SUCCESSFUL INNOVATION REQUIRES PARTICIPATION BY ITS STAKEHOLDERS
Nonprofit organizations used to think of innovation as an extraordinary business practice: something to be done as a last resort given its cost. Business as usual was the more common refrain.
Nonprofits were often in survival mode: dollars raised were spent on programmatic and administrative expenses. The business was in a self-imposed bubble, and rarely sought to collaborate with others. For better or worse, the philanthropy stayed within its lane; change invited challenges which management sought to avoid.
Along came program enhancements and time-saving technologies. However, COVID-19 created upheaval which required nonprofits to embrace innovation in order to compete, if not, prosper. As one observer noted, “…during the pandemic, necessity became a mother of invention.”
Virtually all business organizations soon mastered technology that allowed for virtual (Zoom) meetings, remote medical care (telehealth), and purchasing power utilizing online shopping as well as QR codes for use in ordering meals. Those that pivoted quickly and effectively were praised as resilient and were rewarded with support from new and existing funders.
Today, donors and consumers expect to know how their dollars are being spent, the impact that their dollars will make, and the time frame within which the impact will occur. New technologies enable a nonprofit to furnish answers to these questions in an authentic, impactful way. However, innovation requires more than new technology. Management must engage its human resources, that is, its “stakeholders”, to participate in the innovation process.
IDENTIFY THE PLAYERS
Stakeholders are typically those who have a vested interest in, or who will be impacted by, proposed changes. Included are the nonprofit’s officers, board of directors, executives, employees, donors, volunteers, and beneficiaries. Other supportive nonprofits as well as the community at large may also be stakeholders under certain circumstances.
Each of these stakeholder groups can be an asset to management by asserting its support of the organization’s intent to change objectives, processes and/or priorities.
THE BOARD: MAKE THEM AWARE AND PUT THEM TO WORK
Innovation starts with the people who have the power to accomplish change. In most cases, members of the nonprofit’s board of directors are best suited for the task of conceiving change, envisioning the impact of change, assuming responsibility in the event of failure, and working with management to communicate both timely and appropriately with other stakeholders. Their collaboration is essential to achieve desired changes.
Directors assume fiduciary responsibilities much like owners of a for-profit business. They oversee the resources of the organization and monitor its capacity to finance current and future expenses. Board members should also serve as ambassadors within the community at large. They should be capable of joining initiatives which call for innovation in fundraising endeavors, operations, governance, recruiting of their successors, joint enterprises, marketing and technology.
STAFF: THE KNOWLEDGEABLE BOOTS ON THE GROUND
Management must also create and maintain a culture where its staff is free to question approaches, suggest alternatives, and challenge the status quo. The best way to promote an optimal business environment is to include its employees in its plans for change from the outset of a project, and to elicit their feedback throughout their implementation. Models for acquiring employee input vary. In some situations, nonprofits have engaged all its employees via informal surveys and or dialogue. Others have established ad hoc or standing committees, or task forces to address one-time or recurring innovation issues. Leadership will find that an informed staff is a supportive staff.
DON’T FORGET OTHER STAKEHOLDERS
Donors, especially those who have the wherewithal to help finance a new initiative, must be included in the decision-making process. They’ll want to know how a proposed innovation will impact existing programs and projects that they have underwritten. Circumstances will dictate how management chooses to educate its donors: is a private conversation warranted, or should the orientation be done in a group setting where donors who support the initiative may persuade others who are uninformed or undecided? Parlor meetings, workshops, and town hall meetings each have their advantages and disadvantages.
In some cases, leadership may issue a short survey among its donors to ascertain their preliminary attitudes about the new initiative and use that feedback to decide upon the type and size of gatherings likely to be most effective. Cost is an obvious factor in determining the size and scope of management’s educational efforts.
Volunteers and recipients of a nonprofit’s support/services also have the potential to become strong advocates of the proposed innovation and may be invited to participate in these meetings.
CONCLUSION
Innovation is here to stay. Management has much to gain and little to lose by planning for change in collaboration with its stakeholders. Such may produce ideas which facilitate implementation or disclose obstacles to success which management had not foreseen. Informed directors and donors are far more likely to endorse changes as a positive measure of its organization’s resilience than those who have had no opportunity to be heard. Building consensus is essential to the advancement of any nonprofit in today’s ever-changing business world.