A Manufacturing Approach to Not-for-Profits

February 3rd, 2009 at 06:52am Bob Trojan

With the difficulty that United Way has had in closing the gap of funding and with the barrage of requests that I receive at the office as well as at home, it got me thinking.

In the manufacturing world, especially in those multi-facility locations, when companies look for efficiencies or reduced cost when revenues are falling, they will often consolidate facilities or even entire businesses.  We’ve seen that take place right here in the Rock River Valley.  The cost savings usually will come from consolidating staff, management, and even reducing the number of facilities in operation.

Usually, this results in saving products and saving customers.  Alternatively, if these actions weren’t taken, businesses would close and customers lost to competition.

So is there any lesson that could be translated to the Not-for-Profit agencies?  What if some of them would consolidate and reduce the staff and possibly facilities.  The new units could still serve their customers, i.e. the people in need.  But it could be done with less input of money either through donations or from United Way.

A very similar approach as I’ve seen numerous times in the manufacturing world.  So who would do the consolidating?  Surely, none of the agencies would offer to be consolidated?

Maybe the United Way could give this guidance or even stronger, make it a condition for the agencies to receive funding from them.  Did they ever think there simply were too many NFP’s?

Alternatively, maybe an ad hoc group made of of board members of several agencies might give this consolidating effort the guidance needed.

Harsh?  Yes for the organizations.  It may reduce duplication. After all, they are there to serve their customers, i.e. people in need.  And if they could deliver their services at a lower cost and with lower incoming money, then that certainly is better than reducing the funding that is given to the people in need.

One man’s opinion!

Entry Filed under: Economy