Chronicle of Philanthropy, from the issue dated Thursday, June 17, 1999

MY VIEW

Charities' Big Challenge: Surviving for the Long Haul
By BILL SHORE

Contrary to conventional wisdom, there are not many social problems in the United States that we don't know how to solve. Across the country, non-profit groups have worked with companies, government agencies, and other partners to develop innovative solutions to hunger, homelessness, illiteracy, teen-age pregnancy, and other seemingly intractable conditions.

What we have not been able to do so well, however, is to find ways to pay for those solutions to be implemented, or to figure out how to expand and copy them on a nationwide scale. As Peter Goldmark, former president of the Rockefeller Foundation, puts it, non-profit leaders are now "challenged to be institution builders."

That is not easy for the tens of thousands of organizations that sprang up in the past 15 years in response to government cutbacks in social services. Most were set up with the intention of filling what was perceived to be a temporary gap. They were created by people who wanted to fix social challenges that they had personally encountered. A homeless person's recurring appearance on the corner became the catalyst for a local activist to start a shelter. A successful physician's chance encounter with children who lacked immunizations and health care led to the start of a new child-health organization. Indeed, the goal of many of those founders was to be so successful that they could go out of business -- meaning that their services wouldn't be needed anymore.

But it is clear that the social problems those groups were founded to solve are more complicated than anticipated, and require more long-term solutions. In the anti-hunger field, for instance, dollar after dollar has been spent on more-efficient food banks, canned-food drives, soup kitchens, and other measures that relieve hunger, but woefully little has been aimed at preventing or attacking the cause of hunger, which is poverty. Without more resources devoted to economic opportunity, advocacy, job training, and education, the effort to end hunger simply won't get off the ground. It's a long-distance race if ever there was one.

To make it through the long haul, non-profit organizations need to adopt an approach that is second nature in the business world. In the popular book Built to Last, the authors Jerry Porras and Jim Collins explain that visionary companies are founded to endure despite changing times and changing economic conditions. They recount, as an example, how William Hewlett and David Packard decided to start a company first and then figure out what they would make later. Among visionary companies, the authors observe "a shift from seeing the company as the vehicle for the products to seeing the products as the vehicle for the company." The book notes that making such a shift entails "spending less of your time thinking about specific product lines and market strategies and spending more of your time thinking about organizational design."

With that goal in mind, non-profit organizations need to transform themselves from groups that simply deliver emergency services into organizations that also undertake the more complicated, long-term mission of changing underlying social conditions. That means dealing with tough issues. How does an organization originally built on volunteers and sympathetic donors become self-sustaining? How does it find, recruit, and retain the diverse professional talents needed to build an enduring global institution? How does an organization extract lessons from its own best practices, build upon them, and make them available to others so the practices can bring about even greater change?

An unprecedented number of organizations now face those challenges. They have solved the easier problems, but they now face a shortage of money needed to deal with the tougher challenges, such as institutionalizing the most effective solutions or expanding them to the size required to reach all those who need what they offer.

Although raising additional funds is always helpful, a shortage of top managerial talent presents as significant a challenge. Many organizations still are being managed by their founders or by whoever has worked there longest, not necessarily by the best available managers. For a founder, there is probably nothing more difficult than recognizing how different it is to create an organization than to sustain and expand it.

To become "institution builders," non-profit founders need to hire people who excel not only at delivering services but also at managing others, designing organizational structures, and planning strategically. Building institutions means investing for the future and not just spending for today, and communicating to colleagues so that they understand why that is essential for the organization and for society.

Adding to the difficulties is the fact that it is far more challenging to deal with the fundamental problems that lead to homelessness, hunger, or other social problems than to alleviate the symptoms. Non-profit leaders have neither the tools, training, nor a road map to get there. There are few mentors because, so far, few non-profit leaders have achieved their long-term goals -- and those who have succeeded have not yet established a capacity for teaching others. Going forward, we must strike a delicate balance between honoring all of the great work we've already done and recognizing and admitting just how different it will be to accomplish the institution building that lies ahead.

We also must come to grips with the two specific reasons why even the most effective non-profit organizations do not last for the long haul or reach as many people as they should.

The first reason is that many social-services groups never expected to operate forever. For example, the vast majority of community-based antihunger efforts that exist today were created in response to President Reagan's budget cuts in the mid-1980s. At the time, organizations like Share Our Strength, which I run, thought of hunger as an episodic condition, not a chronic one. When the economy faltered and unemployment was high, there seemed to be a tacit agreement that during the period when government had to cut back, private organizations had to step in temporarily, even though non-profit groups could never do so on the needed scale.

Implicit in that agreement was the faith that when the economy recovered, government would resume a reduced but still significant role. Instead, years of pressure to tame the size and expense of government culminated in federal laws that severely restricted welfare benefits, and cut $27-billion from food-stamp assistance. Millions of single mothers and immigrants left welfare -- only to be plunged further into poverty. No private non-profit group ever expected to fill a gap that large.

The second reason follows from the first. Since organizations didn't expect to be around for a long time, they didn't put in place any of the ingredients that would enable them to do so. Salaries, which in some cases were never envisioned in the first place, ended up being set low, making it impossible for charities to develop a management team that would last for the long term. Because the founders never saw the need to become self-sustaining, no revenue-generating apparatus was created. Thus, once an organization does realize that it needs to operate for a long time, it must backtrack and fill in all those needs.

As a new generation of non-profit leaders comes of age, we need to realize that building sustainable community institutions has a lot in common with the building of cathedrals in an earlier time. The great cathedrals did not grow skyward because their builders discovered new materials or financial resources. Rather, the builders had a unique understanding of the human spirit that enabled them to use the materials they had in a new way. The builders understood that their work might not be completed in their lifetimes, so they developed ways for their efforts to endure. They built on the foundations of those who came before them and generated new wealth to sustain their work, making a lasting contribution to humanity.

Bill Shore is founder of Share Our Strength, a Washington organization that fights hunger and poverty. This article is adapted from his new book, The Cathedral Within: Transforming Your Life by Giving Something Back. (c) 1999 by Bill Shore. Reprinted with permission of Random House.

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