Organisational culture and leadership
Several charities describe undergoing a drastic internal change in their approach to bidding for and delivering public service contracts. This indicates that, while it is difficult to collaborate in the current environment, organisational change is possible and can improve partnership working. These changes were often motivated by a desire to be more financially stable and sustainable, to deliver better services and to reap the benefits of collaboration.
Collaborative organisations often have an organisational culture that supports collaboration and partnership working. This culture is shaped and modelled by the behaviours and values of leaders, including senior management and trustees. We see that collaborative culture then embedded in strategies, decision making processes, job design, structure and resource allocation. These internal factors have a huge influence on how organisations respond to the competitive environment.
A collaborative culture
The most collaborative organisations have a supportive culture that runs throughout their organisation. One major national organisation in particular described the key features of their culture that supports collaboration.
- Responsibility to support smaller organisations is part of their values and behaviours: 'We see our role as a larger provider to leave our door open, so we will help organisations in trouble, we will help organisations not get in trouble, we will help organisations bid...we don't take a charge for that…It's not strategic, it's actually behaviour…it's probably not going to have much impact on us an organisation, but it will on that community'.
- Instructing staff to serve the community rather than serve the organisations: 'When people join...and they come from larger players...their psyche is competition…..Our job is not to think we are the answer to everything...it takes a whole community...and they struggle with that concept because they think we have to defend [the organisation’s] position because this is who we work for....The organisation is immaterial, your job is to work for the people who need the support'.
- Ensuring growth or contract delivery doesn’t stop them from focusing on local communities: 'We play well with local players because we are 'think big act local'...none of our services are the same, they're all delivered in a very individual way to that community...of course everyone will say that, but we really mean it.' This same organisation describes the importance of resisting ‘contract culture’, whereby organisations focus too much on the contract delivery and not enough on achieving real change: '...the contract is part of your job but it's not your whole job'.
Attitude to growth and sustainability
Growth doesn't necessarily lead to better sustainable organisations.
Charities have different approaches to growth and sustainability. Some organisations have a strategy to expand in terms of the types of services they offer and where they offer them to try to make a difference to as many lives as possible. Whereas others grow to sustain their work, due to reduction or decommissioning in other areas, or after a period of growth. Notably, several organisations describe getting smaller, by ceasing to bid for and deliver contracts that do not cover costs, in order to become more sustainable.
Our goal is to see what part of the pie we can have in a fair way.
Several organisations describe the need for a nuanced approach to growth and sustainability. Some larger organisations with aims to expand also recognise that bringing in more and different streams of funding is not always best to achieve impact: It is 'important that larger organisations especially but all organisations delivering public services recognise that diversification for the sake of diversification doesn’t always benefit the individuals you are working with when there are specialist partners out there who you can work with.' One individual said their personal opinion on what growth means has changed over time – they used to view growth as organisational expansion, whereas now they consider how their organisations can be a 'builder for growth' more broadly.
One major organisation was emphatic about the importance of focusing on impact over targets or growth: 'I don't set any targets around development, size, scale or finance. What we are about is increasing our impact. I think those kind[s] of behaviours drive bad business...they drive bad behaviours. And we have been subject to some of that, because we were small…We want to be brilliant at changing people's lives. So long as we don't lose money we don't care about making money...so long as we are getting really good outcomes. We don't care if we are £10m or £100m, but we've always got to be brilliant.' Others described having targets to increase their reserves, rather than broader targets for growth.
Strategy and decision-making
The approach organisations take to making decisions about bidding influences how they compete or collaborate with others. When deciding what to bid for it is common for charities to consider whether:
- The opportunity fits with their strategy, mission and core priorities.
- The contract is financially sustainable, enabling them to recover costs.
- The current provider is delivering the service well.
- The service design/model is ethical.
- They have the capacity to deliver and mobilise.
- They have the relevant expertise and knowledge, to deliver or manage the contract.
- They need to work in partnership to deliver.
We will see contracts coming out for tender all the time where for example they will have cut the number of hours...without any rhyme or reason. It is wrong. We will increasingly push back but it is difficult because you are biting the hand that feeds you.
Partnership is an integral part of some organisations’ strategies and decision-making processes. Some charities describe a concerted effort to increase partnership working: 'As a national organisation we're moving towards more partnerships with very specialist local organisations who can demonstrate a track record in delivering specific aspects of a service well. This safeguards the continuation of their expertise and existence'.
Over the last few years, we have made a conscious effort to build partnerships with smaller local voluntary sector organisations to bid together, generally with our organisation as the lead provider.
Charities also build collaboration into their decision making by making space for other organisations, but we know these practices are not universal. Some charities demonstrate the following behaviours:
- Focusing on core priorities or geographical areas.
- Not bidding if the current provider is delivering quality.
- Only bidding if they have a local presence, or if they can partner with a local organisation.
- Not bidding if it would put a smaller organisation out of business.
We feel really ethically bound to not bid for things where people that we know are delivering a really good service.
Capacity and structure
Organisations need capacity and structures to support collaborative working. Several charities describe the importance of the following factors:
- Staff having the time and skills to collaborate well.
- Embedding collaboration into all job roles and descriptions, with some larger organisations having dedicated partnership leads and teams.
- Ensuring staff are well connected with local infrastructure bodies to help connect partners to further support.
- Ensuring internal collaboration exists to support collaboration with partners.
- Reducing internal barriers to partnership, such as onerous sign off processes.
- Embedding a learning culture into the organisation, ensuring staff are safe to be critical of themselves and the organisation.
Leaders, whether trustees or senior managers, have a clear role to play in shaping organisational culture. There are several functions leaders need to fulfil to shape a collaborative culture.
Clear direction from CEOs is important to change an organisation’s approach to bidding for commissioned work. One organisation described the role of a new CEO in transforming their approach to public service delivery. 'We were on a downward trajectory…She has managed to turn things around. We've stopped doing things for free on public sector contracts...'.
My chief exec…is not afraid to say it how he sees it and will stand behind the things we will push back on and challenge...Up to people at top to step back and say what on earth is going on here.
To shift quickly to a new approach the new CEO scrutinised every part of the organisation and made difficult decisions. A key to their success was focusing on quality, and listening to staff: 'We had been bidding on a number of CSE contracts over the years....and I had been saying I don't think we should bid on these unless we do some work internally. Within the first 3-4 months I got the ok to stop even looking at those'.
Our new CEO has been clear we don’t want to parachute in, and if anything we need to make sure the voluntary sector consists of smaller and local organisations.
Support from senior leaders is vital to ensure staff have the freedom and permission to develop partnerships. In organisations where their approach to commissioning has needed a drastic overall or in smaller organisations, CEOs seem to take a more active role in business development. In larger national organisations devolved responsibility is vital to ensure relevant staff and those with local connections can do what is best for communities: 'We have a local leader...they can develop partnerships, they can look at sharing infrastructure, they can look at sharing resource...they are invariably local people….If they are saying it makes sense to work with these people for these reasons we believe them'.
People on the ground might be prepared to work with us, but the people over them in the organisations won’t. There’s a kind of control there.
Some leaders indicate that partnership working is very personal to them and their leadership style: 'My philosophy is very much about working in partnership. I don't think others are…. some people just don’t like working in partnership and find it quite difficult.' Notably some of the most collaborative individuals in larger organisations remember their organisation being much smaller, or remember working in a smaller, local organisation.
I always think back to when we were small. If someone had come to me and said would you like to use our IT system I would have chewed their arm off to the elbow.
Creating the conditions
Boards have a vital role to support organisations to be collaborative. Some CEOs describe taking time to build the capacity of their boards to be collaborative and have a healthy attitude to risk.
Lots of trustees don't get the importance of their role.
It is vital for boards to be supportive of organisations saying no to work that is unsustainable or beyond their remit. Significant concerns have been raised about trustees from corporate backgrounds bringing an approach to impact that focuses on financial growth and getting bigger. Some highlight the importance of their board focusing on impact, quality and local reputation over growth targets: 'Our board absolutely will never ever, ever set us a target around growth income or margins…Our board want us to have a good solid local reputation not a big national profile…We have a very high risk threshold, but we have an enterprising board that's made up of people who believe in what we do.' It is vital that trustees bring relevant expertise and experience, but understand the different motivations and cultures of charities compared to for-profit business.
That generosity needs a certain level of organisational confidence which comes a lot from the board and the chief executive.