On July 9th, with support and collaboration from the Prudential Foundation and others, the Support Center conducted a full-day conference titled “NEW DESIGNS FOR CHANGING TIMES -Leading Change for a Strong Nonprofit Sector“. Over 200 nonprofit leaders spent the day exploring the current state of the sector and strategies for a stronger, more powerful and more effective future.
Judy Alnes of MAP for Nonprofits in Minnesota, led the session by highlighting some of the key findings of research conducted by MAP for Nonprofits and Wilder Research in July of 2012 (with support from Greater Twin Cities United Way and others) examining forty-one nonprofit mergers of organizations. The aim was to add to the sector’s understanding and adeptness regarding mergers. Merger was defined as the integration of two or more separate organizations into one legal entity; in other words, one organization would cease to exist. The mergers in the study had to include a transfer of programs or services and of assets or staff. Here is some of what the study found:
- 93 percent of participating organizations said they pursued merger to increase service delivery.
- 93 percent reported that they wished to secure through merger the long-term financial viability of one of the merging partners.
- 75 percent said their reasons included the salvaging of services that might otherwise be lost.
- 56 percent sought to expand services to new markets and 29 percent sought to expand the types of services they could offer to consumers.
- Only seventeen of the forty-one participating organizations reported that merger was motivated in part to expand their donor bases. Eight were looking for greater staff expertise and five for additional physical space.
What were some of the “success” factors in pursuing a merger?
- Executives were the key to the success of a merger. Of the mergers studied, 85 percent had an executive “champion.”
- Strong working relationships between executives prior to merger predict key post-merger outcomes, including service preservation, improved image, and financial stability.
- While boards are seldom unanimous in their willingness to pursue merger, strong board involvement prior to a merger predicts improved image or reputation following the merger.
- Seeing potential mutual gains prior to merger is associated with better organizational alignment after merger.
Want to talk more with us about redesign? Feel free to call or email us for a no-cost discussion and assessment. You can also fill out our “Interested Partners Form“. If appropriate we will schedule a complimentary realignment educational session for your Board of Directors. Your expressed interest will be treated confidentially and a member of the Support Center’s Change Consulting ReDesign team will contact you for further discussion.