This post is one of a continuing series on strategic planning and is based on my work facilitating strategic planning with nonprofit agencies. In strategic planning one of my initial conversations with an agency executive director will invariably include a discussion about the use of the strategic plan following its development.  The savvy executive director will describe the concrete ways in which the plan will be used to support agency governance.  S/he will describe the use of performance measures connected to the plan goals and strategies and the specific tools that help the board and staff manage their progress on implementing the plan.  More common however, the the executive director that laments how the exercise of strategic planning rarely impacts the agency in a deep and substantive way.  In this scenario, I am often asked, “how can this strategic planning process be different?”  In this post, I wanted to review the fundamentals of how use the process of strategic planning to increase organizational capacity.

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The obvious direct impact of strategic planning is the written strategy that is created.  At its most basic level in creation of a strategic plan is the DNA of capacity development.  Done well, a strategic plan offers a roadmap for the growth and  development of an organization. With intentional effort to keep the plan present and alive using simple performance monitoring tools, (like a dashboard or scorecard) an agency directly benefits from its investment in strategic planning.  However, I believe the face value of a strategic plan is only the beginning of the use of a strategic plan. Some other layers of using strategic planning to build capacity include the following:

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Board, Staff and Stakeholder Development: While textbook strategic planning can be a very pedestrian process of assessing the current internal and external environment, developing priorities and strategies, and writing a document, I believe the potential of strategic planning is to use the process to develop the energy, passion, skills and knowledge of board, staff and stakeholders.   Strategic planning is about engagement and focus of people and not just about data.  In planning a strategic planning effort, one of the framing questions should be “at the end of this process, how will out staff, board and stakeholders be different?” If this question is pursued intentionally then strategic planning offers and agency to develop the understanding, passion, and commitment of board, staff and stakeholders.  In this context, the planning process can and should include empowerment and learning community approaches. Indeed, a strategic planning process is successful to the degree that it creates a deeper understanding of the role and function of the agency in solving compelling social needs.

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Strategic Dialogue:  Having facilitated the development of numerous strategic plans, I find some of the greatest energy in the process comes as I work with an organization to gather “outside” perspectives.  While not commonly done, I am a strong believer that  organizations benefit from seeking advice and perspective from outside of the agency.  Insights coming from other agencies working on the same issue, from funders, donors, community partners and even agency clients, yield not only valuable strategic planning insights but often begins the process of dialogue.  Once the strategic plan is developed, I encourage agencies to continue the conversation with their funders, donors, community partners, and clients by sharing the strategic directions of the plan.  Some agencies bristle at the concept of sharing such sensitive, internal knowledge and reference the for profit sector’s contention that strategy is proprietary and needs to be guarded. I would counter that being transparent about strategy is actually strategic in the social sector.  Sharing knowledge about strategy makes explicit the position, direction and focus of an agency and can be used to define a larger community or regional agenda.  Engaging in such a dialogue with partners, funders, donors, clients and the community at large fosters collaboration and increases the potential of creating a network of strategies that can improve the collective social impact of all stakeholders.

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Field Building: Paired with the concept of strategic dialogue, a third use of a strategic plan is that it holds the potential to improve the field of practice.  Strategic Planning offers a unique and compressed exercise in evaluation, innovation and system design.  When strategic planning is resourced, well-designed and not simply a rote exercise it is a laboratory experience that has both internal and external dimensions.  Too often a strategic planning process is myopically inward content with asking the question, “how do we succeed in fulfilling our mission?”  While there is no denying that strategic planning is designed to create an organizational future, strategic planning also influences the collective future of the field of practice in which the agency operates.  In addition to how does the organizational “we” succeed there is also a dimension of how does the collective “we” succeed.  One outcome of strategic planning could be the free sharing of lessons learned.  By giving away your knowledge, you enable the the social sector to collectively enhance the knowledge base and field of practice.

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Taken together, strategic planning becomes a layered process of developing capacity.  Clearly and unequivocally the foundation of strategic planning is the creation of an organizational pathway to the future.  However, if layers of “human capital” development, strategic dialogue, and field building are added to the foundation of strategy, a strategic plan becomes a powerful tool to expand agency capacity. Facilitating a strategic planning process is more than following one of any number of strategic planning textbooks.  Strategic planning is large, shaping and capacity-building and it is the responsibility of facilitators to “bring life” to a strategic planning process.  I believe, it is only through this larger lens of capacity development do nonprofits build meaningful strategic plans.

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As always, your comments are welcome.

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As a facilitator I work with a range of social sector organizations on strategic and business planning processes. In my work, I often encounter ambiguity about the difference between a vision and mission statement.  In some cases, I will hear an executive director or board chair say something like, “Our vision and mission are so closely related we don’t distinguish between the two.”  On one occasion an executive quipped, “to create our vision statement we just randomly removed words from our mission statement until we had a vague sounding lofty goal.”  While a quick search of the web will reference dozens of blog posts and websites offering the conceptual differences between vision and mission, there is often little discussion of the practical difference between mission and vision. As I see it, the problem is that in a typical planning process the mission and vision (along with values) are lumped together as a first step in plan.  It is almost as if they are a hurdle to surmount before a team or agency can “get to work on what needs to be done.”  In this post, I want to describe why the differentiation between vision and mission is important and how the two concepts need to be uncoupled in the planning process.

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At the risk of over generalizing, many references and books discussing vision and mission have the tendency to describe the two concepts as if they were distinguishing between goals and objectives.  I have written about the differences between goals and objectives and suggested that a goal is the “upstream activities” necessary to create “change that matters” and that an objective is the work in front of you that gets you to start moving towards your goal. While there is a parallel short-term and long-term thinking associated with the discussion of vision and mission, it would be a mistake to use the paired concepts interchangeably.

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There was a time when a vision might have been thought of as nothing more than a lofty goal.  In the business sector such a mission might have been something like, “We want to be the first choice for luxury cars purchased in America,” or in the social service sector such a vision/goal might have been, “We strive to be the preeminent substance abuse treatment provider in the region.”  However, I firmly believe that equating a vision with a lofty goal is inadequate to clearly define the aspirations of an organization today.  In the private sector “vision” is increasingly framed in the language of a triple bottom line, “people, profits and planet.” In the nonprofit and social service sectors, a vision of organizational success must give way to the larger “upstream” thinking that boldly proclaims the deep social impact created by the agency.

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As a result, a facilitator needs to assist the organization of today in identifying a clear and compelling vision statement.  Such a vision is the response to the social need and context in which an agency operates.  For example, if an agency is working to decrease the “youth violence” then a vision statement is about more than providing youth diversion activities because the prevention of youth violence inherently is not only about youth “behavior.”  In addition to behavior, youth violence is also about many socio-economic and geopolitical disparities which also need to be within the organization’s “field of vision.” I have written previously about strategies for facilitating the development of a social impact model, but the point applicable here is that  a compelling vision starts with a current and urgent social need and tells the story of how the social need of tomorrow will be different than it is today.

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So if the function of an organizational vision is to declare the future social impact of the organization, what purpose is served by the organizational mission?  A mission is also connected to the social need but is the proximal response the changing landscape.  While the core of a strong mission is grounded in the principles and values of the organization, it also references the strategies that are used to confront the compelling social needs. A mission statement is the head and the heart of an organization and serves as the lens through which organizational programs and strategies are viewed.  As such, a mission statement should be closer to the social need rather than the visionary social impact.   A mission statement evolves as the social need evolves while also remaining anchored to the vision. In this context, a facilitator also has a role for helping an organization understand its mission as well as its vision. This need to clearly define and differentiate between the concepts of vision and mission becomes apparent when one introduces program strategies.

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In between the mission and vision, is the “white space” where the organization builds its program strategies.  The following illustration creates the linear process:

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Social Need ==> Mission ==> Programs/Strategies ==> Vision of Social Impact.

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While a bit oversimplified (there are feedback loops and outcomes in the model), the point that I wanted to make is that there is conceptual “distance” between a vision and mission.  For those engaged in strategic and business planning, this spatial relationship is entirely practical.  By situating the mission close to the social need and anchoring the vision to the social impact, a facilitator has the room to help an agency orient its programs and services more strategically. The program strategies become the link between the organizational mission and the organizational vision.  By placing program strategies between mission and vision, the strategies can be more effectively assessed relative to how they well they serve as a the causal link between two. In other words, it is only if you are clear about the social need, the mission and the vision, can one assess the appropriateness of the program strategies.

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Again, as I scanned some of the blogs and websites that discussed the differences between Vision and Mission I was struck by how often the differentiation between the concepts was ignored or oversimplified. I have contended in many of my posts that the highly effective nonprofit organizations think systemically and strategically. Facilitating meaningful differences between Vision and Mission is a critical dimension of a systemic and strategic facilitation process. Mission, supported by strategic programming moves an organization towards their true vision and, in the end, such movement is the core of a strong facilitation process.

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As always your feedback is welcome.

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For many nonprofit organizations this is time of the year where the board and staff turn their attention to drafting a budget to guide business operations for the next fiscal year.  For many agencies, this annual ritual simply starts with taking last year’s budget and incrementally scaling the numbers up or down depending on the known and likely commitments of funding for the next year.  While this method is reliable when continuity between years is strong, an increasing number of nonprofits are still facing volatile economic environments.  For organizations confronting “revenue uncertainty” cutting and pasting from last year’s budget is likely inadequate preparation for the year, or years, ahead.  Organizations’ seeking not only to survive but thrive need to develop an intentional process to facilitate the development of a long-term budget strategy.  Having many years experience creating and managing budgets in career, consultant, and volunteer positions (across nonprofit agencies of all shapes and sizes) I would like to suggest five elements of a facilitation process that will strengthen a strategic budget planning process.

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Define your Funding Model:  It likely comes as no surprise that the agency budget framework for many small to midsize nonprofit organizations is simply the amalgamation of the individual program budgets that have been built in response to specific grants and/or contracts received by organization.  Unfortunately, even some larger organizations fall prey to this “Lego Approach” to budget development.  As new grants, contracts or donations are obtained, the resources are snapped into place to fill budget holes or to expand programs as required by the funding restrictions tied to the new revenues.  Agencies that would raise their hands if asked if they use the “Lego Approach,” would do well to consider convening their board for a strategic conversation about developing an intentional framework to guide the budget process.

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In recent years, there have been a number emerging perspectives in nonprofit fiscal management and philanthropy that, taken together, help nonprofits develop a strategic perspective for long-term revenue development.  Several articles and books are referenced at the end of this post, however, some of the key concepts that form the basis of the conversation should include: a) a review of Pratt’s funding archetypes and the ten funding models recently presented in an article in the Stanford Social Innovation Review; b) exploration of revenue autonomy, reliability and concentration, and c) operational overhead.  The goal of this conversation is to develop a working understanding of the concepts and prepare the board to apply these principles to creating a strategic framework for their organization.

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Assess your Overhead Costs:  One unfortunate legacy that plagues nonprofit organizations is that efficiency is often measured by overhead cost. The assumption is that nonprofit overhead is a proxy measure of efficiency, in essence, suggesting that the lower the nonprofit overhead costs, the more efficient the nonprofit is assumed to be.  This perspective is reinforced by many funding agencies who cap operational overhead at an arbitrary number (like 8%, 10% or 15%) when awarding grants and contracts.  However, over the last few years several studies have begun to challenge this conventional thinking with a growing chorus of voices suggesting that the antiquated approach to efficiency actually sets up a nonprofit “starvation cycle.”  Creating a strategic approach to resource development and budgeting will require boards to develop an accurate administrative overhead budget. This exploration by the board will need to account for both current administrative costs and costs associated with capital investments that need to be made in such areas as human resource, technology, fiscal, that have been deferred expenses.  The resources listed below offer several good starting places for developing an accurate administrative overhead budget.  Having a realistic understanding the true agency overhead costs will help your organization develop realistic plans to align revenues with true costs.

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Value your Staff:   A third component of a strategic budget process is to create a compensation system that values and rewards staff.  Much akin to the under-investing in agency overhead and infrastructure, under-investing in staff is another strategic hurdle that nonprofit agencies need to understand and overcome.  Again, conventional wisdom suggests that nonprofit employees work for intrinsic rather than extrinsic value, which translates into lower salaries and benefits.  Unfortunately, when a critical mass of nonprofit agencies operates under this assumption it creates a market that supports under-compensating staff.  On more than one occasion, I have heard a well-intentioned board member say, “Our employee pay and benefits are at the market rate.” Unfortunately the benchmark should not be “market rate” but should be oriented around the equity of a living wage and incentives that foster the recruitment and retention of high performing employees.  Again, the goal of building a compensation model is to create a resource development goal for an organization that can be supported by intentional objectives to be pursued in a priority sequence.  For example, I know of an agency that laid out a strategic agenda to sequentially develop a living wage structure, strengthen the insurance options, increase retirement contributions and add an employee assistance program and educational benefits.  The organization is supporting this strategy with a specific multi-year resource development plan focused on strengthening compensation.

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Start from Zero:  For those organizations locked into program grants and contracts, many budget decisions were established when the grant or contract proposal was submitted. For those programs that have been funded over multiple funding cycles, the budgets (and ideally work scope) have expanded or contracted based on available funds. However, even if a program budget is set, it is a very productive exercise to start from zero and rebuild a program budget.  In other words, suspending the current program budget, if you were to create an ideal budget for the program services being delivered, what would that budget look like?  If staff compensation was fully loaded and the appropriate overhead was charged to the program, how much money would it really take to run the program?  Creating a zero-based budget allows you to compare where you should be (relative to the revenue and expenses) to where you actually are today.  The variances identified are the program budget gaps that are being absorbed or ignored at the peril of your agency’s fiscal health.  Creating zero budget comparisons across program areas would help bring into focus the gaps between revenues and expenses and would become the groundwork for a facilitated discussion about program priorities and where your agency is appropriately investing, over-investing and under-investing in programs that help the organization meet its social goals and objectives.

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Think About Governance:  Another part of the process is to be intentional about governance.  At the most basic level, governance asks the big three questions is a) is it allowable, b) is it approved and c) is it something that will advance your mission?  In more detailed thinking about governance, your board needs to create a process to ensure that the budget process protects donor intent, appropriately allocates expenses and ensure the agency’s fiscal and legal advisors review the budget strategy for accuracy and legality.  Finally the governance component of budget planning requires attention to risk management and contingency planning, to minimize disruption of programs and services should budget projections not be met.

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Taken together, these five facets of strategic budget planning suggest a staged process that includes:  a) coming to agreement on a funding model for your agency that serves as the organizer for strategy, b) being clear about the true cost of your services, c) recognizing your resource gaps, and d) creating a strategic resource development plan to address the resource gap.  It is important to recognize that re-engineering an agency’s approach to resource development will take time and the first iteration of a strategic budgeting process will likely yield two working documents.  The first document is the strategic resource development plan is a long-term (3-5 years) that defines how your agency will reshape its approach to growing revenue streams over time.  The second working document is the short-term “compromised” budget to address the coming programmatic year that juggles the anticipated expenses with your projected committed and likely revenues.  However, this initial mixed result of “the  pragmatic” and  “the strategic” will only be a temporary stage as the subsequent iterations of the strategic budget process will be oriented more and more toward the strategic goals and objectives of your plan.

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What is becoming clear in the social service sector of today is that that nonprofit organizations can’t simply rely on the momentum of the past.  Strategic thinking and systems thinking need to be core competencies of the leadership and boards of nonprofit organizations.  Even as I write this blog, a new resource came through a “tweet” that made this statement, “Leaders who are determined to have their organizations thrive in these new and challenging times must reevaluate their potentially outdated ways of thinking, prioritizing, investing, and acting. (external link)”  For budget planning and the larger concept of strategic resource planning, I could not agree more.

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As always your thoughts are welcome.

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Resources:

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• Kramer M. (Fall, 2009) Catalytic Philanthropy. Stanford Social Innovation Review
• Landes Foster, W., Kim, P., & Christiansen , B. (Spring, 2009). Ten Nonprofit Funding Models. Stanford Social Innovation Review
• Pratt J. (Summer 2004). Analyzing the Dynamics of Funding: Reliability and Autonomy. Nonprofit Quarterly
• Companion spreadsheet to Pratt Article
• Raymond S (2010) Nonprofit Finance for hard Times. John Wiley & Sones, Hoboken, NJ.
• Sussman C. (N.D.) Building Adaptive Capacity: The Quest for Improved Organizational Performance.
• Goggins &  Howard (Fall 2009) The Nonprofit Starvation Cycle. Stanford Social Innovation Review
• Urban Institute & Center on Philanthropy at Indiana University.  Fundraising and Administrative Costs Website

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The economic downturn that occurred in the last couple of years has been unquestionably harsh on most nonprofit agencies.  The increases in service demand, coupled with the decreases in revenues have created organizational strains and fractures that will linger for years to come.  If there is any silver lining to this recent crisis, it is that has it forced many nonprofits to question their very foundations of mission, vision and operation.  In this context, the exploration of capacity and capacity building has increased in prominence and profile across many organizations. To that end, innovative and adaptable organizations are using this crisis to fundamentally rethink capacity and are linking strategy to capacity.

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I recently attended a panel discussion geared towards grant makers on the topic of nonprofit capacity building.  The panel discussed capacity assessments, the role of training, coaching and consulting and evaluating capacity building efforts.  As with many lunch presentations there was much more content than time, however, it was interesting to hear the “30,000 foot view” of capacity from funding agencies’ perspectives.   As one who has worked with nonprofits in capacity building for many years, the discussion of tactics by the panel revealed little new information.  However, what was interesting in the presentation was the discussion of the “disconnect in thinking” between funding agencies and nonprofit agencies around the concept of capacity.  The disconnect in thinking can be summed up in this way:  When nonprofit agencies think about capacity building, especially in the context of seeking a capacity building grant, they really are asking for operating support for specific projects.  When grant makers talk about capacity building, they are talking about developing infrastructure.  Adapting an illustration that one participant gave, it is like a vegetable garden where the nonprofit is concerned about a particular plant in the garden and the grant makers are increasingly interested in the root system and soil that supports the entire garden.  In previous posts I have discussed the concept of initiating a capacity building conversation and also discussed capacity building in the context of resource development planning. In this post I want to discuss facilitating an organizational capacity planning process.

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Before discussing the process, we first need to define what is meant when we discuss capacity and capacity building. As we are reminded in that now classic primer on nonprofit jargon “in other words,” (external link) capacity is one of those “vague, quasi-occult terms” that evokes the need for outside “expert” consultants who understand the deep mysteries of the concept.  The unfortunate byproduct of such a misunderstood word is that the ambiguity of the term makes the concept of capacity and capacity building seem daunting to an organization.  So as an opening premise, I would like to suggest a clear and concise definition of capacity as “the sum total of the  strategy, management, staffing, infrastructure, resources and operation of an organization.” The process of capacity building then becomes the deliberate assessment and improvement of those core elements of capacity.  The following is a suggested facilitated process for capacity building.

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Assessment:  As with most organization development and performance improvement projects, the first step in the process is to take a systematic assessment of where you are right now.  There are several nonprofit organizational capacity assessment tools that can be found with a simple web search.  The grandfather of tools was developed for Venture Philanthropy Partners by the mega consulting firm of McKinsey & Company (external link).  This tool has been adapted by Marguerite Casey Foundation (external link) and has also been adapted by Social Venture Partners International (SVPI) and is available as an Microsoft Excel spreadsheet (external link). Taking the SVP tool as an example the rubric addresses: financial management, fund development, information technology, marketing and communications, program design and evaluation, human resources, mission, vision, strategy and planning, legal affairs, leadership development, board leadership.  Future versions of the SVP tool will address cultural competency and policy advocacy as additional areas.  My experience (and the experiences of a few colleagues) in using the SVP tool has been that the level of depth of the tool may be less relevant for smaller or grassroots organizations.  In these cases, another useful tool to consider is a “Tool for Assessing Startup Organizations” that was designed to be a due diligence supplement for grant makers (external link).  As I suggested, a web search will help identify additional approaches to capacity assessment. The point of drawing attention to several tools is less about “what  tool  to use” and is more about illustrating the need for a framework for systematically assessing your agency capacity.

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Once you decide on an approach, implementing a capacity assessment ideally takes a 360 degree approach that solicits relevant input from staff, board, clients, funding agencies and other stakeholders. The wider and more inclusive the process, the wider and more inclusive will be the insights on capacity.  Note:  I would be remiss to point out that online surveys can be an effective way to conduct an assessment.

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Dialogue and Planning:  The second stage of a capacity building process to create and intentional dialogue around the findings with three important goals that include: a) creating a shared understanding of where the agency is starting from and where it is going, b) deepening the spirit of community and commitment to strengthening the organization, and c) creating workplans that support capacity building.  While workplan development can be a time intensive process as I have suggested elsewhere I do want to underscore that reflecting on a capacity assessment should also be a time of building community and commitment.  The dialogue and planning process lends itself well to an “intensive” like a board and/or staff retreat, but also could be the basis for a “learning community” process that spans 4-6 months and includes spaces for homework and reflection.

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Action:  The third stage of is the action stage of implementing capacity building workplans.  Recognizing that capacity building is an ongoing commitment to continuous improvement, there needs to be the intentional structures to manage and monitor progress over time. Since capacity building is really about improving an entire system is also useful to think of implementation as a series of “rapid cycle tests” using a model such as the Plan, Do, Study, Act (PSDA).  There are a number of good primers for this model online, (external link). Finally, it is important to keep in mind that the action stage will likely taking an agency into new organizational territory and will likely require some investments in the professional development of the agency’s staff and board.

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Leverage:  The final step in a capacity building process is to be intentional about leveraging your efforts for capacity building.  This brings us back to my opening discussion of grant makers’ perspectives on capacity building.  The organization that invests in the systematic planning for capacity building is uniquely positioning itself to pursue a capacity development grant.  For example, I know of one agency that received a three-year capacity building grant after taking an entire year to asses and begin to implement a plan to build capacity that the entire board stood behind. Based on the demonstrated movement towards capacity, the agency was well positioned to seek a capacity building grant. A grant-writing acquaintance once stated that when it comes to capacity building grants that funding agencies “want to improve organizations –not rescue them,” and so it is imperative for organizations to start from a position of strength.  I believe that the leverage of capacity building grants is most effective when agencies are already engaged in the forward motion of capacity building.

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I recently read a great article titled “On not letting a crisis go to waste: an innovation agenda for Canada’s community sector” (external link) that reinforced the concept that the nonprofit community/social sector is being tempered as we continue to struggle out of the economic recession of the last several years. Implied and stated in the article is that agencies demonstrating vision, leadership, adaptability and innovation are the ones who will not only strengthen themselves but help strengthen and reinvent the social service and community sector.  For many nonprofits this journey of innovation and opportunity begins with an intentional facilitation of a capacity building process.

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As always, your thoughts are welcome.

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In my last post I asserted that the nonprofit organizations of tomorrow are being born out of the economic crisis of today.  In this current economic turmoil, there are many voices counseling the nonprofit world to increase “collaboration.” Unfortunately, many of these experts are using “collaboration” as euphemism for “merger and acquisition.”  However, unlike the opinions of these non-prophets (pun intended), I believe that the organizational tempering is less about “merger and acquisition” and more about vision, leadership, agility and innovation.  As a new operational model, authentic collaboration  needs to be grounded in sovereignty, aspiration, innovation and brought to life as a concrete operating strategy.  In this post, I wanted to outline what I consider to be the provocative questions that nonprofits (and nonprofit boards) need to consider before pursuing formal collaborations with other agencies.

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What are we trying to achieve through collaboration?  A first question that informs a discussion of collaboration is the fundamental question of outcome.  The expert perspective that “there are too many nonprofits,” may suffice as an efficiency justification for encouraging collaboration but for the individual agency struggling with the question of collaboration, efficiency is but one variable.  A nonprofit must clearly identify the drivers of collaboration.  The heart of the question is twofold.  First is a consideration of where an agency wants to be compared to where it is now.  In other words, what is the performance gap that needs to be closed?  The second question asks if collaboration is among the best ways to close the gap (systems-thinking knows that there is usually more than one “best way”).

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I would like to suggest that the question of outcome requires an agency to explore three dimensions of organization practice including its: Operating, Resource, and Social Impact models.  In the resources listed below,  I link to a couple of business planning documents that all discuss these three dimensions of practice.  Such and exploration ideally includes both inquiry and reflection.

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Resource Model: The current economic crisis sets up the  false dichotomy of a “merge or die” line of thinking.  “Our budget is shrinking, should we merge?” is one way to approach the question.  However, implicit in this approach is a scarcity mentality –namely, that there isn’t enough money to go around.  Illustrating this, I was recently talking to a colleague who made the blanket statement that he would “not encourage any agency to launch ambitious new plans in this economy.”  Scarcity thinking is one way to approach the resource model conversation but such an approach often misses larger conversations.  For example, I know an organization with heavy revenue concentration from stable long-term government grants.  It is also an agency that has a large number of volunteers, whom have never been asked for donations.  In the context of three straight years of government budget cuts, the stability of the organization was incrementally being threatened.  By revisiting the resource model of the agency, the decision was made to a build new revenue stream based on small individual donations. Two years into the plan the organization is on track to reinvent its resource development model.

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Operating Model: A second inquiry and reflection exercise is to consider an organization’s operating model.  Are services delivered effectively?  Can the system of operations be reconceived?  Such a conversation does not question the program strategy of an agency but looks for operating efficiencies. Conversations might focus, for example, on the value of collaboration to create “back office” efficiencies or the value of sharing space.

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Social Impact Model: the third conversation that informs the question of “what do we want to achieve?” is the conversation of social impact.  Here a group examines the heart of the organization through the lens of impact.  I can think of more than one nonprofit agency that has reinvented its programs and services to create a larger impact (or the same impact more efficiently).  Here is the greatest need for inquiry and reflection and, in my opinion, it is from this dimension of organizational practice where the best collaborative decisions are made.

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What are the models of collaboration?  Following inquiry and reflection, an agency needs to explore the various models of collaboration (and inherent philosophies of each).  In another post,  I identified five models of collaboration that serve as a good working outline of models.  (In the resources section below I reference a study documenting eight models). Too often groups think in polar opposites.  Merge and “go it alone” are simply two points on a scale of collaboration.  A thoughtful discussion of other collaborative models will help in articulating a collaboration strategy.

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What is the due diligence process associated with our collaboration? A third component of the strategic conversation around collaboration is to create a roadmap for exploring a specific collaboration model.  Making process a part of the initial conversation can help an organization get a clear picture of the scope of work, timeline and resources required to support the development of collaborative partnerships.  As with most organizational change efforts, developing collaborative relationships is subject to the old adage of: “fast, cheap, done correctly –chose any two.”   Collaboration, done correctly, takes dedicated resources of time and money and generally the faster you want it to happen the larger the costs.

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What does the collaboration process look like?  The final component of the collaboration conversation is to be visually clear about what the entire collaboration process looks like.    I have also written before about describing process from the perspective of visual learning.  In mapping out a process of collaboration, creating a visual understanding can assist an organization build a shared image of the change ahead. However, even if an organization chooses not to visually represent the plan, there needs to be a written workplan developed with clear milestones and markers of success along the way.

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Collaboration exists on many levels in organizations.  As this post is a  follow up to my last post, it is important to recognize that I am referencing collaboration that can fundamentally change the fabric of an organization.  Change that can lead to sharing space, affiliation or even merger is a deep process and is not the equivalent of collaborating with other agencies on a community event.  Embarking on the process of inter-agency collaboration is a major undertaking for any organization and carries with it the weight of seismic organizational change.  Facilitating collaboration requires more than simply running a good meeting and requires the thoughtful attention to inquiry, reflection, and process.

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As always, your thoughts are welcome.

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Resources:

The Process of Social Entrepreneurship: creating opportunities worthy of serious pursuit

Business Planning for Enduring Social Impact

Models of Collaboration Nonprofit Organizations Working Together

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I recently read, yet one more so-called expert advice column promoting the ultimatum of “merge” or “die” as the pathway for many nonprofits. In this iteration, the ultimatum arises out of the knee jerk reaction caused by the recent economic downturn. Citing duplication of service and competition for scarce resources, some foundations, philanthropists and many in the nonprofit consulting industry are becoming almost evangelical about the merger and acquisition strategy for social sector organizations.  For example, the leader of one organization that provides training and support to Oregon nonprofits made the statement that perhaps their agency “should serve as birth control for nonprofits,” adding that there are so many nonprofits and that money is scarce.  I agree that there are a fair number of nonprofits with bad business models and that even many stronger nonprofits have been severely damaged by the economic chaos of the last couple of years.  As I have posted elsewhere, I also agree that collaboration, at some level, is appropriate an appropriate strategic conversation for many nonprofit organizations.   However, having external funding agencies, philanthropists and a consulting industry pressuring nonprofits to either merge or acquire as “birth control” is, at best, narrow and unimaginative and, at worse, self-serving and bullying behavior. We would never think of being as paternalistic to “for profit” companies as we are towards social service agencies.

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While economic concerns among nonprofits are real and there are duplicative agencies competing for scarce resources, the driver for collaboration can’t be reduced to economics alone.  Economic solvency is a lazy marker for effectiveness or impact and to impose collaboration based on economics alone is misguided. Just as in the private sector, success for social sector agencies is determined by a combination of products or services, leadership, agility and capital.  Designing a facilitation process with nonprofit agencies facing financial challenges should not begin with the condescending assertion that merger is the assumed pathway. Rather, catalytic facilitation includes a multi-dimensional exploration of capital in the context of products or services, leadership, and agility.  I would like to suggest several guiding principles for facilitating such a process.

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Sovereignty:  In working with any organization, the spirit of sovereignty must be respected and embraced in the change process. Organizations in the midst of fiscal challenges need to be empowered from the strength of their sovereignty. While I believe that empowerment is a foundation of my consulting practice, empowerment becomes the dominant frame in a process might include as an outcome a collaboration that alters an agency’s autonomy.

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Aspiration: During times of fiscal challenge many organizations default to a “circle the wagon strategy ” where decisions are made from the framework of enduring the financial assault.  Unfortunately, this is precisely when the message of “merge or die” is often introduced from some “sage” consultant. In reality, the most helpful process to an agency is not an ultimatum to merge but is a process that  that focuses on aspirations. Economic challenges should cause an organization to refocus on mission and vision.  Considering the question of “why were we called to exist” can re-energize an organization to positively rethink the foundations of strategy and social impact.  Spending time on the aspirational question of “why” is critical as a precursor to considering any pathway to cope with economic challenges.

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Catalytic Innovation: I have been doing a fair amount of reading on the concept of “catalytic change” for social service organizations (see a couple resources below).  A key question of this emerging body of literature is “how can we create a strategy that achieves measurable impact?”  Implied in that question is looking for the second and third right answer and thinking bigger. The challenges imposed by economics are really opportunities to rethink “how” the “why” is implemented.  Spending time in the space of “how we get to the why” breeds innovation. The interests of convention, power and assumption that are united to say, “merge or die”  chokes the possibility of  innovation.

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Alternative Reality: I started out this post lamenting the over-simplistic “merge or die” advice being metered out nonprofits and suggest that agencies in the midst of economic turmoil need to take the opportunity to go deep within their core competencies to find their own solution.  However, in community organizing there is the old saying that “the price of success is a constructive alternative” and so the final step of the reflection and planning process is the creation of a thoughtful alternative plan.  Intentional planning for how an organization will move forward while under economic siege requires leadership, vision and boldness as well as tactical and measurable action plans.

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The organizations of tomorrow are being born out of the economic challenges of today.  The dominant voices argue that the organizations of tomorrow are those who are merging and acquiring today. I would argue that successful organizations of tomorrow are already visioning tomorrow and allowing the economic challengesof today to temper their core competencies of leadership, agility and innovation as they create their own future.  In this context there is a need for catalytic facilitation and process to help social sector organizations, thoughtfully reflect, plan and move confidently forward to create a more civil society.

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Resources:

Disruptive Social Change

Catalytic Philanthropy

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I will confess that I am a visual learner.  I like to not only see the big picture but to be able to draw it as well.  This inclination towards a visual process has served me well in facilitation.  In fact, I have staked out the position that visual learning is a critical facilitation skill.  Recently, I have been thinking about the use of visuals to convey Social Impact. If asked, how many agencies could draw a clear relationship between  the programs and services they offer  and the social impact that is created as a result of what they do? While visualizing social impact may seem like a fairly simple concept it is under-utilized as a tool to communicate the core social change embedded in the mission, vision, programs and services of organizations.

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Recently, I have been working on several projects that involve helping agencies articulate a plan for growth and sustainability.  None of these groups have visual models of impact and it becomes a powerful exercise to help these teams create a visual representation of their social impact. While there are likely many paths to creating a visual social impact model, I would like to outline four models to introduce the concept.

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Pathway Model:  One of the more generic processes of creating a social impact model is to describe the pathway between the current reality and the future vision. For example, if an agency envisioned a community where 80% of children are reading at grade level in 5^th grade and the current statistic was that only 66% of students met that benchmark a pathway approach would anchor 66% of kids at one end and 80% of kids at the other end.  The facilitator would then lead the group through an open-ended conversation to describe what happens between those anchor points as the pathway steps that would close the gap.  If facilitated well, creating such a pathway would reveal if there is capacity in the agency to create the desired social impact. The weakness of a generic pathway model is that it is open-ended and prone to subjectivity because it does not lock groups into thinking in a structured cause-to-effect process.

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Logic Model: While somewhat academic, developing a logic model is an excellent way to visualize social impact. One of the reasons a logic model works well is that it offers a framework for working sequentially from resources to impact.  Here is a link to an excellent guide on creating logic models developed by the WK Kellogg Foundation. Developing a logic model starts with creating the linear categories of: Input, Activities, Outputs, Outcomes, and Impact.  The facilitation process can start with either end of the continuum and moving either forward or backwards.  So if your Impact vision is that 80% of 5^th grade children reading at grade level, then the first backward question is “What Outcomes do you need to see as milestones towards that Impact?” Outcomes that support the impact might include improved test scores, policies changed, number of school institutionalizing programs.  Moving one more step back to Outputs, the group would then describe the service delivery indicators that could cause the Impact. Output indicators might be such things as the number of children participating in programs, number of parents being engaged in the process, etc.  Further back, Activities describe what the organization does to cause the Outputs and, further back still, the Resources describe the assets that the agency has to dedicate to the task.  Conversely drawing a logic model can start with Resources and move forward to Impact.  Logic models work as a visual orientation because it forces a team or an agency to consider the relationship between resources and impact.  Are the resources adequate to produce the activities, outputs and outcomes that create the desired impact?  If not then the choices are to either scale back the impact or increase the resources dedicated to the change effort.

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Outcome Mapping:  Another model for visualizing social impact is an outcome map. Similar to a logic model an outcome map sequentially considers the organizational process from strategies to impact.  A useful guide on creating an Outcome map comes out of Organizational Research Services’ experiences evaluating an Annie E. Casey Foundation projects. One difference between using outcome mapping and a logic model is that outcome mapping has been used extensively to describe social impact in the context of community driven processes. Outcome mapping is better tailored to encourage full participation of stakeholders and the community.  An excellent in-depth exploration of a community and participatory approach to outcome mapping can be found at the International Development Research Centre.

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Social Impact Model™ A fourth visual representation of Social Impact can be found in the trademarked model of describing social impact that was developed by Root Cause.  The Root Cause model, bridges the gap between problem and solution through the clear representation of the Strategies and underlying Operational Model iteratively informed by clear Social and Economic Indicators and Organizational and Performance Indicators.  A full description of the Social Impact Model is found at the Root Cause website.

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The point of outlining four models for describing social impact is not to suggest one approach over another or to prescribe how visualizing social impact “must” be done.  The purpose is to introduce several models that can frame the concept of making explicit the connection between the mission, vision, and program structure of an organization and the Social Impact of the organization.  In an age of accountability and the focus on outcomes and change, organizations need to be able to clearly articulate what social impact they influence or cause.  Finally, while describing social impact may appear to be a “nonprofit” concern, the increasing focus of private sector companies on a “double” or “triple” bottom line suggests that describing social impact is a model for any social enterprise.

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It is my belief that the effective organizations of the future are those who are clear about their purpose and their social impact and can draw the picture to illustrate the connection.  As a result, facilitators need to be skilled in the process and visualization required to help organizations create a social impact model.

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As always, your feedback is welcome.

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In one of the early posts to this blog I offered a taxonomy to help nonprofits think about organizational capacity, resource development planning and fundraising.  In that post I described capacity development as the practice of developing and maintaining staff skills, organizational systems and intellectual and physical resources required to meet your organizational mission. In short, I suggested that capacity building is thinking about what it takes to maintain and build your organization.  I have been working with several organizations on thinking about organizational capacity and thought I would revisit the concept of capacity in a little more detail.

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If you do a Google Search on the term organizational capacity you will see that there is not shortage of resources to help organizations think about capacity building (I reference a couple of the most practical resources below). Unfortunately such a search will reveal a couple of things.  First it will show that successful companies invest in infrastructure and capacity as a normal part of doing business.  Second it will show that in the nonprofit world, agencies strive to under-invest in capacity as a way to demonstrate “effectiveness.”  The idea is, “our overhead is low so we must be good.” This disconnect between the “for profit” and nonprofit agency thinking about infrastructure has been described by at least one set of authors as a starvation cycle. In the long-run, it is argued, under-investing in agency capacity is detrimental to any organization, The purpose of this post is not to overview all of the elements of capacity or even discuss how to build capacity but offers a facilitation approach to a strategic conversation about capacity building. What kind of conversation will result in an agency specific plan to develop capacity? While this post is geared towards nonprofits such strategic conversations might have place in commercial ventures as well.

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Organizational capacity has the domains of: a) governance, leadership and strategy, b) organizational systems and infrastructure, c) reliable and autonomous funding, d) strategic partnerships, e) evidence based programming, and f) evaluation and outcome systems.  On one level, capacity can be measured using rubrics and other metrics to identify gaps between where an organization is now and where it needs to be.  Philanthropic foundations that fund capacity building efforts often take this quantitative approach.  However, capacity building can rarely be reduced to a “present or absent” checklist. Rather, capacity is better reflected as a strategic conversation that involves, story, aspiration and strategic intention. I would suggest that there are four questions inform a strategic conversation:

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Where are the Critical Weaknesses?  While I just suggested that an objective assessment of the capacity portrays an incomplete picture of agency capacity, such an assessment does need to be the starting point of a capacity exploration.  While assessment of an established nonprofit agency might involve a more substantive assessment than is required in assessing a smaller agency, an objective review of capacity domains serves as the baseline understanding that frames the conversation.  In this assessment, agency staff, board and possibly other stakeholders need to engage in frank discussion about critical weaknesses requiring immediate attention.  One can think of any number of critical weaknesses such as a lack of adequate fiscal controls or a lack of HR policies and procedures that could trigger immediate action.

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What are the Leverage Points?  A second question reflects on agency capacity and explores what is the leverage effect of focusing capacity building on one single element.  Is there one part of capacity building that can be leveraged to advance the agency’s larger goals?  For example, one agency that I worked with was planning to launch a fundraising campaign targeting small donors.  Prior to implementing the campaign the agency invested in capacity by redesigning its website to make online donations easier.  When the small donations campaign was launched, online donations represented the primary donation method and the revenues exceeded the investment in the website redesign by a large percent.

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Where are the Opportunities?   Another component of the critical conversation is to discuss the opportunities that present themselves.  In this challenging economic environment, a discussion of capacity might be a good time to explore concepts of reducing overhead to increase capacity.  Discussions of co-housing agencies or even the big “M word” (merger) might be fair game in the discussion of opportunity. In this case, sharing overhead might actually free up resources to invest in other facets of capacity. For some agencies strategic conversations about capacity resulted from opportunities presented by prospective Federal stimulus dollars.

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Where is the Energy and Passion?  A final question that can inform capacity discussions is one that is best answered when the process is opened to the broader community of volunteers and other stakeholders.  By opening the scope of perspectives, the conversation can increase vision, energy and passion.  For example, younger volunteers might use their instinctive technology skills and take the lead on developing a new social media outreach campaign for the agency.  In another example, an executive director told me the story of hosting a capacity building conversation including the agencies that funded them.  The conversation surfaced the fact that one of the funding agencies was going through a department-wide upgrade of computers and because of the conversation the agency decided to donate their older machines to the nonprofit. For a couple hundred dollars to install, configure and network the computers the executive director said it resulted in a significant technology upgrade and standardization of computers for his agency.

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With these four framing questions the next step to consider how you structure a strategic conversation about agency capacity.  Hosting a strategic conversation about capacity could neatly fit into a board/staff retreat or a similar block of at least 2-4 hours.  As suggested earlier, while not an end to itself, a capacity needs assessment should be conducted prior to the strategic conversation.  With a block of time dedicated to the task and assessment data complied, a strategic conversation might include the following format.

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1. Presentation of the Assessment Data:  Whether you use traditional presentation slides, story telling or other visual representation, it is important that everyone in the team is oriented to where the agency stands now.  The second part of the assessment presentation is to frame the vision of where the agency could or should be.  By presenting where you “are” and “where you want to be” you identify the gap that needs to be filled.

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2. Reflection and Movement Building:  The second step of the strategic conversation is to create the opportunity for the group to reflect and engage.  While movement building is perhaps an ambitious word to describe this stage, the idea is to not just talk but to create energy and excitement around the potential. This stage might be achieved by a modified scenario planning exercise, appreciative inquiry process, or by using more traditional prioritization exercises.

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3. Create Strategic Intentions: The third step is to create strategic intentions around capacity. Strategic intentions in this instance ate narrow and focused around the capacity needs and, while in sync with the agency strategic plan, are more likened to key implementation objectives.  The task for this phase of the conversation is to break capacity building into components that can be managed as a whole.  For example, moving from annual fiscal reviews to a formal audit might be one intention and a separate intention might be the development of a donor relationship database. Both together, however, are about improving fiscal management.

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4. Develop an Implementation Plan: The final stage of the conversation is to develop broad implementation strategies. In this stage, there should be a range of creative strategies developed to achieve the strategic intents.  In some ways the strategies might look more like a brainstorm list than a step-by-step workplan. By having broader implementation plans allows for adaptive management of an array of opportunities.

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5. Document the Agreements and Plans: As in all group process there needs to be some documentation of the strategic intents and implementation plan. Communication and feedback loops also need to be built into ensure accountability to the plan.

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Agency capacity is intimately tied to the long-term growth and success of any venture.  Unfortunately, in the nonprofit world, many organizations have been acculturated to under-invest in capacity.  This cycle needs to be broken.  Capacity building needs to be acknowledged as a core responsibility of nonprofit agency management and all strategy must include the development of strong systems and infrastructure that support the missions of the organization.  Hosting a strategic conversation that results in concrete yet flexible action plan is a major first step to raising awareness of capacity needs.  Such awareness has never been more needed than in these challenging social and economic times. An agency willing to have a strategic conversation about capacity will find that such an investment results in the rewards of a clearer focus and greater infrastucture to carry out one’s organizational mission.

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As always your feedback is welcome.

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In Depth Capacity Assessment tool:  Venture Philanthropy Partners Capacity Assessment Grid
Great qualitative tool for smaller agencies: Tool for Assessing Startup Organizations

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In this series on strategic planning, my goal is to outline principles that inform the development of a strategic planning process.  The first principle is that agencies need to connect the planning process and their organizational culture.  The second principle is that strategic planning must be tied to a clear and specific agenda in order to be beneficial.  In this post the principle of momentum and process is introduced.

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Previously I used the illustration of a new Executive Director of a nonprofit agency who had inherited a series of iterative yet similar strategic plans from her predecessors.  As she and I spoke about these plans it became clear that her need was to create momentum and process for the board and staff around the existing strategic plans rather than creating a new plan. The fallacy of many strategic planning processes, I suggested, is that many agencies treat strategic planning as “an event” or “a product” rather than seeing strategic planning as the launch point for a process that requires momentum and long-term engagement.

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Consider how many strategic plans are developed.  Senior management or the board of an agency decides that a strategic plan needs to be created (typically tied to a three or five year planning cycle). So a retreat is scheduled at some off-site location and everyone is convened.  The goal is to spend a period of time engaged in a facilitated process involving many pages of easel chart paper. Events like these range from an irrational 4 hours to a more rational span of a couple of days. Usually a small team or an external consultant then digests the proceedings and puts them in the context of a document that is launched a couple of weeks later.  The written plan often contains goals and objectives and in some cases maybe even a workplan.  However, it is precisely at this point where more than one strategic plan dies.  The reason for the death is that “the event” is over. When the plan arrives on the desk or in the email box of the staff members, any momentum created in the planning retreat has long since been consumed by the day-to-day work and the plan becomes just one more “data point” competing for time, energy and attention. Raise your hand if this description resonates with you.  Whoa, look at all those hands.  Okay you can put your hands down. How can the process be different?

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As the two previous posts suggest, reflective thinking is required before embarking on strategic planning.  By considering how the strategic planning process will support and reinforce an organizational culture and by focusing the process on a clear strategic agenda, an agency has already set in motion a dynamic that will produce a different kind of strategic plan.  The third reflection that will give a different energy and life to the plan is to carefully consider how your agency will create an “implementation environment” for the plan.  This should not be hard to do because a strategic plan has the embedded DNA of motion and action in the goals, objectives and workplan. While strategic planning is typically based on an assessment and collaborative planning (such as a retreat) an agency needs to also create an intentional process that empowers staff members and provides resources to support the plan implementation.  Here are three ideas for creating process and momentum for strategic planning.

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Share Leadership before the Process: Too often strategic planning is a function owned by the senior staff and/or agency board.  I have observed this even in organizations that otherwise have an egalitarian management style.  Incremental change can be managed narrowly but strategy is inherently a broad, systems-level level function that must be shared.  As the authors of  Forces for Good: The six practices of high impact nonprofits, eloquently observe, that only by giving power away and empowering others do groups develop networks and movements large enough to catalyze widespread social change. One way to create a model of shared leadership is to involve the entire team in the pre-planning process.  Using an appreciative inquiry model or another deliberative dialogue process, all stakeholders should be drawn into the circle of leadership and as the process is planned everyone has a voice and understands that s/he has a stake in the success of the planning process.

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Creating a Shared Space: One powerful way foster momentum and process is to create and facilitate “shared space,” where everyone involved has a place to “gather” and “contribute” to the implementation of the plan.  For example, a couple months ago I was at a meeting at the offices of a small and nimble nonprofit agency.  While the space was cramped one large wall had a large 4’ X 6’ dry erase board that had a series of performance metrics packed with visual tracking diagrams such as a thermometer and a pie chart color coded by month.  The board captured the major operating principles of the agency’s strategic plan and the entire team could update, annotate and collectively track progress towards the goal.  For larger organizations and distributed teams technology might play a significant role (here’s how).

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Resource the Process:  A third idea for helping to create momentum is to fully resource the implementation process. I have seen more than once a company pour a lot of resources into the front-end of the planning process by such things as hiring consultants, hosting off-site planning retreats and developing four-color glossy published documents at the end of the plan but then expect the plan to remain a living, animated document without any additional resources.  Resourcing the implementation of the strategic plan is important to the plan’s success. At a minimum, resources need to include: a) time for staff to devote energy and effort to the implementation process, b) additional staff training or other professional development related to plan implementation, c) creation of feedback loops, and 4) the designation a process facilitator.  Without the time, knowledge, tools, and a facilitator with the authority to keep the team focused, engaged and supported then strategic planning runs a high risk of being a “product” or “event” rather than a process that significantly advances the agenda of your agency.

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Aligning strategic planning with your organizational culture, defining a clear and compelling agenda, and creating structures to support the implementation process are three principles to consider before implementing a strategic plan.  The next post in this series will close the loop by discussing the principle of accountability in strategic planning –  who is accountable, to whom, and for what?

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As always, your comments are welcome.

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Facilitators are often called in to help design projects involving multiple stakeholders such as in convening interdepartmental workgroups, cross-functional teams or inter-agency committees and coalitions. For these assignments one of the key assessments that the facilitator needs to make is to determine whether the convening is for the purpose of accomplishing a task or for the purpose of creating collaboration. When I inquire about this I sometimes hear, “I thought every time you brought people together it was for collaboration?” I explain that there is a difference between working together and collaboration. This distinction is not so subtle. Facilitating the development of a product with multiple stakeholders giving input requires a facilitator to create clear expectations, foster information sharing, follow though and problem-solving and tracking progress. Facilitating for the purpose of developing collaboration requires organizing the stakeholders around a common model that is congruent with the sought after outcomes. Developing a product requires tactically working together where collaboration suggests a “shared mind” or shared systems view. (1)
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When facilitating for collaboration the first task is for the stakeholders involved to understand and agree to the model of collaboration. In this process, a key role of the facilitator is to clearly describe models of collaboration and have a toolbox big enough to implement the models based on the customized and tailored needs of the group. At this deeper level, collaboration models typically have distinct organizational and governance structures attached and, in some cases, have legal structure implications. My intention is clearly not to offer legal advice but to simply introduce five models of collaboration that can serve as the basis of collaborative groups and teams.
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Coalitions: The most readily assessable model of collaboration is the community coalition model. In a community coalition the focus of the collaboration is to concentrate the collective power of the members and focus it on action. Typically coalitions have membership guidelines, operating procedures and often bylaws, governance structures and elected leadership positions. There is a fairly large literature base and many textbooks describing the process and functioning of effective coalitions. Collaboration is based on shared goals and vision related to the action agenda. At times, coalitions use structured memoranda of understanding to help operationalize the collaborative process. A Google search will turn up numerous references for developing coalitions. One succinct primer on coalitions was developed by the Prevention Institute.
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Communities of Practice:  Collaboration based on the concept of “communities of practice” involve the creation of a “learning guilds” that support the development of shared expertise and competencies. Developing collaboration around this model primarily focuses on distributing knowledge, competency and building networks between people. While the concept of communities of practice has appeared in the knowledge management literature for at least two decades, Etienne Wenger is one theorist that clearly develops the theoretical framework for this model.
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Cooperatives:  A third model for collaboration is found in the concept of developing a cooperative. The drivers for cooperatives are seven principles relating to membership, control, participation, autonomy, learning, networking and social responsibility. Through co-ownership and participatory governance, a cooperative model has potential to encompass both learning and action. The University of Wisconsin has a great resource center dedicated to cooperatives.
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Cohousing: At first glance the model of co-housing communities might seem a bit abstract to apply to the business or nonprofit sector. Cohousing is a property ownership and management concept where groups of individuals co-own homes that have elements of both social contact and individual space. Typically, cohousing communities have common facilities such as open space, courtyards, play space, and, in some cases, even shared living space like a communal kitchen. The governance structures for co-housing communities are egalitarian or even Socratic and emphasize problem solving and unanimity. Leaping to inter-agency collaboration, governance around shared values and interest in commons can be powerful. In a day when agency mergers increasingly being seem as a way to keep similar mission driven organizations viable, a co-housing model may be an instructive alternative that allows agencies to retain independence by designing and operating collaborations out of a shared space. A resource on Cohousing is the Cohousing Association of the United States.
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Industry Clusters: A final model for collaboration to consider is found in the concept of industry clusters. Industry clusters are basically the associations of companies that share the same maket-space in a particular geographic location. The concept is to create a critical mass of related technologies, workforce and suppliers linked by buyer-seller or peer-to-peer relationships. The intended outcome is that “firms and workers in an industry cluster draw competitive advantage from their proximity to competitors, to a skilled workforce, to specialized suppliers and a shared base of sophisticated knowledge about their industry” (Reference: Oregon Clusters Website). Collaboration in an industry cluster approach balances the needs of individual companies and organizations against the larger need of the entire market with the goal of creating a network effect where the whole that is greater than the sum of its parts.
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There is a myth perpetuated that “collaboration is an unnatural act” but thinking about the models and process of collaboration is, at its core, systems thinking. If we are intentional about imagining what collaboration could look like, it can serve as a frame for a strategic conversation about the role collaboration plays in strengthening the capacity of stakeholders as they seek to expand, grow and achieve a common mission.
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As always your comments are welcome
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(1)One critical texts that needs to be on your shelf is Michael Scharge’s book No More Teams!: Mastering the Dynamics of Creative Collaboration.
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