Smart Growth

A conversation between Mary-Kim Arnold, New Urban Arts board member, and Tyler Denmead, about how non-profit organizations might grow in a sustainable way, maintaining their mission-focus and program-effectiveness.

TD:
I have been asking myself what meaningful growth for non-profit organizations might look like. I see two major influences in how we talk about growth. There is an assumption that bigger means "better" and better means economies of scale. The larger an organization is, the more efficient it must be. This doesn’t feel right necessarily, because the non-profit sector isn’t the manufacturing sector, where the idea of economies of scale originates. In the social entrepreneurship arena, it is often asked how the organization is going to scale - even before its practice is even established. There is a fascination with the entrepreneur as a celebrity/leader who is capable of leveraging broad-based change. There is pressure to grow big, but I find it hard to find thoughtful conversations about what big means, and what the implications of becoming big are.

MKA:
Can you articulate what the pressures are and where they come from?

TD:
One pressure is from a fundraising perspective. An organization that is "small" is only important on a local level, therefore this limits access to funding beyond the community where the organization resides. This is troubling in Rhode Island, considering 70% of non-profit organizations have budgets less than $100,000. Another pressure is from an effectiveness standpoint. If an organization remains small, does it become insular? How does an organization remain fresh, how does it challenge itself when it is not growing (in the traditional sense?) A third pressure, and perhaps the most important, is from a mission perspective. What size and type of organization must one become to achieve the broad-based and sustained change that it envisions?

MKA:
I think the model of small organizations being linked can offer some interesting perspectives. The Alliance of Artist Communities, a member organization, which centralizes some of the administrative functions of the organizations it supports, might be an interesting approach to look at. Charter schools, too, might provide some interesting examples. They are individual, yet there is “power” if you will, in their shared resources, and their ability to collectively advocate, lobby, communicate.

TD:
Yes. I hear the National Performance Network offers another good example.

MKA:
It seems as though the "effectiveness" measures that the manufacturing sector utilize are not consistent with the kinds of things we are trying to measure here. Although I am mindful of some of the lessons from manufacturing and commerce – in terms of Friedman’s “flattening” – the emphasis on ownership of methods is less and less important. The information is available readily from anywhere in the world. It is the implementation, the leadership, the innovation – that drives “results.”

TD:
Absolutely. Yet, organizations like New Urban Arts are critically referred to in some circles as "boutiques" - the implication being that this type of organization is expensive, under-professionalized, and limited in scope. And, the question naturally becomes, how can the organization achieve a certain scale to deliver its programming more broadly, cheaper, and more professionally. I would like to figure out how to reframe the debate. I guess it's trying to understand the best way to share resources, practice, etc. I don't want to be a factory. I don't know how to be a network.

MKA:
It seems to me that "network" is really the way to go. But let’s interrogate this more closely. What do networks look like? How do they work?

TD:
There are webs, hubs and spokes, loosely affiliated programs bound by values and ideas, centralized organizations supporting satellites.

MKA:
What are the obstacles to networks, webs? The entrepreneur as rock star phenomenon?

TD:
The obstacles to networks seem countless. Entrepreneur as rock star is an issue here, i.e. too many egos and ideas can get in the way. Too many varied interests. Too much work. Not enough "results." Centralized leadership versus shared leadership.

MKA:
Is it fair to say that organizations in earlier stages tend to have bigger egos at the lead? The "founders," if you will?

TD:
This is a very important question. According to Independent Sector, 3,000-4,000 nonprofits are being created each month, and growth in employment in the sector outpaced the for-profit and government sectors from 1997-2001. So, understanding founders is critical to understanding the sector.

There was an article published in Grantmakers in the Arts Reader this year by Susan Kenny Stevens, titled, “A Call Taken to Heart: The Entrepreneurial Behavior of Nonprofit Arts Founders.” In the article, she discusses the relationship between one’s “inner script” and the need for venture creation. She cites some common trends among nonprofit arts founders: thrust into premature responsibility, are willing to risk public failure for acceptance, and see creating new ventures as acts of rebellion. The act of starting an organization is perhaps as rooted in the ego of the founder than the need for the organization itself.

Whatever the case may be, the founder’s ego is a driving force in the early stages in many ways, and there is also an assumption that the founder eventually holds the organization back from growing. I tend to hope that the founder’s identity, responsibilities, and skills can shift as the organization evolves.

MKA:
I'm wondering if there is any value in partnering with or exploring more "established" organizations? I am not sure what I mean by that, exactly, but I am thinking that when you put a lot of smart, driven people together, you are bound to end up with a lot of folks who want to be rock stars.

TD:
What does established look like? Organizations that have grown beyond their founders?

MKA:
I think that's what I mean. Organizations that are not exclusively personality-driven. That are sustainable beyond the initial stages of formation.

TD:
This is where rock star comes in. I feel like all organizations are personality-driven nowadays.

MKA:
OK. Well, let's think about rock stars for a moment. How do rock stars come together? A common cause, at least as each individual interprets it? A belief that they are essential to a certain thing being successful (rock star characteristic). A sense that there is a historical moment in the making... a movement.

TD:
The cynical side of me says that when the common cause advances the individual's agenda better than the individual can, then they come together.

MKA:
How to leverage that instinct… I attended a conference a year or so ago of progressive Asian -American women, and one of the main questions was, is there an Asian-American women's movement? And in some ways, this is the question we are looking to answer here in this conversation..is there a movement? Can there be one? Is it necessary or useful to look at it this way?

TD:
I want to go with your thinking, but I can't get the recent 8 global concerts fighting African poverty and indebtedness out of my mind.

MKA:
Yes, the recent concerts, I am trying to block them out myself...although maybe there is a lesson there, as well...

TD:
Tell me more about the conference conversation.

MKA:
We looked at the issues facing APA women, and we looked at the work that was being done. Then we looked around at each other and saw the energy, the passion, the intelligence in the room, and it was inspiring, it was motivating, energizing. We came away with the conviction that "yes there is a movement and we are it." I'm wondering if that's not something that we need - just a convening of sorts - regionally? nationally? virtually?

TD:
I think one of the more beautiful convenings was Black Mountain. Have you read the book by Martin Duberman? I read it the first year I started working on New Urban Arts. It recounts a bunch of post WWII artists - Joseph Albers, Merce Cunningham, Buckminster Fuller - who set up a retreat in North Carolina for people to come make work, share ideas, take "classes." Progressive school.

TD:
What do convenings need? Do they need a reason? Do they need facilitation? It almost seems that what happens must originate there. What are the questions? Who are the audiences?

MKA:
The questions are: How do we grow? How do we communicate with each other? How do we sustain the energy that brings us to the work in the first place? Perhaps we can set up a listserv (I know, another listserv) and invite local/regional nonprofit leaders to sign up - put the questions out there, track them - see if there is energy for such a thing. Board members, and staff of nonprofits that are looking to the next phase - who are interested in envisioning a future for nonprofits… what is our legacy?

TD:
Interesting... Is this a sector-wide conversation? Is it a community arts conversation?

MKA:
I am thinking that maybe we throw it out to the whole sector?

TD:
Conversations across disciplines are missing. The disadvantage is that leadership fear conversations where there may not be a tangible outcome. "How do we capitilize on the energy that is here?" without any resources to do so. The alternative to a convening is to find where the conversation or movement exists, and try to locate ourselves there.

MKA:
Where is it happening?

TD:
Small school movement. Charter school movement. Social entrepreneurship / venture philanthropy movement.

MKA:
Feminist movement? What does it mean to have a movement? What do these movements have in common? What is the threshhold for a movement?

TD:
A cause. Shared energy. Leadership. Attention.

MKA:
A few rock stars.

TD:
Arnold Aprill writes on the website of the organization he leads http://www.capeweb.org, “there must be at least three change agents in any institution to activate a critical mass, a tipping point, for change. In the ecology of an institution: > One change agent is a mutation. (One point is a point of contention.) > Two change agents are a conspiracy. (Two points draw a divisive line in the sand.) > Three change agents are a team. (Three points define a field of discourse, open to others, with many entry points.)”


Thoughts about this conversation from Jim Berson, Meeting Street School, sent via email:

"I was meeting with a local leader who believed that the right size of an organization is dependent on a couple of factors: what it needs from a resource base to hire talented people, having enough people employed to have a leader that could actually spend time leading as opposed to just providing service, and the organization's mission. Another E.D. I met said that things really changed for the positive when his organization was large enough ($350K) to free him up to do advocacy work and impact the public policy dialogue, as opposed to him being in the office leading workshops with kids around racism (which his employees were now able to do when his place grew)

I think that the issue of reinvention and insularity of an organization is largely a leadership issue, at least in my professional experience. I had the distinct pleasure of working for a CEO who had the ability to reinvent himself and the organization -- not like a rockstar, but rather unassumingly -- without losing the core mission/vision/purpose of the place or severing its roots. Sooooo, I think it is possible for an organization to remain vibrant and vital without dot.com like growth rates --- if there is a leader who has the time to focus on leadership.

In terms of growth and size for NUA, I was concerned that you might ask me to be practical as opposed to theoretical. A couple of thoughts, so long as you asked.

1. I think you need to have NUA large enough to be able to assure its location, wherever it may be. This could mean large enough to buy the building you are currently in and make the monthly payments without rolling blackouts to save money

2. I think you need to be large enough so that you have the time to lead-- no rule of thumb, but perhaps you should be spending 1/3 time leading, 1/3 time managing, 1/3 working directly with kids/artists. Then there is the 1/3 time spent fundraising.

3. I think you need to be large enough to have the kind of impact on kids and communities that provides meaning to the kids, communities, you, your staff, and board.

4. I think you need to be large enough to be able to hire talented people, grow and develop them, and keep them.

Other than item 1, perhaps you are already at the size you need to be. And growth could mean more around networked relationships than necessarily budget size."