Spring 2008
Voices in Philanthropy
Reframing the Debate:
Is General Operating or Project Support Better?
Amy Crawford, Executive Director, The Jay and Rose Phillips Family
Foundation
This is an important question raised by nonprofits, and it has no easy answers. Since we do not provide general operating grants at the Jay and Rose Phillips Family Foundation, we approach this question more contextually in working with grantseekers. As another alternative, the foundation offers organizational effectiveness and transitional grants to nonprofits.
When a grantseeker asks if we provide general operating support, we use the inquiry as an opportunity for our program staff to stay curious and probe beyond the initial question. We encourage callers to share more about their proposed request, their anticipated outcomes, and their sense of the initiative's success a year from now.
This exchange is invaluable. Through the conversation we begin to assess whether there is a potential match between the applicant organization's needs and the foundation's funding priorities. By going deeper, we often find that the organization needs to strengthen its ability to respond to an increased demand for services for its constituents with limited, sometimes declining, resources.
In order to meet new demands, demographic changes or funding shifts, organizations need to build or retool their internal capacity and programs. Activities may
involve organizational restructuring, strategic planning, program design and evaluation, fundraising, financial management, board training, staffing, technology
planning, site feasibility and/or new partnerships with peer organizations.
Organizational Effectiveness Funding Makes Positive Impact
The Jay and Rose Phillips Family Foundation provides three types of funding to nonprofits: program, capital and organizational effectiveness grants. Our organizational effectiveness grants are the least well known, but they often have the power for transformative and lasting change.
In 2004, we asked Showalter and Company to review a sample of the foundation's organizational grants from 1999-2002 to evaluate their impact and see how we could strengthen our work going forward. Organizations that participated in the evaluation reported that the overall impact of their projects was positive and that they made a significant difference. These nonprofits also cited notable differences in their internal functioning, including refined organizational mission/focus, improved staff retention/ morale, more effective leadership/management and strengthened programs, among others. The results point to the need for funders to help nonprofits focus on the continuous process of improvement as they deal with the complexity of internal changes and changing community trends.
We understand that nonprofits would generally prefer general operating grants over specific program grants because they provide greater flexibility, help organizations sustain vital programs and keep the lights on and doors open. I would contend that investing in good management and improved functioning is just as critical to helping an organization stay true to its mission, goals and constituents.
Transitional Support Eases Adaptation to Change
Another effective funding strategy for our foundation is to provide transitional support to help move organizations from one mode or level of operation to another while they adapt to changes in their environment. Applicants are able to be more transparent about the particular challenges and opportunities they face, and in turn, grant funds provide the critical resources and time needed to prepare for new ways of doing business that are right-sized for their situation.
This type of funding has also allowed the foundation to evaluate desired changes and impact within an organization. Capacity-building efforts can be very time-consuming, labor-intensive and risky. The organization may choose to pursue a whole new direction as a result of the grant, or it may be unable to carry off the change as hoped. But we see it as a risk worth taking if it means that an organization has learned something that enhances its ability to serve constituents more effectively and is positioned for success.
Who Will Help Nonprofits Work Outside the Box?
Given the many threats right now to the nonprofit sector, including diminished government funds, the reality is that we need more funders who are willing to help nonprofits work outside the box, strengthen their organizational effectiveness and engage their constituents as part of the decision-making process.
We need to reframe the ongoing — and sometimes polarizing — debate that pushes more funders to provide general operating support, that pits one type of funding against the other and that stifles creative thinking about new ways of supporting the health and vitality of the nonprofit sector. The real question is: "How can we continue to listen and learn from our grantees and to provide a mix of funding so they can stay mission-centered and prepare for the tough challenges in the future?" That's a debate with my peers that I welcome. Let's explore how we can work together to advance thoughtful solutions to our community's most challenging issues.
Moving Upstream:
Strategic, Long-Term Health Philanthropy
Joan Cleary, Vice President, Blue Cross and Blue Shield of Minnesota
Foundation
Working in partnership to create healthy communities for all Minnesotans is our focus at the Blue Cross and Blue Shield of Minnesota Foundation. Over 22 years, we have provided different types of grants to most effectively address important health issues in our state. We have supported planning, feasibility studies, applied research, start-ups, operations, capital purposes, endowment funds, programs and projects, technical assistance, evaluation and sustainability.
Blue Cross and Blue Shield of Minnesota provides general operating support for many eligible nonprofits and schools through our annual community giving campaign, with a 50% match of employee contributions from the foundation. Employees also volunteer their time and talents to many of these organizations.
The foundation's primary funding focus is on strategic philanthropy. Over the past decade, we've moved from broad funding priorities to long-term initiatives, from single-year grants to grants up to three years and from rolling review to specific grant cycles. The type of funding we provide reflects the strategic purpose and focus set by our board, our size and capacity as a foundation and ongoing assessment of to best use our philanthropic resources in view of the priorities, needs and assets in our state. That includes input from nonprofits and communities we support.
Now in our third decade, we are "moving upstream," beyond the reach of the traditional health-care system, to focus on key social, economic and environmental conditions that have a major impact on health. This strategic direction challenges us to broaden our thinking and adapt our methods to facilitate change. As a result, our role now includes grantmaking, awareness-building and policy support, and leadership development and recognition. In addition to granting targeted working capital, we offer other resources to build the capacity of nonprofits and government agencies that we fund.
Here are some examples of how we approach our exciting work with partners to facilitate change across the state:
Strengthening Organizational Capacity and Building Community
Since 2005, through our Healthy Together: Creating Community with New Americans initiative, we have supported more than 20 immigrant-led organizations through a combination of small grants, coaching by an organizational development consultant, convenings for training and peer networking, and access to a grantee web portal for online dialogues among grantees, consultants, evaluators and our staff. It's our
premise that, with improved capacity and infrastructure to conduct and sustain
mission-driven work, these organizations will become stronger and more effective in fostering the healthy social adjustment of the communities they serve. Initial independent evaluations are positive, with coaching cited as particularly valuable.
Healthy Together also supports a variety of community-building efforts across our increasingly diverse state to foster immigrant integration and greater social connectedness — an important social determinant of health. In addition to grant dollars, the Blue Cross Foundation provides technical assistance to help grantees develop skills and plans to successfully carry out this bridging work through a partnership with the Center for Democracy and Citizenship at the Humphrey Institute.
Building a Field: Community Health Workers
Through our Critical Links Community Health Worker (CHW) project, the Blue Cross Foundation has served as a catalyst to promote the training and use of CHWs as a strategy for improving health; increasing health-care cultural competence; expanding the size and diversity of Minnesota's health-care workforce; reducing health disparities by race, culture and foreign-born status; and lowering health-care costs.
Since 2000, investments in research, grantmaking and partnerships have led to the development of a standardized CHW training program based in the Minnesota State Colleges and Universities System, the formation of a CHW peer network and viable funding options to sustain this emerging paraprofessional role. We are currently supporting CHW models that foster the mental health of immigrants and refugees.
Supporting Partnerships for Healthy Kids
Growing Up Healthy: Kids and Communities, a 10-year program now in year two, helps communities work across sectors to create an environment that nurtures the healthy growth and development of children ages 0-5. We're supporting a growing network of partnerships that focus on the connections between health and early childhood development, safe and affordable housing, and the environment. Beginning with planning grants, the partners develop a common vision for a healthier future for their youngest children. Implementation funds are available to support the plans, and evaluations will help us identify progress, lessons and outcomes.
© Copyright 2008 Minnesota Council on Foundations
Reproduction in any form without the written permission of the publisher
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