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By Thomas A. McLaughlin Multi-Agency Planning "Lord, deliver us from our friends. The enemy we can handle." -- Col. George S. Patton In case it isn't already obvious, the days of nonprofits as rugged individualists are over. Factors such as the need to develop standardized ways of exchanging information and the necessity of handling massive community issues are pushing nonprofits to cooperate as never before. Foundations urge collaboration among potential grant recipients, and other funders are creating service systems with nonprofits as intermediaries for other nonprofits. Nonprofits often deal with this need by merging, which is usually the speedier, more long-term way of dealing with an increased scope of demand. But at other times, mergers are neither possible nor desirable, and nonprofits are simply forced to find ways to work together. Enter the need for multi-agency planning. Most nonprofits recognize the necessity of strategic planning, but the term itself has deteriorated into code talk for "really, really important planning for kind of a long time period." Often what is referred to as strategic is not really strategic at all but is more like operations planning over a particularly long term. Multi-party planning typically is operations planning that is entered into out of a shared sense of strategic necessity. For example, for several years United Way affiliates have recognized that they must reduce the cost of backroom operations to better compete in a crowded field. This shared sense of strategic necessity has driven them to create innovative technologies and to attempt collaborative approaches to old-fashioned tasks. Relief and food distribution agencies have long accepted that they must work together in very practical, street-level ways. Performing arts groups have tried various types of collaborations. These are all cases where the desired improvements in operations became strategic goals in themselves. To succeed in multi-agency planning, participants need to accept that the keys to success are different from the kind of planning that a single organization undertakes on its own behalf. Here are a few of the differences. Explicit, written values replace culture as the determinant of organizational change. Culture is what people use to assist them in making little decisions where no formal guidance is available. In a single organization, you can count on the organizational culture to implement (or thwart) the intended plan. Any organizational plan gets implemented in the context of many years worth of legends, symbols, capacities, management preferences, and a host of other things. The organization is already accustomed to doing things in a certain way, and there is a general understanding about what is considered important. When multiple organizations get together to accomplish something there is no shared culture, and in fact there are usually some fairly substantial cultural conflicts. No one can count on there being a universal idea of what is important, so they must find a substitute. A workable substitute is an explicit statement of values or a shared understanding of how the collaboration is going to go about its business. It's not perfect and it can easily be ignored, but at least it represents a collective hope for making those little decisions that add up to momentous changes. Decision-making power is diffuse, not centralized. In a single entity, the CEO is the ultimate point of staff accountability. To that extent, power is consolidated in a single pair of hands, to be delegated as necessary. In multi-agency planning there can be no single point of authority because even for a narrowly defined task the participants don't want to give up authority to influence the outcome. The parties may go so far as to establish an independent entity, but it is virtually certain that the entity will be governed in some way as to reflect the viewpoints of the participants. For instance, the governing board will almost always be carefully balanced to reflect participants' size, financial strength, market position, or some other objective means of measuring presumed strength. Trade associations are an example of multi-agency planning taken to a large scale, and they also illustrate how extreme decentralization can dilute impact. The diffusion of power also explains why multi-agency planning often moves so slowly. Without a central decision point, the process of checking and double-checking can stretch on endlessly. Multi-agency planning works better in response to threats than opportunities. Multi-agency planning seems to happen mainly when it's seen as a way to respond to a mutual threat rather than capitalizing on a clear opportunity. For-profit competition in formerly untouched nonprofit territory has been touching off multi-agency planning for the past 10 years or so in some areas. And, large nonprofit service systems sometimes have had the same effect on smaller nonprofits. By contrast, if a single entity thinks it can seize an opportunity by itself it tends to be disinterested in working with others. Sharing capital investments is harder than sharing revenue. Single agency strategic planning is usually partly about revenue, which to some degree makes it easier for participants to put aside their internal rivalries in the hopes of gaining new resources. Nevertheless, at the planning stage the revenue is only a hope, whereas multi-agency planning often hinges on the very different reality of investing capital. Sharing responsibility for capital investments -- such as real estate or a major software system -- is difficult for any business. Accounting fairly and accurately for who owns what and who gets the profits from asset sales in a multi-ownership situation is extremely tricky if not downright impossible. It's one of the reasons why partnerships such as law firms and accounting firms often lease their offices rather than own them. So nonprofit multi-agency planning ventures are likely to find reasonable ways to share any revenue produced but to balk when it comes to investing in major assets. Besides, each set of financial folks probably already has its own ideas about how to use their investment capital and they're not inclined to share. Single agency planning requires trust in the boss, multi-agency planning requires trust among the bosses. Organizations are predisposed to trust their CEO -- and to distrust other CEOs. Multi-agency planning naturally involves multiple CEOs, which dramatically increases the chances that one or more key figures will be distrusted by the participants. Distrust always slows processes and can ultimately stop them. Each CEO needs to pass the trust test. Momentum conquers. The intangible element of momentum can determine whether multi-agency planning succeeds or fails. The odds are stacked against multi-agency planning, so a pervasive sense of this-is-working-and-it's-right will carry a multi-party planning effort a long way.
Thomas A. McLaughlin is a national
nonprofit management consultant with Grant Thornton in Boston. He is
also the author of Streetsmart Financial Basics for Nonprofit Managers
(2nd edition) and of Trade Secrets for Nonprofit Managers, both from
John Wiley & Sons. His email address is tamclaughlin@GT.com.
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