Structure

One of the most effective strategies nonprofits use today is structure. By combining structures, two or more nonprofits can create operating efficiencies, expand geographic reach, create a continuum of services for their clients, compete as a network in the new healthcare environment, and so much more. There are many ways to combine nonprofit structures. Our team of consultants and partners work with each set of clients to deliver the most culturally appropriate, creative, and effective set of services to achieve your goals and create any of the related structural models:

Collaboration

The easiest form of structure to create between two or more autonomous organizations that wish to learn from each other and benefit from sharing. This is a very low-risk, low cost method of sharing from each other.

Partnerships

A deeper form of collaboration which often involves sharing of financial or other valued assets by multiple organizations. A formal partnership is can be governed by the executive directors, a legal contract, or a board of directors, depending on the liability or risk involved.

Alliances

Alliances are meant to be longer-term and usually involve nonprofit organizations from the same field of the nonprofit sector. The benefit of an alliance is that independent organizations pool administrative dollars to purchase services, thus lowering the expense to each member and often increasing the quality of the service delivered.

Networks

A group of autonomous nonprofit agencies that integrate, for strategic purposes, their programs and/or their administrative services, in order to achieve a very specific business outcome. Often their integration involves enough liability and intention of purpose, that there is the need for a separate, staffed governing structure that is accountable to the members.

Asset Transfer/Acquisition

When it becomes necessary for a nonprofit to cease operations due to financial or legal ill-health, it is often too late to seek a merger with another nonprofit. If the nonprofit still has some healthy assets, such as real estate, it may be possible to arrange an asset transfer – to another nonprofit, without completing a merger of the two organizations.

Parent/Subsidiary

Often referred to as an umbrella organization. It may be necessary or desirable to create a parent/subsidiary relationship between nonprofit entities. The Subsidiary keeps its same functions, including its 501(c)(3), its board of directors, its name, perhaps; however the administrative functions transfer to the parent. In effect, this is a form of merger, providing great flexibility and autonomy that might not be possible under a traditional merger. 

Mergers

Two or more nonprofit organizations which decide to blend their assets and liabilities together into one “surviving” legal entity. The benefit here is the opportunity to fully integrate all administrative and program duties, in order to create one nonprofit, with one mission, governed by one board of directors.

Services:

M+S provides a wide variety of Structure services for our Client engagements. Here are the most typical services we provide:

Matchmaking

The process of finding an appropriate partner for a Client sometimes calls for an outside objective third party. M+S has a variety of means to search and identify potential partners for our Clients with the goal of signing a letter of intent to enter to explore a collaboration.

Feasibility Analysis

When two nonprofits propose to partner or merge, it is often appropriate to analyze the possible pros and cons of the potential partnership. M+S will conduct a feasibility analysis examining the implications of mission, financial, program, strategy, and culture integration. Our results are presented in a written report including a recommendation for next steps.

Facilitation

An M+S facilitator acts as an outside, objective third party to each of the participants in our structure engagements. We are an expert adviser, and assist with helping individuals move efficiently through the decision making process. We also prepare agendas and meeting minutes, coordinate logistics, communicate with other experts involved. Our goal is to help the participants reach the best possible outcome in the most efficient way possible.

Agreements

M+S facilitates the preparation of the necessary agreements for any new structure including letter of intent, confidentiality agreement, and memorandum of understanding (MOU). In the case of an MOU, M+S facilitates detailed agreements regarding mission/vision and goals; governance of the partnership; budgets; program/service plan; and many other details applicable to the situation.

Implementation

An Implementation plan for a nonprofit structure agreement is absolutely key to success. M+S works closely with a Staff Implementation Team to get this done, creating 12 and 24 month detailed documents and outcome evaluation and dashboard documents. M+S also works with the Board of Directors to assist with their integration process in order to ensure its success.

Read “A Continuum of Care for the Homeless,” a case study on our Structure services, focusing on our Feasibility Analysis, Facilitation, Agreements, and Implementation work.
Jean Butzen led these two organizations through a merger, allowing them to increase back-office efficiencies, leading to the new organization to serve more people in more ways than each organization did separately. This outcome followed from a considered and deliberate process and a history of working together.

Read “Merging to Address Changing Needs,” a case study on our Structure services, focusing on our Merger Facilitation and Implementation services.
Jean Butzen helped United Cerebral Palsy of Greater Chicago and Seguin Services join together to better serve people with disabilities, reaching more people together than they could have separately.