirical relevance.
Social Innovation in the Nonprofit Context
NPOs form one of the most dynamic sectors of the economy as they are required to engage with a diverse array of stakeholders to deliver complex, high-demand welfare services and social programs, often but not always for the benefit of society’s most vulnerable and disadvantaged citizens (Chalmers & Balan-Vnuk, 2012). The social problems that such organizations grapple with and seek to fix, often “wicked” in nature (hard to identify, solve, or understand and often with unintended consequences), are arguably a vital piece of the jigsaw puzzle of complexity within the nonprofit sector (Westley et al., 2014). The challenge for NPOs is learning how to succeed within competitive multistakeholder environments while fulfilling their core purpose of serving social missions. Social innovation can provide solutions for overcoming difficulties in balancing these two tasks and help NPOs to manage the complexities within their external and internal environments, solve intractable social problems, and hence create social value in more effective and efficient ways (Cahill, 2010; Weerawardena & Mort, 2012). However, one challenge in developing and implementing social innovation for the nonprofit sector is that the current theoretical lenses found in the extant social innovation literature, mostly borrowed from other sectors or disciplines, fail to adequately capture and explain the unique complexity inherent in nonprofits (Westley & Antadze, 2010).
Research has drawn particular attention to a dearth of analysis of how social innovation is implemented by NPOs (Howaldt & Schwarz, 2010). The vast majority of empirical research on social innovation in the nonprofit sector use (induction-based) case study methods that rely solely on in-depth interviews supported by relevant documentation without the use of direct field observations and physical artifacts (e.g., Chalmers & Balan-Vnuk, 2012; Weerawardena & Mort, 2012). The result is a reliance on anecdotes that offer a catalog of inspiring “feel-good” case studies on the positive outcomes of socially innovative behavior (Mulgan, 2006). Without making practical observations in a field setting, researchers run the risk of producing interpretive errors that undermine conclusions. Given its newly emerging area of research, large-scale representative survey data on social innovation are unavailable and several researchers argue against the use of (deduction-based) survey methods because of the poor definition of social innovation concepts (Nicholls & Murdock, 2012). For example, Weerawardena and Mort (2012) contended that “a questionnaire-based approach at this [nascent] stage of [knowledge] development of the field would not offer a fine-grained view of the issues at hand” (p. 93).
The above limitations make induction and deduction, currently widely used as the primary logics of inquiry, of limited usefulness in identifying good practices or influencing policy decisions. The alternative is to use the logic of abduction, which emphasizes phenomenon-driven empirical discoveries to produce knowledge to fully reveal the inner workings of the social innovation “black box.”
Applying the Abduction Process in Social Innovation Research on the Nonprofit Sector
We draw on Peirce’s notion of abduction to outline an abduction-based method of logical inquiry focusing on the topic of social innovation in disability nonprofits. By describing the methods used in a social innovation–related research project that was recently undertaken by our research team, we give an example of how nonprofit scholars can pragmatically apply the relevant methodological techniques within a four-step abductive framework. 3 The four steps of this framework are as follows: (a) grounding the social innovation phenomenon in context, (b) theoretical (nonfield) observations, (c) practical (direct field) observations, and (d) practice–theory iteration to arrive at a “working” hypothesis. The sequence of, and interrelationships between, these four steps are outlined in Figure 1. The next section of this Research Note will describe each of these steps as they were used in our social innovation research project.
The “abduction” process: Creating a testable explanatory hypothesis on social innovation in disability NPOs.
Step 1: Grounding the Social Innovation Phenomenon in Context
The context for our project was NPOs operating in the Australian disability sector which is currently in transition due to the incoming National Disability Insurance Scheme (NDIS). This policy heralds a major paradigm shift in the funding and organization of disability support services in Australia (Green & Mears, 2014) as direct government funding will soon dry up for disability NPOs (e.g., long-standing “block funding” models) and instead disability services will be delivered via a competitive, demand-driven system with individualized budgets in the hands of people with disabilities who will control the purchasing (and thereby determine the viability) of services. For disability NPOs, this means learning how to cope and thrive within a marketplace in which increased external and internal pressures (e.g., volatile cash flow and cost containment challenges), together with the need for in-built flexibility and user-centeredness, will necessitate a “complete about-face in how every aspect of their organization is managed” (Skelton, 2016, p. 458).
With its disruptive and sector-wide influence, the NDIS policy is seen by many to hold great potential to ignite and foster social innovation by disability NPOs (Productivity Commission, 2010). It is expected that managers will vigorously attempt to harness social innovation as a way to ensure that their organization can adapt in both conceptual (e.g., new ways of thinking about service provision) and practical (e.g., income generation and cost containment) terms (Green & Mears, 2014). As a team of researchers that is interested in the poorly understood phenomenon of social innovation in nonprofits, we therefore identified Australian disability NPOs operating in the rapidly changing NDIS landscape as a fertile context for our abduction-driven research project.
Step 2: Theoretical (Nonfield) Observations
Social innovation has “a tendency to elicit passionate and emotional responses from those involved in its practice” (Chalmers, 2012, p. 19), and yet the extant literature indicates that there is a lack of clarity in terms of how social innovation can be deployed advantageously in the NPO context (Howaldt & Schwarz, 2010). Thus, we took our first step in the abduction process when our theoretically guided observations called attention to the following surprising fact:
Despite little being known about social innovation and the inherent complexities that the nonprofit context poses for innovative behaviors, disability NPO managers consider social innovation to be highly desirable to implement.
Proceeding from the surprising fact, our research team made a perceptual judgment that in turn led us to a research question:
Appraising plausible theoretical frameworks that served to foreground the NDIS as a key driving force of social innovation in this context, we selected three relevant theories: First, resource dependence theory (Pfeffer & Salancik, 1978) was identified as a potentially useful lens through which the environmental (e.g., NDIS-fueled) changes could be understood in terms of increasing competiveness in a resource-constrained system (Soldatic, van Toorn, Dowse, & Muir, 2014) together with the importance of marketization as a strategy (Zolkiewski, 2004); second, the possible implications of the individualized “active participant” approach of the NDIS were linked to user innovation theory (von Hippel, 1986); and third, institutional theory was identified for its emphasis on the formal and legal aspects of government structures and policies (Kraft & Furlong, 2012).
In this theory-to-observation process, what we call the “mind-preparing” stage, the researchers engaged in conscious and considered thinking to discern where the use of a particular theory needed to be set against alternative theories, while at the same time blending multiple relevant theories of the social innovation phenomenon within the context of disability NPOs. Adeptly and mindfully achieving this process required that the researchers adopt principles of disciplined imagination and artificial selection (Weick, 1989).
Step 3: Practical (Direct Field) Observations
Once the surprising fact was theoretically observed and the related research question conceptualized, the next step involved the researchers setting out to encounter and decipher the real-world context of nonprofits within which social innovation is embedded in order to reduce the risk of false theoretical underpinnings and other theoretical shortcomings. This led us to the practical (direct field) observations stage or what we call the “mind-and-reality comparing” stage.
In-depth case studies offer a methodological approach in which the researcher can deeply observe the patterns of organizational or management phenomena in situ. We conducted two such organizational case studies in disability NPOs during late 2015 and early 2016: The first case study was an NPO based in the regional city of Hobart that provides accommodation support, respite, specialized skill development, and community access services to approximately 500 clients with disabilities; the second case study was an NPO based in the major metropolitan area of Melbourne with approximately 1,300 people with a disability regularly accessing its community arts and cultural development programs. These two NPOs were selected based on advice from the state-based governing body that oversees the sector and due to the organizations’ innovative track records.
A researcher in our team resided inside these two socially innovative NPOs as a “researcher-in-residence,” each for a period of approximately 4 weeks. To obtain the necessary close-range observations and sufficient diagnosis of the social innovation phenomenon, the researcher gathered relevant information by observing, attending, and actively participating in staff meetings, group planning sessions, and various other day-to-day internal activities as well as client services occurring within each NPO. In-depth interviews were conducted on the NPOs’ premises and a number of key participants were interviewed multiple times and in different contexts and locations (e.g., during car trips and site visits). Along with the interview recordings and collection of organizational documents supplied to the researcher, detailed observational notes were taken. When writing these field notes, a blended schema of reacting/questioning was adopted. Reacting involved notating unfiltered thoughts and impressions relating to events and observations (Eisenhardt, 1989). Questioning involved contemplating and analyzing the meaning of certain emotional, practical, and intellectual experiences (e.g., reflecting on the questions described below in the temporal stages of Firstness, Secondness, and Thirdness).
In making direct field observations, the researcher’s perception (ideas) developed into cognition (inquiry), and specifically this required moving through Peirce’s temporal stages of Firstness, Secondness, and Thirdness. These three stages, which together constituted the “mind-and-reality comparing” stage (Step 3 in the abduction process), were fulfilled in our research project as follows:
Firstness (abduction) stage
Firstness involved the researcher watching, participating, interacting, and learning from the people working in the two case study NPOs (managers and staff) as well as those receiving services (clients). In this stage, the researcher relied on her senses and feelings as a guide to ask and reask relevant questions, such as,
What are the specific behaviors, practices, routines, and decisions/choices observed in these NPOs? Are there any surprising anomalies or unexpected circumstances? What are they?
Of the many observations that emerged through these sensory/emotional experiences within the Firstness stage in the research project, a number of surprising signs or possibilities came to light. For example, it was interesting to the researcher that social innovations were often initiated and developed by frontline staff. This occurred at the first case study organization with the establishment of a youth program for clients with disabilities, including wheelchair users, which engaged them in high-risk activities not offered by other local service providers, including hang gliding and rock climbing. This innovative, boundary-pushing behavior by program staff was actively supported by managerial approaches, for example, by promoting the autonomous decision making of self-managed working groups and maintaining fluid channels of dialogue so that ideas from staff quickly and easily reached management. Another influential factor noticed by the researcher was a collaboration strategy with external entities. For example, in the second case study organization, a new website was being developed in collaboration with an external web design company. The socially innovative aspect of this project was that the website was a world-first due to its integration of unprecedented web accessibility capabilities that were jointly conceived, tested, and implemented by the NPO together with its partner agency. The end result was an award-winning website with an in-built accessible design that had not been achieved by any other known website globally.
Finally, in both case study organizations, a series of observations gave the researcher insight into an embedded organizational value structure based on intrinsic motivation (viewed as “innate” rather than learned) to solve social problems within the sector. This was evidenced by their inclusive practices, for example, the presence of managers and staff with disabilities, as well as through many everyday occurrences of relatedness and experience sharing, such as clients dropping in at the organizational headquarters (where no direct client services were offered) to have informal conversations with managers, often even with the CEO. On these regular occasions, the clients would sit in the kitchen having cups of coffee with organizational staff and/or managers and open information sharing and signs of mutual levels of comfort and enjoyment (such as laughter) were perceptible to the researcher. Through in-depth interviews, the researcher learnt that the origins of various socially innovative projects could be attributed to such informal conversations and that many project ideas initiated in this way had gone on to be codesigned with clients. One such example was the ideation and development of an imaginatively designed portable arts venue made out of a shipping container, which overcame the issue of a lack of accessible venues for artists with disabilities and which now showcases their visual and performing art shows through regular tours across metropolitan and regional areas. The success of these socially innovative projects has often depended on a long-range time frame of multiple years. The researcher was surprised to discover that such open-ended outlooks were still prevalent within the case study NPOs, despite the mounting external pressures arising from the incoming NDIS system which necessitated an orientation toward certain immediate or short-term challenges associated with this sector-wide change.
Secondness (abductory deduction) stage
By diagnosing the surprising fact or result that was observed in the Firstness stage, the Secondness stage gave rise to a hypothesis which related the observation under question to some other fact or rule that could account for it. Based on a process of “abductory deduction,” the researcher carefully applied Peirce’s inferential steps:
The surprising fact, C, is observed; But if A were true, C would be a matter of course; Hence, there is reason to suspect that A is true. (Peirce, 1955, p. 151)
For the observed surprising fact (the communal, open-ended processes, and innate value structures that elicited social innovations within disability NPOs), the potential factors that may have been influential included (a) a participatory, innovation-supportive culture, (b) collaboration with external partners, or (c) a shared value structure grounded in intrinsic motivation to solve social problems. Integrating, correlating, and reframing these factors formed our deliberated working hypothesis:
The shared value of “transformational empathy”—involving a communal commitment to social innovation as the wellspring of ideation and action for solving complex social problems, and a shared aspiration that all people (i.e., managers/staff/clients/external collaborators) can contribute to its creation and implementation—is likely to be the most important attribute that elicits social innovation.
Or, to reframe this statement using the central inferential step in Peirce’s logic, the researcher formulated the following:
If NPOs draw upon a shared value of “transformational empathy,” the fact that social innovation requires communal, open-ended processes, and innate value structures would be a matter of course.
Thirdness (abductory induction) stage
Within this stage, the researcher explained why the “transformational empathy” hypothesis was formed and deserved detailed exploration and testing. The stage of Thirdness takes account of the fact that for any intriguing observation there is an infinite set of possible explanations (Svennevig, 2001), and thus the possibility or plausibility of the “hopeful suggestion” (the chosen hypothesis) requires the researcher to articulate how the insights and inferences deriving from Firstness and Secondness can be logically brought into relation. Through a process of “abductory induction,” the researcher adopts a certain intellectual position which is “not the hypothesis itself . . . but a statement that there is evidence for the hypothesis” (Frankfurt, 1958, p. 594). For example, in our social innovation study, the evidence from the Firstness stage indicated that the shared value of transformational empathy was important for promoting greater internalization and integration within the disability NPOs, and possibly leading to positive effects in terms of creativity, knowledge cocreation, and a pervading attitude of persistence (i.e., maintaining a long-range view) in the face of immediate challenges and uncertainty.
Step 4: Practice–Theory Iteration to Arrive at a “Working” Hypothesis
The fourth and final step in the abduction process involves the provisional acceptance of the “working” hypothesis following a deliberate oscillation between empirical and theoretical observations. Based on the findings from the direct field observations, the researchers surmised that transformational empathy was an important attribute for eliciting social innovation. By moving back and forth between theory and practice, the researchers noticed a possible incongruence between the theoretical observations of the earlier nonfield stage (Stage 2) and the practical observations made during the direct field stage (Stage 3). In particular, the researchers had initially called attention to resource dependence theory and institutional theory. However, the two case studies suggested that social innovation was not predominantly driven by external pressures, such as the sector-wide policy changes, institutional structures, and quasi-market forces set in train by the incoming NDIS; rather, it was the highly personal, self-authored activations, and intentions driven by internal (innate) enthusiasms which fostered the implementation of socially innovative initiatives (i.e., a shared value of transformational empathy). Although largely ignored in the social innovation literature to date, self-determination theory (SDT; Ryan & Deci, 2000) offers a theoretical framework predicated on the importance of the innate human needs of competence, relatedness, and autonomy and these can be seen to link directly with intrinsic motivation, optimal functioning, and growth in both an individual and organizational sense. According to SDT, the fostering of necessary contextual (organizational) supports can lead individuals and organized teams of individuals to “seek out novelty and challenges, to extend and exercise [their] capacities, to explore, and to learn” (Ryan & Deci, 2000, p. 70), denoting some of the key hallmarks of socially innovative behavior.
Blended with these theoretical connotations of SDT, and underscoring the importance of the client-initiated and/or client-led social innovations observed in the case study organizations, the aforementioned user innovation theory (von Hippel, 1986) was deemed to hold valid predictive elements for future empirical testing of the transformational empathy hypothesis. However, the marginalized vantage point of the people involved in such user-led processes within disability NPOs (i.e., people with disabilities) also necessitated the integration of certain social justice tenets of citizenship theory (Duffy, 2010) alongside the relevant aspects of user innovation theory. In so doing, an innate appreciation of the equal dignity of all human beings and the positive value of human diversity for cultivating the necessary energy, direction, and creativity at the heart of social innovation can be better captured in the theoretical understandings of this concept.
As this example of a recent social innovation research project demonstrates, arriving at these deeply grounded and interconnected explanatory junctures was dependent on and driven by abductive reasoning. The researchers in this project would not have discovered these ideas nor thought through their consequences in a broader experiential or applied sense if their inquiry had involved merely reading, hearing, or even watching. Instead, one needs to feel, as “the richness of phenomena lies in their sensuous quality” (Peirce, 1955, p. 262). Although abduction merely suggests that something may be, by engaging in the four-step abduction process which incorporates both the practical, cognitively-based approach (emphasizing observed facts grounded in contextual conditions and filled with existing theoretical knowledge) and a scientific approach (forming explanatory hypotheses), it enables the researcher to devise theories that hold great promise for real-world relevance.
Moving beyond the four-step abductive framework put forward in this Research Note, the researcher would next seek to verify the abductively derived hypothesis in the subsequent stage/s of experimental testing. Maintaining a practice orientation embeds this process within (or in direct reference to) real-world contexts, recognizing that the pursuit of knowledge in complex research fields is a local and contingent process (Fox, 2003). In this sense, testing in/by context may involve establishing a researcher–practitioner dialectic under real-time conditions, for example, as in action research, whereby the researcher’s propositions are tested through organizational interventions or situation-specific trials and practitioners actively respond by reinterpreting the use of theories in a bottom-up approach to implementation and appropriation (Fox, 2003; Watson et al., 1995). In this open-ended mode of engagement, “acting is testing, and the practitioner is an experimenter” (Argyris & Schön, 1974, p. 159). Large-scale testing may also be used to analyze multiple contexts and facilitate interpretation of causally relevant factors, for example, through the use of “set-theoretic” methods such as qualitative comparative analysis (QCA; Ragin, 1987). These tools can contribute to developing theories in practice (Argyris & Schön, 1974) which aim to be of instrumental value to practitioners by communicating the subtle patterns, complexities, and underlying order within organizational phenomena, while also remaining responsive to different contexts. Thus, rather than focusing on “grand theory which globalize and deny difference” (Fox, 2003, p. 87), the processes of testing and theory building in practice-led research harness contextual ambiguity by pursuing localized and evolutionary pathways, including those not predicted but developed out of continued sense making, learning, and adaptation.
Conclusion
This Research Note is situated in the midst of the serious concern about a remarkable dearth of high-impact research that is of relevance, interest, and utility value for practice. In this Research Note, we introduce a novel method of reasoning, “abduction,” and apply it to social innovation in the nonprofit sector. We highlight its value as the most promising methodological tool for finding new knowledge of a perplexing and poorly understood phenomenon in the upstream stage of theoretical development or hypothesis generation. The impact of knowledge discovered through abduction lies in its direct connection with practice. In essence, providing a foundation for building theories that can make a better and more accurate sense of reality is the bottom line of abduction.
The newly emerging phenomenon of social innovation in the nonprofit sector serves as an illustrative example of the usefulness of an abduction-based method of inquiry for scholars and practitioners. There are two take-away messages from this Research Note. First, the unique functional process of abduction enables researchers to navigate their research journey, choosing their direction at each encountered juncture with receptivity and precision. Second, abduction can help researchers to interpret unforeseen experiences and surprising discoveries in ways that lead toward truly fascinating and as yet undiscovered destinations. Such a researcher-as-traveler process—a by-product of abduction involving a blended constitution of intuition, theoretical knowledge, context specificity, practical experiences, and nonrecursive, iterative steps—arguably serves to deliver meaningful and impactful knowledge and innovative solutions with the capacity to positively change organizational practice in the nonprofit sector.
To the best of our knowledge, the value of embedding abductive logic in methodological framing is yet to be acknowledged in NVSQ. By applying abductive reasoning to the nonprofit sector, this Research Note takes a small but significant step in directing future research toward the adoption of a more pragmatic, holistic, and useful methodology. Such a direction will be of great importance in shifting the focus of nonprofit scholarship back to the soul of relevance and the applied nature of our field.
Footnotes
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: The corresponding author acknowledges the financial support received through an Australian Government Research Training Program Scholarship.