Sustaining Innovation

Any professional or lay leader of a nonprofit organization is familiar with the perpetual quest for innovation. Responding to the needs of the community in fresh and cutting edge ways is not only a constant challenge, it is often compounded by the additional task of presenting these new ideas to funders or supporters.

Present and prospective donors are always interested in what is unique, innovative and/or creative about a new program and the way it responds to the community’s needs. It is no longer enough to provide services. At the same time, there is a price for maintaining a strong commitment to creative approaches. How do voluntary agencies sustain funding for sometimes risky and innovative ideas? How do they continually search for new ways of providing social, health and/or educational services and at the same time sustain the services over time?

When an organization strives to be continually innovative there are several dynamics at play. One is finding a steady source of funding for these services. It is not enough to merely cultivate a relationship with a donor or foundation for a new approach to providing services. The ultimate goal is to be able to rely upon this source of funding otherwise the program will be innovative for a limited amount of time and then the organization will once again be faced with the challenge of how to sustain it.

Often with new approaches the agency will have a choice between maintaining its status as an innovative, one-off program or successfully integrating it into its “menu” of services offered to the community. In either case the question remains: How will the funding be sustained? Since many sources of support are interested in funding programs that are new and innovative, the question really is how long will the new program remain a new program?

Once a new program proves to be successful, the next question becomes how to integrate it into the agency’s offering of services. Funding also has to be considered, with either additional fundraising needed or existing services eliminated and redirected to support the new program. Thus, there is a trade-off: raising funds to sustain the new program or setting new priorities for the use of the present budget.

A number of years ago there was an effort to develop creative approaches to dealing with children-at-risk in Israel. A new fund was developed to support creative approaches to dealing with a number of challenges faced by both the agencies and the clients. Nonprofit organizations were awarded grants for pilot programs that had the potential to be replicated throughout the country. The grants were renewable for up to three years and then the participating agencies would have to secure their own funding to continue the programs

Unfortunately, since the three-year limit on funding was implemented, many of the organizations had to discontinue the programs after the funding ran out. This was very frustrating because there were a number of very innovative programs that were able to reach out to the families and their children in very special ways. Although the plan was for the organizations initiated the programs with an understanding that the government to absorb the cost of the programs this did not materialize and the agencies had a difficult enough time raising the need funds for their on-going programs. They had not planned to find additional sources of funding for the new programs and they were prematurely closed down.

A number of foundations have established a policy of renewable grants for up to three years and the professional and volunteer leadership of the recipient organization must consider what will happen at the end of the three year granting cycle. It is not sufficient to wait until the end or even the beginning of the third year to decide how the funded program will be continued. This is not a professionally appropriate way for handling the issue of sustainability.

There are many such examples and the lesson learned is there is a need for the leadership that initiates creative and innovative programs to think about sustaining the programs before they are implemented. It means agencies need to establish a fund for sustaining innovative programs for several years beyond the initial funding period.

If a fund for sustaining innovative programs is not realistic then the agency has to develop an alternate approach. It may mean that even before the grant is awarded, the leadership of the organization begins to approach potential donors to explore who would be willing to either co-fund the program or help leverage funds. Once a program has demonstrated success then it behooves an organization to approach multiple funders to ensure its continued support

The funders are then provided with detailed information about the innovative program and the rationale for the original pilot grant. They would agree to provide the necessary funding during a transitional period from the pilot grant until a plan for the sustainment the program is guaranteed. The most effective way would be to establish an endowment fund for supporting the continuation of special programs for an additional two to three years.

However, if such a fund is not realistic then the next approach would be to solicit support for a number of years on an annual basis. There are donors who would value participating in providing continuity by sustaining the success of creative and innovative programs. It is imperative that an approach to these donors be thought out in advance. This process will benefit the agency and the community because new programs will continue beyond the initial funding.

Stephen G. Donshik, D.S.W., is a lecturer at Hebrew University’s International Leadership and Philanthropy Program and has a consulting firm focused on strengthening non-profit organizations and their leadership for tomorrow. Stephen is a regular contributor to eJewish Philanthropy.