Jon & Steve’s blog post on Monday was certainly thought provoking and when Susan and I chatted about it a whole range of things were brought to mind. Two issues in particular came up for us:
- Defining ‘mission’ success is hard
- Permanently failing organisations (PFOs)
I’ve picked up on the first one and Susan shares some of her experiences of encountering what could be described as PFOs, a termed coined by Meyer and Zucker in the late eighties.
As Steve and Jon indicated in their piece, I think one of our challenges as a sector is the ambiguity of mission success. You might think that measuring success is fairly straightforward – decide what you want to do, monitor what’s happening, evaluate at the end to see whether you achieved it or not. However, approaches to measuring success in the wider non-profit sector have been through a number of different phases that reflect shifting priorities:
- Goal attainment (1960s): delivering specific goals. This can be problematic because it relies on very clearly defined goals (something the sector is not always great at) it also only considers the ends and not the means
- Systems approach (1980s): focuses on the effectiveness of gaining inputs and producing outputs
- Management factors (1990s): internal resources are seen as drivers of success
- New Institutionalism (2000s): success or failure is determined by the institutional context the organisation operates in
I won’t go into detail on all these now, but it is interesting to note that thinking in the non-profit world is constantly changing with regard to the factors that help determine success and/or prevent failure. For me it definitely poses a big question about how we understand success and failure. Not only might we struggle to define our intentions we also have different schools of thought on how their success is determined!
I often see organisations surviving on the basis of ‘what might be’ rather than ‘what is’ and this is now a condition that applies to pretty much the whole sector. As we move into the next phase of the pandemic there are no certainties. Maybe now is the time to have some very open conversations about how me might not just measure but understand success going forward?
Some researchers have suggested that survival is the core marker of success but as Susan will now outline, even that is problematic.
Permanently failing organisations are not always financially weak but their businesses are.
My involvement with permanently failing organisations (PFOs) has been thankfully rare but when I have been asked, usually by funders, to undertake a review of an organisation that turns out to be permanently failing there are a few marked and common characteristics.
- There is a widespread broad understanding of the issues among stakeholders and often key board members well before I start work. Yes, I can get into the detail, but the overall picture is never a surprise, just an unwelcome colouring in of a sketch already drawn. These private acknowledgements are often matched by public silence or even support; indeed, the most common response my work is thankfulness that the truth can now be told openly.
- The troubling aspects of the situation are not new and have usually been of concern for several years if not decades. Problems have been left unaddressed, shoved into the ‘too hard to tackle’ box for reasons of policy, politics or personality. The ‘diverse interests that accumulate over time in and around organizations’ can operate to defend the status quo and limit necessary change (Meyer and Zucker, 1989).
- The internal culture is unhealthy. Common but not universal characteristics include: autocratic leadership, a culture of secrecy and blame, clear ‘in’ and ‘out’ groups, a lack of trust, dysfunctional relationships and a reluctance to be accountable to trustees, funders or the wider public.
- A distinctive pattern of staffing and board membership that combines a few people who remain for years and sometimes decades with a constant churn of many people who leave quickly.
- A narrow and impoverished business model that draws resources (cash, brand, participation) from a limited range of funders, supporters and customers. Permanently failing organisations are not always financially weak but their businesses are.
- Permanently failing organisations are often aware of their vulnerability but seek to deflect responsibility for addressing their challenges onto others, the emphasis is always on rhetoric not results.
As I suspect you have realised by now, this is something I care about and you could reasonably ask me why it matters if the odd organisation is allowed to continue to operate well past its sell by date. My answer would not start with the misuse of resources, although that is a factor especially if the funds are public. Much more seriously PFOs often inflict significant damage on the people who work in them stripping them of confidence, denying them opportunities for learning and hindering their development as human beings. Often PFOs do not serve their communities and beneficiaries well but their presence can deter others who might do better getting involved. And there is an opportunity cost in allowing them to persist: they use resources (cash, people’s creativity, goodwill, engagement etc) that could be better used by others.
This post was triggered by Jon and Scott’s blog on Monday but is also written in the upheaval of Covid. One way stakeholders might look to solve the problem of a PFO is to encourage another organisation to merge with it. If that offer comes your way, think about it carefully.
Dawn & Susan
References
Meyer, M.W. and Zuker L.G. (1989) Permanently Failing Organisations. London: Sage Publications Limited.