I admire those organisations in our community that deliver a broad and diverse range of programs in aged care, disability support, and community support.
One of the larger community health providers near my home has 170 distinct service programs. Yet when I talk with those same people about individual program viability, they’ll almost certainly tell me “every program is important” or “ït’s why we exist” or “the need is there, we just have to make it work”.
They are probably right. Their services have been funded for a reason, and that reason is valid.
The challenge I see, is how can these organisations sustain growth?
Let’s start with their mission statement. If you look hard enough, you can tie almost any program’s impact goal to any inspiring mission statement.
For example: “we reach out to people with multiple disabilities supporting them in achieving self-fulfillment and connection with the greater community”.
These broad mission statements are well meaning, but they are difficult to operationalise.
If the goal is self-fulfillment and connection, there are a thousand ways that could be tackled.
What I often see are management teams taking on as much as they can in the name of the “cause” or “mission” – with the result that they are spreading themselves too thin.
The Illusion of Growth
Growth for growth’s sake becomes an all-consuming passion. Consider this view of an organisation with 26 service programs that has evolved unabated over 10 years into a $20 million company.
To the outsider, this diagram shows a well-meaning heterogenous aggregation of intentions to “do good”. Past program decisions were made aligned with the mission, rather than strategy, and have underpinned the growth in total revenue.
In today’s competitive environment someone else wants your donor, member, customer or participant and even your staff. What are the implications for organisations with an eclectic and diverse range of programs?
A Long Revenue Tail
Consider the following diagram showing the revenue profile of the same 26 programs. This graph highlights the “long tail” of relatively low revenue programs.
Some organisations have a clear mission, but not a clear strategy to determine what’s on or off mission. In these situations, there is a trade-off on “mission fit” and program delivery versus business discipline. This is when the tail wags the dog. You’ll likely see this if:
- The management team’s capability and capacity are spread too thin
- People waste time chasing every grant possible even if remotely linked to mission
- Too much is spent on back office functions to support micro-programs
- Focus is lost. The organisation is drifting away from what it does well.
No prizes for guessing the ultimate consequence: lose customers, alienate donors, good staff get burned out and your reputation takes a hit.
Yes, every program is important. The question is how far do you stretch into new program streams? Are some programs simply distracting and draining your valuable resources?
Operationalise your mission
The first task is to operationalise a broad mission into implementable and measurable strategic initiatives.
Firstly, assess each program’s contribution to your strategic aims against specific criteria. Impact as a broad aim is only one of them. Financials are not measured as accurately and often enough as they should be despite being (somewhat easily) measurable and tangible (cash in/cash out).
These are the four criteria I use to evaluate programs:
- Customer Value/Growth
- Organisational Learning
- Program & Service Capability
Secondly, I suggest you undertake some earnest program self-reflection. What information would you need to gather to answer these questions?
- What’s working well?
- How efficient are we?
- Which programs are truly viable? What should we be saying no to?
- What grants or funding should we go for?
Question 3 is the difficult one. No-one wants to say no to helping someone. Sometimes it’s hard to see that giving something up could be make a greater impact somewhere else.
Where to from here?
Every program is important. You and they exist for a reason. The problem is owning and walking a dog with a very long tail is problematic – operational complexity, management distractions, greater overheads and confusion amongst your stakeholders.
It takes courage to navigate to say no (especially if there’s a temporary dip in total revenue) to create the foundations and disciplines for growth. This is the crux of the matter – how to walk away from those things you are not good at so you can do more of the good stuff.
Bruce Mullan is a strategic adviser and business coach with Revera Business Optimisation.