Ashley Lanfer

Moving Forward in Uncertain Times

In November of 2016, the Boston Globe reported on a pervasive sense of concern and uncertainty in the nonprofit sector as President Trump took office. The Globe reported Jim Klocke, CEO of the Massachusetts Nonprofit Network, as saying, “People are apprehensive, people are wondering what’s going to happen on a whole bunch of fronts. There’s an awful lot of concern out there.”

Six months later, the full effect of the new administration on the nonprofit sector remains unclear. But despite continued uncertainty, many of the nonprofits we serve want to move forward. To inform their planning at a time when the future is particularly hard to predict, they are looking to a variety of data sources and using the data in creative ways.

Here are three data sources our clients have drawn on to shape their assumptions and inform their plans for the future:

1.      One client looked to recommendations from the Heritage Foundation to the Trump administration on how to reduce the size and scope of government. Based in part on Heritage recommendations, our client chose not to hinge their growth plan on partnerships with agencies that Heritage had tagged for major cuts in government funding. The Washington Post confirmed the wisdom of this when it reported that the budget Trump released this spring bore a “striking resemblance” to the Heritage Foundation’s model.

2.      For another client, Wellspring conducted research on the scale and pace of budgetary changes after the election of another conservative American president who was determined to make big change, fast – Ronald Reagan. Under Reagan, cuts to social services came quickly, affecting nonprofit funding by the second year of the administration. Our client used this history as a guide for what they might expect under Trump. Now, they are proactively preparing for cuts on a similar timeline as what social service agencies saw under Reagan and are working to ramp up private funding in time to fill the gap.

3.      Several of our clients are learning from results of a survey of 162 foundation CEOs published by the Center for Effective Philanthropy. The survey assessed how foundations are altering their grantmaking as a result of the election of Donald Trump. It found that three quarters of foundation CEOs are making or plan to make changes in their work as a result of the election. The most frequently reported areas for increased emphasis were collaborating with other funders, advocacy and policy at the local or state level, and convening grantees. Only 1% expected their grantmaking to decrease, while 14% expected it to increase. Many respondents expected to increase funding in areas hard-hit by political change. Our clients are drawing on these insights to inform their conversations with funders.

Nonprofits need not be paralyzed by periods of uncertainty. If they look in the right places, they can find data that can inform their plans and prepare them to meet the future, whatever it looks like.

Funders Want to See “Skin in the Game.” Here are Three Ways to Show It

Image: Shutterstock

Image: Shutterstock

If a nonprofit leader is plotting a bold new move, he or she generally needs to inspire new support from a range of partners and donors in order to pull it off.  But how to do this when the new undertaking involves significant risk?

Careful research, a well-conceived business plan, and a clear and compelling pitch are certainly critical to developing buy-in. But my client work suggests another opportunity to inspire confidence from potential partners in the face of uncertainty that many nonprofits miss.  

Demonstrating that people have “skin in the game” – or have made specific commitments to the field of play – can have a powerful influence on those still standing on the sidelines. The term “skin in the game” is often used in business and finance. But in the nonprofit context it can refer to much more than monetary investment. And the “skin” can come from valued partners, the nonprofit itself, or the community it serves.

Here are three ways I’ve seen this work.

1. Put a dollar amount on in-kind contributions  

One of our clients had ambitious plans to take a pilot program and scale it up to serve a significant portion of all pre-K students and their families in a major urban school district. The program had strong evidence of effectiveness and the growth plan was well conceived. But the plan relied heavily on philanthropic funding, none of which had been committed yet.

In preparation for a meeting with a room full of funders contemplating investment in the plan, we worked with our client to make the Department of Education’s support for the plan concrete. While the DOE was not committing dollars to the program, they were committing their buildings, significant time from teachers and administrators, instructional hours, and professional development time. We put a number value on these critical resources. The total was impressive and helped inspire the major philanthropic investment that followed.

2. Show concrete commitments from credible partners

Another nonprofit I worked with asked its long-term university partner to make specific commitments to gathering and analyzing data on the effectiveness of a program the nonprofit hoped to launch. The commitment of intellectual resources from a respected university increased the credibility of the program to potential funders and other program partners.

But what if you don’t yet have a partner whose commitments you can leverage?

3. Lead before asking others to follow

Nonprofits can start with putting their own skin in the game. That can look like 100% Board giving to the new plan, over and above their gifts from the prior year. It can look like a major portion of their discretionary budget allocated to the new undertaking, or an investment in developing a strong business plan. It can look like a low-income community that raises funds internally through bake sales and barbeques before asking for external investment from donors. These efforts send a strong signal that the nonprofit has committed whole-heartedly to its plans and will see them through.

At the end of the day, showing skin in the game helps potential partners breathe easier, knowing that risk is shared and commitment is strong. 

From Magic to Manuals: a Hard but Worthwhile Transition for Social Innovators

In their early days of ground-breaking social innovation, many of the innovators I have known worked out of their proverbial garage, without much in the way of strategy or funding or staff. What they often did have was a gut-sense, growing day by day, that they were on to something big.

They may not have been able to name the critical elements of their approach – whatever those elements were had a kind of magic to them – but they saw the resulting breakthroughs (as did I, working and watching alongside of them)…

We saw street kids who society had given up on re-enrolling in high school. We saw parents reading for the first time with their young children. And we saw once-neglected seniors being well cared for by their neighbors and children.

In their early days, when they had some anecdotes but no data, I have seen social innovators do well to rely on intuition, opportunism, and adrenalin to hone their approach and advance their ideas.

But fast-forward a few years to a day when the social innovation had hard data behind it, demonstrating its transformative impact. At that point, the demands on the innovator looked very different.

Where agility and opportunism once served the innovator well, now commitment to a well-considered growth strategy was needed to win support and ensure impact.

Where the almost magical quality of the program was once a part of its appeal, now the innovator needed to treat any magic as a liability that must be codified or “manualized” so the program could be broadly replicated.

Where financial considerations may not have driven the work initially, now the innovator had to make them a significant part of the equation if the innovation was to realize its full potential for impact.

I have seen these transitions be challenging and sometimes even painful for social innovators to embrace. But if the opportunity for scaling the impact is real, these transitions can be worth the cost.

Ten Ways to Change a System

Network diagram v2
Network diagram v2

This morning, my husband and I hunkered down on the squat wooden chairs in our son’s first grade classroom and had a conference with his new teacher. From our first interactions it was clear she has a keen intelligence and a gentle bearing, and she has me reflecting on my own extraordinary teachers, from childhood to today. Inevitably, I think of Dana Meadows, a scientist, writer, and systems thinker who was a professor of mine in college and who fundamentally shaped my life path. Dana was a brilliant scientist who built computer models to generate insight into how complex systems function – and who fearlessly brought her heart as well as her brain to the undertaking. She was a pioneer in the field of system dynamics, yet she took the time to invite my whole class to her house to watch the movie Gandhi and snack on carrots from her garden.

Since blogs these days seem to be replete with top ten lists, here is one from Dana:

"Places to Intervene in a System” (in increasing order of effectiveness) 10. Constants, parameters, numbers. (such as subsidies, taxes, standards) 9. Material stocks and flows 8. Regulating negative feedback loops 7. Driving positive feedback loops. 6. Information flows (who does and does not have access to what kinds of information). 5. The rules of the system (incentives, punishment, constraints). 4. The power of to add, change, evolve, or self-organize system structure. 3. The goals of the system. 2. The mindset or paradigm out of which the system – its goals, structures, rules, delays, parameters - arise 1. The mindset or paradigm out of which the goals, rules, feedback structure arise.

To decode much of this, you will want to her full article Leverage Points: Places to Intervene in a System. But for those among you on the hunt for magic buttons to get change fast, be forewarned. These are the final lines of the article:

“Magical leverage points are not easily accessible, even if we know where they are and which direction to push on them. There are no cheap tickets to mastery. You have to work at it, whether that means rigorously analyzing a system or rigorously casting off your own paradigms and throwing yourself into the humility of Not Knowing. In the end, it seems that power has less to do with pushing leverage points than it does with strategically, profoundly, madly letting go.”

Be rigorous, be humble, and let go strategically. These are lessons from an exceptional teacher that I expect to be learning for some time to come.

What “the best nonprofit in the world” sees as key to success

BRAC
BRAC

The Global Journalattempts to identify and rank the best nonprofits in the world. This year, they gave top honors to BRAC – a Bangladeshi anti-poverty nonprofit. (Photo courtesy of BRAC, caption below) Over the last few years, BRAC has fundamentally challenged my assumptions about the limits of what is possible from the nonprofit sector.

As they see it, the keys are:

They go big or go home. BRAC is big. It has a $572M budget and has been described as a “minigovernment.” It touches an estimated 135 million people in 11 countries, educates 11% of all Bangladeshi children, and disburses $1B annually in microloans. As founder Fazle Hasan Abed sees it, "If you want to do significant work, you have to be large. Otherwise we'd be tinkering around on the periphery."

They focus on solvable problems. Despite the wide range of activities they undertake, BRAC puts relentless focus on the problems it seeks to address. An example: One of BRAC’s first major undertakings was to train semi-literate women to fan out to villages across the country and teach people how to treat diarrhea, which in 1980 was claiming the lives of roughly 12% of all Bangladeshi children before their fifth birthdays. BRAC’s health workers taught people how to mix a simple solution (a fistful of sugar, a three-finger pinch of salt, and water measured in a local milk container) and based their modest salaries on the number of people who retained the knowledge weeks later. BRAC scaled the program, training thousands of workers who visited 12 million families. By 2005, child deaths from diarrhea had dropped by more than 80% nationwide,and countries around the world were replicating BRAC’s model.

They don’t depend heavily on fundraising. In Bangladesh, you don’t reach this kind of scale on donations. BRAC covers 70-80% of its budget through microlending and social enterprises that link entrepreneurs and create economic opportunity for the poor all the way up the value chain.

They invest in learning. You also don’t reach this kind of scale and impact without an insatiable appetite and capacity for learning. David Korten, author of "When Corporations Rule the World", called BRAC "as near to a pure example of a learning organisation as one is likely to find."

BRAC challenges the nonprofit sector to reimagine what it is capable of by going big, focusing on solvable problems, developing a sustainable funding stream, and investing in learning.

Photo caption: BRAC Dairy collects milk from 40,000 rural farmers in poor regions of Bangladesh, holds the milk in one of 100 chilling stations, and processes 300,000 litres of milk per day in its factory, ensuring the farmers get a good price for a quality product.

Experts, step aside

Centering II w text
Centering II w text

In the social services and healthcare fields, two experiments are underway that share a similar (and counter-intuitive) approach: Get the experts out of the way so that people can help each other. An anti-poverty organization called the Family Independence Initiative (FII) forbids its staff from offering help or advice to participating families – even when the families are making costly mistakes. Despite this, the organization's results in Oakland and San Francisco show an increase in earnings and savings of 23% and 240% respectively, with 17% of participating families buying homes and 70% of children improving their grades.

The way the Family Independence Initiative sees it, families will not stay out of poverty if they rely on a program or paid social worker for support. FII works to nurture robust social networks -- neighbors who help each other find jobs, buy homes, or with childcare. FII thinks that social workers, however well-intentioned, often get in the way and absorb resources that could go directly to poor families.

Likewise, the CenteringPregnancy model for prenatal healthcare teaches doctors and midwives to take off their white coats, sit in a circle with a group of their patients, and talk as little as possible. When the experts take a facilitative, rather than didactic approach to delivering healthcare, the women themselves share their own fears and experiences about pregnancy and childbirth with one another. They go from being passive recipients of expert advice to being active, powerful participants in the process.

It turns out, prenatal care delivered in this way simply gets better health outcomes. In a multi-site randomized control trial, CenteringPregnancy was shown to reduce the preterm birth rate among participants by 33%. That means for every two CenteringPregnancy groups, one baby is spared the trauma and risk associated with a preterm birth, and society saves an average of $52,000 in expenses.

For those of us who sometimes wonder whether we have too many experts and not enough community, these are welcome data points.