Merry Christmas and Happy New Year!
Blogging will resume Monday January 3, 2011.
Saturday, December 18, 2010
Christmas & New Year Break
Merry Christmas and Happy New Year!
Blogging will resume Monday January 3, 2011.
Wednesday, December 15, 2010
Local Nonprofits in Downturn
As reported by the Sacramento Bee, the impact on local nonprofits from the economic doldrums—especially those dependent largely on government—has been substantial.
An excerpt.
“The rough economy has left charities that provide help needing more help themselves.
“Several dozen Sacramento nonprofits absorbed revenue losses of more than $1 million last year, according to a Bee analysis of charity tax forms.
“The revenue declines not only have led to lost services for area residents but have resulted in lost clout for professional associations based in Sacramento and lost jobs as they have had to cut their own staffs.
"I think the woes we have are pretty common," said Michael Minnick, executive director of the youth services charity Sacramento ENRICHES, which will shut down after almost 15 years at the end of the month. "There's less and less money out there."
“Sacramento's nonprofit industry is large and diverse. It employs about 50,000 local residents and collects billions in revenue annually. It depends heavily on government grants, membership fees and donations. But governments have been cutting back, layoffs are reducing membership rolls and donors are struggling with their own financial problems.
“Of the 400 largest area nonprofits by annual revenue, about 340 have filed tax returns showing how much money they collected in 2009. Those 340 nonprofits saw gross revenues drop by roughly $150 million last year, or about 6 percent, according to a Bee examination of the returns.
“To put that figure in perspective, $150 million is about what the city of Sacramento spends each year on its Police Department.
“Several nonprofit officials said 2010 is shaping up worse.”
An excerpt.
“The rough economy has left charities that provide help needing more help themselves.
“Several dozen Sacramento nonprofits absorbed revenue losses of more than $1 million last year, according to a Bee analysis of charity tax forms.
“The revenue declines not only have led to lost services for area residents but have resulted in lost clout for professional associations based in Sacramento and lost jobs as they have had to cut their own staffs.
"I think the woes we have are pretty common," said Michael Minnick, executive director of the youth services charity Sacramento ENRICHES, which will shut down after almost 15 years at the end of the month. "There's less and less money out there."
“Sacramento's nonprofit industry is large and diverse. It employs about 50,000 local residents and collects billions in revenue annually. It depends heavily on government grants, membership fees and donations. But governments have been cutting back, layoffs are reducing membership rolls and donors are struggling with their own financial problems.
“Of the 400 largest area nonprofits by annual revenue, about 340 have filed tax returns showing how much money they collected in 2009. Those 340 nonprofits saw gross revenues drop by roughly $150 million last year, or about 6 percent, according to a Bee examination of the returns.
“To put that figure in perspective, $150 million is about what the city of Sacramento spends each year on its Police Department.
“Several nonprofit officials said 2010 is shaping up worse.”
Tuesday, December 14, 2010
Donation Misdirection
It has always been difficult for donors to determine how effective and efficient the charities they support are, though over the past several years the online capability of investigation from many groups like Give Well, Charity Watch, Guidestar and Charity Navigator has helped considerably.
This article in the New York Times examines some donations that might be misdirected.
An excerpt.
“This holiday season, Americans will dig into their pockets for good causes. But these gifts will sometimes benefit charlatans or extremists, or simply be wasted.
“Partly that’s because religious giving — and a good deal of casual secular giving — isn’t vetted as carefully as it should be. Researchers find that religious people on average donate more of their incomes than the nonreligious, and Christians, Jews and Muslims alike write checks to charities that they assume share their values. Dangerous assumption.
“Some well-meaning Christians will support Feed the Children, a major Oklahoma-based Christian charity that describes its mission as providing food and medicine to needy children at home and abroad. By some accounts it is the seventh-largest charity in America.
“But the American Institute of Philanthropy, a watchdog group that also runs Charitywatch.org, lists Feed the Children as “the most outrageous charity in America.” The institute says that Feed the Children spends just 21 percent of its cash budget on programs for the needy — but spends about $55 to raise each $100 in cash contributions.
“Feed the Children also has been the subject of troubling litigation and investigations. The Oklahoman newspaper says that in 2007 the charity spent $1.2 million on a house used by the founder’s daughter, a charity executive until she was fired this year. It also said that Feed the Children once lent $950,000 to a framing business headed by the founder’s son, and that the charity has sued the son for allegedly helping strip a warehouse of $5 million in materials. The son has denied the allegations in the suit.
“In addition, the institute says that Feed the Children inflates the value of food and medicine to make it seem as if it does far more than it actually does.
“Tony Sellars, a spokesman for Feed the Children, shrugged off the accusations as a disagreement about methodology and said that the lawsuits were being resolved. “We’ve helped 200,000 families in America this year alone,” he said. “The opinions we value are those of the people we’re helping.”
“Meanwhile, American Jews sometimes support nonprofits that actually make peace for Israel less likely. A few days ago, the Hebron Fund had a gala fund- raiser in Manhattan, and some of those who attended probably thought that they were supporting Jews trying to live peacefully. In fact, the Hebron settlement is notorious for extremism and violence against Palestinians. (The settlers disagree, saying that the problems arise because Palestinians want to kill them.)”
This article in the New York Times examines some donations that might be misdirected.
An excerpt.
“This holiday season, Americans will dig into their pockets for good causes. But these gifts will sometimes benefit charlatans or extremists, or simply be wasted.
“Partly that’s because religious giving — and a good deal of casual secular giving — isn’t vetted as carefully as it should be. Researchers find that religious people on average donate more of their incomes than the nonreligious, and Christians, Jews and Muslims alike write checks to charities that they assume share their values. Dangerous assumption.
“Some well-meaning Christians will support Feed the Children, a major Oklahoma-based Christian charity that describes its mission as providing food and medicine to needy children at home and abroad. By some accounts it is the seventh-largest charity in America.
“But the American Institute of Philanthropy, a watchdog group that also runs Charitywatch.org, lists Feed the Children as “the most outrageous charity in America.” The institute says that Feed the Children spends just 21 percent of its cash budget on programs for the needy — but spends about $55 to raise each $100 in cash contributions.
“Feed the Children also has been the subject of troubling litigation and investigations. The Oklahoman newspaper says that in 2007 the charity spent $1.2 million on a house used by the founder’s daughter, a charity executive until she was fired this year. It also said that Feed the Children once lent $950,000 to a framing business headed by the founder’s son, and that the charity has sued the son for allegedly helping strip a warehouse of $5 million in materials. The son has denied the allegations in the suit.
“In addition, the institute says that Feed the Children inflates the value of food and medicine to make it seem as if it does far more than it actually does.
“Tony Sellars, a spokesman for Feed the Children, shrugged off the accusations as a disagreement about methodology and said that the lawsuits were being resolved. “We’ve helped 200,000 families in America this year alone,” he said. “The opinions we value are those of the people we’re helping.”
“Meanwhile, American Jews sometimes support nonprofits that actually make peace for Israel less likely. A few days ago, the Hebron Fund had a gala fund- raiser in Manhattan, and some of those who attended probably thought that they were supporting Jews trying to live peacefully. In fact, the Hebron settlement is notorious for extremism and violence against Palestinians. (The settlers disagree, saying that the problems arise because Palestinians want to kill them.)”
Saturday, December 4, 2010
Surgery & Blogosphere Absence
Emergency surgery right after Thanksgiving, and the subsequent recuperation will keep me from the blogosphere for a few more days.
Enjoy your weekend.
Enjoy your weekend.
Tuesday, November 23, 2010
Monday, November 22, 2010
Nonprofits & Government
With some of these partnerships, the need for more transparency and oversight is obvious, as this story from the Sacramento Bee reports.
An excerpt.
“While the state weighed billions of dollars in social services cuts to bridge a gaping budget deficit, tax records show one state-funded nonprofit group paid its president a salary of $520,000 to oversee the housing and care of several dozen people with developmental disabilities.
“Jack Hinchman, president of the Ontario-based nonprofit Benson House, also received $281,800 that year to lease his own properties to the organization, according to the group's 2008 tax return, the most recent available.
“The nonprofit's board of directors, charged with monitoring Benson House's practices, included Hinchman's mother and another relative.
“Advocates for disabled people and two state legislators said the practices at Benson House aren't isolated cases in California's system of 21 nonprofit regional centers, which distribute billions of dollars in state money each year to groups aiding developmentally disabled people.
“Regional centers award often lucrative contracts to service providers without competitive bids, which would shed light on proposed spending and help tamp down costs. State laws don't require regional centers to reveal to the public the rates they pay specific service providers.
“The state doesn't even require the centers to produce lists of the providers they use, said Boyd Bradshaw, director of a coalition representing 1,200 state service providers.
“As nonprofits, the regional centers aren't subject to the same public information requirements that govern state agencies, although virtually every dime they receive comes from state and federal sources. The centers received $3.4 billion from the state in the 2009-10 fiscal year to serve 240,000 people.
“Of the $7.7 million in revenue Benson House reported in 2008, all but $210,522 came from fees and contracts from government agencies. The group received its vendor contract from the Inland Regional Center – the state's biggest.
“Hinchman also enjoys a special pipeline into the regional center, serving as the residential facility representative on the center's Vendor Advisory Committee.
"It's not just about how much (Hinchman) gets paid," Bradshaw said, "but what are these contracts that are so lucrative that allow him to get paid so much?"
An excerpt.
“While the state weighed billions of dollars in social services cuts to bridge a gaping budget deficit, tax records show one state-funded nonprofit group paid its president a salary of $520,000 to oversee the housing and care of several dozen people with developmental disabilities.
“Jack Hinchman, president of the Ontario-based nonprofit Benson House, also received $281,800 that year to lease his own properties to the organization, according to the group's 2008 tax return, the most recent available.
“The nonprofit's board of directors, charged with monitoring Benson House's practices, included Hinchman's mother and another relative.
“Advocates for disabled people and two state legislators said the practices at Benson House aren't isolated cases in California's system of 21 nonprofit regional centers, which distribute billions of dollars in state money each year to groups aiding developmentally disabled people.
“Regional centers award often lucrative contracts to service providers without competitive bids, which would shed light on proposed spending and help tamp down costs. State laws don't require regional centers to reveal to the public the rates they pay specific service providers.
“The state doesn't even require the centers to produce lists of the providers they use, said Boyd Bradshaw, director of a coalition representing 1,200 state service providers.
“As nonprofits, the regional centers aren't subject to the same public information requirements that govern state agencies, although virtually every dime they receive comes from state and federal sources. The centers received $3.4 billion from the state in the 2009-10 fiscal year to serve 240,000 people.
“Of the $7.7 million in revenue Benson House reported in 2008, all but $210,522 came from fees and contracts from government agencies. The group received its vendor contract from the Inland Regional Center – the state's biggest.
“Hinchman also enjoys a special pipeline into the regional center, serving as the residential facility representative on the center's Vendor Advisory Committee.
"It's not just about how much (Hinchman) gets paid," Bradshaw said, "but what are these contracts that are so lucrative that allow him to get paid so much?"
Saturday, November 20, 2010
The Future & Reason
In times of great uncertainty, words of wisdom are always appreciated and this short excerpt in today’s Wall Street Journal, written in 1953, is timeless.
An excerpt.
“When I was a younger man, I believed that progress was inevitable—that the world would be better tomorrow and better still the day after. The thunder of war, the stench of concentration camps, the mushroom cloud of the atomic bomb are, however, not conducive to optimism. All our tomorrows for years to come will be clouded by the threat of a terrible holocaust.
“Yet my faith in the future, though somewhat shaken, is not destroyed. I still believe in it. If I sometimes doubt that man will achieve his mortal potentialities, I never doubt that he can.
“I believe that these potentialities promise all men a measure beyond reckoning of the joys and comforts, material and spiritual, that life offers. Not utopia, to be sure. I do not believe in utopias. Man may achieve all but perfection.
“Paradise is not for this world. All men cannot be masters, but none need to be a slave. We cannot cast out pain from the world, but needless suffering we can. Tragedy will be with us in some degree as long as there is life, but misery we can banish. Injustice will raise its head in the best of all possible worlds, but tyranny we can conquer. Evil will invade some men's hearts, intolerance will twist some men's minds, but decency is a far more common human attribute, and it can be made to prevail in our daily lives.
“I believe all this because I believe, above all else, in reason—in the power of the human mind to cope with the problems of life. Any calamity visited upon man, either by his own hand or by a more omnipotent nature, could have been avoided or at least mitigated by a measure of thought. To nothing so much as the abandonment of reason does humanity owe its sorrows. Whatever failures I have known, whatever errors I have committed, whatever follies I have witnessed in private and public life, have been the consequence of action without thought.”
An excerpt.
“When I was a younger man, I believed that progress was inevitable—that the world would be better tomorrow and better still the day after. The thunder of war, the stench of concentration camps, the mushroom cloud of the atomic bomb are, however, not conducive to optimism. All our tomorrows for years to come will be clouded by the threat of a terrible holocaust.
“Yet my faith in the future, though somewhat shaken, is not destroyed. I still believe in it. If I sometimes doubt that man will achieve his mortal potentialities, I never doubt that he can.
“I believe that these potentialities promise all men a measure beyond reckoning of the joys and comforts, material and spiritual, that life offers. Not utopia, to be sure. I do not believe in utopias. Man may achieve all but perfection.
“Paradise is not for this world. All men cannot be masters, but none need to be a slave. We cannot cast out pain from the world, but needless suffering we can. Tragedy will be with us in some degree as long as there is life, but misery we can banish. Injustice will raise its head in the best of all possible worlds, but tyranny we can conquer. Evil will invade some men's hearts, intolerance will twist some men's minds, but decency is a far more common human attribute, and it can be made to prevail in our daily lives.
“I believe all this because I believe, above all else, in reason—in the power of the human mind to cope with the problems of life. Any calamity visited upon man, either by his own hand or by a more omnipotent nature, could have been avoided or at least mitigated by a measure of thought. To nothing so much as the abandonment of reason does humanity owe its sorrows. Whatever failures I have known, whatever errors I have committed, whatever follies I have witnessed in private and public life, have been the consequence of action without thought.”
Friday, November 19, 2010
Knowledge of the Forest & the Trees
Perusing a recent article (Building Programmatic Capacity at the Grassroots Level: The Reaction of Local Nonprofit Organizations to Public Participation Geographic Information Systems) in the Journal, Nonprofit and Voluntary Sector Quarterly, the publication of the Association for Research on Nonprofit Organizations and Voluntary Action (ARNOVA) — an association I have found to provide valuable information over the years — I was struck by the importance of system thinking combined with mission thinking.
Though they seem incompatible, being able to understand and work effectively within the advocacy environment — including needs of funders — most grassroots survive or die in, while remaining true to mission and serving clients at the highest level of expertise and heart, is fast becoming mandatory.
Here is the first paragraph of the article.
“The philanthropic and charitable underpinning of social service nonprofit organizations creates a unique environment in which these entities function. In the past, contributors assumed that nonprofit entities spent funds in an accountable and efficient manner and trusted that public good resulted from their activities. As a result, contributors commonly expressed fewer expectations in terms of reporting requirements or measures of accountability. Not so today. The effects of government downsizing, devolution, and new public management now require nonprofits to explain, if not justify, their financial decision making to contributors. As nonprofit organizations struggle to serve more clients with static or declining resources, they too realize that sound management practices have become critical to their success.” (Volume 39 Number 6 December 2010. pp. 992)
Though they seem incompatible, being able to understand and work effectively within the advocacy environment — including needs of funders — most grassroots survive or die in, while remaining true to mission and serving clients at the highest level of expertise and heart, is fast becoming mandatory.
Here is the first paragraph of the article.
“The philanthropic and charitable underpinning of social service nonprofit organizations creates a unique environment in which these entities function. In the past, contributors assumed that nonprofit entities spent funds in an accountable and efficient manner and trusted that public good resulted from their activities. As a result, contributors commonly expressed fewer expectations in terms of reporting requirements or measures of accountability. Not so today. The effects of government downsizing, devolution, and new public management now require nonprofits to explain, if not justify, their financial decision making to contributors. As nonprofit organizations struggle to serve more clients with static or declining resources, they too realize that sound management practices have become critical to their success.” (Volume 39 Number 6 December 2010. pp. 992)
Thursday, November 18, 2010
California’s Money Woes & Nonprofits
As reported by Nonprofit Quarterly, the situation could be dire.
An excerpt.
“Outgoing governor Arnold Schwarzenegger called a special session of the California state legislature to deal with a $25 billion deficit, incorporating $6 billion in deficits that had just popped up in the last month. If you're the incoming governor, former governor Jerry Brown, what do you do to solve that problem?...
“Unlike much of the rest of the nation, California stayed in the Democratic column despite its "big government" problem. Former Governor Gray Davis (who was Brown's chief of staff during Brown's original run in the Capitol) advised his former colleague to "level with the voters" that there is simply "less money to spend." The Governor may have to level with the nonprofit sector as well, particularly as it has been the beneficiary of several Obama Administration initiatives, notably the various "green" projects that were promoted by the President’s "green jobs czar," Van Jones from the California-based Ella Baker Center for Human Rights….
“If it were a country, California would be one of the 10 top economies in the world; it accounts for 13 percent of the U.S. Gross Domestic Product. In terms of philanthropic assets, the same applies: in 2008, California foundations accounted for nearly 15 percent of "qualified distributions" and over 16 percent of the nation's total foundation assets. All indicators seem to point out that the impact on the state's nonprofits will be pretty horrendous.”
An excerpt.
“Outgoing governor Arnold Schwarzenegger called a special session of the California state legislature to deal with a $25 billion deficit, incorporating $6 billion in deficits that had just popped up in the last month. If you're the incoming governor, former governor Jerry Brown, what do you do to solve that problem?...
“Unlike much of the rest of the nation, California stayed in the Democratic column despite its "big government" problem. Former Governor Gray Davis (who was Brown's chief of staff during Brown's original run in the Capitol) advised his former colleague to "level with the voters" that there is simply "less money to spend." The Governor may have to level with the nonprofit sector as well, particularly as it has been the beneficiary of several Obama Administration initiatives, notably the various "green" projects that were promoted by the President’s "green jobs czar," Van Jones from the California-based Ella Baker Center for Human Rights….
“If it were a country, California would be one of the 10 top economies in the world; it accounts for 13 percent of the U.S. Gross Domestic Product. In terms of philanthropic assets, the same applies: in 2008, California foundations accounted for nearly 15 percent of "qualified distributions" and over 16 percent of the nation's total foundation assets. All indicators seem to point out that the impact on the state's nonprofits will be pretty horrendous.”
Wednesday, November 17, 2010
Social Programs Data
Getting good data that can determine success has always been difficult from programs that work to change behavior, as it is not always easy to measure behavior change, especially within the two or three year window most nonprofits interact with clients.
This article from the Foundation Center explores the issue.
An excerpt.
“There's no question that the need for better data is on the minds of just about everyone who is working to address seemingly intractable social problems. If you run a nonprofit, you've undoubtedly felt the push from funders to demonstrate the impact of your programs. If you're a foundation program officer or an individual donor, you are probably looking for data that enable you to compare programs and choose the most effective ones. And in today's tough economic climate, government leaders at the local, state, and federal levels are urgently seeking ways to use data to make better use of increasingly limited resources.
“Fortunately, we're on the brink of a sea change in how we generate and use data to address social problems — and change is exactly what we need. Although significant data on social issues exist, much of it is not publicly available or is not action oriented. Indeed, quality information about nonprofit performance is scarce and not typically standardized to make it possible to compare organizations working on the same issue. As a result, we don't know whether the billions of dollars invested annually in nonprofit organizations by the public and private sectors is achieving the desired results — or any results at all.
“The enormous potential to improve the quality of and access to information is analogous to the information revolution that took place in the private sector during the twentieth century. The first stage of that revolution was inaugurated by Section 13 of the Securities Exchange Act of 1934, which required publicly traded companies to file annual reports (known as 10Ks) with the U.S. Securities and Exchange Commission. The information revolution continued with the rise of the tech sector in the United States in the late 1970s. Back then, tech start-ups were growing rapidly. Many investors, however, lacked data about industry trends, which companies were "hot," and how those companies were performing on a comparative level. One of the innovations that helped provide more transparency at the time was the development of an independent financial research industry. Reports, conferences, and advice began to be offered by the likes of the Yankee Group, Forrester, and Gartner Research. That information, in turn, provided investors with the insights they needed to make informed investment decisions and greatly increased the amount of growth capital available to tech companies, both young and established.
“In the nonprofit sector today, by contrast, the only standardized source of information is the 990 tax form. And while the 990 provides financial information, it offers no indication of whether an organization is fulfilling the charitable purpose for which it was awarded tax-exempt status in the first place. Imagine, then, what an information revolution similar to the one that transformed the private sector in the last quarter of the twentieth century might mean for twenty-first-century efforts to invest in social change. Rigorous and readily available assessments would ensure that "social investors" are able to identify the most successful approaches to our most pressing social issues. Nonprofits with access to better information could use that information to assess their programs and make informed decisions about ways to improve those programs. Funders would be able to more effectively compare programs and select the most promising grantees at every step of the innovation cycle — from early-stage testing of new models to replicating already proven approaches. And collaborations involving the nonprofit, government, and business sectors would be able to use data to help ensure that their efforts resulted in sustained social impact.”
This article from the Foundation Center explores the issue.
An excerpt.
“There's no question that the need for better data is on the minds of just about everyone who is working to address seemingly intractable social problems. If you run a nonprofit, you've undoubtedly felt the push from funders to demonstrate the impact of your programs. If you're a foundation program officer or an individual donor, you are probably looking for data that enable you to compare programs and choose the most effective ones. And in today's tough economic climate, government leaders at the local, state, and federal levels are urgently seeking ways to use data to make better use of increasingly limited resources.
“Fortunately, we're on the brink of a sea change in how we generate and use data to address social problems — and change is exactly what we need. Although significant data on social issues exist, much of it is not publicly available or is not action oriented. Indeed, quality information about nonprofit performance is scarce and not typically standardized to make it possible to compare organizations working on the same issue. As a result, we don't know whether the billions of dollars invested annually in nonprofit organizations by the public and private sectors is achieving the desired results — or any results at all.
“The enormous potential to improve the quality of and access to information is analogous to the information revolution that took place in the private sector during the twentieth century. The first stage of that revolution was inaugurated by Section 13 of the Securities Exchange Act of 1934, which required publicly traded companies to file annual reports (known as 10Ks) with the U.S. Securities and Exchange Commission. The information revolution continued with the rise of the tech sector in the United States in the late 1970s. Back then, tech start-ups were growing rapidly. Many investors, however, lacked data about industry trends, which companies were "hot," and how those companies were performing on a comparative level. One of the innovations that helped provide more transparency at the time was the development of an independent financial research industry. Reports, conferences, and advice began to be offered by the likes of the Yankee Group, Forrester, and Gartner Research. That information, in turn, provided investors with the insights they needed to make informed investment decisions and greatly increased the amount of growth capital available to tech companies, both young and established.
“In the nonprofit sector today, by contrast, the only standardized source of information is the 990 tax form. And while the 990 provides financial information, it offers no indication of whether an organization is fulfilling the charitable purpose for which it was awarded tax-exempt status in the first place. Imagine, then, what an information revolution similar to the one that transformed the private sector in the last quarter of the twentieth century might mean for twenty-first-century efforts to invest in social change. Rigorous and readily available assessments would ensure that "social investors" are able to identify the most successful approaches to our most pressing social issues. Nonprofits with access to better information could use that information to assess their programs and make informed decisions about ways to improve those programs. Funders would be able to more effectively compare programs and select the most promising grantees at every step of the innovation cycle — from early-stage testing of new models to replicating already proven approaches. And collaborations involving the nonprofit, government, and business sectors would be able to use data to help ensure that their efforts resulted in sustained social impact.”
Tuesday, November 16, 2010
Foundation Tool Kit
The Foundation Center reports on a new resource that could be of value for organizations—even those beyond the community foundations who are its primary target—whose work involves changing public policy.
News piece.
“According to a new publication from the Center for Lobbying in the Public Interest, foundations can do more to advance their missions, influence public policy, strengthen the democratic process, and create systemic social change by supporting civic engagement and advocacy efforts. Foundations for Civic Impact: Advocacy and Civic Engagement Toolkit for Private Foundations (28 pages, PDF) and a companion toolkit for community foundations argue that advocacy and civic engagement are essential elements of strategic philanthropy; explain what foundations can and cannot do legally in terms of lobbying; and provide sample grantmaking guidelines, grant agreements, and communications materials to help foundations empower their grantees and regular citizens.”
News piece.
“According to a new publication from the Center for Lobbying in the Public Interest, foundations can do more to advance their missions, influence public policy, strengthen the democratic process, and create systemic social change by supporting civic engagement and advocacy efforts. Foundations for Civic Impact: Advocacy and Civic Engagement Toolkit for Private Foundations (28 pages, PDF) and a companion toolkit for community foundations argue that advocacy and civic engagement are essential elements of strategic philanthropy; explain what foundations can and cannot do legally in terms of lobbying; and provide sample grantmaking guidelines, grant agreements, and communications materials to help foundations empower their grantees and regular citizens.”
Monday, November 15, 2010
Impact Investing
This new brand of philanthropy is described in a report from The Monitor Institute.
An excerpt.
“What is Impact Investing?
“In New York City, a low-income mother is moving into an apartment on land developed with a loan from the New York City Acquisition Fund. The Fund, created in 2004, aims to facilitate the construction of 10,000 units of affordable housing in a city with rapidly diminishing affordable housing stock. The Fund came together when private foundations made $32 million in low-interest, subordinated loans and a city-based charitable trust invested $8 million on similar terms, enabling commercial banks to raise and place more than $160 million of commercially priced debt into the fund.
“In rural Tanzania, a student is reading at home by the light of an electric light bulb powered by a solar panel her mother bought on credit from a local distributor. The distribution business could reach her village because of an equity and working capital investment made by E+Co, a nonprofit mezzanine fund focused on making debt and equity investments in businesses that develop and sell modern energy services.
“In Cambodia, a small business is expanding with debt from a microfinance bank. The bank is originating new loans after accessing commercial capital markets through a $110 million loan fund structured in 2007 by Blue Orchard, a Swiss microfinance-focused asset management company, and Morgan Stanley. The loan fund, rated by Standard & Poor’s, was syndicated on commercial terms among institutional investors, such as pension funds, in Europe and the United Kingdom.
“The New Yorker moving into her first home, the student in Tanzania studying under electric light, the small-business owner in Cambodia expanding her payroll—none of these people would recognize one another as coparticipants in the same emerging industry. Neither, perhaps, would the commercial banker placing debt in the Acquisition Fund, the high-networth individuals investing in E+Co, or the German worker whose pension fund invested in microfinance through Blue Orchard.
“Yet these are all examples of the proliferation of activity occurring as a new industry of impact investing emerges. This industry which involves making investments that generate social and environmental value as well as financial return, has the potential to complement philanthropy and government intervention as a potent force for addressing global challenges at scale. This document is intended to shed light on the industry’s recent emergence and highlight the challenges it faces in achieving its promise.” (p 3)
An excerpt.
“What is Impact Investing?
“In New York City, a low-income mother is moving into an apartment on land developed with a loan from the New York City Acquisition Fund. The Fund, created in 2004, aims to facilitate the construction of 10,000 units of affordable housing in a city with rapidly diminishing affordable housing stock. The Fund came together when private foundations made $32 million in low-interest, subordinated loans and a city-based charitable trust invested $8 million on similar terms, enabling commercial banks to raise and place more than $160 million of commercially priced debt into the fund.
“In rural Tanzania, a student is reading at home by the light of an electric light bulb powered by a solar panel her mother bought on credit from a local distributor. The distribution business could reach her village because of an equity and working capital investment made by E+Co, a nonprofit mezzanine fund focused on making debt and equity investments in businesses that develop and sell modern energy services.
“In Cambodia, a small business is expanding with debt from a microfinance bank. The bank is originating new loans after accessing commercial capital markets through a $110 million loan fund structured in 2007 by Blue Orchard, a Swiss microfinance-focused asset management company, and Morgan Stanley. The loan fund, rated by Standard & Poor’s, was syndicated on commercial terms among institutional investors, such as pension funds, in Europe and the United Kingdom.
“The New Yorker moving into her first home, the student in Tanzania studying under electric light, the small-business owner in Cambodia expanding her payroll—none of these people would recognize one another as coparticipants in the same emerging industry. Neither, perhaps, would the commercial banker placing debt in the Acquisition Fund, the high-networth individuals investing in E+Co, or the German worker whose pension fund invested in microfinance through Blue Orchard.
“Yet these are all examples of the proliferation of activity occurring as a new industry of impact investing emerges. This industry which involves making investments that generate social and environmental value as well as financial return, has the potential to complement philanthropy and government intervention as a potent force for addressing global challenges at scale. This document is intended to shed light on the industry’s recent emergence and highlight the challenges it faces in achieving its promise.” (p 3)
Saturday, November 13, 2010
Great Philanthropists
America is blessed with many and Fast Company reports on one.
An excerpt.
“Call it a midlife crisis gone terribly right. After 28 years in finance, Ron Cordes--co-chairman of the $21 billion asset management firm Genworth--is dedicating his energy to building an online portal that will make impact investing a whole lot easier.
"I spent the first half of my life building businesses designed to be the best in the world," Cordes tells Fast Company. "For the second half, I really want to support businesses that are the best for the world."
“As he approached the age of 50, Cordes found himself in rural Uganda, in a village five hours off the beaten track. The place was full of widows who had lost their husbands to a two-decade long civil war; Cordes had funded a small microfinance program there, and the women were now running successful small businesses and supporting their kids. "One woman came up to me and said, 'We appreciate it when [white people] come to try to save our children, but we need to be able to save our own children. Thank you for investing in us so we can do that.' I'll never forget that moment."
“That was the moment Cordes realized empowerment was more powerful than pity. He started to brainstorm ways in which his expertise as a financial manager could help create opportunities like this on a much larger scale. Now, with a new product he's calling ImpactAssets, Cordes is adding a crucial element to the impact investing space.
“ImpactAssets is a platform that will bridge high-rolling investors with social enterprises. Financial advisers will find information about solid impact investment options. The absence of a good system of finding, processing, and measuring impact investments, he says, is barring billions of dollars from being invested in good causes.
"There's no ecosystem to help advisers have conversations with their clients about social and environmental investments,” says Cordes. “U.S. investors own $37 trillion of investment capital. Even catalyzing 1% of that is $370 billion--enough to have amazing, groundbreaking, life-changing differences."
“Most people already have philanthropic causes that they support. Meanwhile, entrepreneurs all over the world are starting businesses within these issue areas that are also investable business opportunities. "Part of the process is to create awareness that these opportunities exist," Cordes says. "Once people are aware, we need to create opportunities to turn that awareness into engagement, and then to turn that engagement into actual dollar investments. That's what's going to solve problems."
An excerpt.
“Call it a midlife crisis gone terribly right. After 28 years in finance, Ron Cordes--co-chairman of the $21 billion asset management firm Genworth--is dedicating his energy to building an online portal that will make impact investing a whole lot easier.
"I spent the first half of my life building businesses designed to be the best in the world," Cordes tells Fast Company. "For the second half, I really want to support businesses that are the best for the world."
“As he approached the age of 50, Cordes found himself in rural Uganda, in a village five hours off the beaten track. The place was full of widows who had lost their husbands to a two-decade long civil war; Cordes had funded a small microfinance program there, and the women were now running successful small businesses and supporting their kids. "One woman came up to me and said, 'We appreciate it when [white people] come to try to save our children, but we need to be able to save our own children. Thank you for investing in us so we can do that.' I'll never forget that moment."
“That was the moment Cordes realized empowerment was more powerful than pity. He started to brainstorm ways in which his expertise as a financial manager could help create opportunities like this on a much larger scale. Now, with a new product he's calling ImpactAssets, Cordes is adding a crucial element to the impact investing space.
“ImpactAssets is a platform that will bridge high-rolling investors with social enterprises. Financial advisers will find information about solid impact investment options. The absence of a good system of finding, processing, and measuring impact investments, he says, is barring billions of dollars from being invested in good causes.
"There's no ecosystem to help advisers have conversations with their clients about social and environmental investments,” says Cordes. “U.S. investors own $37 trillion of investment capital. Even catalyzing 1% of that is $370 billion--enough to have amazing, groundbreaking, life-changing differences."
“Most people already have philanthropic causes that they support. Meanwhile, entrepreneurs all over the world are starting businesses within these issue areas that are also investable business opportunities. "Part of the process is to create awareness that these opportunities exist," Cordes says. "Once people are aware, we need to create opportunities to turn that awareness into engagement, and then to turn that engagement into actual dollar investments. That's what's going to solve problems."
Friday, November 12, 2010
Trying Times
While this is surely trying times for most nonprofits, it is also an opportunity to explore the founding vision of your organization in relation to funding and mission sustainability.
Is your organizational mission and your organizational competency still relevant and effective, so that donors—though perhaps greatly reducing their donations—will continue to support your work?
At the core of my practice to grow nonprofits, lies this essential question; for any capacity building consultation must start here.
Is your organizational mission and your organizational competency still relevant and effective, so that donors—though perhaps greatly reducing their donations—will continue to support your work?
At the core of my practice to grow nonprofits, lies this essential question; for any capacity building consultation must start here.
Thursday, November 11, 2010
Social Enterprise & Nonprofit Blogging
There are a couple good articles from the Axelson Review about those two strategies, both excellent tools for nonprofits to consider.
Both are crucial for social change nonprofits as they expand the venue for advocacy, while keeping the message fresh and connected to other advocacy efforts throughout the community.
Both are crucial for social change nonprofits as they expand the venue for advocacy, while keeping the message fresh and connected to other advocacy efforts throughout the community.
Tuesday, November 9, 2010
Fund Raising Costs vs Results
Called ROI—return on investment—this story from PRNewswire reports the results of a recent report on the ROI for health related nonprofits.
An excerpt.
“WASHINGTON, Nov. 8, 2010 /PRNewswire-USNewswire/ -- With charitable pledges – especially in the Western United States – declining due to the deepening recession, fundraisers were forced to spend significantly more money in fiscal year 2009 than in past years to secure gifts and grants for nonprofit hospitals and health care systems in the United States and Canada, according to benchmarking data released today by the Association for Healthcare Philanthropy (AHP).
"The recession's impact and duration were felt more strongly in the U.S. than in Canada, where health care philanthropy tended to advance slightly or at least hold its own despite lower levels of government support," said William C. McGinly, Ph.D., president and chief executive officer of AHP. "U.S. nonprofit hospitals, however, often struggled just to keep giving levels steady, and some saw declines."
“McGinly added, "The constant message that shines through the data is that organizations that best survived last year's worsening economy were those who persevered by keeping sufficient staff and resources to maintain well-rounded philanthropic opportunities and programs."
“AHP gathered detailed data from 66 institutions across the U.S. and Canada, including community hospitals, academic/ teaching, tertiary and specialty hospitals and health care systems. On average, the recession hurt charitable giving to health care institutions most severely in the Western region of the U.S. Sample wide, median Return on Investment (ROI) – a measure of fundraising effectiveness – fell 23 percent in 2009 from $4.63 to $3.57. For cash donations alone, median ROI fell 17 percent to $3.26.
“On the brighter side last year, physicians and other hospital employees of the organizations reporting data in this study donated more money and did so more frequently. Gift amounts from physicians and physician groups averaged $5,000, up $3,000 from 2008 illustrating great strides in foundations' efforts toward building the internal culture of philanthropy.”
An excerpt.
“WASHINGTON, Nov. 8, 2010 /PRNewswire-USNewswire/ -- With charitable pledges – especially in the Western United States – declining due to the deepening recession, fundraisers were forced to spend significantly more money in fiscal year 2009 than in past years to secure gifts and grants for nonprofit hospitals and health care systems in the United States and Canada, according to benchmarking data released today by the Association for Healthcare Philanthropy (AHP).
"The recession's impact and duration were felt more strongly in the U.S. than in Canada, where health care philanthropy tended to advance slightly or at least hold its own despite lower levels of government support," said William C. McGinly, Ph.D., president and chief executive officer of AHP. "U.S. nonprofit hospitals, however, often struggled just to keep giving levels steady, and some saw declines."
“McGinly added, "The constant message that shines through the data is that organizations that best survived last year's worsening economy were those who persevered by keeping sufficient staff and resources to maintain well-rounded philanthropic opportunities and programs."
“AHP gathered detailed data from 66 institutions across the U.S. and Canada, including community hospitals, academic/ teaching, tertiary and specialty hospitals and health care systems. On average, the recession hurt charitable giving to health care institutions most severely in the Western region of the U.S. Sample wide, median Return on Investment (ROI) – a measure of fundraising effectiveness – fell 23 percent in 2009 from $4.63 to $3.57. For cash donations alone, median ROI fell 17 percent to $3.26.
“On the brighter side last year, physicians and other hospital employees of the organizations reporting data in this study donated more money and did so more frequently. Gift amounts from physicians and physician groups averaged $5,000, up $3,000 from 2008 illustrating great strides in foundations' efforts toward building the internal culture of philanthropy.”
Monday, November 8, 2010
Medical Nonprofit’s Beneficial Diagnoses
In an object lesson public oversight leadership needs to be aware of in every region, this Baltimore nonprofit seemed to always benefit from their diagnosis, as reported by the Baltimore Sun.
An excerpt.
“Kevin Brown knew he was hooked on crack cocaine. That was obvious each time he set off on another smoking binge. But Brown says he never imagined that he also suffered from a mental illness until he walked into Baltimore Behavioral Health Inc.
“A day or so after he went to the private, nonprofit Southwest Baltimore clinic in 2007 hoping to kick his drug habit, a psychiatrist diagnosed him with major depression. Soon, he was living in one of BBH's houses, taking antidepressants and spending hours each day in group therapy, half of it focused on mental illness. The treatment lasted months and cost taxpayers thousands of dollars.
“But Brown, 46, doubted that he had a psychiatric illness or needed medication. And for good reason, says Amy Jackson, a University of Maryland mental health social worker who counseled him over a recent six-month stretch after he'd relapsed: He never was clinically depressed.
"Once he was no longer using the substance, he was no longer showing signs of the depression," Jackson said. In other words, he suffers from a chemical addiction, and when that is under control, his mind is not burdened by mental illness.
“Brown, an addict diagnosed with a psychiatric illness that some outside health providers do not think he has, illustrates a recurring theme at BBH.
“Addicts who step into BBH from the city's drug-racked streets are three times more likely to be deemed mentally ill than are addicts treated at other centers across Maryland, state records show.
“And BBH has long funneled patients into the costliest outpatient treatment programs available to poor Marylanders — programs they would not qualify for without a diagnosis that they have a psychiatric illness. In some years, state data show, the West Pratt Street center has swallowed up 85 taxpayer funds spent on intensive outpatient mental health carepercent of the across Maryland.
“From modest beginnings in 1997, Baltimore Behavioral Health grew by last year into a $17 million-per-year operation, with more than 250 staff members tending hundreds of patients a day, making it one of the region's largest providers of drug treatment. It has diagnosed and treated thousands of the city's most broken and desperate, offering many a bed in its network of area rental homes, then busing them daily to the center for state-funded treatment.
“But former patients and employees, as well as outside doctors, say BBH has been diagnosing mental illness — and collecting public money to treat it — in some patients whose main affliction is drug addiction.”
An excerpt.
“Kevin Brown knew he was hooked on crack cocaine. That was obvious each time he set off on another smoking binge. But Brown says he never imagined that he also suffered from a mental illness until he walked into Baltimore Behavioral Health Inc.
“A day or so after he went to the private, nonprofit Southwest Baltimore clinic in 2007 hoping to kick his drug habit, a psychiatrist diagnosed him with major depression. Soon, he was living in one of BBH's houses, taking antidepressants and spending hours each day in group therapy, half of it focused on mental illness. The treatment lasted months and cost taxpayers thousands of dollars.
“But Brown, 46, doubted that he had a psychiatric illness or needed medication. And for good reason, says Amy Jackson, a University of Maryland mental health social worker who counseled him over a recent six-month stretch after he'd relapsed: He never was clinically depressed.
"Once he was no longer using the substance, he was no longer showing signs of the depression," Jackson said. In other words, he suffers from a chemical addiction, and when that is under control, his mind is not burdened by mental illness.
“Brown, an addict diagnosed with a psychiatric illness that some outside health providers do not think he has, illustrates a recurring theme at BBH.
“Addicts who step into BBH from the city's drug-racked streets are three times more likely to be deemed mentally ill than are addicts treated at other centers across Maryland, state records show.
“And BBH has long funneled patients into the costliest outpatient treatment programs available to poor Marylanders — programs they would not qualify for without a diagnosis that they have a psychiatric illness. In some years, state data show, the West Pratt Street center has swallowed up 85 taxpayer funds spent on intensive outpatient mental health carepercent of the across Maryland.
“From modest beginnings in 1997, Baltimore Behavioral Health grew by last year into a $17 million-per-year operation, with more than 250 staff members tending hundreds of patients a day, making it one of the region's largest providers of drug treatment. It has diagnosed and treated thousands of the city's most broken and desperate, offering many a bed in its network of area rental homes, then busing them daily to the center for state-funded treatment.
“But former patients and employees, as well as outside doctors, say BBH has been diagnosing mental illness — and collecting public money to treat it — in some patients whose main affliction is drug addiction.”
Saturday, November 6, 2010
Privatization
This strategy for reducing government costs often involves nonprofits assuming the service delivery previously held by government, and, as this article from Governing reports, sometimes it works out real well, and sometimes not.
An excerpt.
“Back in 2008, the U.S. Senate voted to privatize the operation of the Senate restaurant, which was not only losing money at an alarming clip -- roughly $2 million a year -- but also serving lousy food. As the joke went at the time, the food was bad but at least the portions were small.
“The move to privatize caused anguish for the Democratic majority at the time. Democratic Sen. Robert Menendez of New Jersey argued against contracting out, telling the Washington Post that "you cannot stand on the Senate floor and condemn the privatization of workers, and then turn around and privatize the workers here in the Senate and leave them out on their own." California Democratic Sen. Dianne Feinstein said, "It's clearly not the sort of thing I ran for the Senate to do."
“To her credit, Feinstein opted for privatizing the restaurant rather than watching taxpayers subsidize a substandard operation. But for many, the decision to outsource seemed to be the moral equivalent of an attack on government, an admission that government isn't any good at anything.
“On the flip side, there are some who seem eager to privative at all costs.
“During the occupation of Iraq, the Bush administration appeared content to drive the majority of projects through hastily arranged contracts with private providers, many of them on a no-bid basis. A recent article in the Los Angeles Times notes the "legacy of waste" associated with this approach. This assessment is largely based on the findings of Stuart Bowen, the special inspector general for Iraq, whose job it was to review these contracts. In many cases, these contracts turned into costly white elephants, like the $40 million spent on a prison that has never been opened. "Billions of dollars have already been spent and billions have been wasted," Bowen said.
“Ideology often serves as an impediment to good decision making. Why can't we simply agree up front to the blazingly obvious truth about privatization: In some cases, it leads to better services and lower costs; in other cases, it doesn't.
“The political embrace of preconceived positions regarding government and markets simply doesn't help. Clinging to the notion that a government-run restaurant is inherently better (or worse) than a privately-run restaurant is ridiculous. The proof really is in the pudding -- that is, outsourcing decisions are best judged by their outputs and costs.
“Once we get past the ideology, we can focus on what really matters: the results. We can look at the evidence and start to see the conditions that make successful privatization more likely. Is there an established private market for this service? Are the deliverables relatively straightforward to measure? Is there good data about internal costs that allows for a meaningful comparison of in-house and outsourced services?
“There is evidence that when the conditions are right, outsourcing can be a great way to deliver public services for less, in areas ranging from fleet maintenance to janitorial services, from wastewater treatment to street sweeping. Acknowledging this isn't the moral equivalent of attacking democratic government.
“There is also evidence that outsourcings can go awry. Corrupt bidding practices can lead to problems. Large, complex outsourcings, as with IT systems and the like, depend on highly skilled contract administration, and do not always end well. Acknowledging this isn't the moral equivalent of attacking the free enterprise system.”
An excerpt.
“Back in 2008, the U.S. Senate voted to privatize the operation of the Senate restaurant, which was not only losing money at an alarming clip -- roughly $2 million a year -- but also serving lousy food. As the joke went at the time, the food was bad but at least the portions were small.
“The move to privatize caused anguish for the Democratic majority at the time. Democratic Sen. Robert Menendez of New Jersey argued against contracting out, telling the Washington Post that "you cannot stand on the Senate floor and condemn the privatization of workers, and then turn around and privatize the workers here in the Senate and leave them out on their own." California Democratic Sen. Dianne Feinstein said, "It's clearly not the sort of thing I ran for the Senate to do."
“To her credit, Feinstein opted for privatizing the restaurant rather than watching taxpayers subsidize a substandard operation. But for many, the decision to outsource seemed to be the moral equivalent of an attack on government, an admission that government isn't any good at anything.
“On the flip side, there are some who seem eager to privative at all costs.
“During the occupation of Iraq, the Bush administration appeared content to drive the majority of projects through hastily arranged contracts with private providers, many of them on a no-bid basis. A recent article in the Los Angeles Times notes the "legacy of waste" associated with this approach. This assessment is largely based on the findings of Stuart Bowen, the special inspector general for Iraq, whose job it was to review these contracts. In many cases, these contracts turned into costly white elephants, like the $40 million spent on a prison that has never been opened. "Billions of dollars have already been spent and billions have been wasted," Bowen said.
“Ideology often serves as an impediment to good decision making. Why can't we simply agree up front to the blazingly obvious truth about privatization: In some cases, it leads to better services and lower costs; in other cases, it doesn't.
“The political embrace of preconceived positions regarding government and markets simply doesn't help. Clinging to the notion that a government-run restaurant is inherently better (or worse) than a privately-run restaurant is ridiculous. The proof really is in the pudding -- that is, outsourcing decisions are best judged by their outputs and costs.
“Once we get past the ideology, we can focus on what really matters: the results. We can look at the evidence and start to see the conditions that make successful privatization more likely. Is there an established private market for this service? Are the deliverables relatively straightforward to measure? Is there good data about internal costs that allows for a meaningful comparison of in-house and outsourced services?
“There is evidence that when the conditions are right, outsourcing can be a great way to deliver public services for less, in areas ranging from fleet maintenance to janitorial services, from wastewater treatment to street sweeping. Acknowledging this isn't the moral equivalent of attacking democratic government.
“There is also evidence that outsourcings can go awry. Corrupt bidding practices can lead to problems. Large, complex outsourcings, as with IT systems and the like, depend on highly skilled contract administration, and do not always end well. Acknowledging this isn't the moral equivalent of attacking the free enterprise system.”
Friday, November 5, 2010
Donor Response
A brief post from Fast Company on five simple ways that organizations can respond to donors.
An excerpt.
“Hopefully, many of you do or will contribute generously to causes that you care about, and even step up to join nonprofit boards and help to fundraise. Fundraising is an exciting and very concrete way to build support for a mission that you are really passionate about.
“For those of you who get involved in fundraising on a nonprofit board, be alert to how the organization treats its donors. It can make all the difference in whether or not your donors are enthusiastic repeaters, or drift away. I continue to be surprised that there are still too many nonprofits that scare away donors by neglecting to:
1. Say thank you in thoughtful ways (or even at all!)
2. Provide opportunities for donors to make site visits to see programs "in action"
3. Provide straightforward information about how funds are used to achieve meaningful results
4. Involve donors in service activities if they are interested
5. Recognize donors at events, on the organization's website, and in the annual report.”
An excerpt.
“Hopefully, many of you do or will contribute generously to causes that you care about, and even step up to join nonprofit boards and help to fundraise. Fundraising is an exciting and very concrete way to build support for a mission that you are really passionate about.
“For those of you who get involved in fundraising on a nonprofit board, be alert to how the organization treats its donors. It can make all the difference in whether or not your donors are enthusiastic repeaters, or drift away. I continue to be surprised that there are still too many nonprofits that scare away donors by neglecting to:
1. Say thank you in thoughtful ways (or even at all!)
2. Provide opportunities for donors to make site visits to see programs "in action"
3. Provide straightforward information about how funds are used to achieve meaningful results
4. Involve donors in service activities if they are interested
5. Recognize donors at events, on the organization's website, and in the annual report.”
Thursday, November 4, 2010
Evaluating Social Enterprise
The social enterprise concept is an excellent one, bringing forprofit principles into the nonprofit world, and when handled correctly, benefits both.
Many New York social enterprise efforts have recently been evaluated, as reported by the Wall Street Journal.
An excerpt.
“Hundreds of New York's social-service organizations are short-changing the people they are supposed to serve by focusing on money-making schemes, according to a report released Wednesday by Pace University.
“By pursuing income-related activities such as selling donors' contact information to third-party marketers and running online shops, nonprofits have diverted income away from service activities, says Rebecca Tekula, the report's author.
"Organizations that spend money and divert resources to other activities do so at the detriment of the homeless, domestic violence victims and people who need these services," says Ms. Tekula, executive director at the Wilson Center for Social Entrepreneurship at Pace University. "Social enterprise may be an innovation," she says, but it is one that can tempt nonprofits into a substantial "mission distraction."
“Researchers analyzed the tax forms of 700 social-service organizations across New York County between 2000 and 2005. The organizations in the sample raised an average of $1 million in so-called unrelated business income, putting the money toward average expense budgets of $19 million.
“The report found that organizations that engage in unrelated business activities, often called social enterprise programs, are more likely to run less efficient shops than their peers. As income from peripheral businesses went up, the share of a contributed dollar that went to actual services went down, according to the report.
“While Ms. Tekula says the report does not prove causality, she maintains that the high correlation between poorly performing nonprofits and those that pursue income-generating projects is cause for concern.
"Organizations with unrelated businesses were not investing profits in their mission-related services," Ms. Tekula says. "Instead, profits were reinvested in the business, and losses were subsidized with funds that might have gone to clients."
“For instance, she points to God's Love We Deliver, an organization that prepares meals for people with serious illnesses, which in 2006 lost about $100,000 on merchandise it sells via holiday catalogs. Since then, it has made between $36,000 and $55,000 a year through online sales, according to tax forms.
“God's Love maintains that the real loss was closer to $7,000 and that the larger number reflects an Internal Revenue Service accounting rule that requires charities to record donated goods as expenses, even if the charity did not pay for them.
“The sales ventures "either break even or have a positive bottom line every year," says Karen Pearl, the group's president and CEO. "Our catalog and gifts are a teensy part of our $9 million budget but it helps keep God's Love in the forefront of peoples minds, hearts and ultimately in their giving."
“Covenant House, a $37.6 million New York-based nonprofit that provides food, shelter and crisis care to homeless youth, has earned between $500,000 and $700,000 a year by renting out its list of donor contact information to third-party marketers. Meanwhile, only half of the nonprofit's revenue went to run its programs, with the other half going toward administrative and fund-raising expenses, according to Ms. Tekula's analysis.
"List rentals aren't an ideal way to earn money but it translates into a source of income that can help hundreds of kids," says Tom Manning, a spokesman for Covenant House.
“Because Covenant House is an umbrella organization with 18 affiliates, its administrative expenses appear higher when looked at alone, Mr. Manning says. Including the affiliates, which run the bulk of the organization's programs, he says the amount spent on programs rises to more than 71% of its expenditures.”
Many New York social enterprise efforts have recently been evaluated, as reported by the Wall Street Journal.
An excerpt.
“Hundreds of New York's social-service organizations are short-changing the people they are supposed to serve by focusing on money-making schemes, according to a report released Wednesday by Pace University.
“By pursuing income-related activities such as selling donors' contact information to third-party marketers and running online shops, nonprofits have diverted income away from service activities, says Rebecca Tekula, the report's author.
"Organizations that spend money and divert resources to other activities do so at the detriment of the homeless, domestic violence victims and people who need these services," says Ms. Tekula, executive director at the Wilson Center for Social Entrepreneurship at Pace University. "Social enterprise may be an innovation," she says, but it is one that can tempt nonprofits into a substantial "mission distraction."
“Researchers analyzed the tax forms of 700 social-service organizations across New York County between 2000 and 2005. The organizations in the sample raised an average of $1 million in so-called unrelated business income, putting the money toward average expense budgets of $19 million.
“The report found that organizations that engage in unrelated business activities, often called social enterprise programs, are more likely to run less efficient shops than their peers. As income from peripheral businesses went up, the share of a contributed dollar that went to actual services went down, according to the report.
“While Ms. Tekula says the report does not prove causality, she maintains that the high correlation between poorly performing nonprofits and those that pursue income-generating projects is cause for concern.
"Organizations with unrelated businesses were not investing profits in their mission-related services," Ms. Tekula says. "Instead, profits were reinvested in the business, and losses were subsidized with funds that might have gone to clients."
“For instance, she points to God's Love We Deliver, an organization that prepares meals for people with serious illnesses, which in 2006 lost about $100,000 on merchandise it sells via holiday catalogs. Since then, it has made between $36,000 and $55,000 a year through online sales, according to tax forms.
“God's Love maintains that the real loss was closer to $7,000 and that the larger number reflects an Internal Revenue Service accounting rule that requires charities to record donated goods as expenses, even if the charity did not pay for them.
“The sales ventures "either break even or have a positive bottom line every year," says Karen Pearl, the group's president and CEO. "Our catalog and gifts are a teensy part of our $9 million budget but it helps keep God's Love in the forefront of peoples minds, hearts and ultimately in their giving."
“Covenant House, a $37.6 million New York-based nonprofit that provides food, shelter and crisis care to homeless youth, has earned between $500,000 and $700,000 a year by renting out its list of donor contact information to third-party marketers. Meanwhile, only half of the nonprofit's revenue went to run its programs, with the other half going toward administrative and fund-raising expenses, according to Ms. Tekula's analysis.
"List rentals aren't an ideal way to earn money but it translates into a source of income that can help hundreds of kids," says Tom Manning, a spokesman for Covenant House.
“Because Covenant House is an umbrella organization with 18 affiliates, its administrative expenses appear higher when looked at alone, Mr. Manning says. Including the affiliates, which run the bulk of the organization's programs, he says the amount spent on programs rises to more than 71% of its expenditures.”
Wednesday, November 3, 2010
Group Wisdom
An interesting look at the thinking that often comes from groups, from Governing; and the answer to the author’s question in the second paragraph is: because they are bigger, more diverse, and not always dominated by authority.
I just ordered the book mentioned and will blog about it after reading it.
An excerpt.
“In 2004, James Surowiecki had a bestselling book entitled The Wisdom of Crowds. In it, he argued that tapping into the wisdom of groups was a great way to determine how to proceed in a wide variety of social situations, including thorny public policy questions.
“But if groups are so wise, why are committees so moronic? We all know that while anyone can make a mistake, it takes a committee to really screw things up.
“Have you ever been trying to cross a busy street with three or four other people? It can turn into a horror show. Someone starts to cross, and then stops; the group lurches out behind them, and then lurches to a stop, turning a routine event into a mini-disaster. The context generates poorer decisions when people try it as a group than if they were to go it alone.
“It isn't just your imagination. As Surowiecki notes, while under the right conditions groups can generate wise decisions, a group can produce outcomes worse than any individual might be expected to make in other cases. The context of collective deliberations turns out to be critical to good decision making.
“So what makes for group wisdom?
“Consider a 10-person committee given the task of guessing how many jelly beans are in a big jar on the table. One approach to collective decision-making would be for the group to work together to reach consensus on their best guess. Another approach would be for each person to generate an estimate independently, then to average all the estimates.
“Surowiecki might argue, and experience bears out, that while both approaches have merit, the second method is more likely to yield an estimate closer to the truth. In committees, there can be a tendency for the strongest personalities to exert great influence on the group's thinking. The second method taps into each member's intelligence and their unique experience.”
I just ordered the book mentioned and will blog about it after reading it.
An excerpt.
“In 2004, James Surowiecki had a bestselling book entitled The Wisdom of Crowds. In it, he argued that tapping into the wisdom of groups was a great way to determine how to proceed in a wide variety of social situations, including thorny public policy questions.
“But if groups are so wise, why are committees so moronic? We all know that while anyone can make a mistake, it takes a committee to really screw things up.
“Have you ever been trying to cross a busy street with three or four other people? It can turn into a horror show. Someone starts to cross, and then stops; the group lurches out behind them, and then lurches to a stop, turning a routine event into a mini-disaster. The context generates poorer decisions when people try it as a group than if they were to go it alone.
“It isn't just your imagination. As Surowiecki notes, while under the right conditions groups can generate wise decisions, a group can produce outcomes worse than any individual might be expected to make in other cases. The context of collective deliberations turns out to be critical to good decision making.
“So what makes for group wisdom?
“Consider a 10-person committee given the task of guessing how many jelly beans are in a big jar on the table. One approach to collective decision-making would be for the group to work together to reach consensus on their best guess. Another approach would be for each person to generate an estimate independently, then to average all the estimates.
“Surowiecki might argue, and experience bears out, that while both approaches have merit, the second method is more likely to yield an estimate closer to the truth. In committees, there can be a tendency for the strongest personalities to exert great influence on the group's thinking. The second method taps into each member's intelligence and their unique experience.”
Saturday, October 30, 2010
Election Blogging Break
Dear Reader:
I’ll be taking an election period break from blogging until Wednesday, November 3rd, when I hope we will all share in a great wave of common sense voting, bringing committed public leadership to serve this great nation and our beloved communities.
Take care.
David H. Lukenbill
Thursday, October 28, 2010
Government Funding & Human Service Nonprofits
In Sacramento there are discussions about turning over the government's help for the homeless to nonprofits, and in St. Louis, as reported by St Louis Today, nonprofits helping the homeless are asking for the money owed to them by the government.
Not a pretty picture anyway you look at it, and those who need help the most, the homeless and others—such as the domestic violence victims in the St. Louis article—continue to suffer from a disorganized method of help, all too often made worse by government’s involvement.
A terrific book to read for some foundational knowledge around this issue is, To Empower People: From State to Civil Society, by Peter Berger and Fr. Richard John Neuhaus, and here is an excellent review of it.
An excerpt from the St Louis article.
“Nonprofit groups contracted by the government to provide basic shelter for the city's homeless and domestic violence victims are frustrated because they have been stuck holding the bills for months.
“The agencies began providing services for this year's federal emergency shelter grant in January. None of the $870,000 in grant money has been paid.
“The St. Louis Department of Human Services, specifically its homeless services unit, has administered such grants for years. Director William Siedhoff said Tuesday that he is disturbed by the "tremendous lag" in payments this year and assured checks would be cut sometime next month.
“Siedhoff said he became aware of the situation last month.
"There has got to be a better way to do this, and I am going to figure out how to do it," he said. "I know the hardship this creates."
“The grant comes from the U.S. Department of Housing and Urban Development. James Heard, director of HUD's St. Louis office, said the money has been delayed this year because the city had provided incomplete paperwork about how the housing grant was used in previous years.
“He said this year's money was cleared for release last month.He was surprised to find out Tuesday that the nonprofit groups are still in limbo.
"We are concerned," he said. "They need to be paid."
“The delay has caused some nonprofit groups — already strapped by a heightened demand for services — to dip into reserves, lean on lines of credit and cut back on items as inexpensive as bus tickets.
"We have a really small margin of error," said Michelle Schiller-Baker, executive director of St. Martha's Hall, which helps abused women and their children. "We don't have bus money to get to that doctor's appointment, to get to that job interview."
“She said the city owes her agency $35,800 in housing grant money. It's just a sliver of the nonprofit group's $900,000 annual budget, but Schiller-Baker said "every single penny is accounted for."
"Regardless of what amount it is of our budget at the shelter," she said, "you owe me the money, you better give it to me."
“Lydia's House, which provides transitional housing for domestic violence victims, is owed $27,000.”
"We are looking forward to getting that funding," said executive director Ellen Reed. "We haven't had to cut programs, but it has certainly made things tight. We have had to dig into our reserves."
"Catholic Charities Chief Financial Officer Colleen Dusek said its Housing Resource Center for the homeless is owed $80,000. She said the agency experienced similar delays last year. The center has covered its costs with a line of credit from the Archdiocese of St. Louis."
Not a pretty picture anyway you look at it, and those who need help the most, the homeless and others—such as the domestic violence victims in the St. Louis article—continue to suffer from a disorganized method of help, all too often made worse by government’s involvement.
A terrific book to read for some foundational knowledge around this issue is, To Empower People: From State to Civil Society, by Peter Berger and Fr. Richard John Neuhaus, and here is an excellent review of it.
An excerpt from the St Louis article.
“Nonprofit groups contracted by the government to provide basic shelter for the city's homeless and domestic violence victims are frustrated because they have been stuck holding the bills for months.
“The agencies began providing services for this year's federal emergency shelter grant in January. None of the $870,000 in grant money has been paid.
“The St. Louis Department of Human Services, specifically its homeless services unit, has administered such grants for years. Director William Siedhoff said Tuesday that he is disturbed by the "tremendous lag" in payments this year and assured checks would be cut sometime next month.
“Siedhoff said he became aware of the situation last month.
"There has got to be a better way to do this, and I am going to figure out how to do it," he said. "I know the hardship this creates."
“The grant comes from the U.S. Department of Housing and Urban Development. James Heard, director of HUD's St. Louis office, said the money has been delayed this year because the city had provided incomplete paperwork about how the housing grant was used in previous years.
“He said this year's money was cleared for release last month.He was surprised to find out Tuesday that the nonprofit groups are still in limbo.
"We are concerned," he said. "They need to be paid."
“The delay has caused some nonprofit groups — already strapped by a heightened demand for services — to dip into reserves, lean on lines of credit and cut back on items as inexpensive as bus tickets.
"We have a really small margin of error," said Michelle Schiller-Baker, executive director of St. Martha's Hall, which helps abused women and their children. "We don't have bus money to get to that doctor's appointment, to get to that job interview."
“She said the city owes her agency $35,800 in housing grant money. It's just a sliver of the nonprofit group's $900,000 annual budget, but Schiller-Baker said "every single penny is accounted for."
"Regardless of what amount it is of our budget at the shelter," she said, "you owe me the money, you better give it to me."
“Lydia's House, which provides transitional housing for domestic violence victims, is owed $27,000.”
"We are looking forward to getting that funding," said executive director Ellen Reed. "We haven't had to cut programs, but it has certainly made things tight. We have had to dig into our reserves."
"Catholic Charities Chief Financial Officer Colleen Dusek said its Housing Resource Center for the homeless is owed $80,000. She said the agency experienced similar delays last year. The center has covered its costs with a line of credit from the Archdiocese of St. Louis."
Tuesday, October 26, 2010
Women Give More
Almost twice as much from those in the middle income range, as this article from USA Today notes.
An excerpt.
“Women are more generous than men when it comes to charitable donations, a study released today suggests.
“In all income groups, women are more likely to give, and in four of five groups, they give more than men do — sometimes twice as much, according to the study by the Women's Philanthropy Institute at Indiana University's Center on Philanthropy.
"Women have just been socialized as the care-givers in their families to be more empathetic and altruistic," says Debra Mesch, director of the Women's Philanthropy Institute. "I think this is being manifested in giving to charity."
“It's not just character, though, Mesch says.
“She explains, "We know that the primary factors for philanthropic giving are wealth, education and income. We see, especially in the USA, extraordinary gains in those areas for women."
“In the study's middle range of income, $43,500 to $67,532, the average donation was $728 from women, $373 from men.
“The report, Women Give 2010, found never-married and divorced women more likely to give than their male counterparts, and they gave more. Widows were less likely to give than widowers.”
An excerpt.
“Women are more generous than men when it comes to charitable donations, a study released today suggests.
“In all income groups, women are more likely to give, and in four of five groups, they give more than men do — sometimes twice as much, according to the study by the Women's Philanthropy Institute at Indiana University's Center on Philanthropy.
"Women have just been socialized as the care-givers in their families to be more empathetic and altruistic," says Debra Mesch, director of the Women's Philanthropy Institute. "I think this is being manifested in giving to charity."
“It's not just character, though, Mesch says.
“She explains, "We know that the primary factors for philanthropic giving are wealth, education and income. We see, especially in the USA, extraordinary gains in those areas for women."
“In the study's middle range of income, $43,500 to $67,532, the average donation was $728 from women, $373 from men.
“The report, Women Give 2010, found never-married and divorced women more likely to give than their male counterparts, and they gave more. Widows were less likely to give than widowers.”
Monday, October 25, 2010
Donor Loyalty
An article from Sumac note some good points in retaining donors.
An excerpt.
“According to Adrian Sargeant, a professor of fundraising at Indiana University’s Center on Philanthropy, a typical nonprofit will lose 50% of its donors between the first and second donation and up to 30% per year thereafter. With these rates, organizations must continually scramble to bring in new donors. But donor acquisition is very costly. According to Penelope Burk, president of Cygnus Applied Research, “new donors are expensive to get and rarely give much the first time.” In the end, “acquisition is more expensive than retention and often runs at a loss.” If non-profits focused instead on boosting donor retention, therefore, the payoff could be huge.
“Boosting Donor Retention
“Likewise, Sargeant argues that even a small improvement in retention can yield a windfall over time. Even boosting the retention rate by as little as 10 percent, he says, can increase the lifetime value of a nonprofit’s donor base by up to 200%.
“So, how do you boost donor retention? You give donors what they want. Thanks to Burk’s national research studies on the key motivators of donor loyalty, we know exactly what that is. In that research, 93% of donors indicated three things that would influence them to stay loyal and give increasingly generous gifts over time:
1. Prompt and personalized gift acknowledgement
2. Confirmation that funds will be used as originally indicated in the solicitation
3. Measurable results on donors’ last gift before they are asked for another one.
“All three of these things, Burk points out, are tied to donor communication and are within the control of charities and fundraisers to change. So, why don’t non-profits focus their attention on changing communications to meet donors needs?”
An excerpt.
“According to Adrian Sargeant, a professor of fundraising at Indiana University’s Center on Philanthropy, a typical nonprofit will lose 50% of its donors between the first and second donation and up to 30% per year thereafter. With these rates, organizations must continually scramble to bring in new donors. But donor acquisition is very costly. According to Penelope Burk, president of Cygnus Applied Research, “new donors are expensive to get and rarely give much the first time.” In the end, “acquisition is more expensive than retention and often runs at a loss.” If non-profits focused instead on boosting donor retention, therefore, the payoff could be huge.
“Boosting Donor Retention
“Likewise, Sargeant argues that even a small improvement in retention can yield a windfall over time. Even boosting the retention rate by as little as 10 percent, he says, can increase the lifetime value of a nonprofit’s donor base by up to 200%.
“So, how do you boost donor retention? You give donors what they want. Thanks to Burk’s national research studies on the key motivators of donor loyalty, we know exactly what that is. In that research, 93% of donors indicated three things that would influence them to stay loyal and give increasingly generous gifts over time:
1. Prompt and personalized gift acknowledgement
2. Confirmation that funds will be used as originally indicated in the solicitation
3. Measurable results on donors’ last gift before they are asked for another one.
“All three of these things, Burk points out, are tied to donor communication and are within the control of charities and fundraisers to change. So, why don’t non-profits focus their attention on changing communications to meet donors needs?”
Sunday, October 24, 2010
Hope & Change
Certain times seem to generate optimism, others pessimism, and for many observers of the public arena, this is one of those very optimistic times, as we wait for the results of the elections across the country that will surely usher in a new sense of public policy making.
With all of the hitches in the formerly ascendant narrative putting some halt to its once remorseless advance; the stiller, smaller, voices of the people have been raised in a dynamic chorus of hoping for change, and it does appear that change will occur, at least in public leadership.
Whether the change in public leadership—assuming it does happen—will actually lead to a change in public policy, remains to be seen, as many who enter the halls of power from main street often become so self-enamored by their very ascension, that they forget how and on whose shoulders they arose, but I am optimistic it will happen and they will not forget.
With all of the hitches in the formerly ascendant narrative putting some halt to its once remorseless advance; the stiller, smaller, voices of the people have been raised in a dynamic chorus of hoping for change, and it does appear that change will occur, at least in public leadership.
Whether the change in public leadership—assuming it does happen—will actually lead to a change in public policy, remains to be seen, as many who enter the halls of power from main street often become so self-enamored by their very ascension, that they forget how and on whose shoulders they arose, but I am optimistic it will happen and they will not forget.
Saturday, October 23, 2010
Small Nonprofits
Over the past few years legislation was passed that required all nonprofits, even those with income of $25,000 a year or less, to file a 990 form with the IRS, and though it is a straightforward online process, many small nonprofits still struggle with it.
In response to the new interest in small nonprofits, the Urban Institute produced a brief, "Small Nonprofit Organizations: A Profile of Form 990-N Filers” and it is worth a read.
In response to the new interest in small nonprofits, the Urban Institute produced a brief, "Small Nonprofit Organizations: A Profile of Form 990-N Filers” and it is worth a read.
Friday, October 22, 2010
Nonprofits & the Public Good
As the Chronicle of Philanthropy reports, the discussion around government regulation of nonprofits has many facets.
An excerpt.
“Making the case that philanthropic dollars do good and benefit society isn’t going to be enough to convince lawmakers and the public that foundations deserve the freedom and tax benefits they now enjoy, William Kristol, the conservative commentator, told an audience at the Philanthropy Roundtable’s annual meeting.
“Instead, he called for a “more principled defense” against government regulation of foundations and their work.
“Mr. Kristol said that it’s not always the case that philanthropic dollars help society, a message he joked would make him the “skunk at the party.” The argument that foundations deserve autonomy because of all the good they do was made by his co-panelists during the discussion, and it is a focus of a new public-education campaign by the Philanthropy Roundtable.
“Mr. Kristol suggested that some charitable projects are ill-conceived, others cause real harm, and some are totally at odds with each other. “You can support think tanks that are either propounding Obamacare or opposing Obamacare, and you can’t both be right,” said Mr. Kristol. “They can’t both be good for the country.”
“He said that people who question whether foundations deserve their special tax status are not necessarily unreasonable. Such people see foundations as big pools of money, led by individuals who are relatively unaccountable to the public and who are spending that money however they see fit.
“They don’t have to be idiotic populist yahoos on the left or right” to raise those questions, Mr. Kristol said.
“He urged donors to embrace a broader defense of philanthropic freedom. “I would turn the question on its head,” he said. “People who have a stake in philanthropic freedom have a stake in freedom.”
“A university’s decision not to recognize a student group because of its beliefs, or efforts to force the Boy Scouts of America to accept gay people, he said, ought to give donors pause. Donors and nonprofit organizations should be concerned about the freedom of corporations; nonprofits, like businesses, are operating in the private sector, Mr. Kristol said. He also said that nonprofits should be worried about President Obama’s recent attacks on organizations registered under section 501(c)(4) of the federal tax code, nonprofit groups that can engage in lobbying.
“I don’t think that philanthropic freedom will survive,” he said, “if we sit back and allow the freedom of other entities to be severely constrained.”
An excerpt.
“Making the case that philanthropic dollars do good and benefit society isn’t going to be enough to convince lawmakers and the public that foundations deserve the freedom and tax benefits they now enjoy, William Kristol, the conservative commentator, told an audience at the Philanthropy Roundtable’s annual meeting.
“Instead, he called for a “more principled defense” against government regulation of foundations and their work.
“Mr. Kristol said that it’s not always the case that philanthropic dollars help society, a message he joked would make him the “skunk at the party.” The argument that foundations deserve autonomy because of all the good they do was made by his co-panelists during the discussion, and it is a focus of a new public-education campaign by the Philanthropy Roundtable.
“Mr. Kristol suggested that some charitable projects are ill-conceived, others cause real harm, and some are totally at odds with each other. “You can support think tanks that are either propounding Obamacare or opposing Obamacare, and you can’t both be right,” said Mr. Kristol. “They can’t both be good for the country.”
“He said that people who question whether foundations deserve their special tax status are not necessarily unreasonable. Such people see foundations as big pools of money, led by individuals who are relatively unaccountable to the public and who are spending that money however they see fit.
“They don’t have to be idiotic populist yahoos on the left or right” to raise those questions, Mr. Kristol said.
“He urged donors to embrace a broader defense of philanthropic freedom. “I would turn the question on its head,” he said. “People who have a stake in philanthropic freedom have a stake in freedom.”
“A university’s decision not to recognize a student group because of its beliefs, or efforts to force the Boy Scouts of America to accept gay people, he said, ought to give donors pause. Donors and nonprofit organizations should be concerned about the freedom of corporations; nonprofits, like businesses, are operating in the private sector, Mr. Kristol said. He also said that nonprofits should be worried about President Obama’s recent attacks on organizations registered under section 501(c)(4) of the federal tax code, nonprofit groups that can engage in lobbying.
“I don’t think that philanthropic freedom will survive,” he said, “if we sit back and allow the freedom of other entities to be severely constrained.”
Thursday, October 21, 2010
Microsoft Helps Advocacy
In this New York Times article, Microsoft's efforts are described, which is very good news for nonprofit advocacy groups, who are often the only vehicle to get out information crucial to people’s lives, especially in countries dominated by tyranny.
An excerpt.
“MOSCOW — Microsoft is vastly expanding its efforts to prevent governments from using software piracy inquiries as a pretext to suppress dissent. It plans to provide free software licenses to more than 500,000 advocacy groups, independent media outlets and other nonprofit organizations in 12 countries with tightly controlled governments, including Russia and China.
“With the new program in place, authorities in these countries would have no legal basis for accusing these groups of installing pirated Microsoft software.
“Microsoft began overhauling its antipiracy policy after The New York Times reported last month that private lawyers retained by the company had often supported law enforcement officials in Russia in crackdowns on outspoken advocacy groups and opposition newspapers.
“At first, Microsoft responded to the article by apologizing and saying it would focus on protecting these organizations in Russia from such inquiries.
“But it is now extending the program to other countries: eight former Soviet republics — Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan — as well as China, Malaysia and Vietnam. Microsoft executives said they would consider adding more.
“We clearly have a very strong interest in ensuring that any antipiracy activities are being done for the purpose of reducing illegal piracy, and not for other purposes,” said Nancy J. Anderson, a deputy general counsel and vice president at Microsoft. “Under the terms of our new nongovernmental organization software license, we will definitely not have any claims and not pursue any claims against nongovernmental organizations.”
An excerpt.
“MOSCOW — Microsoft is vastly expanding its efforts to prevent governments from using software piracy inquiries as a pretext to suppress dissent. It plans to provide free software licenses to more than 500,000 advocacy groups, independent media outlets and other nonprofit organizations in 12 countries with tightly controlled governments, including Russia and China.
“With the new program in place, authorities in these countries would have no legal basis for accusing these groups of installing pirated Microsoft software.
“Microsoft began overhauling its antipiracy policy after The New York Times reported last month that private lawyers retained by the company had often supported law enforcement officials in Russia in crackdowns on outspoken advocacy groups and opposition newspapers.
“At first, Microsoft responded to the article by apologizing and saying it would focus on protecting these organizations in Russia from such inquiries.
“But it is now extending the program to other countries: eight former Soviet republics — Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan — as well as China, Malaysia and Vietnam. Microsoft executives said they would consider adding more.
“We clearly have a very strong interest in ensuring that any antipiracy activities are being done for the purpose of reducing illegal piracy, and not for other purposes,” said Nancy J. Anderson, a deputy general counsel and vice president at Microsoft. “Under the terms of our new nongovernmental organization software license, we will definitely not have any claims and not pursue any claims against nongovernmental organizations.”
Wednesday, October 20, 2010
Organizations as Environment
Echoing the work of Pierre Teilhard de Chardin, a great Catholic thinker, Gareth Morgan writes about the holistic way to view organizations.
“Many biologists now believe that it is the whole ecosystem that evolves and that the process of evolution can really be understood only at the level of the total ecology. This has important implications because it suggests that organisms do not evolve by adapting to environmental changes or as a result of these changes selecting the organisms that are to survive. Rather, it suggests that evolution is always evolution of a pattern of relations embracing organisms and their environments. It is the pattern, not just the separate units comprising this pattern, that evolves. Or as Kenneth Boulding has put it, evolution involves the “survival of the fitting,” not just the survival of the fittest.
“Organizations and their environments are engaged in a pattern of cocreation, where each produces the other. Just as in nature, where the environment of an organism is composed of other organisms, organizational environments are in large measure composed of other organizations. Once we recognize this, it becomes clear that organizations are, in principle, able to influence the nature of their environment. They can play an active role in shaping their future, especially when acting in concert with other organizations. Environments then become in some measure negotiated environments rather than independent external forces.” (Morgan, G. (1998). Images of Organization: The Executive Edition. San Francisco: Berrett-Koehler Publishers. (p. 61)
“Many biologists now believe that it is the whole ecosystem that evolves and that the process of evolution can really be understood only at the level of the total ecology. This has important implications because it suggests that organisms do not evolve by adapting to environmental changes or as a result of these changes selecting the organisms that are to survive. Rather, it suggests that evolution is always evolution of a pattern of relations embracing organisms and their environments. It is the pattern, not just the separate units comprising this pattern, that evolves. Or as Kenneth Boulding has put it, evolution involves the “survival of the fitting,” not just the survival of the fittest.
“Organizations and their environments are engaged in a pattern of cocreation, where each produces the other. Just as in nature, where the environment of an organism is composed of other organisms, organizational environments are in large measure composed of other organizations. Once we recognize this, it becomes clear that organizations are, in principle, able to influence the nature of their environment. They can play an active role in shaping their future, especially when acting in concert with other organizations. Environments then become in some measure negotiated environments rather than independent external forces.” (Morgan, G. (1998). Images of Organization: The Executive Edition. San Francisco: Berrett-Koehler Publishers. (p. 61)
Tuesday, October 19, 2010
Social Entrepreneurship
Posted on before, this type of leader is becoming more common, but still rare, and this article from the Foundation Center remarks on their attributes.
An excerpt.
“One of the remarkable traits about social entrepreneurs is their ability to play many roles. They care deeply about how their vision is implemented and feel personally invested in the outcome. Social entrepreneurs are often so involved in all aspects of the organization that they end up holding up decision making, losing talent, and creating bottlenecks. At some point, grumblings of dissatisfaction from employees or frustrating inefficiencies emerge and need solutions. To avoid getting to this detrimental stage, the entrepreneur must recognize that he can no longer do everything himself and preemptively prepare to let go. Before hiring any high-level managers, he needs to assess his own strengths and weaknesses honestly. Social entrepreneurs must ask themselves questions such as, What do I enjoy doing? What am I really good at doing? What am I not good at doing? What kind of people do I need around me?
“Board members play a particularly important role at this stage of the process. They should instigate conversations with the social entrepreneur about building strong, talented management teams, and preparing for leadership succession. To ensure that this happens, entrepreneurs should fill their board with opinionated members who bring skills, networks, and experience to the organization. Entrepreneurs must use the start-up stage as an opportunity to build trust with board members and ensure that board members are invested in the vision and long-term sustainability of the organization. This trust enables entrepreneurs to heed advice that can often feel personal or be difficult to hear. Strong boards help entrepreneurs grow comfortable with dissenting voices, challenged ideas, and evolving roles.
“Entrepreneurs should map out their senior management hires ahead of time. Too often, they see an oncoming cash flow crisis and hire someone with an accounting background, or decide they are overwhelmed with direct reports and hire a COO. “Social entrepreneurs are often encouraged or forced to get a person or a skill set in immediately,” says Sally Osberg, president and CEO of the Skoll Foundation. They “often go into it feeling cornered.” Kevin Flynn, director of client services at Commongood Careers, sees this behavior frequently. “We hear, ‘I need someone who is an entrepreneurial CFO and can do technology and fundraising and also code in Java,'” says Flynn.
“The Leadership Team
“Once the social entrepreneur has spent time in honest self-reflection and frank board discussions, it's time to create a new leadership team. The entrepreneur must approach leadership team development with the same thoughtfulness and determination that he applies to creating his vision or he risks making the wrong hires. Our research indicates that there are five essential leadership roles in an organization that is ready to scale up. These roles may or may not be filled by five separate people; in some cases multiple roles can be filled by one person.
“Evangelist
“The most important member of the leadership team is the evangelist — the person who is deeply passionate about the organization's mission and convinces others to help fulfill it. When the founder is still at the organization, he is the person who fills the role of the evangelist. If the founder has been replaced, it is the entrepreneur who is running the organization (often with the title of CEO, president, or executive director) who becomes the evangelist.
“The evangelist has a number of responsibilities. First, he is the organization's visionary, continually refining its mission and strategy and making sure that priorities are established and met. He needs to share his vision with people inside and outside of the organization, especially with the leadership team. Willy Foote, president and founder of Root Capital, explains that the evangelist is going to see new opportunities that may not fit with the current organization's strategy, and his role is to “get the team to believe in the value of disruption, while being very cautious to court disruption, not destruction.”
“The evangelist also maintains the organization's culture. For example, when Mike Feinberg, co-founder of the Knowledge Is Power Program (KIPP), served as CEO of the KIPP Foundation, he ensured that each conference room held the name of a children's book that held significance on the KIPP school campuses. All new hires learned the symbolism of these books and embraced the metaphors associated with them. For example, The Polar Express represented the message that all “KIPPsters” (students who attend a KIPP school) can “hear the bells” even when naysaying communities, peers, or adults try in vain to convince them that college is not an option. Each evangelist will choose a different way to keep the organization's culture alive, but he needs to be the person who constantly reminds others of the importance, characteristics, and values of the organization's culture.
“The evangelist is also the external face of the organization. People want to understand the evangelist's underlying motivations for leading the organization and be captivated by the organization's founding story and long-term vision. The evangelist can skillfully weave together the organization's mission and programs with stories that express it in personal terms in order to truly “evangelize” and convert non-believers.”
An excerpt.
“One of the remarkable traits about social entrepreneurs is their ability to play many roles. They care deeply about how their vision is implemented and feel personally invested in the outcome. Social entrepreneurs are often so involved in all aspects of the organization that they end up holding up decision making, losing talent, and creating bottlenecks. At some point, grumblings of dissatisfaction from employees or frustrating inefficiencies emerge and need solutions. To avoid getting to this detrimental stage, the entrepreneur must recognize that he can no longer do everything himself and preemptively prepare to let go. Before hiring any high-level managers, he needs to assess his own strengths and weaknesses honestly. Social entrepreneurs must ask themselves questions such as, What do I enjoy doing? What am I really good at doing? What am I not good at doing? What kind of people do I need around me?
“Board members play a particularly important role at this stage of the process. They should instigate conversations with the social entrepreneur about building strong, talented management teams, and preparing for leadership succession. To ensure that this happens, entrepreneurs should fill their board with opinionated members who bring skills, networks, and experience to the organization. Entrepreneurs must use the start-up stage as an opportunity to build trust with board members and ensure that board members are invested in the vision and long-term sustainability of the organization. This trust enables entrepreneurs to heed advice that can often feel personal or be difficult to hear. Strong boards help entrepreneurs grow comfortable with dissenting voices, challenged ideas, and evolving roles.
“Entrepreneurs should map out their senior management hires ahead of time. Too often, they see an oncoming cash flow crisis and hire someone with an accounting background, or decide they are overwhelmed with direct reports and hire a COO. “Social entrepreneurs are often encouraged or forced to get a person or a skill set in immediately,” says Sally Osberg, president and CEO of the Skoll Foundation. They “often go into it feeling cornered.” Kevin Flynn, director of client services at Commongood Careers, sees this behavior frequently. “We hear, ‘I need someone who is an entrepreneurial CFO and can do technology and fundraising and also code in Java,'” says Flynn.
“The Leadership Team
“Once the social entrepreneur has spent time in honest self-reflection and frank board discussions, it's time to create a new leadership team. The entrepreneur must approach leadership team development with the same thoughtfulness and determination that he applies to creating his vision or he risks making the wrong hires. Our research indicates that there are five essential leadership roles in an organization that is ready to scale up. These roles may or may not be filled by five separate people; in some cases multiple roles can be filled by one person.
“Evangelist
“The most important member of the leadership team is the evangelist — the person who is deeply passionate about the organization's mission and convinces others to help fulfill it. When the founder is still at the organization, he is the person who fills the role of the evangelist. If the founder has been replaced, it is the entrepreneur who is running the organization (often with the title of CEO, president, or executive director) who becomes the evangelist.
“The evangelist has a number of responsibilities. First, he is the organization's visionary, continually refining its mission and strategy and making sure that priorities are established and met. He needs to share his vision with people inside and outside of the organization, especially with the leadership team. Willy Foote, president and founder of Root Capital, explains that the evangelist is going to see new opportunities that may not fit with the current organization's strategy, and his role is to “get the team to believe in the value of disruption, while being very cautious to court disruption, not destruction.”
“The evangelist also maintains the organization's culture. For example, when Mike Feinberg, co-founder of the Knowledge Is Power Program (KIPP), served as CEO of the KIPP Foundation, he ensured that each conference room held the name of a children's book that held significance on the KIPP school campuses. All new hires learned the symbolism of these books and embraced the metaphors associated with them. For example, The Polar Express represented the message that all “KIPPsters” (students who attend a KIPP school) can “hear the bells” even when naysaying communities, peers, or adults try in vain to convince them that college is not an option. Each evangelist will choose a different way to keep the organization's culture alive, but he needs to be the person who constantly reminds others of the importance, characteristics, and values of the organization's culture.
“The evangelist is also the external face of the organization. People want to understand the evangelist's underlying motivations for leading the organization and be captivated by the organization's founding story and long-term vision. The evangelist can skillfully weave together the organization's mission and programs with stories that express it in personal terms in order to truly “evangelize” and convert non-believers.”
Monday, October 18, 2010
Leadership
In this article—Building a Great Organization—from Leader to Leader magazine, the leadership attributes necessary to do that are examined.
An excerpt.
“Peter Drucker wrote, “There may be natural born leaders, but there are so few of them that they make no difference in the greater scheme of things.” Leaders are self-developed; they work on themselves continually. In Talent Is Overrated, Geoff Colvin (a Fortune editor) shows how business leaders—starting from the beginning of their careers—develop themselves through hours and hours of “deliberate practice.”
“The essential skills are like parts of a mosaic, and you must work on them for a decade—or at least 10,000 hours—to master them. For our book Now, Build a Great Business!, we conducted a World Success Survey in 110 nations to determine the key traits of leaders whose impact has lasted more than 20 years. We found seven key steps to maximize the impact of your organization.
“Just as Peter Drucker’s famous “five questions” are deceptively simple—but extraordinarily poignant and challenging—so too are our seven principles. These questions are necessary for every leader to address in order to create a great organization.
1. Become a great leader: How will you develop yourself and hold yourself accountable?
2. Plan: What will it take to create a useful business plan?
3. Surround yourself with great people: How will you attract and honor your team?
4. Offer a great service: How will your products make a real difference?
5. Design great marketing: Why should this organization matter to others?
6. Perfect a great sales process: How will you engage and educate customers to buy in to your mission?
7. Create a great customer experience: How will you engage people in an extraordinary relationship with your product or service?”
An excerpt.
“Peter Drucker wrote, “There may be natural born leaders, but there are so few of them that they make no difference in the greater scheme of things.” Leaders are self-developed; they work on themselves continually. In Talent Is Overrated, Geoff Colvin (a Fortune editor) shows how business leaders—starting from the beginning of their careers—develop themselves through hours and hours of “deliberate practice.”
“The essential skills are like parts of a mosaic, and you must work on them for a decade—or at least 10,000 hours—to master them. For our book Now, Build a Great Business!, we conducted a World Success Survey in 110 nations to determine the key traits of leaders whose impact has lasted more than 20 years. We found seven key steps to maximize the impact of your organization.
“Just as Peter Drucker’s famous “five questions” are deceptively simple—but extraordinarily poignant and challenging—so too are our seven principles. These questions are necessary for every leader to address in order to create a great organization.
1. Become a great leader: How will you develop yourself and hold yourself accountable?
2. Plan: What will it take to create a useful business plan?
3. Surround yourself with great people: How will you attract and honor your team?
4. Offer a great service: How will your products make a real difference?
5. Design great marketing: Why should this organization matter to others?
6. Perfect a great sales process: How will you engage and educate customers to buy in to your mission?
7. Create a great customer experience: How will you engage people in an extraordinary relationship with your product or service?”
Saturday, October 16, 2010
Designers & Nonprofits
This is a terrific partnership—one that has also happened in Sacramento on a regular basis—and its application is noted in this article from the Nonprofit Quarterly Newswire.
An excerpt.
“DesigNYC just advertised its second call for applications so we thought we would introduce you to what we think is a pretty great idea. The program matches nonprofits with master designers on a pro-bono basis. The project may be landscape design or architectural design or campaign materials design but it seems to us this idea is well worth replicating.”
An excerpt.
“DesigNYC just advertised its second call for applications so we thought we would introduce you to what we think is a pretty great idea. The program matches nonprofits with master designers on a pro-bono basis. The project may be landscape design or architectural design or campaign materials design but it seems to us this idea is well worth replicating.”
Friday, October 15, 2010
Nonprofits and Government
The ideal relationship is that program innovation, development, and management comes from the nonprofit; and base funding and technical support comes from government, which appears to be the case with two programs (YouthBuild & College Summit) in this article by their respective founders in Governing.
An excerpt.
“Harlem Children's Zone and its founder Geoffrey Canada are famous.
“Many know Harlem Children's Zone from Waiting for Superman, a recently released documentary which focuses on Canada's efforts to transform a failing public education system.
“The same week of the film's release, the White House announced $10 million in planning grants under Promise Neighborhoods, a new Department of Education initiative based on the Harlem Children's Zone model.
“Praise for Harlem Children's Zone is well deserved. But the temptation to attribute superhuman qualities to Geoffrey Canada and other social innovators who have been blazing new approaches to the hard task of rebuilding broken communities is dangerous. Cities may fall into the mistake of waiting for their own "superman" to fix their problems, or they might set themselves up for disappointment if the results are not as otherworldly as expected.
“The real lesson of the Harlem Children's Zone is that government should be looking outside its own bureaucracy for determined, albeit human, innovators who will thrive with government support and partnership.
“YouthBuild and College Summit
“One of us started an organization that also works with young people in Harlem. For over 30 years, Dorothy has infused YouthBuild with important values such as taking personal responsibility for our lives and community; treating everyone with profound respect; and, as intangible as it may sound, believing in the power of love.
“YouthBuild programs not only build about 1,000 units of affordable housing each year, they also engage about 10,000 students (40 percent are court-involved) in the process of completing their GED or high school diploma through a full-time, 10-month program. YouthBuild USA turned over its program model to the federal government, and now serves in a training and technical assistance role to charter schools and community-based nonprofits that receive federal grants from the U.S. Department of Labor to implement local YouthBuild programs.
“I founded College Summit, which like YouthBuild, knits a positive peer and adult mentor culture together with a focus on leadership development. Designed to help high schools in low-income communities shift from being destinations to being launch pads for college and career success, College Summit works on two assumptions. First, young people are motivated to work hard in high school not by a diploma, but by a chance to create a brighter future -- better job, more money, better college and better life. Second, young people themselves are best situated to create a college-going culture at their high school.”
An excerpt.
“Harlem Children's Zone and its founder Geoffrey Canada are famous.
“Many know Harlem Children's Zone from Waiting for Superman, a recently released documentary which focuses on Canada's efforts to transform a failing public education system.
“The same week of the film's release, the White House announced $10 million in planning grants under Promise Neighborhoods, a new Department of Education initiative based on the Harlem Children's Zone model.
“Praise for Harlem Children's Zone is well deserved. But the temptation to attribute superhuman qualities to Geoffrey Canada and other social innovators who have been blazing new approaches to the hard task of rebuilding broken communities is dangerous. Cities may fall into the mistake of waiting for their own "superman" to fix their problems, or they might set themselves up for disappointment if the results are not as otherworldly as expected.
“The real lesson of the Harlem Children's Zone is that government should be looking outside its own bureaucracy for determined, albeit human, innovators who will thrive with government support and partnership.
“YouthBuild and College Summit
“One of us started an organization that also works with young people in Harlem. For over 30 years, Dorothy has infused YouthBuild with important values such as taking personal responsibility for our lives and community; treating everyone with profound respect; and, as intangible as it may sound, believing in the power of love.
“YouthBuild programs not only build about 1,000 units of affordable housing each year, they also engage about 10,000 students (40 percent are court-involved) in the process of completing their GED or high school diploma through a full-time, 10-month program. YouthBuild USA turned over its program model to the federal government, and now serves in a training and technical assistance role to charter schools and community-based nonprofits that receive federal grants from the U.S. Department of Labor to implement local YouthBuild programs.
“I founded College Summit, which like YouthBuild, knits a positive peer and adult mentor culture together with a focus on leadership development. Designed to help high schools in low-income communities shift from being destinations to being launch pads for college and career success, College Summit works on two assumptions. First, young people are motivated to work hard in high school not by a diploma, but by a chance to create a brighter future -- better job, more money, better college and better life. Second, young people themselves are best situated to create a college-going culture at their high school.”
Thursday, October 14, 2010
Dependence Index
The Heritage Foundation’s Index of Dependence on Government is an important document for nonprofit leaders—especially those in human service nonprofits—as it helps in defining the environment within which they operate.
An excerpt from this years report.
“Abstract: Year after year, The Heritage Foundation’s Index of Dependence on Government documents the ever-growing number of federal aid programs and the ever-growing number of Americans who rely on government subsidies for their existence. The number of Americans who now pay no taxes has passed 35 percent. The International Monetary Fund predicts financial devastation for the U.S. by 2015 unless drastic cuts are made in the deficit immediately, and Congress has lost control of the national budget. An impending tipping point for the structure of American government and civil society is tangible. Following are preliminary estimates for the upcoming 2010 Index of Dependence on Government that all Americans should heed.
“The Heritage Foundation has published the Index of Dependence on Government for eight consecutive years. For each of these eight years, the Index has signaled troubling and rapid increases in the growth of dependence-creating federal programs; and for each of these eight years, Heritage has warned of the threat that rapid growth in government dependence poses for the United States’ republican form of government, as well as for the broader civil society.
“Preliminary estimates for the 2010 Index dramatically underscore the concerns of years past. According to preliminary estimates by The Heritage Foundation’s Center for Data Analysis (CDA):
1. Americans’ dependence on government grew by 13.6 percent in 2009.
2. The Index’s dependence variables that grew the most over that past year are:
• Health and Welfare at 22 percent,
• Rural and Agricultural Services at 20 percent, and
• Housing at 15 percent.
3. The increase over 2009 means that the Index has grown by 49 percent since 2001.
4. Americans’ dependence on the government was 14 times greater in 2009 than it was in 1962.
“The increase in the Index of Dependence on Government during 2009 is the greatest single-year percentage change since 1976. It covers data through the end of 2009, which was a momentous year across a wide horizon of public policies. Even seasoned Washington insiders, however, might be surprised to learn just how noteworthy that year was.”
An excerpt from this years report.
“Abstract: Year after year, The Heritage Foundation’s Index of Dependence on Government documents the ever-growing number of federal aid programs and the ever-growing number of Americans who rely on government subsidies for their existence. The number of Americans who now pay no taxes has passed 35 percent. The International Monetary Fund predicts financial devastation for the U.S. by 2015 unless drastic cuts are made in the deficit immediately, and Congress has lost control of the national budget. An impending tipping point for the structure of American government and civil society is tangible. Following are preliminary estimates for the upcoming 2010 Index of Dependence on Government that all Americans should heed.
“The Heritage Foundation has published the Index of Dependence on Government for eight consecutive years. For each of these eight years, the Index has signaled troubling and rapid increases in the growth of dependence-creating federal programs; and for each of these eight years, Heritage has warned of the threat that rapid growth in government dependence poses for the United States’ republican form of government, as well as for the broader civil society.
“Preliminary estimates for the 2010 Index dramatically underscore the concerns of years past. According to preliminary estimates by The Heritage Foundation’s Center for Data Analysis (CDA):
1. Americans’ dependence on government grew by 13.6 percent in 2009.
2. The Index’s dependence variables that grew the most over that past year are:
• Health and Welfare at 22 percent,
• Rural and Agricultural Services at 20 percent, and
• Housing at 15 percent.
3. The increase over 2009 means that the Index has grown by 49 percent since 2001.
4. Americans’ dependence on the government was 14 times greater in 2009 than it was in 1962.
“The increase in the Index of Dependence on Government during 2009 is the greatest single-year percentage change since 1976. It covers data through the end of 2009, which was a momentous year across a wide horizon of public policies. Even seasoned Washington insiders, however, might be surprised to learn just how noteworthy that year was.”
Wednesday, October 13, 2010
Measuring Advocacy
It has always been difficult to measure the impact—especially the economic impact—of nonprofit organizations that advocate for a particular cause, but this new report out from the National Committee for Responsive Philanthropy, indicates that it is possible, and that is a very good thing.
The report is incomplete in many respects—for instance, it doesn’t calculate the costs of the crimes committed by the criminals that would have been housed in a prison whose construction was stopped, saving $1 billion dollars in building costs (p. 4)—but nevertheless, is a very good effort.
An excerpt.
“The social concerns that funders address with their grantmaking – education, human needs or environment, for example – exist in a larger context shaped by many forces, including public policy, economics and community culture. Many funders believe that to be successful in their chosen areas of interest they must address the larger systems that shape these realities.
“Why and how do foundations and other institutional grantmakers invest in policy advocacy, community organizing and civic engagement by nonprofit organizations, and how does it make a difference in the daily lives of local residents if they do?
“This report describes, measures and, where possible, monetizes the policy impacts that 20 community organizations in the Northwestern region of the United States achieved with foundation support during a five year period (2005–2009)….
“Using these resources and strategies, the groups had significant accomplishments:
“> Collectively, the groups helped garner more than $5 billion for marginalized communities over five years. These dollars were in the form of wages, expanded services, state investments in housing and other programs, savings from costly and ill-conceived initiatives that were prevented, and other benefits.
> The groups achieved substantial impacts that could not be monetized; yet, these benefited tens of thousands of underserved residents. Examples include protecting and advancing LGBTQ rights, promoting fair immigration policies and protecting communities and natural resources from environmental threats.
> The 20 groups demonstrated a remarkable depth and breadth of civic engagement. Collectively, they trained more than 11,000 leaders, grew their memberships by 98,000 individuals and turned out 417,000 people at public actions. They also registered more than 71,900 voters, including many Native Americans, Latinos and people of color.
"Foundations and other institutional grantmakers provided critical monetary, capacity building and convening support to these efforts. Funders contributed $23.2 million, or 69 percent of all policy engagement funding over five years. Members of the organizations also contributed significantly to their own success: among 15 organizations, membership dues collected over five years totaled almost $4.9 million.
“NCRP totaled the monetary benefits of the impacts in Idaho, Montana, Oregon and Washington and calculated a return on investment (ROI). For every dollar invested in their advocacy, organizing and civic engagement ($33.9 million total), the groups garnered $150 in benefits for their communities.” (pp. 3-4)
The report is incomplete in many respects—for instance, it doesn’t calculate the costs of the crimes committed by the criminals that would have been housed in a prison whose construction was stopped, saving $1 billion dollars in building costs (p. 4)—but nevertheless, is a very good effort.
An excerpt.
“The social concerns that funders address with their grantmaking – education, human needs or environment, for example – exist in a larger context shaped by many forces, including public policy, economics and community culture. Many funders believe that to be successful in their chosen areas of interest they must address the larger systems that shape these realities.
“Why and how do foundations and other institutional grantmakers invest in policy advocacy, community organizing and civic engagement by nonprofit organizations, and how does it make a difference in the daily lives of local residents if they do?
“This report describes, measures and, where possible, monetizes the policy impacts that 20 community organizations in the Northwestern region of the United States achieved with foundation support during a five year period (2005–2009)….
“Using these resources and strategies, the groups had significant accomplishments:
“> Collectively, the groups helped garner more than $5 billion for marginalized communities over five years. These dollars were in the form of wages, expanded services, state investments in housing and other programs, savings from costly and ill-conceived initiatives that were prevented, and other benefits.
> The groups achieved substantial impacts that could not be monetized; yet, these benefited tens of thousands of underserved residents. Examples include protecting and advancing LGBTQ rights, promoting fair immigration policies and protecting communities and natural resources from environmental threats.
> The 20 groups demonstrated a remarkable depth and breadth of civic engagement. Collectively, they trained more than 11,000 leaders, grew their memberships by 98,000 individuals and turned out 417,000 people at public actions. They also registered more than 71,900 voters, including many Native Americans, Latinos and people of color.
"Foundations and other institutional grantmakers provided critical monetary, capacity building and convening support to these efforts. Funders contributed $23.2 million, or 69 percent of all policy engagement funding over five years. Members of the organizations also contributed significantly to their own success: among 15 organizations, membership dues collected over five years totaled almost $4.9 million.
“NCRP totaled the monetary benefits of the impacts in Idaho, Montana, Oregon and Washington and calculated a return on investment (ROI). For every dollar invested in their advocacy, organizing and civic engagement ($33.9 million total), the groups garnered $150 in benefits for their communities.” (pp. 3-4)
Tuesday, October 12, 2010
Criminals Becoming Entrepreneurs
Though it seems counter-intuitive (but also has application to other marginalized groups) this is the centerpiece of the rehabilitative approach used by several nonprofit organizations—profiled by the Cleveland Plain Dealer—and by being congruent with the operating mantra of many professional criminals, will probably continue to work, as this article in the Plain Dealer notes.
An excerpt.
“CLEVELAND, Ohio -- For nearly 10 years, Augustus Turner had a lot of time to ponder an American dream that he refused to believe was out of reach because of a big mistake and a permanent label.
“Turner was a prison inmate, hoping to run his own business after serving time for drug trafficking.
“He knew the odds weren't good. Although 97 percent of prisoners are eventually released, only 53 percent find work, and a far smaller share start their own businesses.
"What I learned from the streets is how to hustle," said Turner, 39. "You can dream. You can pray. It all starts there. But you have to actively make it happen."
“And he did. Today, Turner operates Masterpieces, a 10-year-old art studio, tattoo shop and silk-screening business on the West Side of Cleveland.
“Turner made his dream happen through sheer perseverance, but a growing movement across the country is trying to train released convicts to achieve success as entrepreneurs.
“Northeast Ohio might be lagging behind the trend. A few people here are trying to make a difference, but no coordinated effort has emerged to help parolees stay out of prison by starting businesses.
“More than 700,000 people will be released from the nation's state or federal prisons this year. About two-thirds will wind up back behind bars within two or three years.
“Government, private-sector officials and academics seem to agree that a job helps keep an ex-prisoner from returning to the penitentiary. And nobody disputes the challenges of becoming employed.
“For instance, studies in Milwaukee and New York found that a criminal record reduces employment opportunities by 50 percent for white people and 64 percent for black people -- at a time when jobs are already scarce.
"More than 60 percent of employers surveyed in the 2002 Multi-City Study of Urban Inequality (MCSUI) reported that they would "probably not" or "definitely not" hire applicants with criminal history records.
“The answer might be entrepreneurship, according to a 2007 national report from the Prisoner Reentry Institute at John Jay College of Criminal Justice. "Venturing Beyond the Gates" is considered the most extensive recent study on successful re-entry to society through entrepreneurship.
“Only a handful of entrepreneur-loan programs exist for ex-prisoners. And communication is virtually nonexistent among them, according to the study.
“The most notable and biggest prison entrepreneurship program is in Texas, with offices in Houston and Dallas. Former Wall Street investor Catherine Rohr founded the program in 2004 after she toured a prison and decided that executives and inmates had more in common than most would think. Both know how to manage others, and even the most unsophisticated drug dealers understand business concepts like competition, profitability and proprietary sales channels, said David Joekel, executive relations manager at the prison program.
“Hardened criminals including murderers, thieves, drug dealers and gang leaders from more than 60 jails in Texas are invited to apply each year. Those selected are transferred to one correctional facility, where they learn entrepreneurial skills as well as strategies for finding a job. With private funding, MBA students as mentors, a highly selective admissions process and stringent pre- and post-release programs, ex-prisoners have started about 60 businesses in the program's six years.
“So far, 600 inmates have graduated. In the last two years, 98 percent of the graduates have found decent jobs within three months of release, with an average starting salary of $10.75 an hour. The program continues to gain momentum and interest from volunteers including business, government leaders and dozens of MBA programs, because of a return-to-prison rate of less than 10 percent for the graduates.”
An excerpt.
“CLEVELAND, Ohio -- For nearly 10 years, Augustus Turner had a lot of time to ponder an American dream that he refused to believe was out of reach because of a big mistake and a permanent label.
“Turner was a prison inmate, hoping to run his own business after serving time for drug trafficking.
“He knew the odds weren't good. Although 97 percent of prisoners are eventually released, only 53 percent find work, and a far smaller share start their own businesses.
"What I learned from the streets is how to hustle," said Turner, 39. "You can dream. You can pray. It all starts there. But you have to actively make it happen."
“And he did. Today, Turner operates Masterpieces, a 10-year-old art studio, tattoo shop and silk-screening business on the West Side of Cleveland.
“Turner made his dream happen through sheer perseverance, but a growing movement across the country is trying to train released convicts to achieve success as entrepreneurs.
“Northeast Ohio might be lagging behind the trend. A few people here are trying to make a difference, but no coordinated effort has emerged to help parolees stay out of prison by starting businesses.
“More than 700,000 people will be released from the nation's state or federal prisons this year. About two-thirds will wind up back behind bars within two or three years.
“Government, private-sector officials and academics seem to agree that a job helps keep an ex-prisoner from returning to the penitentiary. And nobody disputes the challenges of becoming employed.
“For instance, studies in Milwaukee and New York found that a criminal record reduces employment opportunities by 50 percent for white people and 64 percent for black people -- at a time when jobs are already scarce.
"More than 60 percent of employers surveyed in the 2002 Multi-City Study of Urban Inequality (MCSUI) reported that they would "probably not" or "definitely not" hire applicants with criminal history records.
“The answer might be entrepreneurship, according to a 2007 national report from the Prisoner Reentry Institute at John Jay College of Criminal Justice. "Venturing Beyond the Gates" is considered the most extensive recent study on successful re-entry to society through entrepreneurship.
“Only a handful of entrepreneur-loan programs exist for ex-prisoners. And communication is virtually nonexistent among them, according to the study.
“The most notable and biggest prison entrepreneurship program is in Texas, with offices in Houston and Dallas. Former Wall Street investor Catherine Rohr founded the program in 2004 after she toured a prison and decided that executives and inmates had more in common than most would think. Both know how to manage others, and even the most unsophisticated drug dealers understand business concepts like competition, profitability and proprietary sales channels, said David Joekel, executive relations manager at the prison program.
“Hardened criminals including murderers, thieves, drug dealers and gang leaders from more than 60 jails in Texas are invited to apply each year. Those selected are transferred to one correctional facility, where they learn entrepreneurial skills as well as strategies for finding a job. With private funding, MBA students as mentors, a highly selective admissions process and stringent pre- and post-release programs, ex-prisoners have started about 60 businesses in the program's six years.
“So far, 600 inmates have graduated. In the last two years, 98 percent of the graduates have found decent jobs within three months of release, with an average starting salary of $10.75 an hour. The program continues to gain momentum and interest from volunteers including business, government leaders and dozens of MBA programs, because of a return-to-prison rate of less than 10 percent for the graduates.”
Friday, October 8, 2010
Nonprofits & Government
As we have seen locally, many nonprofits that have become dependent on government funding are struggling, some even having all their funding cut off.
This new report from The Urban Institute examines the situation in relation to human service nonprofits.
An excerpt.
“The recession crippled the budgets of many nonprofits just as demand for their services rose. On top of shrinking revenue from donations and fees, many organizations struggled with ongoing payment problems from one of their biggest funders—government agencies. As a result, many were forced to cut services and staff or close program sites, hurting the communities they serve. While pain from the recession may have been unavoidable, better government management of contracts and grants can at least avoid adding to nonprofits’ financial stress.
“Goodwill, Boys & Girls Clubs of America, the American Red Cross, homeless shelters, food banks, and child care centers—these are just a few examples of human service organizations that Americans count on every day. Although human service nonprofits are heavily funded by government, which extends their reach, little is known about the size and scale of these contracting relationships or how effective they are. This study aims to provide a comprehensive look at the scope of governments’ contracts and grants with human service organizations in the United States and document the problems that arise. We also assess how these nonprofits were affected by the recession, how they responded to shrinking revenues, and how flaws in government contracting practices intensified their budget woes.”
This new report from The Urban Institute examines the situation in relation to human service nonprofits.
An excerpt.
“The recession crippled the budgets of many nonprofits just as demand for their services rose. On top of shrinking revenue from donations and fees, many organizations struggled with ongoing payment problems from one of their biggest funders—government agencies. As a result, many were forced to cut services and staff or close program sites, hurting the communities they serve. While pain from the recession may have been unavoidable, better government management of contracts and grants can at least avoid adding to nonprofits’ financial stress.
“Goodwill, Boys & Girls Clubs of America, the American Red Cross, homeless shelters, food banks, and child care centers—these are just a few examples of human service organizations that Americans count on every day. Although human service nonprofits are heavily funded by government, which extends their reach, little is known about the size and scale of these contracting relationships or how effective they are. This study aims to provide a comprehensive look at the scope of governments’ contracts and grants with human service organizations in the United States and document the problems that arise. We also assess how these nonprofits were affected by the recession, how they responded to shrinking revenues, and how flaws in government contracting practices intensified their budget woes.”
Thursday, October 7, 2010
Organizational Blogging
Every organization needs to have a blog, even if the minimal one post a day with no comments format I use, as it provides the electronic office for busy people to acquaint themselves with your organizational mission, current issues, and organizational views.
This article from Guidestar encourages blogging with some good facts about it and reasons to do it.
An excerpt.
“Blogging statistics are staggering.
“A September 2010 study from eMarketer on the continued rise of blogging says the medium will continue to grow in popularity as more users turn to blogs to produce and consume content. According to the same study, by 2014, blog readership will rise to more than 150 million Americans, or 60 percent of the Internet population in the United States. June 2010 figures from WordPress (which powers many of the blogs you read) cite 11.4 million blogs hosted on their platform, with WordPress.com users publishing about 350,000 new posts on an average day (and their readers, in turn, leaving 400,000 new comments every day).
“With all that conversation, discussion, opinion, interjection, and objection, it's easy see why some communicators consider blogging to be a daunting task. But the blogosphere is calling you, beckoning input and insight from you and your organization. And while it is something that requires dedication and commitment, it is a necessary communications tool in today's social media environment.”
This article from Guidestar encourages blogging with some good facts about it and reasons to do it.
An excerpt.
“Blogging statistics are staggering.
“A September 2010 study from eMarketer on the continued rise of blogging says the medium will continue to grow in popularity as more users turn to blogs to produce and consume content. According to the same study, by 2014, blog readership will rise to more than 150 million Americans, or 60 percent of the Internet population in the United States. June 2010 figures from WordPress (which powers many of the blogs you read) cite 11.4 million blogs hosted on their platform, with WordPress.com users publishing about 350,000 new posts on an average day (and their readers, in turn, leaving 400,000 new comments every day).
“With all that conversation, discussion, opinion, interjection, and objection, it's easy see why some communicators consider blogging to be a daunting task. But the blogosphere is calling you, beckoning input and insight from you and your organization. And while it is something that requires dedication and commitment, it is a necessary communications tool in today's social media environment.”
Wednesday, October 6, 2010
Social Media
This story from the Sacramento Bee about local—and national—nonprofits using social media to help with fundraising and building supporter community, is another reminder of the importance of understanding and using technology.
An excerpt.
“Women Escaping a Violent Environment in Sacramento needed cash, and needed it fast.
“So the nonprofit agency, which serves victims of domestic violence, sent out a modern-day SOS.
“With a critical program on the chopping block last summer because of the loss of county money, WEAVE enlisted the pro bono help of technology firm Activate Direct, and launched an elaborate e-mail, Facebook and Twitter campaign.
“The effort created a viral response that raised nearly $25,000 in less than three weeks, enough to save the group's Sexual Assault Response Team program, which provides an advocate to meet rape victims at hospitals.
“As big-money donors cut back and government funding grows scarce, nonprofits like WEAVE are successfully turning to social media to solicit smaller donations to make up for shortfalls.
"We knew we could not do without this program, and we needed to find the money fast," or lose matching federal dollars, said Amber Stott, WEAVE's director of community development. "It used to be enough to send a newsletter through the mail. That's no longer the case."
“During the past two years, social media campaigns have become an important part of the communications and fundraising repertoires of nonprofit agencies in Sacramento and across the country.
“According to a Dartmouth study published last year, 89 percent of the 200 largest charities in the United States were using at least one form of social media in 2008. Ninety percent of charities described social media campaigns as successful, and 45 percent said the approach is "very important" to their fundraising strategy.
“Savvy nonprofits now are able to instantly tap into longtime supporters while cultivating a whole new audience through forwarded messages and blogs, shared links and re-tweets, said Lesley Miller of 3fold, a Sacramento marketing company that contracts with agencies to design and run campaigns.”
An excerpt.
“Women Escaping a Violent Environment in Sacramento needed cash, and needed it fast.
“So the nonprofit agency, which serves victims of domestic violence, sent out a modern-day SOS.
“With a critical program on the chopping block last summer because of the loss of county money, WEAVE enlisted the pro bono help of technology firm Activate Direct, and launched an elaborate e-mail, Facebook and Twitter campaign.
“The effort created a viral response that raised nearly $25,000 in less than three weeks, enough to save the group's Sexual Assault Response Team program, which provides an advocate to meet rape victims at hospitals.
“As big-money donors cut back and government funding grows scarce, nonprofits like WEAVE are successfully turning to social media to solicit smaller donations to make up for shortfalls.
"We knew we could not do without this program, and we needed to find the money fast," or lose matching federal dollars, said Amber Stott, WEAVE's director of community development. "It used to be enough to send a newsletter through the mail. That's no longer the case."
“During the past two years, social media campaigns have become an important part of the communications and fundraising repertoires of nonprofit agencies in Sacramento and across the country.
“According to a Dartmouth study published last year, 89 percent of the 200 largest charities in the United States were using at least one form of social media in 2008. Ninety percent of charities described social media campaigns as successful, and 45 percent said the approach is "very important" to their fundraising strategy.
“Savvy nonprofits now are able to instantly tap into longtime supporters while cultivating a whole new audience through forwarded messages and blogs, shared links and re-tweets, said Lesley Miller of 3fold, a Sacramento marketing company that contracts with agencies to design and run campaigns.”
Tuesday, October 5, 2010
Philanthropy & A Life
Behind most major individual philanthropic efforts is a story of individual achievement providing the resources to conduct major philanthropy and a personal history from which the compassion to help grows.
The story of the saving and restoration of the great ship, the SS United States, from the Philanthropy Roundtable is such a story.
An excerpt.
“She was once the fastest ship in the world, the pride of the United States. She held the trans-Atlantic speed record, re-taking it from a British vessel. “She’s the first, first lady of the sea,” went the song composed before her maiden voyage. And there she sat, barnacling in Philadelphia’s harbor. Her paint peeling and faded, her name lined with rust: United States.
“Some called her a relic. An ocean liner built at the cusp of the jet age; a hulking heap whose repair would cost more than her worth. She was bound for the scrap yard.
“That’s when Gerry Lenfest intervened. Barely a day before bids from scrappers were due, and without even seeing the ship first, he made a $5.8 million pledge to purchase and bring new life to the SS United States.
“She is worth saving,” he explains. It’s a simple but telling statement. It reveals a profound sense of history, a deep sympathy for the underdog, and a healthy appetite for risk.
“In other words, it reveals a lot about Gerry Lenfest.
“From Seventeen to Seven Billion
“H. F. (“Gerry”) Lenfest is used to sudden, abrupt changes—which may help explain his willingness to take bold, decisive action. When he was 13 years old, his father uprooted the family from their suburban home in Scarsdale, New York. Lenfest suddenly found himself on a working farm in Lambertville, on the New Jersey–Pennsylvania border. “Milking the cows and most other chores fell to me,” Lenfest would later explain. “Working on a farm was not my dream.” Not long thereafter, his mother died.
“Lenfest was devastated. Her cerebral hemorrhage was unexpected. His twin sister was sent to a boarding school, and his father was frequently away on business. (He was a naval engineer who worked in Lower Manhattan, with a 60-mile daily commute.) Unsurprisingly, Lenfest’s grades suffered. He struggled academically, drifting from school to school. Only once his father secured him a place at Mercersburg Academy was he able to correct course.”
The story of the saving and restoration of the great ship, the SS United States, from the Philanthropy Roundtable is such a story.
An excerpt.
“She was once the fastest ship in the world, the pride of the United States. She held the trans-Atlantic speed record, re-taking it from a British vessel. “She’s the first, first lady of the sea,” went the song composed before her maiden voyage. And there she sat, barnacling in Philadelphia’s harbor. Her paint peeling and faded, her name lined with rust: United States.
“Some called her a relic. An ocean liner built at the cusp of the jet age; a hulking heap whose repair would cost more than her worth. She was bound for the scrap yard.
“That’s when Gerry Lenfest intervened. Barely a day before bids from scrappers were due, and without even seeing the ship first, he made a $5.8 million pledge to purchase and bring new life to the SS United States.
“She is worth saving,” he explains. It’s a simple but telling statement. It reveals a profound sense of history, a deep sympathy for the underdog, and a healthy appetite for risk.
“In other words, it reveals a lot about Gerry Lenfest.
“From Seventeen to Seven Billion
“H. F. (“Gerry”) Lenfest is used to sudden, abrupt changes—which may help explain his willingness to take bold, decisive action. When he was 13 years old, his father uprooted the family from their suburban home in Scarsdale, New York. Lenfest suddenly found himself on a working farm in Lambertville, on the New Jersey–Pennsylvania border. “Milking the cows and most other chores fell to me,” Lenfest would later explain. “Working on a farm was not my dream.” Not long thereafter, his mother died.
“Lenfest was devastated. Her cerebral hemorrhage was unexpected. His twin sister was sent to a boarding school, and his father was frequently away on business. (He was a naval engineer who worked in Lower Manhattan, with a 60-mile daily commute.) Unsurprisingly, Lenfest’s grades suffered. He struggled academically, drifting from school to school. Only once his father secured him a place at Mercersburg Academy was he able to correct course.”
Monday, October 4, 2010
Employee Classification
It has become a newly important issue—independent contractors or employees—as this article from Third Sector New England notes.
An excerpt.
“Classifying workers as employees or independent contractors may be the hottest and most contentious issue in human resources management. It is also one that creates confusion and potential problems for nonprofits.
“The issue is hot because the U.S. government and state officials are aggressively pursuing employers who misclassify employees. According to the New York Times, President Obama's 2010 budget assumes that the federal crackdown will yield at least $7 billion over 10 years.
“More than two dozen states, Massachusetts included, also have stepped up enforcement. The Obama administration plans to expand investigations by hiring 100 more enforcement personnel. The IRS has begun auditing 6,000 companies to see whether they are in compliance with the law.
“Focus on Protecting Workers
“Federal and state regulations related to properly classifying workers were put into place for two key reasons. First, the regulations were designed to generate tax revenue. Second, the regulations help protect workers by ensuring they receive minimum wage and basic benefits. Given that most nonprofits strive to stand in solidarity for the rights of the underrepresented, it follows that we would want to abide by and support these laws. And, in fact, many do.
“In April, the National Employment Law Project and two dozen worker and civil rights, faith-based and other interested groups sent a letter to Congress urging support for this heightened scrutiny.
“Christine Owens, executive director of the National Employment Law Project, explains, "Independent contractor misclassification robs federal and state treasuries of billions in needed revenues... and denies wages, benefits and workplace protections to huge numbers of workers. More workers are falling prey to this kind of exploitation, and it puts a drag on the whole economy."
“Dollars and Sense
“Yet we regularly hear from cash-strapped organizations that contracting with consultants or independent contractors, rather than hiring employees, often makes good financial sense. Employers are required to pay Social Security and Medicare taxes when workers are classified as "employees." They don't incur those expenses when workers are classified as "independent contractors."
“In difficult financial times, reducing payroll expenses may be a tempting way for organizations to maintain mission-critical programs and services. And in fact, some workers prefer to be paid as independent contractors because of both the real and perceived financial benefits to them.”
An excerpt.
“Classifying workers as employees or independent contractors may be the hottest and most contentious issue in human resources management. It is also one that creates confusion and potential problems for nonprofits.
“The issue is hot because the U.S. government and state officials are aggressively pursuing employers who misclassify employees. According to the New York Times, President Obama's 2010 budget assumes that the federal crackdown will yield at least $7 billion over 10 years.
“More than two dozen states, Massachusetts included, also have stepped up enforcement. The Obama administration plans to expand investigations by hiring 100 more enforcement personnel. The IRS has begun auditing 6,000 companies to see whether they are in compliance with the law.
“Focus on Protecting Workers
“Federal and state regulations related to properly classifying workers were put into place for two key reasons. First, the regulations were designed to generate tax revenue. Second, the regulations help protect workers by ensuring they receive minimum wage and basic benefits. Given that most nonprofits strive to stand in solidarity for the rights of the underrepresented, it follows that we would want to abide by and support these laws. And, in fact, many do.
“In April, the National Employment Law Project and two dozen worker and civil rights, faith-based and other interested groups sent a letter to Congress urging support for this heightened scrutiny.
“Christine Owens, executive director of the National Employment Law Project, explains, "Independent contractor misclassification robs federal and state treasuries of billions in needed revenues... and denies wages, benefits and workplace protections to huge numbers of workers. More workers are falling prey to this kind of exploitation, and it puts a drag on the whole economy."
“Dollars and Sense
“Yet we regularly hear from cash-strapped organizations that contracting with consultants or independent contractors, rather than hiring employees, often makes good financial sense. Employers are required to pay Social Security and Medicare taxes when workers are classified as "employees." They don't incur those expenses when workers are classified as "independent contractors."
“In difficult financial times, reducing payroll expenses may be a tempting way for organizations to maintain mission-critical programs and services. And in fact, some workers prefer to be paid as independent contractors because of both the real and perceived financial benefits to them.”
Friday, October 1, 2010
Three Leaders
In this article from the Stanford Social Innovation Review, the different types of leaders (monk, architect, diplomat)—seen as necessary for organizational success—are examined.
As the spiritual aspect of nonprofit work is, I believe, the most important part, here is an excerpt from the role of the monk.
“BE A MONK, NOT A FATHER
“Monks invite you to become spiritually engaged in your work. They do this by subtly modeling the values they want to impart. They listen carefully, never direct you paternalistically, and always strive to help you find your way.
“Successful social entrepreneurs recognize that their primary role is to turn the organization’s mission and values into practice. Like monks, they know that everything they say and do—and don’t say or do—sends signals through the company about what values are important.
“So be mindful of your powerful effect on people in your organization. No matter what the formal company documents say, you make values visible. If respect for others is an important company value, what do you do when you, the CEO, walk into an office where two co-workers are engaged in a business conversation? Do you interrupt them because you and your agenda are more important, or do you wait your turn until they are finished? Gun Denhart, cofounder and former CEO of children’s clothing company Hanna Andersson, responded by saying: “I wait until they’re finished. If it goes on, I’ll leave and come back. I don’t break in and interrupt their work. Unfortunately, I’ve seen that rudeness too often from ‘important people.’”
“Don’t feel you need to know everything. If you did, there’d be no room for anyone else to contribute. Admit to “not knowing,” even as you help others develop their competence. This creates an atmosphere of honesty and transparency, where employees share information and responsibility, accept doubt, and expect help in finding sustainable solutions to business challenges.
“Another way to lead like a monk is to incorporate spirit into your work. At RSF Social Finance, a San Francisco-based socially responsible financial services organization, when monthly financial statements are sent to investor clients, each client’s company representative personally initials each page of the statement. In these moments, they are mindful of their client’s situation and of communicating that attention simply. Over the last 60 years, that one practice has received more positive response from investors than any other of the bank’s client services.
“Entrepreneurs can extend that mindfulness beyond traditional company boundaries, too. One CEO, for example, after recognizing how her seasonal business affected the working hours of her distributors’ employees, shared her market research with her distributors so they could better predict work cycles and not increase seasonal employee stress.”
As the spiritual aspect of nonprofit work is, I believe, the most important part, here is an excerpt from the role of the monk.
“BE A MONK, NOT A FATHER
“Monks invite you to become spiritually engaged in your work. They do this by subtly modeling the values they want to impart. They listen carefully, never direct you paternalistically, and always strive to help you find your way.
“Successful social entrepreneurs recognize that their primary role is to turn the organization’s mission and values into practice. Like monks, they know that everything they say and do—and don’t say or do—sends signals through the company about what values are important.
“So be mindful of your powerful effect on people in your organization. No matter what the formal company documents say, you make values visible. If respect for others is an important company value, what do you do when you, the CEO, walk into an office where two co-workers are engaged in a business conversation? Do you interrupt them because you and your agenda are more important, or do you wait your turn until they are finished? Gun Denhart, cofounder and former CEO of children’s clothing company Hanna Andersson, responded by saying: “I wait until they’re finished. If it goes on, I’ll leave and come back. I don’t break in and interrupt their work. Unfortunately, I’ve seen that rudeness too often from ‘important people.’”
“Don’t feel you need to know everything. If you did, there’d be no room for anyone else to contribute. Admit to “not knowing,” even as you help others develop their competence. This creates an atmosphere of honesty and transparency, where employees share information and responsibility, accept doubt, and expect help in finding sustainable solutions to business challenges.
“Another way to lead like a monk is to incorporate spirit into your work. At RSF Social Finance, a San Francisco-based socially responsible financial services organization, when monthly financial statements are sent to investor clients, each client’s company representative personally initials each page of the statement. In these moments, they are mindful of their client’s situation and of communicating that attention simply. Over the last 60 years, that one practice has received more positive response from investors than any other of the bank’s client services.
“Entrepreneurs can extend that mindfulness beyond traditional company boundaries, too. One CEO, for example, after recognizing how her seasonal business affected the working hours of her distributors’ employees, shared her market research with her distributors so they could better predict work cycles and not increase seasonal employee stress.”
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