Corporate/Nonprofit Alliances

Is economic development ready for the next generation partnership with the business world?

Maybe we could take a note or two from others already well along this path. Here is a source you might want to investigate further, if you have been thinking about new types of alliances with companies. This is from the Marketing Science Institite and you do have to buy the report, but a summary exists here.

"More and more companies are supporting social causes while advancing their business goals. Likewise, nonprofit organizations are increasingly reaching beyond their traditional sources and modes of support to tap corporate coffers. Some collaborative efforts between companies and nonprofit organizations have moved beyond cause marketing and strategic philanthropy to encompass close, mutually beneficial, long-term relationships designed to accomplish strategic goals for each partner. Drumwright, Cunningham, and Berger label these partnerships 'social alliances'."

Social alliances can create and enhance financial capital, human capital, and social capital for both partners; however, even the best alliances can experience problems, usually the result of an organization's inexperience in working with the other sector.

Many social alliance problems are rooted in cultural differences between the sectors—some of which are real, some perceived. There are six categories of predictable problems: misconceptions, misallocation of costs and benefits, misuses of power, mismatches, misfortunes of time, and mistrust. There is no single prescription for preempting such problems. However, they can be anticipated and mitigated through a consideration of (1) the fit between the company, the nonprofit, and its cause, and (2) the structural characteristics of the nonprofit, the company, and the social alliance itself. Both may be influenced through the choice of partners.

The best social alliances involve intensive educational efforts and demand considerable learning on the part of both partners. Nonprofits have opportunities to learn business skills from companies, and companies have opportunities to learn how to motivate and energize people, manage volunteer efforts, and allocate charitable donations more effectively. Commitment to the social alliance must be diffused through both the company and the nonprofit organization. Networks of engagement within both organizations facilitate this process. Mobilization occurs through various forms of adaptation on the parts of both partners. This requires matched structures, aligned processes, compatible performance measures, and integrated managements.

Finally, if there is anything universal about successful social alliances, it is that entrepreneurship abounds. Nonprofits as well as companies have substantial entrepreneurial obligations, and "social alliance entrepreneurs" are needed within both organizations. These individuals must be both boundary spanners and boundary protectors, and most importantly, they must discern when to play these quite different roles."

My attitude is why re-invent the wheel if you don't have to.