Keep calm and carry on - presentation for High Peak CVS

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  • Director of T3SC Asked to set the context But preaching to converted? Bit of a quiz Size of organisation: stand up – stat partners sit down income levels – up to £50k; up to £100k; up to £250k; up to £.5m; up to £1m; £1m+ Hands up if you are here as a trustee..............paid member of staff
  • Size and shape of the sector From NCVO Civil Society Alamanac 2009 – leading source for reliable data Some figures only available for 2006 So, sector is large – big business
  • Across GM, about 4% of workforce is employed in the sector Tameside 1% (700 people) Turning to the recession....... Grant makers – esme fairburn foundation, Lloyds TSB Foundations etc – have endowments, use the investment income from those to make grants Interest rates low, stock markets falled sharply – less income = less grants
  • Continuing to see increased demand from recession Often working with most maganalised, those most in need of hekp Know that through our work on recession action plan – CAB etc, but also work by NAVCA in ‘Crunchtime’ report on impact of recession on local charities In terms of donations / individual giving – who gets significant levels of income from those?
  • Continuing to see increased demand from recession Often working with most maganalised, those most in need of hekp Know that through our work on recession action plan – CAB etc, but also work by NAVCA in ‘Crunchtime’ report on impact of recession on local charities In terms of donations / individual giving – who gets significant levels of income from those?
  • List of areas / funds cut now published by CLG – on NAVCA website www.navca.org.uk/news/cutsdetailforcouncils In Derbyshire: Supporting people Admin £330k reduction Dept of Eduction (area based grant) £3.4 million reduction May not seem a lot – Derbyshire gets £700m from central government But – ring fence removed – other funds may be affected
  • This can be positive, allowing you to develop a niche and preserve the most valuable elements of what you do. When the environment improves, you can expand again.
  • Usually a “last resort” option in our sector Organisations can be very protective of their unique history and culture, even when there are other organisations doing similar work – and sometimes with good reason There is a risk of “mission creep” when the organisation is determined on survival at all costs It is important to remember it is the mission that matters – voluntary organisations are not run for the benefit of the staff or boards but for their beneficiaries, members and supporters. The organisation is just a way for people to work together.
  • Analysis of private sector shows a winning strategy in recession is often to increase capacity, research and development and go for growth In our sector this strategy isn’t often adopted consciously, and when it is organisations can appear threatening to others But sharks can also be benevolent A predatory shark strategy is very risky - whilst attacks on the "territory" of other voluntary organisations may be successful in the short term, there may be longer term damage to your reputation and ability to form partnerships. But a difficult and changeable environment throws up new opportunities and some organisations may be ready to seize them There will also be some rationalisation in our sector as organisations close or go to the wall, which may allow stronger organisations to pick up projects or other assets from them
  • Not for everyone, but my feeling is that this is where really exciting things could happen High risk – but with big rewards for success Exploiting new sources of funding could mean getting into loans or social interest bonds as well as contracts New organisational structures such as formal partnerships, consortia and trading companies will certainly be the way forward if you want to deliver public services We could be innovative in how we deliver services - on line, through a community hub or someone else's organisation, or using more volunteers.
  • Geographic neighbours Helps model behaviours, test out ideas Staff development opportunity
  • Board discussed secondment fully – everything to lose, what to gain? Reputation risk if it went wrong Risk that Liz would be scared off being a chief officer for life – or leave – or want to stay with VAO I told her it would be ‘character forming’ – good development opportunity Next bits of the story: 3 month secondment – part time Extended while contract with LA sorted VAO advertised – couldn’t recruit Liz didn’t apply – felt too much to do; lack of support ; setting up to fail VAO unable to appoint, and came back to us before christmas....”you know that idea – are you still interested....”
  • Geographic neighbours Helps model behaviours, test out ideas Staff development opportunity
  • Geographic neighbours Helps model behaviours, test out ideas Staff development opportunity
  • Keep calm and carry on - presentation for High Peak CVS

    1. 1. Tony Okotie Keep Calm and Carry On The national picture  The challenges facing voluntary organisations  Examples of different ways of working 
    2. 2. Some context
    3. 3. Some context <ul><li>171,000 ‘general’ charities in UK </li></ul><ul><ul><li>Growth of 6,800 in 2006/7 </li></ul></ul><ul><li>Income growth to £33.2 billion </li></ul><ul><ul><li>Growth of 3.3% in 2006/7 </li></ul></ul><ul><li>Grants, donations and legacies were worth £13.6 billion in 2006/07, equivalent to 41% of total income </li></ul>
    4. 4. Some context <ul><li>Paid workforce in sector is over 634,000 employees </li></ul><ul><ul><li>Growing by 20,000 in 2006 </li></ul></ul><ul><ul><li>Now 24% bigger than 1997 </li></ul></ul><ul><li>Falls in global stock markets during recession </li></ul><ul><ul><li>Affects investment returns / endowments = less grant making </li></ul></ul>
    5. 5. Some context <ul><li>Recession has seen increased demand for services from the sector </li></ul><ul><ul><li>Debt advice, housing and homelessness, employment, employment support </li></ul></ul><ul><li>Impact of recession felt most by charities £100k - £500k </li></ul>
    6. 6. Some context <ul><li>Long term impact of recession on individual giving / donations not known </li></ul><ul><li>UK has emerged from recession </li></ul><ul><ul><li>‘ long tail’ still being felt by the sector </li></ul></ul>
    7. 7. Stormy times ahead?
    8. 8. Stormy times ahead? <ul><li>General election </li></ul><ul><ul><li>Change in government: Conservatives committed to role of voluntary sector </li></ul></ul><ul><li>BUT </li></ul><ul><li>Significant public sector funding cuts </li></ul><ul><ul><li>Savings this year of £6.1 billion </li></ul></ul><ul><ul><li>Local Authorities ‘share’ of savings £1.3 billion (21% of overall savings) </li></ul></ul><ul><ul><li>Less ‘ring fencing’ of grants from central Government to LA </li></ul></ul>
    9. 9. Stormy times ahead? <ul><ul><li>Full budget / CSR this Autumn will inevitably announce further, more draconian, cuts to reduce the £156 billion fiscal deficit at least by £60 billion </li></ul></ul><ul><ul><li>If same ‘share’ as in May transferred to local authorities will be £12.6 billion </li></ul></ul><ul><ul><li>Government consultation in August about public priorities </li></ul></ul><ul><ul><li>Full picture on where savings are to come from in October comprehensive spending review </li></ul></ul>
    10. 10. Stormy times ahead? <ul><li>A number of programmes that voluntary sector contribute to / benefit from axed: </li></ul><ul><ul><li>Future Jobs Fund </li></ul></ul><ul><ul><li>‘ Worklessness’ programmes </li></ul></ul><ul><li>Health budget protected </li></ul><ul><ul><li>But management cost reductions of 30%+ required </li></ul></ul>
    11. 11. recession? Continued demand for third sector organisations: homelessness, debt advice etc
    12. 12. But also opportunities? Big Society <ul><li>The creation and expansion of mutuals, co-operatives, charities and social enterprises , and enable these groups to have much greater involvement in the running of public services </li></ul><ul><li>Public sector workers given a new right to form employee-owned co-operatives and bid to take over the services they deliver </li></ul><ul><li>Training of a new generation of community organisers and support the creation of neighbourhood groups across the UK, especially in the most deprived areas </li></ul><ul><li>National Citizen Service for young people </li></ul><ul><li>A range of measures to encourage volunteering and involvement in social action </li></ul>
    13. 14. Good advice for hard times <ul><li>THERE IS NO EDUCATION LIKE ADVERSITY </li></ul><ul><li>WHAT WE ANTICIPATE SELDOM OCCURS; WHAT WE MOST EXPECT SELDOM HAPPENS </li></ul><ul><ul><ul><ul><li>Benjamin Disraeli </li></ul></ul></ul></ul>
    14. 15. Housekeeping It’s not going to affect us........ Has your organisation got its head in the sand?
    15. 16. Some strategies Mudfish, Lemming, Albatross, Shark or Pig?
    16. 18. Mudfish? <ul><li>Downsize, possibly looking at sharing staff or resources with another organisation, or specialising more in your most important or unique work. </li></ul>
    17. 19. Lemmings? <ul><li>Close down or seek a merger with another stronger organisation with which you share a mission. </li></ul><ul><li>Sometimes closing down is positive, mission accomplished. </li></ul><ul><ul><li>. </li></ul></ul>
    18. 20. Lemmings? <ul><li>Merger can also be positive especially for beneficiaries, creating efficiencies, enabling mutual learning, eliminating competition and developing a stronger and better resourced organisation . </li></ul>
    19. 21. Sharks? <ul><li>Seek growth and diversification, repositioning your organisation to build on your strengths and capitalise on opportunities. </li></ul><ul><li>Can work well if you really do have strengths and there really are opportunities. </li></ul>
    20. 22. Sharks? <ul><li>Sharks can threaten other organisations, but they need not be predatory. </li></ul><ul><li>And someone has to swallow the organisations that choose to close or seek mergers! </li></ul>
    21. 23. Albatross? <ul><li>Possibly the most tricky to pull off, requiring you to adopt completely new methods for essentially carrying on as usual. </li></ul><ul><li>Can be a good option if your services are excellent and much in demand and you are strong enough to invest in research and development. </li></ul>
    22. 24. Albatross? <ul><li>This option could include exploiting new sources of funding ,entering new organisational structures, or delivering services differently </li></ul>
    23. 25. ...or flying pig? “ Something will turn up, we have been through this sort of thing before”
    24. 26. Partnership in practice Collaboration between VAO & T3SC
    25. 27. Variety of Income Streams But .... <ul><li>55% of current income from TMBC </li></ul><ul><li>Majority of funding streams expire (renewed?) March 2011 </li></ul><ul><li>Increased pressure on external grant funding: Lottery and Capacitybuilders </li></ul><ul><li>.........and that was before the current pressure on public finances </li></ul>
    26. 28. About VAO <ul><li>Financial crisis for the organisation with Lottery funding closing and no funding secured post August 2009 </li></ul><ul><li>OMBC seeking radical changes in delivery and wider partners calling for competitive tendering process. </li></ul><ul><li>Chief officer left: T3SC approached by GMCVO to provide a management secondment to VAO </li></ul>
    27. 29. Balancing risk and opportunity
    28. 30. Why work together? <ul><li>T3SC and VAO have compatible needs </li></ul><ul><li>T3SC need to reduce costs without impacting on service provision </li></ul><ul><li>VAO needs a strong foundation to enable it to focus on the needs of the VCF sector in Oldham </li></ul>
    29. 31. Collaborative working
    30. 32. Where are we now? <ul><li>Secondment now a strategic alliance / formal collaboration </li></ul><ul><li>High level collaboration / partnership agreement signed </li></ul><ul><ul><li>Principles of relationship </li></ul></ul><ul><ul><li>Dispute resolution </li></ul></ul><ul><ul><li>Review and break clauses </li></ul></ul><ul><ul><li>Individual service schedules </li></ul></ul>
    31. 33. Where are we now? <ul><li>Services provided by T3SC for VAO </li></ul><ul><ul><li>Strategic management </li></ul></ul><ul><ul><li>Newsletter production </li></ul></ul><ul><li>Both organisations have balanced budgets for 2010-11 </li></ul><ul><ul><li>Saving for T3SC £50k </li></ul></ul>
    32. 34. Change for VAO <ul><li>Secured over £550k of funding (3 competitive tenders for new services) </li></ul><ul><li>Full backing of OMBC and third sector partners </li></ul><ul><li>Restructured and streamlined organisation focussed on delivery </li></ul><ul><li>Radical growth in membership of VAO and strengthened position as strategic leader </li></ul>
    33. 35. Touchstones for T3SC
    34. 36. Touchstones for T3SC <ul><li>Must save us money </li></ul><ul><li>Mustn’t affect the quality of service we offer Tameside groups </li></ul><ul><li>Must have commitment to relationship from VAO board, OMBC, TMBC </li></ul>
    35. 37. Lessons lear nt (so far...)
    36. 38. Lessons learnt (so far...) <ul><li>Be clear about the drivers for your organisation </li></ul><ul><ul><li>Entering new markets? Reducing costs? Improving quality? </li></ul></ul><ul><li>Think about how to protect service to clients not your organisation </li></ul><ul><li>Board leadership essential </li></ul><ul><ul><li>“ not empire building” </li></ul></ul>
    37. 39. Lessons learnt (so far...) <ul><li>Think the unthinkable now </li></ul><ul><ul><li>in 6 months time it might be too late </li></ul></ul><ul><li>Don’t expect huge cost savings overnight </li></ul><ul><li>Explain, explain, explain </li></ul><ul><ul><li>Remember Stakeholders / funders </li></ul></ul><ul><ul><li>Change can be scary for staff </li></ul></ul>
    38. 40. Other T3SC ‘thinking the unthinkable’ strategies <ul><li>‘ Day to day ’ cost saving programme </li></ul><ul><ul><li>Premises </li></ul></ul><ul><li>Asking ourselves: How would we deliver our core service with 40% less funding? </li></ul><ul><ul><li>And preparing for that eventuality </li></ul></ul><ul><li>Investigating other collaborations / mergers </li></ul>
    39. 41. Other T3SC ‘thinking the unthinkable’ strategies <ul><li>Increasing proportion of self generated income </li></ul><ul><ul><li>Launch of T3SCplus </li></ul></ul><ul><ul><ul><li>Consultancy </li></ul></ul></ul><ul><ul><ul><li>Research </li></ul></ul></ul><ul><ul><ul><li>Training </li></ul></ul></ul><ul><ul><ul><li>Bid writing </li></ul></ul></ul><ul><li>Upskilling; marketing; cultural change </li></ul>
    40. 42. BUT THINK AND ACT NOW

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