Diversification Needed for NFP Sustainability

Diversifying service offerings and creating successful partnerships are key elements for a Not for Profit experiencing rapid growth, a national conference has been told.

General Manager of Settlement Services International (SSI), Peter Zographakis, told a Sydney conference on NFP income generation that sustainability could only be achieved by tackling reality head on.

SSI is a community-based Not for Profit that provides a range of services to refugees, asylum seekers, migrants, people with disability and the unemployed.

The organisation supports thousands of clients every year through a range of services that help refugees successfully integrate into the NSW community.

Its CEO, Violet Roumeliotis, was named in Pro Bono Australia’s Impact 25 as one of the most influential people in the social sector for 2014 and 2015.

Zographakis said SSI had experienced rapid growth and had been forced to demonstrate that it can quickly scale up and down.

“To give you some idea of what I mean, in August 2012, SSI was contracted by the Federal Government to provide assistance to people seeking asylum, after they were released from detention to live in the Australian community,” Zographakis said.

“Overnight we had to begin a process of recruiting almost 100 program staff and to set up a workplace in a large warehouse in Auburn to service these new clients. It was a hectic time of playing catch up and moving quickly to get systems in place.

“Today, we have over 500 staff and, I’m pleased to say, a much more sophisticated IT system.

“Our workforce is also young and from diverse backgrounds with more than 60 per cent of our staff under the age of 40 and over 65 per cent are women. We also speak over 83 different languages.”

Zographakis said diversification, partnership, organisational capacity and governance had been the key elements in a sustainability program implemented by the organisation.

He spoke about change within the Not for Profit sector, and in particular, dealing with increased competition between NFPs and cross-sector engagement. He also detailed key strategies employed by SSI to adapt in a changing environment.

“Not for Profit organisations are increasingly finding themselves in a changing environment and SSI is no exception,” he said.

“We run both federal and state government-funded programs and work in partnership with a number of organisations such as Beyondblue, St Vincent De Paul and Uniting. We also fill some service gaps with a range of self-funded initiatives.

“Our story so far is one of rapid growth, adaptability and diversification with a demonstrated capacity to quickly scale up – and down.

He said SSI now had over 500 staff and a much more sophisticated IT system.

“Our workforce is also young and from diverse backgrounds with more than 60 per cent of our staff under the age of 40 and over 65 per cent are women. We also speak over 83 different languages,” he said.

“In a recent ‘State of the Community Service Sector in NSW’ 2015 survey, carried out by the Social Policy Research Centre at the University of NSW, respondents highlighted that funding uncertainty was the major issue that their organisation was currently facing.

“Irrespective of an organisation’s size, type of service or location, changes at all levels of government and new developments in policies and funding mechanisms have created uncertainty.

“In response to this uncertainty, many services reported that, like us, they were now adopting new strategies.

“These organisational reforms included changes to governance processes and the seeking of new sources of funding from other government departments, other levels of government, market income and philanthropy.”

Zographakis said the organisation’s most obvious “outward-looking” strategy was the diversification in its service delivery.

“At the core of this diversification is an ability to establish and maintain working relationships. SSI’s capacity to leverage the relationships we have with member migrant community-based organisations, other Not for Profits and the private sector has been critical to our success,” he said.

“At SSI, we believe in partnerships over competition and take a collaborative approach to our business operation.

“A recent success story that supports this approach was our ability just last year to bring together a consortium of 22 organisations to successfully tender for a major settlement services program in NSW, which we won, once again demonstrating the power of collaboration over competition.

“It appears that not only is collaboration critical to an organisation’s capacity to meet complex needs, but it is also the way of the future.”

He said NFP’s needed to consider collaborating with for-profits if they wanted to survive.

“From my experience, collaboration has been one of the most useful, if not essential, strategies for our organisation. The benefits have included being able to share resources, talent and knowledge, create an even larger impact, and further leverage funding in a resource limited environment,” he said.

“For-profit organisations have enormous potential to create jobs, open access to education and basic services and deliver innovative solutions. By leveraging our joint resources and expertise I believe that we can quickly and effectively come up with novel solutions for age-old problems.”

He said his organisation had adopted more “inward-looking” strategies to future-proof SSI.

“These include building internal organisational capacity by investing in corporate services, and implementing a new governance structure,” Zographakis said.

“While we remain true to our mission and our clients are at the heart of what we do, we need to have the infrastructure, systems and processes that support the work that we do.

“More importantly, it’s an issue of sustainability and ensuring the organisation has the optimum governance structure, is financially viable and has the reputation for using funding responsibly.

“For an organisation, this means ensuring that their ‘enabling functions’ are benchmarked against other sectors.

“For SSI this meant recognising that in today’s environment, we now occupy the same space as many of the ‘for-profit’ companies, large NGOs and multinational organisations.”