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A Newbies View on Grantmaking
Topics: Communications and Learning
Hello from MMT Communication and Learning land. I can’t believe I’ve been at MMT for 9 months and this is my first blog post. Hello world!
…and, in a nice symmetry, this post is about another first for me: my first GEO (Grantmakers for Effective Organizations) conference.
Because this year’s conference was in Seattle, more of the MMT staff got a chance to attend than would typically. I was really happy to be a part of the 9-strong crew in attendance. Here we are (plus 1) at an event hosted by the Bill and Melinda Gates Foundation:
For me, the conference was a great chance to hear from some knowledgeable speakers and, more importantly, get a broader sense of what the philanthropic community is doing and thinking about these days. Some of the main themes I heard were around collective impact and funding collaborations, nonprofit scaling for impact, and mission/program-related investing.
Some other ideas I heard were:
Data doesn’t matter (if the audience has the wrong story in their heads)
Andy Goodman from the Goodman Center reminded us that data doesn’t change minds if it doesn’t match personal experience or the popular story. Personal stories have more power than data in shaping opinion. The stories people have heard or experienced act like filters through which we view the world and we tend not to hear or believe things that run counter to established stories. He brought up the notion of the elephant and the rider – the idea that our conscious mind (the rider) sits atop our emotional/unconscious mind (the elephant), so persuasive ideas need to appeal to both the elephant and the rider.
Hardly working can be working hard
Jonah Lehrer, author of Imagine: How Creativity Works, told us that the best thing to do when trying to solve a creativity problem is to walk away, relax and maybe take a shower. Eureka moments are more likely to occur when alpha waves are present in the brain, which is something that happens when we are relaxed. He also stressed that traditional “no-idea-is bad” brainstorming is…well…bad. Environments that allow debate over the merit of ideas are often more fruitful and make people think about a problem more deeply, especially if the environment encourages “plussing,” or adding to someone’s idea if you think it doesn’t measure up.
Creative napping - this child gets it!
I heard a few speakers mention the importance of timing and organizational readiness when it comes to making change. One presenter was talking about creating effective networks and reminded us that organizational lifecycles matter – for instance, orgs who are more mature are usually more prepared to lead or even participate in a network. A similar point I heard was that collaborations take time to develop. Another speaker made the point that breaking evaluation findings and data into chunks and sharing them publicly over time can keep an audience interested and make it easier to digest, while allowing you to benefit from feedback.
Unfortunately some sessions filled up fast, and I didn’t get to go to every session I would have liked. Fortunately, my colleagues covered pretty much every session I didn’t get to attend. Here are a few of my colleagues’ favorite thought-provoking quotes and highlights:
Nonprofit Scaling for Impact
- We should scale for impact, not size. Avoid growth for growth's sake.
- If you want to make change you must create a path to simplify the process. Scaling involves 3 things - more service to more people, advocacy to address underlying issues, and knowledge sharing to inform others.
- Levers for scaling are service enterprise, volunteer labor as a core part of resources; technology, data systems to increase efficiencies; train the trainers to package the service model for use by others; advocacy to change policy and impact the field; scaling the nonprofit's systems for operations, programs, and HR; and developing earned income, which requires exceptional functioning in operations, marketing, finance, customer service, legal, and human relations.
Collective Impact, Collaboration and Advocacy
- If you stay in isolation, the status quo wins. We need to interrupt the status quo. We need a system of organizations to achieve collective impact.
- Many foundations’ support for tackling tough issues results in “program rich and systems poor” outcomes. They may support individual organization's programs but fail to see how each grantee contributes to solving the overarching issue. What kind of infrastructure and ongoing systems is the backbone organization leaving behind to ensure that work continues?
- Philanthropy can't replace public funding of social programs. For funders that want to advance the importance of addressing policy issues that affect our sector, funders should ask grantees if advocacy is a part of their work. For funders that believe in advocacy, give operating grants.
- Networks can be highly effective and increase collective impact, as long as it is supported by strong lead staff that are paid and the network has secure financial support.
- For policy development, think less silver bullet (there's only one way to approach a problem, focusing on best practices) and more silver buckshot (thinking of multiple innovative solutions to a problem, focusing on promising practices and best practices alike).
- Good collaborations require several elements, but especially "shared mission and strong backbone.”
- Advocacy was a key component for a “troubled youth” collaboration. The foundation in their grant contract required each nonprofit in the collaboration to “advocate to the fullest extent of the law.” This eventually led to changes to the state laws for the incarceration of youth. The sun-setting of a program to solve homelessness was an important foundation requirement. The 10-year leadership by the sponsoring foundation was structured to end and forced the work to happen faster and the nonprofits to become stronger.
- According to the Russell Index, funders involved in PRI/MRI making are business oriented, entrepreneurial, and values driven. Curiosity causes them to explore; they like being in the doing mode with ready, aim, fire actions; and their work is instructive, they learn from their successes and failures.
- You must build the financial literacy of the investment committee. There is a dance between impact, the money that goes out; endowment, keeping it in perpetuity; and operating costs, the cost to do business.
- Risk management is about embracing risk, not avoiding it. Take ownership if you fail. Be transparent about it. Talk about it on your website and share what you learned.
- Young people or people outside of the usual area of expertise often add the most creativity to an organization.
- There is value in solving complex problems through crowd sourcing. There can also be value in rotating staff from field to field when feasible - this stimulates creativity and innovation.
- “Nonprofits aren’t businesses; they exist because of market failure—if someone could make money doing this work they wouldn’t need a nonprofit.”
- “Being a 501c3 is a tax status, not a business model.”
- The manufacturing and retail sectors are the only ones in the US that employ more people than the nonprofit sector (approximately 10 million people are employed by the nonprofit sector). Nonprofits need to adapt to the new economy in order to remain stable. Nonprofits often have underdeveloped financial management capacity and these weaknesses have both internal causes (organizational culture that places little regard for the value of organizational infrastructure, a history of doing more with less) and external ones (funders' policies and practices, variable and often inadequate funding of indirect costs, complicated reporting requirements).
- Take a two pronged approach to capacity-building for financial sustainability that includes: a) individual organization level work to help them understand the true costs of program delivery and build financial expertise throughout their organization; and b) sector wide work by supporting policy advocacy that affects the external environment, which in turn has impact on the internal strength of non-profits. Funders typically support capacity building of individual organizations to enhance sustainability, but there seems to be little happening sector wide that focuses on improving the environment for NPOs to become financially sustainable.
New Media and Tech Tools
- Program officers and leadership in foundations (as well as at the nonprofits) need to use and understand social media tools themselves to effectively understand the requests grantmakers receive to utilize them. There is a huge cultural shift in how people use technology and communicate, and we need to stay current. Hardware and software used to be a big part of technology requests, but the cloud has changed all that. Nonprofits don't have to worry about maintenance on aging equipment and all their staff can access their data from any location. Use of iPads and smartphones in the field are replacing needs for expensive laptops.
- It takes a generation for new leaders to come to power and make change. People don't change; they die off and then the new generation takes over.
- Foundations are mainly staffed by people over 40; what happens when there is no new guard to take over?
Evaluation and Transparency
- Grant evaluation should balance accountability and learning, and use it as a conversation tool with grantees. A survey of grantees said that grantees get much more from the reporting requirements of grantmakers if they get to talk with program officers about the report.
- Transparency in evaluation does NOT mean "sharing private or confidential information.” It is also not a substitute for rigorous data gathering and evaluation—the two work best in tandem with a learning-in-public approach informing the data-gathering and evaluation process.
All in all I got a lot from the conference, and it seems so did my colleagues. Thanks Seattle and GEO.
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