Nonprofit Remix

Translating business research into nonprofit language

Collaboration, Fundraising

What Prevents Nonprofit Collaboration?

I was sitting in a panel discussion today at the Alliance For Nevada Nonprofits conference in Reno, and a funder brought up the subject of collaboration (inevitably.) The context was, “we require collaboration between nonprofits in order to make grants to them.” Everyone nodded. Sage advice.

Someone asked, “why?”

“Because it’s required. And also we want to see that nonprofits with similar missions are working together.”

Does anybody else see the unstated assumption? Funders add requirements to grant applications because they’re trying to come up with legitimate reasons to tell one organization “no,” and another organization “yes.” I would propose that not having collaborations is considered a negative. In other words, if you’re not collaborating, you’re not as effective.

But collaborations can be hard to come by. Competing priorities, lack of time/funding to pursue collaboration, or few willing partners can all make collaboration a difficult prospect. Not to mention that many of us internally translate “I want to partner with you” to “I want something from you for free.”

Surprisingly, this is one area where nonprofits and for-profits completely diverge. Customers don’t even care a little bit whether or not a company is collaborating with other companies. The only instance I can think of is when a company gets in trouble for working with a dirty supplier, e.g., Nike sweatshops. Most company collaboration is within the context of suppliers.

What that means for Nonprofit Remix is that there’s not a whole lot of business writing about collaborations. But there is!

I was going to mention this one in the context of nonprofit mergers, but it seems to work just as well for collaboration. It’s called Rich versus King, and it was originally presented at a conference by Noam Wasserman, and published in the Academy of Management Proceedings in 2006.

The short version is this: Entrepreneurs who want to grow quickly need resources, and acquiring those resources can require giving up control.  In other words, a founder has two choices in an organization: he can be the king, or he can be rich.

Why is this of interest to nonprofits where there is no such thing as the rich condition? Well, that’s precisely the point. Nobody is ever going to get rich by giving up control, so nobody will ever give up control. Nonprofit leaders are locked into the control side with no other option.

You can see why this affects collaboration. Collaboration is giving up control, which is the default priority of nonprofit leaders. And mergers are even worse.

Perhaps we can begin to educate funders about the difficulty of true nonprofit collaborations, and begin to drill into why they think collaboration is important. I suspect that it’s used to combat duplication of effort, but that’s another blog post.

Read it yourself: Rich versus king: The entrepreneur’s dilemma, Academy of Management Proceedings, August 2006.

Image by: William Warby

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