Video Kate Dewey discusses considerations for organizations forming strategic alliances.
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Nonprofit organizations are exploring how to work together in new and creative ways. Why?
- Demand for services is up, along with competition for financial resources, making the drive towards efficiency increasingly important.
- Duplication of services is viewed as wasteful.
- Some types of restructuring are equated with cost-savings.
- The social issues that nonprofits address are larger and more complex and call for scaled-up solutions.
Understanding the types of strategic alliances is a good first step in determining a fit for your organization. There’s general agreement that the types of strategic alliances follow a continuum. At one end are informal arrangements. At the other end are those that require high levels of formality, shared decision-making, and organizational integration.
The following types of strategic alliances are taken from the work of Dr. John Yankey, Ph.D., retired professor, Case Western Reserve University:
- Endorsement: Providing approval or support of a concept or action already conceptualized or completed by someone else. Example:letters of support.
- Co-sponsorship: Two or more organizations share (although not always equally) in providing a program or service.
- Affiliation: A loosely connected system of two or more organizations with a similar interest(s).
- Federation/Association: An alliance of member organizations established to centralize common functions.
- Coalition: Independent organizations that usually share a political or social change goal.
- Consortium: Organizations and individuals representing customers, service providers, and other agencies who identify themselves with a specific community, neighborhood or domain.
- Network: Organizations that share resources for mutual benefit, such as service provision.
- Joint Venture: A legally formed alliance in which member organizations maintain joint ownership (generally through a joint governance board) to carry out specific tasks or provide specific services.
- Acquisition: One organization acquires a program or service previously administered by another organization.
- Divestiture: One organization "spins off" a program or service to another organization.
- Merger: A statutorily defined alliance in which one organization is totally absorbed by another.
- Collaboration: Includes information sharing, program coordination, and joint planning. Organizations involved in collaboration remain independent with full decision-making power.
- Administrative Consolidation: Typically aimed at increasing efficiency, includes formal agreement for contracting, exchanging, or sharing services. Organizations involved in administrative consolidations share decision-making powers.
- Joint Programming: A restructuring where organizations share the launch and management of one or more programs. Organizations involved in joint programming share decision-making powers for the progam while maintaining their independence in managing their own programs.
- Corporate Merger/Acquisition: Includes full integration of all programmatic assets and administrative functions.
See also our other resources on nonprofit collaboration:
- Understanding Collaboration: Our free class, offered as an in-person class or a live/recorded webinar.
- Nonprofit Collaboration Resources web area, which includes a searchable database of 670+ collaboration profiles that detail participants, missions, motivations, successes, and lessons learned.
- An abridged online version of Best Practices of Effective Nonprofit Organizations, by Philip Bernstein. This volume provides guidance for nonprofit professionals eager to advance their organizations' goals.
Selected resources below may also be helpful.
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