http://www.ssireview.org/articles/ Strategies, Tools, and Ideas for Nonprofits, Foundations, and Socially Responsible Businesses en nicholas_jenna@gsb.stanford.edu Copyright 2010 2010-02-24T07:00:54+00:00 http://www.ssireview.org/articles/entry/merging_wisely/ http://www.ssireview.org/articles/entry/merging_wisely/ In the midst of the worldwide financial crisis, funders are increasingly suggesting that nonprofits consider merging—that is, fusing their boards, management, and legal entities to form a single organization. In 2009 alone, my consulting firm delivered nearly 60 presentations and workshops on mergers and other partnership forms to more than 6,000 participants—double the previous year’s tally. Similarly, our strategic restructuring practice (which handles mergers and other partnerships) grew 60 percent last year, during the worst part of the recession. Now 2010 is upon us, and the urge to merge shows no signs of abating. Underlying this trend are two core beliefs: The nonprofit sector has too many organizations, and most nonprofits are too small and are therefore inefficient. Mergers, the thinking goes, would reduce the intense competition for scarce funding. Consolidating organizations would also introduce economies of scale to the sector, increasing efficiency and improving effectiveness. Yet a closer look at the nonprofit sector suggests that this thinking is too simplistic. Mergers are risky business. They sometimes fail, although not so frequently as in the corporate world. They usually cost more than anticipated. They sometimes create more problems than they solve. And the problems that they allegedly solve—too many nonprofits,… Nonprofit Management, Philanthropy, Responsible Investing 2010-02-25T20:56:12+00:00 http://www.ssireview.org/articles/entry/research_interviewer_beware/ http://www.ssireview.org/articles/entry/research_interviewer_beware/ Her suit is Prada. Her hair is neatly coiffed. Her handshake is firm and her eye contact steady. Her body leans forward ever so slightly to show that she is interested, but not anxious. Her easy banter manages to convey her many achievements without seeming arrogant. Her replies arise after thoughtful pauses. Her compliments seem sincere. And her next job is quite likely to be the one you are offering, suggests a new meta-analysis of several dozen studies. Combined, the studies show that hiring managers are remarkably susceptible to a job candidate’s appearance, gestures, postures, flattery, and self-promotion. Alas, the study also finds that these interviewer-wooing tactics have more to do with whether a candidate gets the job than how well she performs at it. “Many executives and managers have too much confidence in their ability to read people,” says Murray Barrick, chair of the management department at Texas A&M University and the study’s lead author. “They don’t want to hear that self-presentation tactics are having this much impact on their hiring decisions.” “I also didn’t think that our effects would be this strong,” he adds. Barrick and colleagues’ study offers an antidote to the beguiling wiles of potential hires:… Nonprofit Management 2010-02-24T06:00:53+00:00 http://www.ssireview.org/articles/entry/whats_next_bite-sized_goodness/ http://www.ssireview.org/articles/entry/whats_next_bite-sized_goodness/ In the time it takes to update your Facebook page, you could be making the world a slightly better place. That’s the idea behind The Extraordinaries, a Web-based platform for microvolunteering that’s been generating plenty of buzz since its launch last year. The goal is to harness thousands of currently untapped hours by making volunteering fast, convenient, and bite-sized. While waiting for a bus or cooling your heels at the dentist’s office, you could be using your smart phone to tag photos for the Smithsonian, send a study tip to an at-risk student, or map your local parks. “We want volunteering to be as fun and ubiquitous as playing a game,” explains Sundeep Ahuja, cofounder and president of the San Francisco-based business. The Extraordinaries (www. beextra.org) was founded by a trio with deep experience in social media. Chief technology officer Ben Rigby pioneered the use of mobile phones for youth voter registration when he founded Mobile Voter. CEO Jacob Colker was one of the first to harness Facebook to organize political campaigns. Ahuja was a product manager at MySpace before helping to launch Kiva, the microphilanthropy site. Traditional community service “has been about carving out a Saturday afternoon or an… Nonprofit Management, Philanthropy, Responsible Investing 2010-02-24T06:00:44+00:00 http://www.ssireview.org/articles/entry/a_handbook_for_change/ http://www.ssireview.org/articles/entry/a_handbook_for_change/ In a world that is becoming increasingly complex, it was a welcome beacon to read the title of Chip and Dan Heath’s new book: Switch: How to Change Things When Change Is Hard. With great anticipation I turned to the introduction, where the authors promised to teach me how to change things at the individual, organizational, and societal level. The book’s premise is straightforward—successful change occurs when people change their behavior. A person’s behavior is driven by three factors: his logic and rationality (what the authors call the “Rider”), his emotions (the “Elephant”), and his environment (the “Path”). The best way to create change, say the authors, is to “Direct the Rider,” “Motivate the Elephant,” and “Shape the Path.” Most of the book is divided into three sections, each exploring one of these principles. Although the introduction provides the logic behind the principles, I sometimes found it difficult to bring them together into a coherent whole. For example, I found the second principle of change, Motivating the Elephant, insightful, but felt the need to return to the first section on the importance of Directing the Rider so that I could get a better perspective on the dynamic relationship between the… Nonprofit Management, Book Reviews 2010-02-24T06:00:30+00:00 http://www.ssireview.org/articles/entry/dashboards_that_guide_good/ http://www.ssireview.org/articles/entry/dashboards_that_guide_good/ Many nonprofit directors keep a close eye on their dashboards, those colorful arrays of output, outcome, and impact measures that represent an organization’s goals and guide its decisions. The dashboard’s brightly colored bubbles quickly signal the health of an organization’s different activities. Green dots mean, “This is going really well—no need to put more energy here.” Red dots warn, “Focus an hour of your meeting here—deep well of trouble brewing.” And yellow dots relay, “Proceed with caution.” Despite their usefulness, dashboards can create problems all their own. In a noisy and complex world, many organizations struggle to decide which indicators to include and which to leave out. Cash-strapped times and a spike in the need for nonprofit services have only muddied matters because measuring outputs, outcomes, and impacts can be expensive and time-consuming. Indeed, as the size and complexity of dashboards grow, and more and more staff members have to help with measurement, dashboards can take on a life of their own. When faced with too much information, managers may either pay attention to the wrong data or stop making databased decisions altogether. Just as staring at an odometer while driving on a winding road in a rainstorm is not… Nonprofit Management, Philanthropy, Responsible Investing 2010-02-24T06:00:05+00:00 http://www.ssireview.org/articles/entry/the_power_of_theories_of_change/ http://www.ssireview.org/articles/entry/the_power_of_theories_of_change/ The fundamental tenets of strategic philanthropy are that funders and their grantees should have clear goals, strategies based on sound theories of change, and robust methods for assessing progress toward their goals. Although these ideas are gaining traction, some prominent philanthropic thinkers continue to express reservations about how they may affect the balance of power between funders and the organizations they support. For example, former Ford Foundation president Susan Berresford expresses concerns about “funder-led strategic planning that imposes wearying and unnecessary demands on applicants and grantees,” and wistfully asks, “Has the role of the quiet, patient, and responsive funder become less appealing?” 1 She quotes the Indian social entrepreneur Sheela Patel’s complaint about funders’ imposition of logic models and their demand “that in a period of two years, we can implement perfect strategies and produce complete solutions.” Similarly, Sean Stannard-Stockton, the founder and CEO of Tactical Philanthropy Advisors and philanthropic blogger, argues that the idea of a theory of change makes sense in a “static landscape, where you can learn more and more about what works and what doesn’t and finally craft the perfect theory,” but “fails in a dynamic landscape, such as social change, where what you learned on… Nonprofit Management, Philanthropy, Responsible Investing 2010-02-24T05:59:59+00:00 http://www.ssireview.org/articles/entry/the_wrong_risks/ http://www.ssireview.org/articles/entry/the_wrong_risks/ During the early 1980s, I worked in a community center that looked after the welfare of an inner-city neighborhood in Mumbai. My clients were the poorest of the poor: pavement dwellers who lived on the sidewalks. We offered these families health services, enrolled their kids in school, and organized childcare for them. But every 15 days, public officials came and broke up their makeshift homes because it was illegal to squat on sidewalks. All we could do was give our clients a safe place to hide their belongings until the officials passed. Being young and hot-blooded, a small group of us took the local government to court. At that time, India had a chief justice of the supreme court who regarded even a postcard from a poor person as a legitimate opening to a public interest suit. And so the suit commenced with relative ease. Our small group was very excited that we might actually change the policies that kept pavement dwellers impoverished. To my surprise, however, my employer severely reprimanded me for this action and stripped away many of my discretionary powers. This organization, the Nagpada Neighborhood House, was one of the oldest and most prestigious nongovernmental organizations (NGOs)… Nonprofit Management, Philanthropy, Responsible Investing 2009-12-15T20:00:42+00:00 http://www.ssireview.org/articles/entry/outrun_the_recession/ http://www.ssireview.org/articles/entry/outrun_the_recession/ Recessions are not sprints; they are endurance events. To find out how nonprofits are faring during the toughest recession in more than 30 years, we have been surveying 100 nonprofit executives across the United States at six-month intervals since late 2008. As of October 2009, some 80 percent of our respondents had experienced funding cuts, and a full 93 percent said that they were feeling the effects of the downturn. Yet many of our respondents are also adopting healthy habits that not only will help them survive the present recession, but also may help them thrive when better times return. Below we summarize the seven healthy habits of nonprofits that endure. Act quickly, yet thoughtfully Anxiety tends to provoke one of two responses: unthinking activity or deer-in-the-headlights paralysis. Both are understandable; neither is helpful. Instead, nonprofits must be both thoughtful in their decision making and fleet-footed in their implementation. And that means planning for the worst, starting now. For example, take the Women’s Lunch Place, a Boston-based nonprofit that gives poor and homeless women and children a daytime refuge. By the fall of 2008, the organization had seen its funding reduced by $400,000 and wasn’t sure what its future held.… Nonprofit Management 2009-12-07T20:33:01+00:00 http://www.ssireview.org/articles/entry/endowment_for_a_rainy_day/ http://www.ssireview.org/articles/entry/endowment_for_a_rainy_day/ Judging from media accounts, U.S. nonprofits are facing unprecedented, if not catastrophic, financial distress because of endowment losses. Hiring is being frozen, facility maintenance is being deferred, programs are being dropped, performance seasons are being shortened, and construction projects are being cut back or even halted. As the president of Harvard University, Drew Gilpin Faust, put it when defending her decision to sharply reduce expenditures following a 30 percent drop in the value of the school’s endowment, “Tinkering around the edges will not be enough.” Harvard isn’t the only institution making dramatic cuts in response to a falling endowment. The J. Paul Getty Trust, which runs the J. Paul Getty Museum in Los Angeles, slashed 14 percent of its workforce and delayed exhibitions and acquisitions after its endowment fell from $6.4 billion to $4.2 billion. Yale University cut capital expenditures by $2 billion and staff salaries and benefits by 7.5 percent after its endowment fell from about $23 billion to about $16 billion. And the Shriners Hospitals for Children considered closing 6 of its 22 children’s hospitals after its endowment fell from $8.3 billion to $5.0 billion. The Shriners tabled that motion, but are considering billing insurance and Medicaid for… Nonprofit Management, Philanthropy, Responsible Investing 2009-12-01T22:36:55+00:00 http://www.ssireview.org/articles/entry/design_thinking_for_social_innovation/ http://www.ssireview.org/articles/entry/design_thinking_for_social_innovation/ In an area outside Hyderabad, India, between the suburbs and the countryside, a young woman—we’ll call her Shanti—fetches water daily from the always-open local borehole that is about 300 feet from her home. She uses a 3-gallon plastic container that she can easily carry on her head. Shanti and her husband rely on the free water for their drinking and washing, and though they’ve heard that it’s not as safe as water from the Naandi Foundation-run community treatment plant, they still use it. Shanti’s family has been drinking the local water for generations, and although it periodically makes her and her family sick, she has no plans to stop using it. Shanti has many reasons not to use the water from the Naandi treatment center, but they’re not the reasons one might think. The center is within easy walking distance of her home—roughly a third of a mile. It is also well known and affordable (roughly 10 rupees, or 20 cents, for 5 gallons). Being able to pay the small fee has even become a status symbol for some villagers. Habit isn’t a factor, either. Shanti is forgoing the safer water because of a series of flaws in the overall… Nonprofit Management 2009-11-19T06:00:54+00:00