Cuts aren’t the solution, and there are other, better strategies for financial sustainability…
Public services are in desperate need of more funding, that’s a given. But despite the ongoing campaigns, if history is any guide, an injection of cash could be a very long time coming.
So, in the meantime, we’ve little alternative but to think seriously about how civil society organisations can, not just survive, but do yet more with even less.
The default option, basically “doing what we’ve always done”, is for each organisation to try and squeeze out yet more costs. I’ve written guides to this in the past, but for most, it’s a road so well-travelled there’s barely any tarmac left.
Thankfully, it’s not the only route we can take – there are at least three other strategies for financial sustainability that we all need to start seriously exploring.
The first place to look at, beyond the walls of your own organisation, is at the efficiency of our sector.
I’ve touched on this in previous articles, but there is huge opportunity for efficiencies here, whether from merging, sharing back-office functions, systems and physical assets, or aligning services to reduce duplication.
These are the grown-up conversations we can no longer avoid, and if you’re not having them already, I’d suggest you start right now.
The second opportunity is for us to lead more effectively on addressing the awful inefficiencies of the systems we work within.
Whether it’s the NHS and social care, asylum and housing, prisons and probation, everyone has their own stories of chronic inefficiency where the resources aren’t in the right place, or the behaviours aren’t incentivised to act quickly, to make timely and holistic decisions; where the costs of delay far outweigh any savings from the cuts that created them.
There are many great examples of civil society organisations taking the lead, convening others, redesigning pathways, setting collective goals and plans, but nowhere near as many as there needs to be.
I’ve rarely met a charity leader who hasn’t been able to point to numerous examples of systems that could produce far better outcomes, for far less money overall, “if only…”
We’re literally surrounded by these opportunities, and if we want a more sustainable future, those examples need to move from jaded anecdotes to serious action plans – more on this here.
The third area of potential is for us to draw in money, resources, and capability, from other sources. Most often from businesses and communities themselves, through things like asset-based commissioning, place-based philanthropy, corporate partnerships, and skill-based volunteering.
One of my guests in conversation next week, Charlotte Hill, runs a fantastic organisation (the Felix Project) built almost entirely on corporate partnerships.
But there are also some fantastic models out there for social finance, particularly where it’s linked to that second point – changing systems to make them far more efficient. Wherever there’s a long-term financial return as well as a social one, there’s the potential for drawing in new types of funding.
As with the other two strategies, this one is very often just a matter of getting the right people around a table talking about the right topic, sharing what they know and what they have.
The biggest barriers to us unlocking most of these opportunities are entirely self-created, and much of it is about identity, risk aversion and self-protection.
When the organisation we’re responsible for is existentially threatened, it’s natural for leaders to look inward, to take control, avoid big risks and prioritise survival. And it often feels counterintuitive to look outwards, to share and cede control, to take big risks, and to prioritise purpose above the survival of the organisation itself.
Yet in reality, very few of the solutions we need to respond to this challenge, can be found within our own organisations. They are far more likely to be found in the wide blue ocean of opportunity between our organisations, in the systems operating around us, and in partnership with others.
If we’re serious about exploring better strategies for financial sustainability, and if we’re prepared to be genuinely visionary in the service of our cause, these are the roads we need to travel.