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Investment in Organizational Capacity Brings Rewards PDF Print E-mail
Tuesday, 27 September 2011 01:34

Peter Goldberg, President and CEO of Families International which includes the Alliance for Children and Families and United Neighborhood Centers of America, Ways to Work and FEI Behavioral Health, died unexpectedly on August 12th while on vacation in Maine.

This “Point of View” is based on a keynote address he delivered at the Council of Family and Child Caring Agencies Annual Meeting in May of 2011.

At both the Alliance for Children and Families and United Neighborhood Centers of America (UNCA), we have a deeply-rooted conviction that a difficult environment such as the one we find ourselves in now will increasingly cause differentiation between high performing nonprofit organizations and those that are not.

It is logical, in our view, that high performing organizations are more likely to provide sustainable quality programs and services than those under-investing in their organizational capacity.  It doesn’t mean that every strong organization will always survive, or that some weak organizations won’t prosper.  But the odds tilt more in your favor when your organizational capacities are appropriately aligned with your service delivery responsibilities.

While achieving and maintaining high performance for a nonprofit human services organization includes many variables, it is important to address the overlapping issues of core competencies and mission, outcomes and impact, and strategy.

Core Competencies & Mission

In this era of fiscal restraint, a lot of agencies are giving careful consideration to their definitions of core competencies, and perhaps by extension, the scope of their mission. Specifically, many are asking if it is time to hunker down, to focus only on being the best you can be in a reasonably limited number of areas of expertise. This approach — essentially a narrowing of mission and core competencies — works very well for some organizations. 

But others ask:  Is it the time to be more horizontal and possibly more entrepreneurial; in effect, to stretch core responsibilities into new and adjacent functions? In other words, how much time and effort do we put into trying to preserve the best of what we have built versus the amount time and effort we devote to seeking new ways to apply our core capacities to new opportunities?

The very nature of this dichotomy suggests that there are different conclusions to these questions for different organizations.  Regardless, strong organizations will be purposeful and strategic about the decisions they reach rather than backing into them.

I confess to being a growth proponent.  I tend to counsel our members to adopt a more comprehensive suite of programs and services.  Looking for new opportunities in a time of budget contraction may seem counterintuitive, but I believe change creates opportunity.
In fact, given the harsh economic conditions of our time, the easy thing to do would be to provide a passionate defense of who we are and what we have done, and why we have done it; all in the context of preserving what we have accomplished.  There is no doubt we have a cherished history and a right to be proud of it. 

Yet, at this moment in time, I think that a more strategic, future-oriented focus will serve you better. 

Outcomes & Impact

As you know, times change; expectations change.  The real challenge we face now is how to change with them while staying true to our core values. 

Right or wrong, fair or unfair, the bar of public expectations has been raised.  We are compelled to examine our best practices and ask ourselves each day: Can we be even better than we are?
One aspect of this constantly changing playing field, in my view, is that high performing nonprofit organizations increasingly are going to be challenged to differentiate between outcomes and impacts.  

On the one hand, the focus on outcomes, measurement, and accountability has had many positive attributes.  Most nonprofits have sharpened their game.  They do not take support for granted; they go out and document their progress and earn their support every day, all of the time.

Perversely, however, we risk lapsing into a collective mindset that leads us to assume that if we succeed on outcomes for our projects, then we automatically succeed on the outcome for our mission.

Indeed, the focus on outcomes and accountability might quite arguably lead us to be too cautious in our aspirations.

How so, you ask?   Well, perhaps, we have become masters at writing achievable outcome statements.  After all, who wants to fail on an outcome?  So we present the limited “annual stretch” goal that we are confident we can attain.

It is like a 104% impact strategy.  But, given the environment in which we operate, given the challenges that the children and families we serve face, is 104% really sufficient?  Have we deluded ourselves into believing that outcomes are the same as impact?  Where are our visions for 1,000% and 20,000% impact?

Are we motivating ourselves, our boards and our funders with a vision for what we can achieve?  Do we, in effect, need two sets of books: one for our outcomes and another for our impact? 


Within our field, and just about every other field for that matter, we use the term “strategy” quite a bit.
But have we become too traditional, too twentieth century, in our view of strategy?  Are we failing to recognize the difference between a “strategic plan” and “strategy?”

In fast changing times, is the strategic plan nimble enough, or do we need a more dynamic and deeper commitment to “strategy?”

In the view of the Alliance and UNCA, which is substantiated by significant research that includes numerous interviews with members and other stakeholders, we have come to believe that many nonprofit human service organizations — and especially larger nonprofit human service organizations — may be under-investing in strategy.

We have come to acknowledge that in many nonprofit organizations, strategy frequently takes a back seat to program development, day-to-day firefighting, managing ongoing changes in the regulatory environment, and the pursuit of new sources of revenue.

In fact, we have come to strongly believe that one way many organizations can increase their capacity to achieve their overarching goals and impact is to elevate the role of strategy.
Accordingly, the Alliance is extremely pleased to have received a new four year, $5.375 million grant from the Kresge Foundation to help elevate the role of strategy in high performing nonprofit human and social service organizations.

Our new program, which we have named Strategy Counts!, will start an effort to populate our field with several chief strategy officers; we will be supporting a series of lighter-touch strategic interventions; we will be running some cohort learning groups on strategy; and, at the end of the grant cycle, we will either be able to document and validate our assertion that nonprofits in this field are under investing in strategy, or we will draw alternative learning experiences as a result.

Core competencies and mission, outcomes and impact, and strategy are all essential components of high performing nonprofit organizations.
To a certain extent, it does not matter whether you are doing child welfare, residential care, family services, or neighborhood development; unless your organizational capacities are aligned with your service responsibilities, it will be very difficult to sustain quality programming.
Finally, one essential characteristic of strategy in a high performing nonprofit organization is the ability to anticipate a future different from the past.  Among the issues which we at the Alliance and UNCA feel are on the radar screen are:

•    Blending of traditional human services with programs that advance economic self-sufficiency;
•    New ways to serve older adults;
•    Opportunities to provide services to military personnel and families;
•    Growing dedication to civic engagement, advocacy, and public policy;
•    The impact of advances in neurosciences on the future of human service delivery.
There is no doubt we are at a watershed time.  But, believe it or not, this is actually a great time to be a leader of a nonprofit human services organization. 

It’s relatively easy to lead through simple and unproblematic conditions.  The conditions we are in now warrant our best.  This is what we should have been trained for.  This really ought to be why we do what we do.  This is when the cream rises to the top.

Conditions may only get worse, but when they are hardest of all is when we need to step to the plate. 

We need to be energized and invigorated by the challenges in front of us; if we aren’t perhaps we need to step aside.

The children and families we are serving deserve the very best we can give them; and I know that is what they are getting now.   By focusing on core competencies and mission, impact, and strategy, by not forgetting new opportunities, you will be the leaders of high performing nonprofit organizations that emerge from this difficult cycle of a weak economy and harsh government ideology, stronger than you were before.


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