The Business of meaning well and doing well
By Peter Boyes
When I started in communications and marketing some thirty odd years ago, it was common for charities and not for profit organisations to be run by retired major generals, former school teachers and gentle folk on private incomes. One charity I used to advise in London was staffed largely by former India Office employees who would stop work at 4 pm every day for pink gins before tottering gingerly home.
One of my specialist areas is health care and pharmaceuticals and it was not unknown for some of these voluntary organisations to be in receipt of grants from drug companies for huge amounts of money but there were very few checks and controls in place over how this largesse was used. From time to time in New Zealand I am called in to advise on clearing up the scandal after donated funds have gone astray in not for profit organisations.
But these days the number of not for profits run by enthusiastic volunteers is fast disappearing as both private and government funders look for more up front accountability. According to the latest Grant Thornton survey of the sector (Doing good and doing it well? Not for Profit sector survey 2013/2014)
not for profits on both sides of the Tasman are striving to adopt more professional standards in how they manage, operate and govern their enterprises.
Yet according to Business Mentors New Zealand CEO, Ray Schofield, many not for profits are being held back by a lack of skills and training. He says: `We have worked with a number of not for profit organisations over the years very successfully. But there are still many not for profit organisations who would benefit from our volunteer mentoring services. The sector faces many challenges, including the ability to source funding. Our specialised mentors can help improve the ability of not for profits to compete for funding.’
Business Mentors New Zealand has been developing a separate service to support this increasing need among not for profits for business skills and training. Ray Schofield explains: `We have been working closely with the Tindall Foundation, which has kindly provided seed funding, to launch a mentoring service targeted to help the Community and Charitable sector. ‘Community Mentors’ is currently in the incubation phase in the Taranaki region and we are working there in collaboration with the Bishop’s Action Foundation. A team of mentors with experience in the sector has agreed to be part of this exciting pilot and we will look to a nationwide launch once we have measureable outcomes and achievements from this initiative.’
The Grant Thornton survey points out that one of the greatest pressures on funding is the sheer number of not for profit organisations in Australasia competing for a limited pool of money rather than any after effects of the global financial crisis now mostly behind us.
In this climate, according to Ray Schofield, governance and how well the organisation handles its funds becomes even more crucial. He explains: `Governance standards now apply across both not for profit and for profit sectors. New Zealand has introduced new reporting standards with more on the way. The pressure is on organisations to be run by experienced people, typically from a business background.’
As the Grant Thornton survey points out: `The alternative – boards run by passionate inexperienced volunteers – not only exposes the organisation to increasing legal risks, but also to greater funding challenges, as funders with the deepest pockets are more likely to demand that donee organisations demonstrate sound governance and business practices.’
One of the first things that James Bichan did when he was appointed General Manager of iSign, Deaf Aotearoa’s interpreter service, was to apply for a business mentor. He got me.
He says: `We organise communication between deaf and hearing people and work with our clients and the interpreters to provide the best interpreting solution possible that best meets the needs of everyone involved. We encourage our interpreters to continuously improve their skills through professional development and mentoring to ensure our clients receive the best services possible. It was incumbent upon me to make sure my skills in running the service were professional too.
‘I started working as the acting manager of iSign in June of 2012. Six months later I became the permanent manager... and yes, I’m hearing. I grew up as a farm boy outside Palmerston North and started learning New Zealand Sign Language in 1999. I’m passionate about continued learning and affecting positive change. It was a straightforward decision to get a business mentor from Business Mentors New Zealand. I was new to a management role. You don’t know what you don’t know. I knew nothing about managing the organisation but I knew I needed to go and look for support.
`When I applied for a business mentor I honestly thought you would help me understand what I needed to do to promote iSign so that we could get more clients and more business for the interpreting service. But the most important things you helped me to understand were what the management of the organisation needed and how the governance of iSign relative to our parent body, Deaf Aotearoa should be structured. You directed me towards not-for-profit management training and then helped me develop a structure for the business, which is really vital if you’re new to not for profit organisations. I got a much better understanding of what I needed to do the job, what our baselines are so we can measure our progress and further define what our values are.’
James says it won’t be until later this year that he even looks at how iSign should be communicating because there has been so much groundwork that needed doing first.
`Later this year we can look at consolidating what we’re doing, and why and how we’re going to communicate. Up until now it has almost felt like creating an organisation from scratch. You prompted me to go and look at the whole question of governance. From that we started to have board meetings and more formal links between our organisations. Up until then it had all been a bit loose. We have a much closer relationship and a proper reporting structure in place. It has been eye opening and so valuable to bring in some more experience around governance. Our interpreting services are founded on volunteers, people who mean well, but we need business tools and expertise in order to do well.’
The same business principles of tight management, efficiency and accountability apply to any organisation whether it is a not for profit or a commercial entity. But a not for profit has to be particularly clear about its purpose and clear about timelines.
With both my commercial clients and mentored businesses I try to ensure that there is detailed and integrated data and planning. My business and marketing communications programmes are very focused on measuring the outputs and outcomes.
With many not for profits using money from government and foundations there is an extra level of accountability in financial reporting. There is no room for vague expenses and easy to misunderstand items such overseas trips or conferences unless there are clear, beneficial outcomes. When you are dealing with grant money or donations, budgets should be well-planned, transparent and watertight.
One of the things the new Business Mentors New Zealand initiative will do is bring in expertise from management and funding raising at larger organisations such as corporate foundations. But the core of the offering will be the provision of business expertise.
As Ray Schofield points out: `For us the business mentoring comes first. It is important that the business of the organisation works properly. We know from overseas that linking business principles to what your not for profit does is a streamlined way to operate, which generates energy in the organisation. But think about it, a business reputation is a positive. The fact you think like a business and can measure your success provides confidence for your funders.’
Peter Boyes is a PR and marketing communications consultant and a volunteer business mentor with Business Mentors New Zealand. For further information see