Peter York's slides from the AZENET Conference on Organizational Effectiveness May 8 and 9

1. Peter York
Senior Partner
Chief Research & Learning Officer
TCC Group

2. Agenda
1. Nonprofit Effectiveness: Who Are We Talking
About?
2. Effectiveness for All
3. Sustainability: How Leading, Adapting and
Managing Matter
4. Growth & Scaling: How Program Codification,
Replication & Resource Generation Matter
5. Strategic Learning: The Key to Effectiveness
2

4. The Micro and Macro Impact Ecosystem
Types of Nonprofits:
Macro Strategies
Change populations en masse through 1. Macro – Policy/Advocacy,
adding, changing, monitoring and/or Systems
evaluating system and/or institutional laws,
regulations, funding allocations, standards,
practices and/or policies 2. Micro – Direct Service
Social 3. Hybrid
Problem
or
Desired 4. Intermediaries
Impact
Micro Strategies
Change individuals, families and small groups,
through implementation of funded programs, and
on-the-ground enforcement and/or adherence
programs for new or improved
laws, regulations, policies
4

5. Types of Nonprofits
Neighborhood Organizations
Scalers Grassroots organizations
• Serves local neighborhood
10% • Either macro or micro, narrow set of
services
• Addresses basic needs
• <$150K
Community Organizations
• Serve multiple neighborhoods
Small • Broader array of services
Businesses • Macro, micro and/or hybrid
• Employ multiple strategies
20% • Reach $1M+
Mom & Pops
Scaling Organizations
70% • Work across many communities
• Develop replicable models w/in macro
and/or micro
• Codify way to achieve goals
• Networked/affiliated
5

7. The Four Core Capacities Model
External Environment
Resources
Human
Facilities Resources
Organization
Adaptive Capacity
the ability of a nonprofit organization to monitor,
assess and respond to internal and external
changes .
History
Leadership Capacity Management Capacity
the ability of all organizational the ability of a nonprofit
leaders to create and sustain organization to ensure the
Time the vision, inspire, model, Organizational effective and efficient use of
Technology
prioritize, make decisions, Culture organizational resources
provide direction and innovate,
Language
all in an effort to achieve the
organizational mission.
Technical Capacity
the ability of a nonprofit organization to implement all of
the key organizational and programmatic functions
Finances/ Program
Funding Design and
Model
Key Resources
the one or more critically needed resources
that most directly support programs and services
7

8. The Lifecycle Model
All organizations
go through
stages of Impact expansion through
Stage 3 sharing, collaboration and/or
development and
collective action
have to “get their
house in
order” (achieve
lifecycle stage 3) Infrastructure/business development to
before they are Stage 2 sustain and grow results from the core
ready for program/strategy model
collective action.
Core program or strategy development for direct
targets:
Stage 1
Micro = individuals, small groups
Macro = populations, system change agents, etc.
8

9. Organizational Effectiveness
Leaders Get
Resources &
Impact
Direct Collaborative Resources Impact Expansion Social Impact
Expansion
Managers
Deploy the Infrastructure
Operational Resources Business Processes
Development Sustain & Grow
Resources
Program (Micro)/ System Program Delivery/
Core Program Client/Target
Leaders (Macro) Resources Development
Strategy Deployment Changes
Design & Plan
9

11. Organizational Resource Sustainability of CCAT Orgs
Challenged
Strong
30% 28%
Satisfactory
42%
11

12. The Sustainability Formula
Program
Leadership Adaptability Sustainability
Capacity
12

13. The Sub-Capacities that Matter
Internal Leadership Program Staffing
• Applying a mission-centered, • Making staffing changes as
focused, and inclusive needed to increase and improve
approach to making decisions, programs and service delivery
as well as inspiring and Empowering
motivating people to act on
them • Promoting proactivity, learning,
and a belief in the value and
Fundraising Skills ability of staff and client
• Developing resources Leader Vision
necessary for efficient
operations, including • Formulating a clear vision and
management of donor relations motivating others to pursue it
13

14. There’s More to Leadership…
• Effectively communicating mission and vision
• Engaging all stakeholders in planning
• Making decisions on cost-effectiveness
• Implementing quick fixes
• Holding leaders accountable for recipient/target results
Only one in four nonprofit organizations are well led…
14

15. The Key to Leading Is Learning
• Gathering sophisticated program and business data
• Determining formulas for success
• Engaging in data-driven planning
• Measuring and managing performance
Only one in four nonprofit organizations are effective learners…
15

16. There’s More to Program Capacity…
• Effective staffing
• Infrastructure growth to keep up with program growth
• Continuous program delivery improvement
• Continuous program management improvement
• Facilities
Only one in seven organizations have strong program capacity...
16

18. Some Nonprofits Grow Faster than Others
• Only 1 in 2 nonprofits grow faster than the annual
inflation rate over a three-year period.
• Five measures of organizational capacity explain 20% of
the reasons why an organization grows faster than
inflation:
1. Program Design (Strategic Learning/R&D)
2. Program Replication
3. Independent Program Resource Generation
4. Program Sustainability
5. Growth Rate Stability
18

19. How Well Are Nonprofits Doing?
Independent Program Resource Generation (1 in 50)
Program Reliability (1 in 50)
Program Design (1 in 25)
Program Sustainability (1 in 3)
Organizational Stability (1 in 2)
19

20. The Building Blocks of Nonprofit Growth & Scaling
Program
• Centralized Program Design Leadership
Reliability &
Program- Expansion
Centered, Management
• Program-Centered Independent, Sustainable and
Independent,
Diversified Resource Generation
Sustainable,
& Diversified
• Program Reliability andResource Management
Expansion
Generation
Centralized
Program
Design
Leadership
20

21. The Program Design Leader’s Checklist
q Gather data directly from q Identify patterns and themes in
program recipients to program data that show which
determine how to improve program ingredients worked,
services for whom, and how.
q Decide on outcome metrics q Bring program design leaders
by first listening to, together to address the
documenting, and sharing resources needed to deliver
actual client success stories programs effectively.
and results.
q Leverage insights to inform the
q Engage key leaders and staff program implementation team.
in making meaning out of
client-derived data.
21

22. The Resource Generator’s Checklist
q Make sure the strategic plan is q Invest your resources into
anchored in resourcing, strengthening and improving
strengthening and improving your programs/program
program impact, which is a models, and don’t invest in non-
significant predictor of plan programmatic infrastructure
implementation. until program growth hurts.
q Diversify the funding streams - q Keep your board and funders
particularly if your organization “out of the kitchen,” including
depends on a few large grants raising or providing program
from funders who have a say in funding, unless they agree to a
how programs are delivered. “no strings attached” policy.
q Acquire numerous repeat
givers, donors or buyers
22

23. The Program Manager’s Checklist
q Train staff to deliver the q Invest in program managers
program as it is designed. as implementers (staff or
volunteers) grow.
q Invest in ongoing training for
program improvements and/or q Have clear guidelines to make
modifications. difficult staffing decisions
based on program data.
q Assess program implementers
based on client results. q Develop cost-per-result
metrics to manage
q Leverage program data to accountability.
measure and monitor program
delivery.
23

24. The Developmental Model for Growth & Scaling,
and The Learning Tools to Get There
Build the Expansion Model to Replicate
the Model In More Communities Scaling Evaluation & Community Impact Studies
Build the Business Model to Grow Performance Measurement &
the Program in Our Community Growth Management
Build the Program Model Strategic Learning/
for Those We Serve Codification Research &
Development
24

25. strategies to achieve social impact

26. The Key to Effectiveness

27. strategies to achieve social impact

28. The Metrics, Methods & Analyses Are Wrong
• There’s NO outcome synchronicity between the
investor and investee
• There’s NO Research & Development for
programs/initiatives
• Effectiveness and accountability HAVE TO BE
viewed through the measurement of proximate
effect
• Proximate cause-and-effect is the ONLY way!
• Learning REQUIRES understanding the cause,
NOT the effect
28

29. The Outcome Synchronicity Problem –
A Comparative Example
For-Profit Accountability: Nonprofit Accountability:
Just Give Me the Direct Results, But Somehow Prove to
Just Give Me (or Show Me) the Direct
“Them” That We Can Do Much More…
Results, Please…
Nonprofit • Child Development, School
Business Readiness, Crime
Leaders & Reduction
Investors Business Clients • Parental Reduction in Child
Consumers Abuse & Neglect, Maternal
(Funders) Leaders
Health
Recuperation, parent-child bonding, healthy • Same Direct Results
adjustment to family change, tools for care and as the For-Profit Funders
feeding, stress-reducing routines and habits, better Business (Investors)
communication skills with providers
29

30. Evaluation: Using the Wrong Model
Community /
Short-Term Long-Term
Resources Strategies Social
Outcomes Outcomes
Impact
30

31. Strategic Learning: Changing the Model
Community /
Achievable Research
Resources Strategies Social
Outcomes says…
Impact
31

32. The Problems with Comparison Groups
We Did It
On Our
Own
Control
Group
What
About All
of Us?
Yeah! But,
Intervention
three of us
Group
would
have
succeeded
anyway
It made a Evaluator
significant Why did
difference What
the girls do
…the About Us?
better?
program
worked
32

33. strategies to achieve social impact

34. Five Guiding Principles for Strategic Learning
1. Listen to the client
2. Quantify, then qualify
3. Measure backgrounds, program experiences and direct outcomes
4. Don’t describe, analyze
5. Don’t report, design and re-design
34

35. The Seven Steps to Strategic Learning
1. Determine the “real” outcomes
2. Find or create the metrics
3. Gather data, quant then qual
4. Make meaning out of patterns
5. Create/modify program models
6. Re-design programs
7. Repeat steps 2-6
35

36. First, Uncover the “Real” Outcomes
• It’s all about the path to behavior change:
– Awareness +
– Knowledge +
– Attitude +
– Motivation +
– Skills +
– Opportunity +
– Behaviors =
___________________
Habits
36

37. Analyze Data
Hold one or more meetings and go through the following
process:
1. Create outcome buckets – high, medium, low.
2. Ask of this sorted data the following questions:
• What program components and combinations worked?
• What background factors played a role?
• What preconditions (readiness factors) made a
difference?
3. Finalize conclusions about what worked, for whom and why.
37

38. Make Meaning
Hold one or more meetings to discuss the following:
1. How should we change our program formulas? What do
we leave in, what do we improve and what do we take
out?
2. What resources do we need or need to change to
improve the program?
3. How can we leverage findings to garner more and/or
better resources?
4. How do we better “manage to outcomes,” moving
forward?
38

39. strategies to achieve social impact

41. Types of Nonprofits

42. The Micro and Macro Impact Ecosystem
Types of Nonprofits:
Macro Strategies
Change populations en masse through 1. Macro – Policy/Advocacy,
adding, changing, monitoring and/or Systems
evaluating system and/or institutional laws,
regulations, funding allocations, standards,
practices and/or policies 2. Micro – Direct Service
Social 3. Hybrid
Problem
or
Desired 4. Intermediaries
Impact
Micro Strategies
Change individuals, families and small groups,
through implementation of funded programs, and
on-the-ground enforcement and/or adherence
programs for new or improved
laws, regulations, policies
42

43. Types of Nonprofits
Mom & Pops
Scalers • Grassroots organizations
• Serves local neighborhood
10% • Either macro or micro, narrow set of
services
• Addresses basic needs
• <$250K
Small Businesses
Small • Serve multiple neighborhoods
Businesses • Broader array of services
• Macro, micro and/or hybrid
20% • Employ multiple strategies
• $250K - $1M
Mom & Pops
70%
Scalers
• Work across many communities
• Develop replicable models w/in macro
and/or micro
• Codify way to achieve goals
43

44. Capacity Building Effectiveness = “Ready, Set, Go”
Awareness, Knowledge, Attitude, Motivation, Skills Opportunity, Behavior, Habit
Ready Set Go!
Skills:
• Awareness • Plans • Assisting
• Know-How • Tools • Showing
• Motivation • Resources • Doing
• Instructions • Feedback
Support:
• Education • Resources • Coaching
• Training • Tools • Mentoring
• Consulting • Technical Assistance
• Technical Support
“Go” Services ensure that behaviors happen, habits are formed, and changes are sustained
44

45. Seven Steps for Capacity Strategy
1. Determine what type of org 5. Determine who needs to
you are – Mom and Pop, change.
small nonprofit business, or
scaler. 6. Determine whether the
individuals or group are
2. Assess your organization’s “ready to go” or “need to get
size. ready.”
3. Assess your organization’s 7. Determine a cost-effective
lifecycle. model for supporting capacity
building.
4. Assess your organization’s
capacity needs.
45

46. The Lifecycle Model
All organizations
go through
stages of Impact expansion through
Stage 3 sharing, collaboration and/or
development and
collective action
have to “get their
house in
order” (achieve
lifecycle stage 3) Infrastructure/business development to
before they are Stage 2 sustain and grow results from the core
ready for program/strategy model
collective action.
Core program or strategy development for direct
targets:
Stage 1
Micro = individuals, small groups
Macro = populations, system change agents, etc.
46

47. The New Lifecycle Model: Size Matters
Only
10%
of nonprofits
reach or
exceed this
point
75%
The Sky is the Limit
of nonprofits
sustain at or
below this level
Infr
ent astr
ve lopm uctu
re R
e
eD edu
ctur ctio
a stru n
Infr
Program Development Program Reduction
$250,000
$1,000,000
$500,000
$3,000,000
$5,000,000
$10,000,000
$10,000,000
$5,000,000
$3,000,000
$1,000,000
$500,000
$250,000
47

48. Assessing Lifecycle Stage and Capacity Needs
Infrastructure
Core Program Collective Impact
Development
Internal leadership and Internal leadership to Scalable models for
Leadership vision to design, sustain sustain and grow community impact and
and grow program model business model system change
Organizational Evaluation, planning,
Needs assessment and assessment for and process
ongoing evaluation (SL/ sustainability and implementation for
Capacity Needs
Adaptive R&D) to sustain and business planning for community alliances,
grow independent resource collaborations, and
generation for growth system reform efforts
HR and infrastructure
Strong program
management and
management and Alliance and partner
Management implementation for
performance
management
measurement for
sustainability and growth
sustainability and growth
Operational and
Program delivery,
administrative facilities; Relationships, networks,
Technical resources and tools for
skills and tools for and resources
sustainability and growth
sustainability and growth
48

49. Who Needs to Change and How?
Does Not Know Does Not Want Needs
Instructions, Needs Practice
Who? How To and Confidence
(Ready – Awareness & (Ready – Attitude and Tools, Systems, (Go)
Knowledge) Motivation) Resources (Set)
• Executive Director Inform Counsel Instruct Mentor
• Board Members ______________ _______________ _______________ _______________
• Program Directors
______________ _______________ _______________ _______________
• Program Managers
• Operational Directors ______________ _______________ _______________ _______________
• Operational ______________ _______________ _______________ _______________
Managers
• Program Educate Direct Resources Coach
Implementers ______________ _______________ _______________ _______________
• Operational
______________ _______________ _______________ _______________
Implementers
• Community Outreach ______________ _______________ _______________ _______________
Directors ______________ _______________ _______________ _______________
• Community Outreach
Managers Support
• Community Outreach _______________
Implementers
_______________
_______________
_______________
49

50. The End