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There
are three sectors in an economy. The first is the Public
Sector. The second is the Private Sector. And the third
is the Non-Profit Sector. The Non-Profit Sector is very
important to the Irish economy, employing 8.8 percent of
the workforce, along with another 2.3 percent on a
voluntary basis. It accounts for 8.4 percent of
G.D.P.
2into3
combines the skills and experiences of the Private and
Non-Profit Sectors in Management Consulting and
Recruitment.
This
publication will offer quarterly insights into the
Non-Profit Sector, fundraising, management consulting,
philanthropic trends, and developments at 2into3
itself. The newsletter is intended to inform, educate,
and promote thought and discussion, so please peruse
the selected articles and give us your feedback. We
hope you find the items interesting and useful, and we
look forward to hearing from
you. |
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SECTOR
SEGMENTATION:
THE 2INTO3
PHILOSOPHY
Insightful
segmentation of the Irish non-profit sector is key to
ensuring collaborative progress in the future, according
to 2into3 Director Dennis
O'Connor.
Dennis
O'Connor, 2into3 Director
2into3
classifies non-profit organisations by 12 fields of
activity: philanthropy; international development; trade
unions; religious groups; health; advocacy, law and
politics; environment; arts, culture and heritage;
social services; sports and recreation; education and
research; development and housing.
The
model was developed by the Centre for Civil Society
Studies at Johns Hopkins University in Maryland, and it
was later adopted by the Centre for Nonprofit Management
at Trinity College Dublin.
2into3 believes
that identifying non-profits through this established
model helps to clarify the individual aims within the
sector and prompts streamlined thinking amidst
organisations which have similar
purposes.
'Our
reason for doing it is that the model has always helped
to make sense of this very large marketplace, and I
think it helps the marketplace make sense of itself,'
says Mr O'Connor, who is also the co-founder of
2into3.
'If
you look at the categories that are there, they are done
by the nature of the mission. Some of the non-profits
are starting to see themselves in those
ways.
'If
you take the international development organisations, I
think they've been the most advanced as seeing
themselves as being part of a group who are in the same
area. Then you form some sort of organisation in the
form of Dochas, and they've come together for common
issues.
'The
sector as a whole doesn't have the equivalent of an IBEC
- a body which brings it all together so that it can
look at its issues in a common
way.
'One
of the benefits of the model is, if people start to see
that these things make sense, people will say, "Look who
else is in educational research. We have a common
agenda, whether big or
small."
'You've
more in common, firstly, with people doing similar
things, and you've more to learn from each other.
Obviously all non-profits have something they can learn
from each other at a wider level, but specifically there
are learnings from a particular common form of activity
that are
invaluable.' |
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INTERVIEW:
DAVID MCGLOUGHLIN,
CEO
WEXFORD FESTIVAL OPERA
David
McGloughlin joined Wexford Festival Opera last year
after more than 15 years working in the Irish film
industry. Here, he discusses his experiences in the
world of Irish arts non-profits.
Do
you come from an Arts
background?
When
I left college in 1990 with an economics degree from
Trinity, I set up my own company, an event organising
company, which went fairly well. But I'd worked
voluntarily for the Dublin Film Festival for many years,
and in 1989 the then-board of the Dublin Film Festival
had actually appointed me to the board of the festival.
Then in 1991 I was appointed chief executive of the
festival, which was limited by guarantee with a board of
voluntary directors. I was in that position until 1996.
That gave me a good insight and a good feel for how
festivals had to be organised. I later founded the
Dublin International Film Festival with Michael Dwyer,
the Irish Times film critic, in 2002. I'm still on the
board but I just stepped down as chair due to pressure
because work chairing a voluntary board can often be
more work than chairing an executive board. From 2005
until 2007, I was also chief executive of Screen
Producers Ireland. It was basically the trade
representative organisation for the film industry. We
were an affiliate organisation of IBEC; it was a
nonprofit, but it was more of a business lobby
group.
How did you
end up working for Wexford Festival
Opera?
I was referred to
Dennis, in particular, by a colleague. I was meeting him
to have a general chat about arts in the non-profit
sector, and the job kind of came out of left field.
Dennis happened to mention they had a part-time position
in the arts sector, so I put my name forward and I was
one of a number of candidates. Ironically - and to be
totally honest, my knowledge of opera is somewhat
limited - if I had seen this job advertised in a
newspaper, I probably wouldn't have applied because I
probably would have thought I wouldn't have gotten it.
But it turned out to be an advantage rather than a
disadvantage. They weren't looking for someone who would
end up being a frustrated part director in the chief
executive role. They wanted someone who doesn't get too
bogged down, who can focus on the operational side of
the business and run the festival as a business. What
I've discovered since is that my two career threads from
a previous life have a kind of relevance. One experience
from running the Dublin Film Festival is that there is a
common thread running through all festivals; you have to
focus almost your entire 12 months of work for a short
period, a matter of weeks. Another experience helps in
that the Wexford Opera Festival is a producing festival;
it produces lives artwork or art performances, and it
involves employing directors, costumer designers and
crew - in a way similar to when I was working in the
commercial sector in film production. The organisation
of a producing festival is almost a combination of both
threads in a way.
Anyway, Dennis felt I should put my
name forward, and the position was advertised both
nationally and internationally. I took up the position
of interim chief executive in September of last year,
and I was appointed long-term executive from May
1.
Have you seen
recent changes in arts organisations in the non-profit
sector?
I think they're
becoming more professional. They're becoming more aware
of the necessity to broaden their appeals from a funding
point of view to all sectors, not just to rely
predominantly on the public sector and not just rely on
the private donations of the philanthropic sector but
also to look more to the commercial sector - not really
doing sponsorship deals but in many ways pushing the
whole CSR side of corporations and using that as a lever
to get support.
The
corporate governance of non-profits in the arts sector
is also important; there's more of a realisation of the
responsibility of directors in their non-executive roles
but also in the fulltime executive as well. Non-profits
are adhering more to rules and regulations and they are
aware of the fact there is this new charities
legislation coming, as well. The structures that are in
place generally seem to be more professional, as well;
there is more attention to the financial imperatives,
the increasing competition and pressure, and also
the importance of cost-control, proper financial records
- which traditionally were more the areas of the
commercial sector.
Do
you think arts non-profits face unique challenges in the
Irish non-profit world? Do they attract support more or
less easily than issue-driven
organisations?
First
of all, there's a huge number of arts organisations and
an increasing number, as well - every few weeks there
seems to be a new local arts festival around the
country. The difficulties that art non-profits have, in
terms of particularly raising philanthropic funds, is
that there can be a certain cynicism about the arts in
Ireland. Although the arts is quite vibrant, I don't
think there's necessarily a broad appreciation of the
arts across the commercial sector, such as in European
countries and certainly America. Without being crass
about it, I think the fact that we are not issue-driven
- and often there seems to be less immediacy about the
cause - I think more often can make it a more difficult
sell.
And
in the past, the arts as a group haven't necessarily
been the best ambassadors of their own industry. I think
it allowed certain people to feed on the perception that
the arts sector lives off the government. Personally, I
think it's probably more difficult - but I know the
other side in terms of the caring non-profits, the whole
compassion fatigue can come into play and there's
competition there, as well. But if they're focused right
in terms of who they're trying to get the funding for, I
think it can be a more focused
sell.
In
the arts sector, you're appealing to people that have an
appreciation of the arts - not only targeting
organisations, but individuals within organisations who
you feel would be sympathetic to your particular art
form. We're still trying to raise funds for Wexford
Opera House; we're getting to the point the building is
almost finished, but we haven't reached our target. A
lot of the potential Irish donors . . . there's a
difference between the attitude towards funding for arts
capital in Ireland and in other parts of the world. The
Irish attitude, in the broadest sense, seems to be 'If
you're coming to the end of your capital project, why do
you need the money?' whereas the American attitude is
'If we can see what you've completed already, the more
likely we are to support.' Rather than seeing plans in
an architectural office, they can actually feel the
product and they're more likely to support. I think this
is a more enlightened approach. In terms of the Irish
market, I think there's probably a ways to go in terms
of the corporate sector and particularly trying to
encourage them to donate for arts capital funding
projects.
I
suppose part of our specific argument that we put across
is we emphasise the various things we are doing such as
outreach programmes, community involvement . . . We
would talk about that, stressing the fact that we are
very much a non-profit. Apart from providing direct
benefits to our customers, we also provide direct
benefits to the community.
In
the past, we haven't stressed it enough, I think. In a
way, talking about an opera festival can be seen as
quite elitist. It's an art form that is only enjoyed by
a small percentage of people, and there is often a
perception that - because the majority of opera patrons
tend to be high networth value, more from the ABC1
market segment - because the patrons tend to be wealthy,
the arts sector is suffering the least. That's
unfortunately not the case. It may be supported by
people of high networth value, but it's also the most
expensive art form you can
present.
Increasingly,
there is more and more competition for what will always
be limited resources. Funding from the state, generally
proportionally speaking, is reducing. The Arts Council
funding effectively has been frozen for next year. It
makes it tough, as well, and perhaps rightly so, that
there is increasing questioning from the government
about their support for the arts. You have to justify
more and more your support from the likes of the Arts
Council. But it's important we justify our funding from
everyone, including the state.
Who
do you think is best suited to high-level non-profit
positions - people from the non-profit world, the
commercial world, or candidates who have experience of
both?
I
think overall, it depends on the person. You can't be
too precise about it, in terms of saying 'If you haven't
worked in the non-profit sector before, it's not a good
ida to try it.' With anything, if you have the different
areas of employment you've been involved in, the broader
your experience is going to be. Generally, it probably
does help to have been exposed to the commercial sector.
What's useful in that side is you tend to bring some of
the work practices and the general attitude towards
business - which benefits the non-profit sector because
it improves the professionalism. And I think the
non-profit sector has lessons that it can learn from the
commercial side, and vice
versa. |
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THE
WHEEL PUBLISHES RESULTS OF FIRST NATIONAL PAY AND
BENEFITS SURVEY
Nearly
one quarter of Irish non-profits have had difficulty
recruiting staff in the past year, and 13 percent had
problems retaining employees, according to a new
study.
The
main reason given for retention difficulties was that
non-profit salaries are too low, concluded the report by
The Wheel, which recently conducted the first national
survey on pay and benefits in community, voluntary and
charitable organisations in
Ireland.
The
Wheel compiled responses from 317 organisations which
completed a detailed questionnaire regarding their
respective employment practices. The results, published
by The Wheel this summer, contain a number fascinating
findings and set the stage for an introspective and
productive discussion about how best to attract and
retain top talent in Irish non-profits. The survey
reported results using a number of categories, including
job level, activity within the sector and organisation
size.
The
findings showed that, for heads of organisations and
CEOs, the average salary is E84,943 within companies of
20 or more employees. Earners in the lower quartile
received E68,854 and in the higher quartile received
E103,772
For
smaller non-profit organisations, CEO salaries ranged
from an average of E47,942 to E55,040 - increasing with
the number of employees.
Across
all levels of jobs, non-profit professionals working in
the health sector earned the highest average
salaries.
The
majority of participating organisations reported
following national pay agreements when deciding on
salary increases for employees, but many did not operate
defined pay scales.
In
regard to benefits, the average basic annual leave
entitlement was 23 days. More than half of the
organisations said they had an occupational pension
scheme for employees, and 66 per cent operated a formal
sick pay scheme. Nearly three-quarters of organisations
reported that they provide some form of assistance to
employees for further
education.
The
survey also made interesting findings about the make-up
of the Irish non-profit workforce.
'Non-profits
already do so much with so little, the temptation to
continue on with less particularly in difficult economic
times is understandable, however this approach is not
sustainable,' says John Kelly of 2into3. 'If we are to
create a cohesive civil society then we must invest in
creating thriving civic society organisations. The two
critical inputs required by non-profit organisations are
money and leadership. In addition to developing its own
pool of leaders , the sector critically needs to attract
and retain leadership talent from outside the sector. In
our experience salaries are a barrier. Talented manager
do not join non-profits to get rich. That does not mean
that salaries do not matter. There is inevitably an
economic component to an individual's career choice and
even modest changes in compensation will have an impact.
The shortlist for a Finance Director or an Operations
Director at €90k looks different to one at €70k. The
additional 20k will attract candidates that are not only
more seasoned but have more experience of running
complex
organisations.' |
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HOW
TRANSPARENCY WILL HELP NON-PROFITS IN UNCERTAIN ECONOMIC
TIMES
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Financial
fears in the face of an economic downturn could have
strong consequences for non-profit organisations - and
make it all the more important that groups maintain
total honesty and transparency about operating costs and
budgetary constraints, experts
say.
Misreported
overhead costs have been a traditional hallmark of
non-profit organisations, and the upcoming charities
legislation in Ireland will naturally demand more
accurate reporting. But in addition to complying with
State mandates, increased transparency will actually
help non-profits to better sustain themselves amidst
times of economic turmoil, according to
studies.
"We
can't afford to 'fake it until we make it'", said Clara
Miller, Nonprofit Finance Fund President and CEO. "This
heroic type of behaviour does no one any good in the
long run. Non-profits need to share worries with boards
and funders, and enlist their support in getting ready
for a possible recession."
She
made the comments earlier this year when the NFF
released five recommendations to help non-profits
prepare themselves for uncertain economic times. Full
disclosure - rather than brave optimism intended to
allay funders' fears amidst negative economic media
reports which seem omnipresent - was a key
suggestion.
Consulting
organisation The Bridgespan Group came to similar
conclusions after conducting a recent
study.
'It's
a badly kept secret that overhead costs in the
non-profit sector are most often much greater than
what's visible in financial reports and fundraising
literature," the group wrote. "But misguided
expectations and actions-on the part of funders and
non-profits alike- fuel a vicious cycle that keeps the
pretense going . . . The cycle has grave
consequences for an organisation's ability to have
impact. As unrealistic overhead expectations place
increasing pressure on organisations to conform,
executive directors and their boards can find themselves
under-investing in infrastructure necessary to
improve or even maintain service-delivery standards,
particularly in the face of growth. In the short term,
staff members struggle to 'do more with less.'
Ultimately, it's the beneficiaries who
suffer."
Hence
non-profits must convey realistic projections and
problems, satisfying funders - who may be tighter with
their money under the current financial circumstances -
that all donations will be used to efficiently support
the organisations' aims.
But
at the same time, contingency plans must be made and
publicly discussed, proving that non-profits are
adaptable, practical and committed to ensuring the
longevity of their organisations.
The NFF
recommended that non-profits should engage with board
members and funders in contingency planning on what is
likely to happen to clients and funders during a
recession; avoid large investments in fixed assets and
infrastructure; and get firm handles on their current
revenue patterns before hard times throw a wrench in
established patterns.
'The
goal of surviving a recession or economic recession is
not to stay afloat for the sake of staying in business,
but rather to make sure you're around to keep serving
the public, particularly in times of increased demand
for services,' Miller said. 'It's important to get board
members and funders to go public with that message --
that the organisation's survival is important because of
the clients it serves."
And
re-evaluation, belt-tightening and increased disclosure
can also inadvertently break the so-called 'cycle'
mentioned by Bridgespan, helping groups to slowly create
a new and improved non-profit culture. Non-profits can
develop a strategy that explicitly recognises
infrastructure needs and improve communications with all
stakeholders.
"Framing
discussions about strategy around a clear plan that lays
out the organisation's goals, the investment needed to
achieve the goals, and the resulting benefits for
beneficiary groups can be more useful than centering
such discussions on costs," the report concluded. "Even
within the confines of a "cost conversation," executive
directors can use this type of plan to illustrate how
infrastructure investments actually reduce the cost to
serve over time. Non-profit leaders can further increase
their ability to invest appropriately if they
communicate the logic for increased overhead investment
throughout the organisation, and to the board. A
collective commitment from all levels of the
organisation, including senior staff and the board, is a
powerful lever."
Bridgespan
concluded that 'given the research and momentum on the
issue, there appears to be an opportunity for
unprecedented dialogue between funders and grantees. The
forces that fuel the vicious cycle are strong. But the
opportunity to achieve more for beneficiaries over the
long-term is a compelling incentive. As one non-profit
leader summed up, following a successful effort to align
the organisation's board and funders around more
realistic overhead investments: "We are a fundamentally
different-and better-organisation today than we were
three years ago, and I attribute much of that to
investments in building our capacity."
Another
concluded: "We're now an impact
culture." |
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2INTO3
EXPANDS MANAGEMENT CONSULTING WITH NEW ADDITION TO
TEAM
2into3
has added a new member to its team as it expands its
management consulting services.
In
July, the company was pleased to welcome Deirdre Hatch
(B. Mus (Perf) from Trinity College Dublin, M. Phil.
from Dublin Institute of Technology, DBS from Michael
Smurfit Graduate School of Business). She joined 2into3
as a Consultant, with specific responsibility for
supporting the provision of Strategy and Fundraising
services to clients.
Ms
Hatch previously spent two years at Deloitte
(Consulting) in London, where she worked with a range of
different clients, primarily in the financial services
and public sectors. Having a background in music,
Deirdre also taught music for a number of years and has
worked with the National Youth Orchestra of
Ireland.
Her
wide range of experience and knowledge broadens 2into3's
team and allows the company to help an increasing client
base.
'Since
I started in the company, I've been working on a number
of different elements for our clients,' Ms Hatch said.
'Typically what I do is help our clients to figure out
their fundraising strategy, working with them to
identify how much they need to raise to achieve their
goals, and the most appropriate way to raise that
amount. A large part of this revolves around examining
their fundraising mix and considering whether or not it
is appropriate, given their goals, their organisation
and the environment in which they operate.
'I
help our clients prepare the case for support,
identifying the most appropriate way to present their
need to potential donors, and constructing a solid
argument to present.
'I'm
also involved in project coordination and project
support. In addition, I've become involved in research
on areas of particular interest and importance to the
sector.'
Ms
Hatch said she was thrilled to return to work in the
non-profit sector and was impressed by the 'enthusiasm,
knowledge and experience' at 2into3.
'There's
a team here that have extensive experience working in
the sector, both as fundraisers and consultants', she
said. 'This experience, coupled with the fact that
it's a relatively small team, means I can both learn
from my colleagues and contribute.' |
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For
any additional information about 2into3, please contact
Amy Curtin at amy@2into3.com
or +353 1 640 1914. | | |
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FORWARD
THIS NEWSLETTER! |
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Why
not send along this email to colleagues or contacts? The
discussion of topical and thought-provoking issues -
such as those outlined within this newsletter - is key
to the continuing development of the non-profit sector.
2into3 highly encourages such ongoing debate and
exploration.
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Achieving
Excellence in Fundraising Practice and Leadership in
Ireland
The
Centre for Nonprofit Management, Trinity College Dublin
,in partnership with the Center on Philanthropy, Indiana
University, are holding a definitive education Programme
for Fundraisers, The Principles & Techniques of
Fundraising, in Dublin on 20 - 24 October
2008.
As
a leading Practitioner in the nonprofit sector in
Ireland 2into3 Chairman, Dennis O'Connor, will be
contributing at the 5-day programme along with other
contributors including Kinsley Aikens (Ireland Funds),
Richard Dixon (Concern) and Mary Apied (President,
Trinity Foundation).
Please
visit www.cnm.tcd.ie for more information on this
exciting
programme.
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2into3's
Harvey Duthie is the treasurer of Fundraising Ireland.
Established
last year, the group is a new network of
fundraisers in Ireland.
Among
its many aims, Fundraising Ireland hopes to provide a
forum for fundraisers to meet and discuss issues, as
well as to maintain a database of fundraiser conctact
details.
For
more information about Fundraising Ireland, please visit
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