A strategic partner is any person or group that can help meet strategic goals. If your after-school literacy program aims to help 1,000 more students read above grade level within the next twenty-four months, then reading teachers, parents, book publishers, and PBS are examples of possible partners.
Partnerships exist along a continuum from collaboration to group structures and finally merger:
Collaboration → strategic partnerships → joint programming → administrative consolidation → mergers/acquisitions
Less integration of administration and programs is required along the left and more along the right of the spectrum. The left side is more like dating. The right is like marriage. A strategic partner on this continuum, then, is one that will help achieve a particular goal without having to…get hitched! LaPiana Consulting, a national firm with expertise in strategic restructuring, is a great resource to learn about the different types of alliances and integrations.
|Fiscal Year||Children Served||Expenses||Cost Per Child|
|Threat indicators escalate →||FY06||1,680||$682,433||$406|
|Possible strategic partners sought →||FY07||2,072||$763,465||$368|
|Collaboration began →||FY08||1,488||$525,299||$353|
|Administrative consolidation →||FY09||2,800||$412,547||$147|
|Dissolution of Stages of Learning →||FY10||2,968||$371,651||$125|
The partnership dramatically reduced costs by 70% between FY07 and FY10 without affecting program quality according to the organization’s internal evaluations. The recession earned its “greatness” during the partnership, however, as nonprofits around the country began to feel the effects. Queens Theatre, struggling with challenges unrelated to the acquisition of Stages of Learning, no longer had the capability to sustain an education program and the Stages of Learning board chose to separate and dissolve the organization. We believed that the environment could no longer support the quality services for which Stages of Learning had become known.
Despite the dissolution of an organization that I loved and built, the goals of reaching more students while lowering administrative costs were ultimately achieved because of the partnership.
Stages of Learning is not an isolated case. Thomas A. McLaughlin, founder of Massachusetts-based McLaughlin and Associates, has said that now is the single most intense time in mergers and alliances among charities — a perspective shared by Bob Ottenhoff, outgoing president and CEO of GuideStar in Washington, D.C. who said “We’re on the verge of something happening if the economy doesn’t pick up. We’re going to begin to see…mergers and acquisitions become more prevalent. But it’s on people’s minds like it wasn’t five or ten years ago. The golden age of funding and those days are over” (Hrywna).
Are you going it alone? Maybe it’s time to to look around for friends and collaborators who can advance goals and ultimately the mission of organization(s) with which you work.
Next up: relationship to development and fundraising.
References and recommended reading:
- Building Successful Collaborations: A Legal Guide for Nonprofits by the Lawyer’s Alliance of New York: provides tools to make the collaboration process easy, effective, and legally strong.
- “Types of Strategic Restructuring” by LaPiana Consulting: describes different alliance options and integration types.
- “Strategic Restructuring: Alliances, Partnerships, and Mergers“ by the Center for Civic Partnerships: online tools, how-to guides, and practical resources.
- “Nonprofit Collaboration Resources“ by The Foundation Center: a searchable database of 670 collaboration profiles that detail participants, missions, motivations, successes, and lessons learned.
- “Collaboration, Strategic Alliances, and Merger Resources“ by the Third Sector New England: articles, web links, project profiles, and videos on nonprofit collaboration.
- “Grant Space” by the Foundation Center: a knowledge base for information about strategic alliances.
- Board Talking Points: Mergers and Strategic Alliances by the Lawyers Alliance of New York: provides a framework for discussion, defines terms, and describes the mechanics of a merger.
- Mergers and Strategic Alliances for New York Not-for-Profit Corporations by the Lawyer’s Alliance of New York: addresses the legal issues surrounding mergers and other strategic alliances for New York’s not-for-profit corporations.
- “Mergers Keep Doors Open, Refocuses Management” by Mark Hrywna: describes current activities and trends in mergers and alliances.