ODGERS INTERIM OPINION
Rebecca O’Connor, Consultant in Odgers Interim’s Public Practice, discusses current trends in the charities sector
With statutory funding rapidly declining and the demand for high quality service provision unceasing, charities are finding themselves in a brave, and incredibly competitive, New World. The question is; are they able to create sustainable and robust business models with the service user still being the most valuable stakeholder?
With local authorities adopting new commissioning frameworks for large public service contracts, the charity sector – and particularly those organisations operating in health, social care and criminal justice - are moving towards a position where they will be able to compete with rather than be the "arm candy" of the prime contractors. However, that could be a long time coming for some of the smaller to medium sized charities as one of core the issues around being able to compete is that they lack the scale and vital commercial & management skills to challenge the private sector.
‘Professionalisation of the workforce’ is a phrase I hear frequently. What makes a good frontline client facing manager doesn’t mean an automatic promotion to a good operational or commercial director. Much work could still be done around training the workforce so that they are able to deal with the challenges of working in an open market with performance management and business development being particular key challenges. I am often asked to find experienced interim managers who have a blend of both commercial and public sector experience, who have worked with multiple stakeholders and have knowledge of a shifting regulatory and commissioning landscape.
Charities are - in effect - social businesses and in any market-led model greater emphasis is needed on evidencing high professional standards and good quality products that are backed by robust governance, greater financial accountability and best value for money for the services provided. This doesn’t mean you ‘stack them high, sell them cheap’ when it comes to working with the most vulnerable people in society, but the rigours of the commercial sector should still apply.
Of course it would be erroneous to suggest that all charity managers are not as forward thinking as their commercial counterparts. I have met many incredibly commercially minded yet socially driven directors who effectively have to achieve more out of less whilst not losing sight of the person at the heart of the care they provide.