Culture First: Tips on Nonprofit Merger Success through Organizational Cultural Integration

Too often people think of nonprofit mergers as a frantic survival strategy for organizations in a state of financial crisis. However, robust nonprofit organizations are using a range of partnership, consolidation and strategic alliance models not to survive, but to thrive.

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In early 2015, AIDS Network and AIDS Resource Center of Wisconsin (ARCW) announced their merger, supported by a grant from the AIDS United Sector Transformation Initiative. The organizations were not in crisis. The merger goal was to combine two strong organizations and expand services to patients and clients.

“Wisconsin has always been a national leader in the fight against AIDS. Our merger will enhance this leadership position. By combining the best of our two organizations, we will enhance services, improve clinical outcomes, and generate new financial resources, all of which are critical as we continue on our quest for a world without AIDS.”

– ARCW President & Chief Executive Officer Michael Gifford.

Some Merger Integration Do’s and Don’ts

Vista Global Coaching & Consulting facilitated the negotiations and the organizational integration for AIDS Network and ARCW.  The continuity of consulting support over the course of both phases expedited the entire process. The timeframe from the initial conversation of the negotiation team to the celebration of the merger integration process was 18 months.  Although the process was efficient, it was not without intention and focus.

Don’t Ignore Culture in the Negotiation Phase

Honor important cultural elements of pre-merger organizations. Surface and address historical challenges in relationships between organizations to move forward in creating a new narrative. Sensitivity to power imbalances and strategies to mitigate those imbalances from the beginning of negotiations, sends the clear message to staff of both organizations that we are in this together to create a stronger organization that will better serve clients.

It is important to build relationships among the negotiation team members and develop a shared vision. Crafting ‘Strategic Intent Statements’ supports transparency and documents a process rooted in good faith which allows the group to point to that shared intent when there are bumps along the way.

Do Make Culture the First Priority in Integration

It is easy to launch into the systems and structural integration elements of combining two organizations but there is great risk in not putting emphasis on culture as the first priority.  Without this focus, it is easy for staff to stay locked in the pre-merger cultures and fall into “us v. them” perspectives.  Building an integrated culture is critical for long-term success.  Cultural integration requires intention, structure and tools to support the transformation.

To begin a cultural integration process, it can be helpful to use an assessment tool that provides an objective framework of the cultures of the combining organizations. In the AIDS Network-ARCW integration process, we used the Organizational Culture Assessment Inventory (OCAI). The tool allowed the merger integration team to look at the existing cultures and determine the preferred culture moving forward.  Identifying the vision of the preferred culture and the behaviors and beliefs that align with that preferred culture sets the course for “being the change we want to see” in the new organization.

Leadership Takeaways and the Return on Investment

Leaders need to understand when it is important to push for rapid changes and when it is more important to pause, listen, and allow members of the organization time to process. In the integration phase, building a “guiding coalition” of staff from all levels of both pre-merger organizations is a critical success factor.  The ARCW Merger Integration Team had 14 staff members.  These individuals became the change agents as the structural integration process began.  Eight work groups were established that included approximately 50% of all employees.  Even though ARCW is a statewide organization with 10 offices, every staff member was engaged in the integration process.

Strong nonprofits considering merger will be most successful if they go beyond just negotiations and invest financial resources, time, and staff in the integration process. Invest in a structure of internal leadership combined with external consultant support. Create early wins before and after the merger to maintain the momentum necessary to build a new organization.

Organizational culture can be abstract or intangible. A nonprofit’s culture is the sum of many parts. For a successful cultural integration, leaders need to acknowledge the value of each part.  The successful AIDS Network and ARCW merger integration is proof that cultural integration is possible when leaders invest in the process.

What is your experience in cultural integration?  We would love to learn more from you about this critical success factor. Contact Mary today!

Listening: Possibly the Most Important Leadership Skill

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Too often leadership development programs focus on a leader looking inward or building demonstrative skills like ability to delegate or exuding confidence. But often the most successful leaders are adept at focusing on others in the form of listening.

Do you think you are a good listener? You may want to think again.  The Center for Creative Leadership describes some key indicators in their resource Listening and Leadership. Some of the most common signs that your listening skills need improvement include:

  • You’re easily distracted. Solution: Do your best to stop multi-tasking and be present enough to listen to your team.
  • You fear silence. Solution: Embrace the quiet moments and do not feel obligated to fill silences or respond to every comment.
  • You give advice too soon. Solution: Wait to here the full story and do not feel compelled to be the expert.

For a comprehensive list of resources for your improving listening skills, check out Beth Kanter’s recent blog Ways that Emerging Nonprofit Leaders Can Build Virtuoso Listening Skills. It should be required reading for every leader!

 

When a Nonprofit Is Your Friend for Life

Being dedicated to social impact can be a life-long pursuit and passion. Do you have a personal story of when a nonprofit became your friend for life?

My friend for life, AMIGOS, taught me that if you open yourself to discovering other cultures and the way people live in other places, you will build bridges that make the world a better place for all to thrive.

How did we meet? The power of word of mouth

In the Spring of 1987, on the campus of UC Berkeley, I found myself sitting in the Study Abroad office going through piles of pamphlets and flyers of “Summer Abroad” experiences. As a 21 year old self-supporting college student,  I wanted to do something adventurous and meaningful over summer break while improving my Spanish skills.

None of the flyers or pamphlets were compelling. Uninspired… I asked friends what they have done during the summer, particularly a friend who was studying Spanish. He urged me to check out Amigos de las Americas and I was thrilled to find their program was a perfect fit. The program entailed spending 6-8 weeks in a rural community in 1 of 8 different Latin American countries.

How did we become friends? Sometimes it takes a village

Before the internet (when dinosaurs roamed the earth), college students had to make a phone call and request an information packet be snailmailed in order to apply. After receiving my application, I was shocked to learn the program cost $2500!

Keep in mind, at that time, $2500 was the same amount as tuition for a semester of college. At first, I didn’t see how I could apply for the program and pay for the next year’s tuition because I would also lose that income from not working all summer.

AMIGOS was there to help, by providing a fundraising letter template. I sent an appeal letter to family members and family friends, a total of 25 appeals and waited. Generously, donations began to arrive as $100 came in, $50 came in, $25 came in…

I waited to deposit the checks, so I could return the donations in the event I didn’t meet the fundraising goal. With just a few days before the application payment was due, I was still short $500. Then, one more check arrived, exactly $500 from my Great Aunt Harriet.  Aunt Harriet, then retired, had served as the Dean of Randolph Macon College in Virginia for decades.  The note included with her check said,  “the best investment in education is seeing the world.”

I spent 8 weeks in Ecuador that summer which inspired me to pursue a graduate degree in Latin American Studies and embark on a career of working to make a difference in my local community and communities globally.

How did we stay friends? Giving back comes full circle

Twenty-five years after that summer in Ecuador, I was Chair of the Board of Directors of AMIGOS. I wanted to continue my commitment to creating opportunities for other students to change themselves…and help change the world.

What’s Your Story?

Do you have a nonprofit friend for life? I want to hear from you! Share your story in the comments below or contact me. Part of my mission at Vista Global Coaching & Consulting is to help leaders make a difference in the world. Share your story so we can inspire others to do the same!

New Resources on Nonprofit Success Factors

As a contributing author, I’m excited to share new publications from Public Interest Management Group that address the question “What contributes to nonprofit success?” This action research project examines 32 success factors in five categories: Strategy, Culture, Operations, People and Business Model.

The Success Factor Analysis is a fresh data-driven approach to nonprofit management.  Read an overview of new publication Success Factors for Nonprofit Organizations: A New Approach to the Development of Thriving Mission-Driven Enterprises to learn more.

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Read the new blog by Public Interest Management Group founder, Scott Schaffer, for an introduction to the Organizational Success Index and more!

Ten Years of Boldly Pursuing their Dreams

I have been working in the nonprofit and social sector as a practitioner, board member and a consultant for almost 25 years. I love having the opportunity to learn about the spark that launched organizations and the vision that a founder had for the change he or she wanted to see in the world. In 2012, in partnership with Forward Community Investments, Vista Global Consulting facilitated the Girls on the Run (GOTR) Dane County strategic planning process.  We shared that experience at the National Summit. GOTR-10thAnniversaryRace As a 9-year old girl who did bold things, like play little league baseball, I am very drawn to their vision:

We envision a world where every girl knows and activates her limitless potential and is free to boldly pursue her dreams.

The culmination of the GOTR program is a 5K run. For 2 years, I heard about the wonderful experience the run was for the girls, the coaches, and the volunteers. This year I participated as a volunteer in the Dane County 10th anniversary event.  GOTR founder, Molly Barker came to Madison for the event and spoke about her vision for the organization almost 19 years ago.

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Photo of Girls on the Run Founder, Molly Barker, with 10th Anniversary Race participant running with her father.

I was able to experience this wonderful organization living its dreams!

If you need support in boldly pursuing your dreams, whether that is strategic planning or coaching, let’s chat, contact me today!

Is Your Nonprofit Navigating Change Successfully? Here’s Your Guide to Leadership Transition and Succession Planning

Vista Global Coaching & Consulting has partnered with the Olive Grove Consulting team on an exciting national research project based on hundreds of nonprofit CEO and Board Chair surveys and interviews. Some of their answers may surprise you.

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What are the risks, challenges, and opportunities facing the sector today?

To start, 56% of board chairs in our study stated “the CEO doesn’t plan to leave for a long time.” but 41% of the CEOs we surveyed “plan to leave within the next two years.”

Check out our new eBook, Proactively Plan for the Inevitable: A Guide To Leadership Transition and Succession, to learn more.

This eBook is an effective staff and board resource for charting successful leadership transition and succession planning that is now available free.  Download the PDF.

Creating a robust leadership transition and succession plan might seem like a tremendously daunting task. But, with a little help it can be easier than you think. Contact us today to get started!