The Tail Wagging the Dog: a Strategic Pathway to NFP Sustainability

How can the local leaders of national or international organisations be the spark for change and sustainability – like the tail wagging the dog, asks fundraising strategist George Liacos.

If there is one thing Australians are known for it’s practicality. It is with a very practical eye that Not for Profit leaders are engaging with the whole concept of a business model and funding sustainability.

The environment that is pushing such a concept is not new. The notions that NFP’s must diversify their funding streams, move away from government funding and entertain commercial activities are not new.

Much of our previous writing in this publication has been focused on leaders who can drive a whole-of-organisation process towards sustainability. This article is written for a different bunch, namely, the local leader. You may be the Australian leader of an international NGO or the state leader of a national organisation. You may have felt “how could little us possibly be the spark for change?” … like the tail wagging the dog right?

Well here are some practical thoughts that might be helpful. For those of you facing new financial year planning, these may be timely too…

Through our recent work with the Australian arms of BINGOs (Big International NGOs) we have recognised an opportunity for a bit of “tail wagging”, which can help with short-term funding and long-term sustainability. How?

By taking a leadership position on innovation and volunteering to be the test-bed for new sustainability initiatives. Local leaders are asking for support to take risks and design new models. In return they will share and disseminate learnings to benefit the broader organisation.  

Specifically, local leaders are:

1. involving themselves in the innovation and sustainability committees, working groups and discussions (or starting them)

2. developing clear and compelling business case documents to their international or national counterparts

3. offering to conduct pilots, in return for seed funding, either from the parent body or collectively from a number of countries or offices

4. engaging in shared value collaborations and partnerships with the private sector or other NFP’s which support the early stage in return for pay-off later.

In essence, the “win win” dynamic is that the flexible local entity, which is often smaller, more agile and has less ability to seed sustainability initiatives, receives the capital and mandates its needs to innovate. The broader entity gains the benefits of this flexibility to try sustainability initiatives, in a controlled manner. If the initiative is indeed successful, the “wins” for each extend to potential income and increased impact. A more robust business model. Practical, elegant and leveraging the strengths of each party.

The business cases themselves, while needing to be rigorous, don’t need to be overcooked. So long as they contain these things they should be adequate for a decision:

1. clear definitions of the value propositions
2. a competitive analysis
3. market sizing
4. financial forecasts
5. a high-level implementation plan for the pilot
6. a risk register.

Key tips:

1. Make the pilot small.
2. Use methods such as Google Sprints to define the initiative within a week.
3. Opt for an intensive time period to pilot the basics of the initiative.
4. Don’t put all your eggs in one basket, have initiatives that are of varying sizes over varying time horizons so as to give the organisation some wins and some longer goals.

What this all means for local leaders undertaking planning now is that this approach provides a way to focus on sustainability without letting funding worries limit strategic thinking.

Park the funding conversation while generating ideas for sustainability (for tips on how to do this step, see our whitepaper on sustainable business models). Conduct a preliminary evaluation to narrow the field of ideas, and with the surviving two or three ideas, commit to undertaking business cases of five to six pages to share with the international organisation. This commitment is much less of an ask to boards than launching straight into an organisation wide transformation.

The above suggestions and experiences are drawn directly from what your peers are doing today. They are practical demonstrations of how the tail can wag the dog, for the better.

About the author: George Liacos is the managing director of Spark Strategy, an agency that works with Not for Profits and social enterprises to realise their social mission objectives. Liacos has advised Not for Profits, social enterprises, governments and commercial organisations for more than 18 years in the areas of new business and funding models, business and digital strategy, and system transformation. He has also held roles as the national lead partner for Transformation at Grant Thornton, program director for the Department of Premier and Cabinet as well as chairman and non-executive director on a number of technology and service businesses. For more about achieving sustainability, download the whitepaper In search of sustainability: Thinking beyond funding models.