Changing/diminishing role of the governments Globalization Growth of wealth/influence of corporations Many problems (e.g., HIV/AIDS, TB, SARS ) have grow in complexity, requiring a multi-sector response.
Revenues of the largest 100 companies exceed the GDP of 5 countries. Daewoo has same annual revenue as Bangladesh with 116M people. 359 companies account for 40% of world trade. 1.2Billion people live on less than $1 a day. 40M are infected with HIV/AIDS; 14,000/ day 48 developing countries have 10% of the world’s population but only 0.3% of trade.
Research indicates that there is still a huge amount of distrust among the businesses, government and NGOs. A study by the Prince of Wales Business Leaders Forum found that the public sector is often viewed as inefficient, NGOs are seen as unfocused and highly politicized and the private sector is seen as self-interested and resource draining. It is only by breaking down these barriers that collective action can be undertaken to achieve common objectives (BSR web site) Businesses expect that partners will provide business value (e.g. cost-savings); view NGOs as not being capable to effectively solve the problems they are trying to address; think that NGOs are highly political; and perceive NGOs as fostering dependency. On the other hand, NGOs often:see business as part of the problem; view businesses only as check writers; expect corporations to help further NGO social missions without any business benefit. In general both businesses and NGOs are concerned about loss of control in the partnership (e.g., use of NGOs name, businesses might be concerned that the NGOs won’t deliver) and they often misunderstand each other’s intentions. Thus, in order to reap the benefits of cross-sectoral partnerships, there needs to be attitudinal and organizational changes among both NGOs and businesses. First, NGOs need to perceive partnerships with corporations as a viable option; not the source of the problem. Second, NGOs and businesses will need to learn how to speak with each other in an understandable and meaningful way to bridge the differences to achieve great impact on common issues.
What levels of resources are available? (Are you paying or Are we going dutch?) Why are you doing this? (e.g., to feel good, to improve your reputation, visibility) What are the requirements of the partnerships (do you expect a goodnight kiss?) What effects will partnering with you have on my reputation/business. Businesses often have specific needs that can be filled by non-profit services. These partnerships are often narrowly defined by the business and services are provided by NGOs. What are the specific outcomes of the agreement? What are the reporting requirements? What are the requirements of the partnerships (do you expect a goodnight kiss?) What effects will partnering with you have on my reputation/business. These are usually sub-contract and sub-grantees. Each party gets what they want- narrowly defined. Break-up is not difficult if each party fulfills their obligations
Philanthropic: constrained by gratefulness (NGO) and charity syndrome (Business). Minimizing interaction and communication. Expectations and investments were relatively low and narrowly defined on both sides. Engagement is one way. Transactional: Cause related marketing, event sponsorship, licensing pad service arrangements. Engagement and the value flow are more significantly two-way. Begins to connect more directly with business operations. Strategic fit becomes closer and more important. It is mutually beneficial; buyer-seller relationships. Employees Integrative: The relationship begins begins to look like a highly integrated joint venture that is central to both organizations strategies. Individual value creation escalates to joint value creation; each organizations culture is affected by the processes and procedures. Collaboration frontier in cross-
Why Collaborate? What is the purpose of the collaboration? How does the collaboration fit within the organization’s mission and strategy? What are the benefits and potential risks of the collaboration? Type of Collaboration? Once an organization is clear why they want to collaborate, then they need to decide what type of collaboration makes the most sense for them. If the primary purpose of the collaboration is provide funds and/or technical services to implement a project then philanthropic (1+1=2). Transactional collaboration, t he value created arises from the partners joint activities, which may or may not include financial exchanges (1+1=5). If the purpose is to create a joint vision among organizations that will be sustained beyond a single project an integrative collaboration might be the most feasible (1+1=11). Types of Partners ?: There is a wide variety of organizations that could be selected as partners Thus, depending on the type of collaboration, programming area, operating environment and organizational capabilities some partners will appear more suitable than others. Partnership: A partnership relationship is determined by the type of collaboration and type of partner organization. Table 6 provides an outline of the types of collaboration that can be undertaken with a variety of organizations. While all these partnerships are possible, most of the development partnerships among NGOs, CBOs and governments have largely been through sub-contracts or joint programming so they are shaded in the table. However the trend over the last 5-10 years has been to shift away from a contractual nature of relationships to more meaningful partnerships.
Funding Mechanisms: the type of collaboration and/or the potential partner organization may include the type of money that can be received (e.g. local/foreign currency, ownership of property, nationality and donor requirements). The funding mechanism (e.g., contract, grant, private) often influences the nature of the relationship, regardless if the partner is a NGO, corporation, or corporate affiliated NGO. Required Level of Effort : The level of effort required by an organization varies by type of collaboration and partner organization. In addition, effort required for a successful partner-ship is greatly influenced by: 1) size of the partnership (e.g., funding levels, geographic); 2) complexity/number of organizations participating in the partnership; 3) breadth of differences (e.g. philosophies, missions) among the partner organization; 4) size/structures of each partner organizations compared with the other operating partners (e.g., level of decentralization of decision-making processes); 5) nature (e.g. advocacy, implementation) and complexity of activities; 6) operating environment (e.g., emerging markets, post-war, rehabilitation); 7 government relations and policies; and 8) donor priorities. Strategic alliances require the most effort, with full engagement of senior management as well as a variety of dedicated staff throughout the firm. Large sub-contracts and sub-agreements that are very large that would also require large amounts of organizational support and would greatly benefit from having partnership structures and systems in place at the outset of the relationship. Before beginning a partnership, it is important for an organization to really think about how much level of effort will be required to support the partnership, in light of existing commitments. Many organizations underestimated the time require-ments, particularly staff time, to full participate in these relationships, thus limiting the effectiveness of the partnership.
To what extent are individuals personally and emotionally connected to the social purpose of the collaboration? Have individuals been able to touch/see the social value of the collaboration? What level and what quality of interaction exist among Sr. management? How strong are the interpersonal bonds? Clarity of Purpose What is the purpose of the collaboration? Where does the relationship fall on the collaboration continuum and where does each partner want it to be? Have the partners escaped the gratefulness/charity syndrome? Has each partners determined the different functions and relative importance’s of the partnerships already existing in its coloration portfolio? 3. Congruency of Mission, Strategy and values How well does each partner understand the other’s business? What are the missions, strategies, and values of each partner? What are the areas of current and potential overlap? How can each partner help the other accomplish its mission? To what extent I the collaboration a strategic tool for each partner? Have the partners engaged in a shared visioning about the future? 4. Creation of Value What resources of each partner are of value to the other? What specific benefits will accrue to each partner from the collaboration? Do the benefits outweigh the costs and risks What new resources, capabilities/benefits can be created by the collaboration? Are resources and capacity transfer two-way? Are benefits equally balanced between the partners? Has the value exchange and creation depreciated? If so to what extent? Can the Collaboration Value Construct be re-created and enhanced? Is it time to end the collaboration? 5. Communication between Partners What level of respect and trust exists between the partners? Is communication open and frank, it critical communication constructive? How is communication between the partners managed? What channel and vehicles are used to communicated internally Are there potential dissenters? Can they be converted? Do the partners have a coordinated external communication strategy/programs? Is the partnership underpublized? 6. Continual Learning 7. Commitment to the partnerships
Fostering Effective NGO-Corporate Partnerships Susan Rae Ross, SR International Randy Chum, Wells Fargo
Presentation Summary <ul><li>What are NGO-Corporate Partnerships? </li></ul><ul><li>Why are these Partnerships Important? </li></ul><ul><li>Trends Influencing these Partnerships </li></ul><ul><li>Benefits/Challenges </li></ul><ul><li>Types of Partnerships </li></ul><ul><li>Key Questions for NGOs </li></ul>
What are these Partnerships? <ul><li>Cross-Sectoral Partnerships : </li></ul><ul><li>People and organizations from some combination of public business, NGOs and civil society groups who engage in voluntary, mutually beneficial , innovative relationships to address common societal aims by combining their resources and competencies …..The Copenhagen Center, Partnership Alchemy </li></ul>
Why these Partnerships? <ul><li>the world has grown flatter with dramatic technological advances </li></ul><ul><li>yet looming social & environment issues have not fully benefited </li></ul><ul><li>from these efforts…requiring society to marshal knowledge, skills, </li></ul><ul><li>resources of all its sectors . . Thomas Friedman, The World is Flat </li></ul><ul><li>issues have become too complex &interdependent ; financial/ </li></ul><ul><li>managerial resources required too scare for any single sector </li></ul><ul><li>to effectively respond to current challenges. New forms of </li></ul><ul><li>partnerships are needed to address societal problems where </li></ul><ul><li>traditional, single sector approaches are proving inadequate </li></ul><ul><li>………………… Simon Zadek Partnership Alchemy. </li></ul>
Benefits of NGO-Corporations Partnerships <ul><li>For Corporations </li></ul><ul><li>Economies of scale </li></ul><ul><li>Image/creditability </li></ul><ul><li>Recruitment/retention of high-performing staff </li></ul><ul><li>Skills development </li></ul><ul><li>Product innovation </li></ul><ul><li>For NGOs </li></ul><ul><li>Access to staff/skills </li></ul><ul><li>Financial resources </li></ul><ul><li>Access to Networks </li></ul><ul><li>Technical expertise/ </li></ul><ul><li>technologies. </li></ul><ul><li>Enhanced visibility </li></ul>
(Mis)Perceptions <ul><li>Business </li></ul><ul><li>Self-Interested </li></ul><ul><li>Part of the Problem </li></ul><ul><li>Profit Motivated </li></ul><ul><li>Dishonest </li></ul><ul><li>Check Writers </li></ul><ul><li>NGOs </li></ul><ul><li>Inefficient </li></ul><ul><li>Not Analytic/Strategic </li></ul><ul><li>Foster Dependency </li></ul><ul><li>Highly Political </li></ul>
Different Perspectives <ul><li>World Views </li></ul><ul><ul><li>Timing (quarterly earnings vs behavior change) </li></ul></ul><ul><ul><li>Missions (profit, non-profit) </li></ul></ul><ul><li>Language (e.g. technical jargon) </li></ul><ul><li>Status Different (e.g, size, resources, influence) </li></ul><ul><li>Approaches and Results </li></ul><ul><ul><li>Decision-Making (e.g., quick vs consensus building) </li></ul></ul><ul><ul><li>Measures of Success </li></ul></ul>
Types of Collaboration <ul><li>Resource Exchange/Philanthropic </li></ul><ul><li>Traditional partnerships limited by gratefulness and </li></ul><ul><li>charity syndrome. Expectations/investments are low </li></ul><ul><li>and narrowly defined on both sides. </li></ul><ul><li>Transactional/Fee for Service </li></ul><ul><li>Engagement limited in focus with specific results </li></ul><ul><li>expected by the paying party. </li></ul>
Types of Collaboration (cont’d) <ul><li>Joint Programming </li></ul><ul><li>Engagement is more 2-way. Activities are more closely </li></ul><ul><li>aligned with business objectives. Strategic fit becomes </li></ul><ul><li>More important . (e.g., cause-related marketing, licensing agreements ) </li></ul><ul><li>Integrative </li></ul><ul><li>The relationship evolves into a highly integrated joint </li></ul><ul><li>venture that is central to both organizations strategies . </li></ul>
Internal Partnership Assessment <ul><li>Question 1 : Why Collaborate? </li></ul><ul><li>Question 2 : Type of Collaboration Desired? </li></ul><ul><li>Question 3 : Who to Partner with? </li></ul><ul><li>Question 4 : Type of Partnership? </li></ul>
Partnership Portfolio Mapping Corporate Foundations Private Foundations Government/Multi-Laterals Corporation University/Research Other Non-Profit Private Voluntary Org. Community Based Org. Integrative Joint Program Transaction Resource Exchange Type of Collaborative Efforts/Partnerships Type of Partner/Organization
Partnership Implementation and Results <ul><li>Question 5 : Relationship Mechanisms? </li></ul><ul><li>Question 6 : Required Level of Effort? </li></ul><ul><li>Question 7 : Desired Outcome of Partnership? </li></ul>
Level of Effort and Outcomes Contract Deliverables Project & Finance Staff, some Sr. mgmt Contracts/Fee for Service Transactional Outcomes +Greater Visibility + Improved Relationships+ Value Sr. mgmt involvement of a variety of staff @ organizational levels Series of Agreements Integrative Project Outcomes +Greater Visibility+ Funds Project, finance, comm/marketing staff & more support from Sr. mgmt Cause related marketing, Licensing Joint Program Project Outcome (Short-term) Project & Finance Staff, some Sr. mgmt Grants, In-kind Donations, pro-bono services, volunteers Resources Exchange Results/ Outcomes Level of Effort (Staff) Mechanism Type of Partnership
Successful Partnerships <ul><li>Are built, they do not just happen. </li></ul><ul><li>Are a valuable outcome in their own right. </li></ul><ul><li>Have clearly defined outcomes/results. </li></ul><ul><li>Have well-articulated partnership strategy including indicators to monitor progress of the partnership </li></ul><ul><li>Have organization structures, communication channels and operational systems to support the partnership. </li></ul>
Summary <ul><li>Cross-Sectoral partnerships will increase in importance in the coming years. </li></ul><ul><li>NGOs and Business will need to learn how to speak the same language and find common ground for partnerships to succeed. </li></ul><ul><li>Mechanisms to efficiently leverage the various strengths among the various partners will need to be developed. </li></ul>