Are big innovations possible within nonprofits?

The recent Social Innovation Camp proved a highly successful experiment in bringing together social activists, web developers and others who believe the best way to get things done is to get creative people together and cook ideas rapidly. I've reported over here how eighty projects were filtered to six for intensive development over a weekend, and why I think this model will be significant in future.

At the camp I experimented with some instant video, using Qik to upload from my Nokia N82. It was a bit rough - but had the advantage of no lengthy editing afterwards. One of the interview I shot was with Paul Birch, who has an impressive track record as an Internet entrepreneur, and Paul Miller, one of the team behind the camp. As you can see in the video, both of them were highly doubtful about how far it was possible for people to innovate within organisations - unless here was a highly supportive culture.

The two Paul are on the social entrepreneur wing of social action, along with co-organiser Dan McQuillan, who wrote last year that charities are broken. Do you think they are right? Any examples of major innovations within organisations that disprove their point? Obviously this happens if there is drive from the top - but is it possible for staff, however committed, to make major changes from the inside without that?