PUBLIC MEDIA FUTURES

Questions to ask before you collaborate

Lessons from experience

Commentary by Richard C. McPherson

Cutting costs without a strategy to reinvest the savings is a risky strategy for fundraisers, says McPherson. It just becomes downsizing and leads to “irrelevance in the marketplace.” (Photo: Current.)

For two decades, Dick McPherson has managed the McPherson Associates’ Public Media Co-op, through which 30-plus stations with more than 25 percent of pubTV members have shared fundraising materials, strategies and tests. Current asked McPherson to flesh out his heroically concise remarks at the Feb. 27 Public Media Futures forum about the powers and pitfalls of collaboration in fundraising.

“Collaboration” sounds so good, even natural and certainly logical, especially among colleagues who share the same values and challenges. “Going in together” is not only efficient but today seems essential for public stations’ survival. No wonder there are so many collaborations among public media stations, and why they are usually greeted with enthusiasm.

Harder to explain is why so many fail to produce the big benefits forecast for them. As a participant, architect and observer of pubcasting collaborations for 25 years, I gradually figured out why certain collaborations don’t work and others do.

My assessment is based heavily on experience with collaboration in fundraising, though I see similar issues appear in efforts to consolidate technology and create program content.

If you are considering a cooperative effort for your station, the single most useful step you can take is to list the most fundamental assumptions you are making. Then brutally challenge them.

Here are five simple notions which have achieved the status of unassailable assumptions that have driven many fundraising collaborations over the years. A close look reveals their weaknesses, and also ways to address them.

Assumption No. 1:
“Best practices” will save us.

There is a widespread belief that if we all did something — anything! — with reverent devotion to “best practices,” our results would be, well, the best. Who doesn’t want to operate using best practices? But there’s a huge structural problem with this assumption:

In most collaborations, some participants use highly effective practices, maybe even best ones, while their partners are trying to catch up. So a “best-practices” collaboration becomes, in effect, a remedial activity focused on bringing underperforming players “up to code.” If every participant, for example, is conducting an effective membership renewal program, why collaborate at all on renewals? If no participant is doing a good job, how can they possibly help each other? And if some are effective and some are not, the collaboration inevitably will focus on fixing the weakest links.

Before fixating on a particular “best practice,” consider that it’s often impossible to dictate what’s best for every station or every situation. Perhaps even more important to remember is that there may be multiple practices which are equally effective, making collaboration less a process of identifying the “best” and more one of selecting the “preferred.”

Q. Have we clearly distinguished the “practices” we cherish from those we are willing to change? In other words, if there are two or three ways to achieve the same goal, are you truly willing to adopt a new practice if it differs from your present thinking.

Q. Look at best strategy, not just best techniques: Which present practices are “good enough” and don’t really deserve extensive attention, and which have the potential for real impact if changed?

I’ve found that collaborations would benefit by making best practices a requirement for admission — a starting point, not a goal. A collaboration among stations should seek breakthroughs and significant improvement, not marginal, mechanical enhancements. Otherwise, why bother?

Assumptions No. 2 and 3:
Combining activities lowers costs. And that’s the main thing to do.

One of the most alluring — and often unsupportable — assumptions is that working together to share a function is cheaper. This may well be true when consolidating master controls or other functions that will eliminate disproportionately expensive overhead costs. But in fundraising, working as a group can actually increase costs because it requires intermediaries to perform tasks once done inside the station.

Combining activities can result in lower costs, but only if a station is ready to let go of some functions long considered too important or sensitive to outsource. Too often the only functions truly “let go” are relatively minor. So the benefits are also minor, and the collaboration becomes one more thing to manage.

And lower costs don’t necessarily mean better net results. When success is measured solely by how much is saved, it generates a mania for streamlining — cutting every task, sometimes including refinements that are productive.

The conversation ceases to be “how can we raise more money or improve local programs?” and becomes “what’s the least we can do to get by?” At a time when stations need maximum support from audiences — and when the media and philanthropic climate grows more competitive — cutting costs without a reinvestment plan is a very risky strategy.

Every station management that wants to cut costs also has a list of ideas for new programs, new services and new fundraising activities that are waiting for investment. Cost-cutting seen as a way to fund new efforts creates an entirely different climate and energy within an organization.

In the fundraising world, reducing costs without a correlating plan for growth is just downsizing. It simply maps the glide path to irrelevance in the marketplace.

In successful collaborations I’ve seen, cutting costs makes great sense, but mostly as an essential way to reshape spending. Thus the questions:

Q. What savings are possible and where would it be best to use those savings? What unfunded activities would the staff jump to begin? Where can we reduce spending, redirect the money and get going?

Assumption No. 4:
Stations can do it themselves.

One of the most striking features of pubcasting collaborations is they’re most likely to succeed when an outside player with a financial stake is the facilitator or driving force. Obvious examples are Target Software’s role in developing the original Team Approach membership software for WGBH and PBS and (I readily disclose) agencies like ours that develop fundraising material for client stations to share.

Such business partners can bring expertise and other kinds of capital, but they also inject a simple incentive that human nature endows with effectiveness. Station personnel who join in a collaboration generally receive no reward for its success and suffer no penalty for its failure. It’s not clear where credit or blame is due. When a multistation effort fails, a station’s outsourced functions may revert to its staff, but life otherwise goes on unchanged.

At a business, in comparison, managers typically see a bonus when a project works out, or lose their job when it doesn’t. The existence of real stakes — personal and financial — is central to collaboration success, and pretending otherwise is kidding ourselves.

Bonuses and promotions aside, employees’ noneconomic stakes significantly affect many collaborations. The plan often develops within their shared comfort zone. We invite station peers we respect and vendors we know. In fact, achieving big changes requires going outside our comfort zone and enlisting partners who have solved similar problems from a completely different angle.

Certainly we need partners like Target Analytics, the direct marketing agencies that know the system, and so on, but we’re all planning for fiscal 2013, not 1993 or even 2003. Where are Kickstarter, Groupon,

YouTube, Apple or Google? Station collaborations aimed at mobilizing new tools need outsider participants who have been wildly successful using those very tools.

The questions for potential collaborators are basic: Does my station have the skills and tools even to attempt a particular activity? If so, then collaboration with commercial participants is a matter of cost and benefit, just like hiring a staff member. But rapid technological changes have reduced the ability and the need for individual stations to perform all tasks themselves — including program delivery, content development and many kinds of fundraising. If a station group does not have the skill or tools to compete effectively, then collaboration simply will not take place without an outsider.

Kickstarter, for example typically takes 4 percent to 5 percent, and gift processing takes perhaps another 4 percent to 5 percent. So in this example, the “take” by commercial participants is perhaps 10 percent, but offers access to a gift aggregator which now provides more support for the arts than the National Endowment for the Arts and is perfectly suited to local efforts like programs. A group of stations, NPR or PBS could build an online gift aggregator … but why should they when others already exist?

So we would be well advised to ask:

Q. What are the most forceful trends at work in the world around us, and how can we collaborate in concert with those trends?

Q. Who should be at the table because they have succeeded at benefitting from those trends? Who should be at the table because they have more money to invest than we do — while they share many of our values? Are there competent outsiders involved who can be given a serious financial stake in our success?

Assumption No. 5:
Our station staff would love to outsource some work.

Your station staff, especially at the management level, took their jobs to make a difference and show what they can do. They didn’t apply for jobs to hand off functions to other organizations or vendors. In fundraising, stations ask job applicants to show us how much money they raised, how good their productions were, what strengths they have. If collaboration is our future, it would be better to ask applicants about their experience in outsourcing and consolidating activities. After all, employees who have to implement the collaboration want to do it and understand how they will benefit. Let’s start asking:

Q. If collaborative success would mean giving up something, what exactly would that be? Is that change clear (and agreeable) to our staff? If it means launching a new activity, what is the case for developing a new skill versus buying the help of a vendor with that skill?

Q. Does the person managing our collaboration have the authority to make budgetary, staffing and other changes necessary for success?

Q. Do our job descriptions stress the skills required for outsourcing and collaborating? If a collaboration involves letting go of something, will the affected staff feel they have failed — or feel that the path has been cleared for either professional or financial growth?

In my experience with our Co-op, I have seen close-up the incredible value of collaboration. When I visit television and radio stations all over the country, I inevitably find professionals who want to try new things and to work together in new ways. But the desire for change through collaboration has outstripped our understanding about how to make it work.

My candid assessment of the challenges doesn’t for a minute mean collaboration is naïve, wrongheaded or doomed. It means we need to approach collaborations with a very different set of questions than those we usually ask first. We need to start by looking at our most fundamental assumptions about why we should collaborate, who should participate and how it will affect the function and culture of our stations.

Richard C. McPherson is the founder and chief innovator of McPherson Associates, based in the Philadelphia-area town of Malvern, Pa. Besides managing the Public Media Co-op, he served as a fundraising advisor to President Carter’s conflict-resolution center, the late Mrs. Martin Luther King Jr., major universities and libraries, and nonprofits involved in overseas relief, women’s rights and conservation as well as public broadcasters. He wrote the books Digital Giving: How Technology Is Changing Charity (2007) and Mobile Giving: How Your Phone Is Changing Charity, to be published later this year.
Copyright 2012 American University

EARLIER STORY

Cohesion: It helps when collaborators want the same thing. A report on the Public Media Futures forum, Feb. 16, 2012.

RELATED LINK

McPherson Associates, the writer’s fundraising firm.

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