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An upward trend of small- to medium-sized not-for-profits (NFPs) struggling to effectively serve their clients, due to budget pressures and operating scale has seen an increase in NFPs amalgamating with their peers.
Newsletter
NFP opportunities are born through unity
09 February 2022
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11 minute read
Although this process may seem daunting, the unification of compatible NFPs can not only provide budgetary benefits but can potentially result in a higher quality of service delivery and a wider range of resources being made available to clients.
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This was apparent to the boards of specialist legal centres the Employment Law Centre of WA, the Humanitarian Group and Tenancy WA that in response to such challenges merged to form Circle Green Community Legal (Circle Green). Circle Green offer support in relation to workplace rights, tenancy, humanitarian, and family and domestic violence.
In an interview with Pitcher Partners, chief executive Sara Kane and chairperson Emma Watton shared many insights behind the move and points to consider when contemplating amalgamation.
Ms Kane and Ms Watton said the decision to merge was not only about sustainability but was motivated by being able to provide clients with the opportunity to have a holistic service experience with their legal needs and supported non-legal needs being catered for by one provider.
The journey was arduous with the organisation first commencing their search for more sustainable means of operating in 2012.
However, the decision to unify proved successful with Circle Green experiencing a surge in demand for their services throughout 2020 with the pandemic amplifying vulnerable people’s need for legal support to help navigate complex challenges. This included tenancy issues due to a loss of income and, workplace issues due to the introduction of JobKeeper and more recently, mandatory COVID-19 vaccinations required in the workplace. Further demand on the humanitarian team peaked and continues to do so as a result of the Afghanistan humanitarian crisis.
Ms Kane and Ms Watton conveyed the need for NFPs to take into great consideration whom they intend to amalgamate with, focusing particularly on their mission, vision, and values, as this will greatly impact the NFPs’ ability to cater to the needs of its clients.
Circle Green has been successful because all three of the NFPs shared the vision of delivering accessible justice through fair and equitable access to legal services while addressing clients’ needs holistically. This was integral in ensuring that the NFP had a clear focus for the future and could hit the ground running once established.
Additionally, the culture of the NFPs is critical with a lack of alignment resulting in frustration from management and employees. To avoid this, the respective boards must develop an understanding of each respective organisational culture and form a realistic plan as to how these will be unified. This can be challenging as board members of each group bring a different perspective. The focus must be on finding alignment that appeases stakeholders, while also outlining methods to overcome potential clashes.
Once a unified vision and culture are defined it then needs to be communicated to management and employees to ensure “buy in”, Ms Watton emphasised. Fluid communication also boosts morale as it eliminates uncertainty around the merger process.
Ms Kane conveyed the importance of creating a safe working environment where there is open engagement between employees and board members.
“We knew we had to bring the staff and board from merging entities together, both in a professional and social manner, so that unity could be formed,” Ms Kane said.
“A failure to intervene and bring unity to the organisation early on in the merger will create opportunities for bitterness and distrust to develop, leading to a toxic work culture.”
Ms Kane and Ms Watton spoke of how critical it was to have adequate financial provisions and resources made available for the merger process itself. They also advocated bringing on specialists to assist in the merger process to assist with mandatory complex technicalities such as legal and accounting requirements.
Bringing in professional advisers to assist the board of directors, with their fresh perspective and lack of bias can also assist in a smoother unification process.
It is critical that individual NFPs strategically research, consider and plan prior to entering the amalgamation process. The success of this heavily relies on the alignment of the organisations’ culture and having the appropriate and dedicated resources to see the unification through, while maintaining fluid communication to various stakeholders will ensure a smoother transition process.
Pitcher Partners upcoming Not-for-Profit survey seeks to unveil the future challenges facing NFPs. If you would like to be the first to share your insights, then complete the early release of the survey, available on Pitcher Partners’ website.
Pitcher Partners Not-for-Profit survey will be accessible through the Pitcher Partners LinkedIn page from 14 February 2022.
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