From Shortchanging to Sea Changing

Perhaps it’s cliché to start off a newsletter at this time of year by talking about gratitude. But in a world whose axis is tilted too far toward tragedy right now, we’re more than willing to risk being trite.

We’ll start by expressing our gratitude for two actions that could trigger an important mindshift in how foundations and government agencies think about “overhead.”

On November 9, Ford Foundation President Darren Walker announced big steps toward reinvention and renewal at the 79-year-old foundation, including his decision to double its overhead rate on project grants, from 10 to 20 percent, starting on January 1. He acknowledged in refreshingly blunt terms that he and his Ford colleagues “have been willing participants in the charade” of overhead reimbursements that don’t come close to paying for what it actually costs to get the job done or to build a high-performance organization. We suspect that Walker’s bold decision, which will help knock down a longstanding barrier to high performance, will provoke good discussions and positive peer pressure the next time he and the CEOs of the other mega-foundations get together.

A few days before Walker’s announcement, the Board of Supervisors of Los Angeles County, the country’s most populous county, voted unanimously to develop new rules that will pay nonprofits for the full cost of the services they provide. “This action effectively repeals the unwritten policy by governments at all levels that has systematically shortchanged nonprofits and prevented them from achieving high performance,” said National Council of Nonprofits CEO Tim Delaney. Tim’s effective advocacy for this change received a major shot in the arm from the Gates Foundation’s Victoria Vrana, Urban Institute’s Elizabeth Boris, Habitat for Humanity Greater San Francisco’s Ann Goggins Gregory, and GuideStar’s Jacob Harold—all Leap Ambassadors. For more information on how to advocate for this reform in your county, check out these resources from the National Council of Nonprofits.

On the personal side of our lives, we also have big gratitude. Lowell and his fiancée, Kris, will be celebrating Thanksgiving in a way that feels especially meaningful in light of the fear and hatred dominating the news. They and their children are leaving tomorrow to be with family in Mozambique for a holiday that will blend traditions from Islam, Judaism, and Christianity. The greatest gift of all may come later, when the kids share their experiences and act as a counterbalance to those who would paint an entire religion with a broad, ungraceful brush.

Mario and his wife, Dana, will keep a 24-year tradition by hosting the holiday meal and long weekend with their extended family. Mario and Dana are grateful that all three of their children, young adults with busy lives, will be back in the nest. They’re also grateful that they’ll be able to share love and support with several family members and close friends for whom this holiday is the first without a parent or spouse. These losses will remind them to cherish each day as a precious gift and never take the good fortune they enjoy for granted.

And now for some additional updates that spark appreciation and gratitude:

• If you’re interested in seeing how courageous leaders can improve the outcomes of a program in the most responsible and remarkable fashion, please check out Communities In Schools President Dan Cardinali‘s article “When Scale Means Contraction: Putting Quality Considerations First.” The article is a perfect illustration of what it means to embark on the journey toward high performance!

• Because we’re such big fans of Dan Cardinali, we should also note that his insights featured prominently in the Drucker Institute’s Monday* newsletter feature on “How to Improve Your Batting Average When it Comes to Hiring.” “Communities In Schools looks for many qualities when it’s considering a job candidate, but there’s one that stands out: resilience. ‘We’re dealing with at-risk kids, and they will test your boundaries, and sometimes it might seem like you’re going backwards,’ Cardinali says. ‘Resilience means understanding that this can be part of the change process.'”

• We partnered with Nancy Roob, Albert Chung, Lissette Rodriguez, and their colleagues at the Edna McConnell Clark Foundation to offer a new series of videos of nonprofit leaders talking about crushing failures and uplifting successes along the journey to high performance. The videos feature Tess Reynolds (New Door Ventures), Nick Ehrmann (Blue Engine) and Mike Duggan (Domus Kids), CEOs from several of the nonprofits in EMCF’s PropelNext Here’s just one example of their priceless candor: “It was a bunch of garbage that we were looking at and pretending that we were doing the right thing by kids.” —Mike Duggan

• Leap Ambassador Debra Natenshon and Lowell used these powerful videos to good effect on November 6, when they co-presented a workshop on “The Performance Imperative” (PI) to a standing-room-only audience at the Net Impact conference in Seattle. We encourage you to animate your own presentations with any of our 30+ video illustrations of what the journey to high performance looks and feels like—and why it’s worth the risk.

• Our newest Leap Ambassador, former PATH COO Eric Walker, presented the PI in an even lovelier city—Copenhagen—in his keynote address at NetHope. “It was in offering the broader perspective on benchmarking nonprofit performance that I included the Performance Imperative, explaining its promise as a starting point for cross-organization comparison. It was an opportunity to introduce the PI to chief information officers and [for-profit] leaders.”

• Know any superstar direct-service workers who are great at supporting their clients and use data to ensure their efforts lead to great outcomes? If you have superstars in your organization who deserve national recognition and a $5,000 cash award, please nominate them for this year’s Veronica Awards, started by our friend Steve Butz. Online nominations are being accepted until November 25, 2015—just a week away.

• Phil Buchanan, Ellie Buteau, and their colleagues at the Center for Effective Philanthropy (CEP) released their infographic-rich report Benchmarking Foundation Governance to help readers get insights into the board structures and practices of 64 larger foundations. We suspect and hope that CEP will next look into board practices that are tied to high performance.

Events/Webinars for Raising Performance:

• “Turning the Tables: From Chasing Grants to Having Your Pick” webinar; December 15; PerformWell
• “Building Better Movements” webinar; January 14; SSIR
• “Data on Purpose: Telling Great Stories with Data” conference; February 9-10; Stanford, CA; SSIR

Gratefully,
Mario and Lowell