Charities – merge, collaborate, survive

People joining hands in front of a jigsaw piece being added to a picture
Essential to join forces and survive

Charities – Merger Acquisition and/or Collaboration for Survival?

A major issue emerging for some Charities in 2019 is the sudden collapse in revenues, despite previous operational successes and great community outcomes. 

A second one is the maturing and implementation of GDPR data controls as everyone becomes even more aware of recent data breaches and fines. Communications of sensitive information, about care plans and beneficiaries, from staff and volunteers to marketing agencies, the NHS and Social Services are often fraught with dangers.  

Revenue collapse? A continuing squeeze on local authority and CCG funding, combined with previously ‘friendly’ grant bodies being swamped with requests, and turning down applications, can create unexpected cash flow shortfalls. Changing gear to try to tap into Private Sector businesses for support is sensible but not an overnight cure. The nationals often have made prior inroads. 

Data and GDPR controls? Initial attempts initiated for the June 2018 threshold need freshly analysed and with staff changeovers, controls must be checked. 

Market sizing and optimal structures? With over 160,000 Charities active, and most with revenues of less than £500,00 and employees less than 20, is there therefore a need for some to merge and join forces, and in the process reduce overheads whilst presenting a more sustainable image? 

Founders and CEOs will have had great pride in their ‘independent’ journeys, and it will be a humbling yet courageous step to lower the white flag and accept that a merger and collaboration may be inevitable. 

But practical problems lie ahead. 

  1. who takes control? 
  2. what is the new service delivery model going to be? 
  3. how do new processes actually flow?
  4. what balance sheet assets remain and can reserved funds be pooled 
  5. how can sensitive data on different systems be merged and rationalised? 
  6. can locality differences be resolved – and most of all 
  7. how can teams be managed so that services to beneficiaries are maintained for their protection during any merger or acquisition.

Managing and optimising People, Processes, Technology and Information is never an easy task. 

There is need to integrate the leadership and resources, to accelerate financial payback and get implementation benefits faster. Meanwhile of course, protecting those you look after.

The problem? – two cultures, teams, sets of processes and systems, and two sets of data on staff, volunteers, contracting bodies, grant bodies and beneficiaries – but just one set of rules on GDPR and compliance to be followed. 

Pressure will grow from grant bodies, contracting agencies and trustees, to get it done and present a new operation as being sustainable – so what we at DataWise Intelligence do is to help you and your accountants and solicitors (who will be laying out the financial and legal hurdles to be overcome) map out the practical steps needed to be taken on integrating teams, systems, data and of course marketing and communications planning, and fund raising.

With many years’ experience as managers and some of us as trustees, we have spent several man years designing our new Optimiser4 service. This integration methodology model will help any Charity CEOs and Trustees address the key issues in a holistic, integrated yet pragmatic way. Furthermore, our legal and GDPR team can map out what can and cannot be done with any information you currently hold or use. 

Mergers and acquisitions are great on paper but do need to be well planned and followed through carefully. An initial set of interviews with a Chair and CEO can let us provide you with an Action Blueprint laying out scope and possible priorities – all provided for a low fixed cost. 

One place, one common understanding, one set of creative ideas provided at a low and fair initial cost set to reflect the austerity environment.

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