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Managing the Tidal Wave of Change ( summarized from a workshop for nonprofits developed by Anne Hays Egan, New Ventures & Bob Orser, The Nonprofit Doctor)The non-profit landscape is being fundamentally changed, restructured by a massive wave of change. This massive changes is being fueled by a number of state, national and international trends. These are major changes that affect attitudes, policies, financing and fundamental structure of organizations and business systems. Many of us who grew up listening to the Beach Boys and and The Ventures remember the pictures of the great surfers writing the huge waves. And, some of us were lucky enough to actually surf a bit ourselves. What always fascinated me was the way a good surver would ride that space of air between the top or lip of the wave and water beneath. The pipeline, they called it, the " sweet spot" for the greatest ride, and the most dangerous place if one was misfortunate enough to mis- judge. Some of the waves literally dwarfed the surferr. These are the kind of waves that are hitting our shores at the end of the 20th century. If we are successfully to "surf the ocean of change," we must understand a force of the wave, the currents, the way the waves may break, and those waves we should not try to ride. Otherwise, there is no way to position ourselves to catch the wave in the future, other than locked in sheer tenaciousness. Most of us will get wet and take many falls as we develop the change management skills needed to move into the next century. But, like the good surfers of old, many of us who remain in the field will hone our skills, develop new techniques, and learn to use different equipment. Historically, major trends have come in cycles, 10 and 20 year cycles, 50 year cycles and cycles of 100 years or more. These include major cycles like the Enclosure Movement in Europe after the early Middle Ages which displaced hundreds of thousands of people I gave rise to charitable works of churches. The Industrial Revolution created massive displacement, dislocation, new work, opportunity and wealth. The Information Age Revolution and a Global Financial Revolution and Structural Adjustment are creating similar change today. The large cycles tend to be slow developing, global and massive in their impact. Medium cycles of change include some of the political of social trends as well as the way of work and family are organized at local, regional and national levels. Smaller and larger cycles of change interact so that within certain issues, the distinctions may blur. Our national policy changes with health and welfare reform are part of a multi-generational cycles of change. Current national policy reforms, called "devolution" are part of a six-year cycle, and represent the largest changes since the New Deal legislation of the Roosevelt administration. Today, we have many different types of families: traditional, multi-generational, single parent, blended, gay and lesbian, and families of choice where are people with shared values live together and/or share resources. Demographic analysts and marketing experts have told us our market is more diverse and more fragmented today than ever before. "Niche marketing" efforts are needed to reach people more effectively. Local and state elected and appointed leaders are finding a set of the challenges as a struggle to understand the impact of massive national policy changes such as welfare reform and workforce development. Their faces the local financing challenges and a reticence on the most citizens to tax increases in bond issues. In the 1950s, it was, the fine the most people in a community who worked had a job for lifetime, or perhaps two jobs. Today, we have not only multiple jobs within a career, but multiple careers in which we may have multiple jobs. We may work in officer telecommute. Our work may be conducted as a staff member, contractor, consultant, or member of an outsource organization. Many of us work longer hours today and we are deluged with information. Some take early retirement or "cash out" of lucrative career and move to a less stressful environment. We are now experiencing the largest inter-generational transfer of wealth in our nation's history, paired with creation of new wealth by entrepreneurial and technological business. These volunteers and donors often reflect different interests in motivations from their parents' and grandparents' generations and have a more "hands-on" approach to giving. All of these trends affect the way we live the work, and affect the staff and volunteers non-profit organizations in our communities. Nonprofits are beset by major changes in a number of areas. These include:
Here is a summary of some of the trends: This includes welfare reform, workforce development, health care reform and a general reduction of federal funding for social programs (devolution). Many states are not making up the gap. Many states and localities are experiencing "taxpayer revolt", with taxpayers voting down revenue bonds and other proposed increased taxes, and voting against candidates supporting them. Fewer federal dollars are going directly to non-profit organizations in a competitive bid process, with more going to block grants to states, or in competitive proposals requiring extensive collaboration (HUD and Workforce Development are examples). Many states are reducing their funding for Health and Human Services, social a community programs. More nonprofits are finding they must compete with for-profits for state and federal funds. Competition for many state and local grants requires more extensive community needs assessments, service mix, better infrastructure and extensive collaboration. Donors are asking to see results. When they are convinced, they can be quite generous. The U.S. is experiencing the largest inter-generational transfer of wealth and its history. Corporate giving remains flat, but many corporations are looking to partner in new, creative ways. Nonprofits need to create a greater mix of revenues, more targeted approaches to these varied financing resources, and focus on results. Ten or 20 years ago, the tenure for non-profit executives was longer than it is today. The average development director stays in the job just a little over the length of the school year! Many organizations keep good development professionals for years, but turnover in the field is rapid, especially rapid and some areas. Executive directors are departing, and many are not continuing their work at the Executive Director level in another agency. The leave for staff work in a large agency, for contract project work, consulting, or they change fields. Personnel issues, management challenges and the lower than average salaries paid by many nonprofits create high turnover among all levels of staff, resulting in significant losses. Executives and managers who can deal with these challenges, provide effective direction and support, create a strong team, and pay attend competitive wages have a significant edge in the marketplace. Many board members of the past came from corporations that had a long-standing commitment to the local community. Banks, stores, hotels and other businesses were locally based. Today, companies in almost every field or consolidating through mergers and mega-mergers, and downsizing local operations for maximum efficiency. This is creating a situation where many local business leaders are transferred, lose jobs, or are extremely overworked in the new system. However, many executives that leave business positions create entrepreneurial start-ups that bring in new business and jobs to a community. The local communities experience with mergers, downsizing, economic development and entrepreneurial start-ups will play a large role in available pool of top-quality potential board members for non-profits. The other key is a non-profit skill in developing relationships in keeping a strong calm effective board operation. Searches for board members need to be handled differently, as the new "thirty-something" and "forty-something" executives are often small business leaders to do not hang out the local business clubs, nor attend black-tie events. They run their fast-growing operations in jeans and tennis shoes; like less formal activities for their free-time; and want hands-on experience with your agency. There are so many good agencies competing for good volunteers that agencies with the well developed in focused board will recruit more effectively. In the '50s, '60s and '70s, organizations for relatively simple. They had an organizational hierarchy most often characterized by the traditional boxes of the organizational chart. The organization experience change, but not as rapidly as the change found today. Today, organizations face so much change that the organizational chart is often a " document in flux" with constant deletion than editions. Functions are staffed by traditional full-time staff, part timers, temporaries, job sharing teams, contractors and consultants. Many organizations have self-directed work teams. There is less money available for management, and workers on the front-line need to make more decisions. The well-educated, motivated and self managing workforce is a new requirement for future success (which is a challenge for many nonprofits that have less than competitive salaries, an often are not up to speed in the newest management principles and techniques.) Non-profit and for-profit organizations are finding that that they are developing new relationships through collaborative ventures. Organizations are required by the marketplace to collaborate more with others, while maintaining competitive relationship with many of them. These include collaboration around issues, work partnerships through Memorandum of Understanding (MOU's), creation of networks and virtual organizations, and mergers. This activity creates downsizing, project spin off, and entrepreneurial start-ups. More the organization systems are upgrading to more computerized, high-tech operations to create cost savings in a long run, but are expensive to install train staff to use. This includes phones, mail, computer networks, data analysis, finance and accounting, marketing and a host of other functions. Agencies that do not have e-mail, network computers, integrated software programs, and MIS system that is able to handle more sophisticated analysis required by today's contracts are at a distinct disadvantage. However, while there is this move toward merger and consolidation, larger organizaitons and high-tech systems, there is at the same time, a growth in entrepreneurial and small operations and grassroots, community-based answers to problems. The key is knowing your programs constituency and niche. Basic marketing functions are now more highly computerized systemized. They are also more targeted. Today's marketing and fund development software allows for a level of analysis and market segmentation never before possible. Software also allows agencies to "desktop publish" many materials that formally required lengthy inexpensive typesetting. These tools allow for personalization, responsiveness, market segmentation and niche marketing impossible even a few years ago. However, staff need to have the appropriate software and market analysis resource and skills in order to take advantage of this new opportunity. The Internet, Web and e-mail provide new marketing opportunities to many smaller nonprofits. And with all of the new resources, personnel relationships are still primary. The author's professional career began using typewriters with round keys, and copies made with carbons. Since then, we have seen the development of answering machines, desktop computers, computer networks, cellular phones, Internet, e-mail, Web sites an increasingly small portable communication systems that allow you to take the office with you. The software has moved from a simple 256K based, to highly sophisticated tools for managing information through expert systems that border on artificial intelligence: data analysis, computation, desktop publications, publications, scanning and much more. As the hardware and software become standards in the industry, agencies with smaller budgets will be at greater risk. However, state associations and management resource centers can help nonprofits limit risk by providing bulk purchasing opportunities, reselling, corporate donations and information and training. As a society, we are more mobile and more fluid and we were a few generations ago. Many have greater wealth and disposable income, yet there are an increasing number of poor and very poor or unable to find living wage jobs, housing or services. Although health care is available to many, there are over 40 million uninsured Americans, and the numbers growing as employers opt out of insurance benefit plans. Our cities have become increasingly diverse and many regions, bringing with that diversity or range of new views, opportunities and a richness from the cultural blend. But, in many areas we find an increase in racial tensions evidenced by the burning of the African American Churches and hate crimes against a number groups. We also see on the one hand, the need for people to develop bi and tri- lingual capacity in business, but a backlash in many communities against bilingual public education. The Southern Poverty Law Center is tracking the very real increase in hate crimes, white supremacist activities and militia groups. And error our national public policy and funder initiatives to support healing of tensions, and to rebuild areas devastated by racism. Our families are much more diverse and ever before. We have traditional nuclear families, but they represent an increasingly small percentage of total households. There are more divorced, separated and widowed families. There are blended families and intergenerational families as households absorb both elderly parents as well is grown children and their children. At the same time, there are many more single persons households and homeowners. There are gay and lesbian households. And there are people who choose to live together as a " family of choice" as Maggie Kuhn of Gray Panthers was fond of saying. We hear the our society has "sped up". Many people report higher levels of stress and fatigue simply trying to manage the multiple pressures of work, family and community. People report working longer hours. In some fields, people are making much more money. However, those without highly specialized skills are making much less. In general, many in the American population have a declining standard of living compared to the 1970s, and, for the first time since gathering statistics, there has been a decline in the percentage of the middle-class compared to the rich in the poor. People are changing jobs more often, and changing careers. For many, this provides great new opportunities, for others, downward mobility. There has been a historic increase in violence in our cities and among our youth and young adults, especially for African American and Hispanic populations. In some areas, the violence has peaked or lessened. Teenage pregnancy has risen for years, but has peaked in the number of state and municipalities. Substance abuse is a real challenge in most communities, affecting increasingly younger children. Domestic violence continues to grow as a troubling social issue, and is being reported more in areas that have significant community problems. Literacy skills have dropped in many communities, and our children's scores on standardized tests do not compete well with other nations. Incarceration has increased in a number of regions. There are areas in our country were economic development is vibrant, and growing based on a number of indicators. There are other areas were communities are struggling to deal with population loss, economic decline caused by the flight of jobs and capital, violence in crime, and many other social and economic problems. High tech has impacted our personal social lives, through cable and Web TV, personal systems, and a range of "gadgets" unknown even a generation ago. In the midst of this fast-paced and high-tech world, we see quiet in nature as never before. "Cocooning", telecommuting early retirement and moving to rural or small city areas have become life-stylel choices for many well-educated, highly skilled in driven adults with high stress jobs and above-average incomes. Our world is more fragmented in many ways, and facing serious challenges. Yet, we find it many quarters the willingness to talk about spiritual foundations and hope. Some call it a spiritual resurgence, and not just in traditional religions but it many new arenas. Mediation centers and Ashrams are growing. Glide Church in San Francisco has become a national and international model for creating community. Twelve Step programs are flourishing, and our country has a fast-growing population of practicing Buddhist and Hindus. There's a growth in focus on spirit in the workplace, and the need for spiritually based, ethical business practices. There's a continued growth in socially responsible investing and socially responsible businesses. Chicken Soup for the Soul, books on angels, and Mary Ann Williamsons influence on the media with newTV shows about angels,miracles and goodness indicate that something is happening in our society's view of the spiritual. The emphasis on building communities, whether through asse -based community development or through national initiatives like those supported by Points of Light all demonstrate that there is a concern, and perhaps spirit and willingness to create healthier communities based on commonly held beliefs and values. Business has become more conglomerate, global, and also very localized. These different, really opposite, trends are happening simultaneously. Many large businesses have been bought and then bought again for ever enlarging conglomerates. In some cases, those large conglomerates breakdown and spin off portions of the old business. During the 1980s, financing for those acquisitions through the newly discovered technique out "leveraged buyouts" (LBO's) created a wave of mergers, followed by downsizing and stripping of companies in order to repay the financing package. Many jobs were lossed in the process, and although the finance industry has modulated this practice, the period of corporate acquisitions has been extremely difficult for many businesses and communities where they reside. As businesses downsize, move or change in other ways, the most talented of the executive pool often "cash out" with large bonus payments and develop highly successful small businesses or consulting practices. Still, other executives not as able to weather changes find themselves downsized and either unemployed or under employed. Those that succeed provide a wide range of new small businesses that build economic vibrancy and diversity in our cities, and provide new jobs. The balance in any region between job loss and job gain is one of the challenges as we analyze these trends; and analysis of fields most impacted by loss and gain is equally important. Many companies have global operations, especially large businesses, certain fields that benefit from political changes in Eastern Europe and Asia, and almost all conglomerates. This is driven by market need and market opportunity, as well as by a lower cost of human and material capital in other countries. This has created a situation were many companies have moved factory operations to Mexico, Central America or other areas. In Mexico, these operations are "maquiladoras", often branded, state-of-the-art facilities located in areas were laws are less strict, and the wages a small fraction of those paid in the US. There are new business it opportunities which have developed in the US as a result of the outsourcing of labor to other countries, however, they tend to be in the highly specialized fields. The blue-collar worker has fewer options, and will continue to face impoverishment and fewer options without significant retraining in a new field or entrepreneurial opportunity. Global business changes everything. There are new rules based on global norms rather than those of our own country. Our financial institutions are connected to global net of markets and governments. The World Bank has developed a policy that has led to massive economics shifts in many countries, called structural adjustment. Research and development begin (R &D) cycles in Japan are faster than those in the US, and our companies are working hard to invest more in R&D, shortened R&D time and expand markets for new items. International trade policy becomes increasingly important as we look at the balance of trade and at employment opportunities for our citizens. Jeremy Rifkin, author of The End of Work, indicates that in the competition for markets and profits, businesses are becoming increasingly competitive, functions are being automated, and work is requiring increasingly high levels of skills. Those without highly sophisticated education, language, technical, computer technology and social skills sets will be less able to compete to earn a living wage. What will our states, nations and a global community do to support both business and social needs? That is one of the great challenges of the new millenium.
Trend Worksheet
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