Corporate Model for Corporate Entities

A snappy title I agree. It all came about after a meeting I had with a former client. It's quite a large charitable enterprise that used to be extremely well run (well of course I would think that since I helped!). Some poor leadership in in the last five years, however, has led to some re-thinking on the part of the Trustees and management board and that is where everything has gone wrong.

Running charities is difficult, if only because it is so different to running a commercial or corporate organisation. I know, I've done both and am currently Chair of a small charity in Berkshire.

If a charity has been run badly, Trustees and boards often ask their auditors for advice or, if they are feeling brave, seek advice from large consultancies. These sorts of bodies tend to understand their own worlds and so offer a corporate model of governance. This can, sometimes, work - but generally only in the very large national and international charities which look quite like corporate organisations. For most charities and not-for-profit organisations it can be a disaster.

The key difficulty is in understanding that charities operate because of good will. Good will from staff, members, volunteers. The good will exists because everyone understands and agrees with what the charity is doing and believes that they are helping. Staff will accept what is usually a lower wage, members will join and then engage in the activities of the charity and people will volunteer to help out.

So steaming in with a corporate model can wreck all of that. 'Outsource non essential costs' is often the first cry and this tends to be catering, security, cleaning etc. I'm not even going to argue whether these can be considered non essential or not. The point is that staff in these areas in charitable and not-for-profit organisations are often engaged beyond their remit. They are working in that organisation because they like it and support it - so that means that a member of the charity or a member of the public who is served a cup of coffee, or who is greeted by the security guard at the door or who bumps into the cleaner meets someone who cares about the organisation, who knows what is going on and who passes on a real enthusiasm about the visit.

This does not happen in corporates.

Another problem with the corporate model is the profit centre. New managers in charities love to establish cost and profit centres and to encourage staff to think about ways to show profit in their centre. It is a charity - there is no profit. Staff in charities should be encouraged to do their jobs as well as possible so that more resource - time, effort and money - goes into the core charitable purpose. Prices in cafes and shops should be pitched towards market values, in general, but buyers should be made aware of why the price is what the price is - and that surplus goes towards the charitable purpose. If the charity has members and one of the purposes of the charity is to support those members (an educational charity, for example) then why should the organisation try to 'maximise profit' from selling them things - these are the people you are supposed to be supporting.

So - if your job is to run a charity, please try to run it like a charity and not like an accounting firm or a consultancy. It really just won't work. Remember about good will and work with your staff, members, volunteers and the public to drive understanding of the core charitable purpose - but don't forget that it is the people in the organisation that make the difference. Treat them like corporate and commercial staff (i.e. reasonably badly) and your organisation will start to look and operate like a corporate organisation, but without the financial resources and profit available. In the end your organisation will, at best, just end up looking like a badly resourced and run firm.

That can't be good.

Being on Holiday...

I spend quite a lot of time working with and mentoring senior managers in law firms, chambers, and commercial organisations. There are often two main things that I start by trying to get across - the importance of having some time to think, and the importance of having time to relax and recharge.

At this time of year, it is the second that I concentrate more on. In August, many of us are either on holiday or are about to go on holiday. If you are on holiday, my main point at the moment would be this: why on earth are you reading business blogs when you are on holiday! You have probably followed a link to the blog from an email or from Twitter, of you have some sort of notification that lets you know a new blog entry awaits. Again, however, why on earth are you reading this sort of thing while you are on holiday?

Most of us work rather hard and managers in organisations - particularly law firms and chambers, where few professional managers exist, and where the leadership team are managing the organisation part-time - and so it is vital that we take some time to relax and re-energise so that we can carry on the good work.

So - being on holiday. In order to be on holiday, there are a couple of things that you can do in advance that will help.

The first is to have a conversation about emails - with your secretary, with your assistant, or with your clerk. Are you going to look at emails at all over the holiday? Are you going to look at them once a day? Are you going to trust your secretary/assistant/clerk flag particular emails and only read those? Or are you going to be like Cory Doctorow (link here) who is reported to set up an autoreply when he is on holiday that says:

"I'm on vacation until x/x/2010. When I get back, I'm going to delete all the email that arrived while I was gone, so if this note is important, please send it to me again after that date."

Personally I think that approach is a little brave. My point is that it doesn't matter which of those you opt for, you should have the discussion in advance so that everyone in the office/chambers knows what your particular deal is - that way no-one is surprised that you haven't read their email for example.

The second thing you can do is have another discussion with the same people as above on the subject of contacting you while you are away. "Call me if something important come up" is hopelessly vague - you must agree what 'important' means otherwise you will either get calls to let you know that they have run out of coffee on the second floor and don't know where the petty cash is - or you will return to a smoking ruin of a building and someone saying "Oh we didn't like to bother you...".

Finally - let your most important clients know that you are going away and what the deal is about contacting you. You might say that your phone will only be on for an hour in the early evening so that you can check messages or you might prefer to tell them that you are going somewhere that has no phone reception (whether you are or not). Again the point is to set a rule and let everyone know what it is. You will be surprised about how accommodating clients usually are - after all, they go on holiday too.

Have those three discussion and it will go some way towards making sure that your holiday is as restful as possible.

Have a happy - and restful - holiday.