UK: In my opinion - Institute of Management companion Ian Bruce of RNIB and City University Business School ...

UK: In my opinion - Institute of Management companion Ian Bruce of RNIB and City University Business School ... - In my opinion - Institute of Management companion Ian Bruce of RNIB and City University Business School believes business can learn from the

Last Updated: 31 Aug 2010

In my opinion - Institute of Management companion Ian Bruce of RNIB and City University Business School believes business can learn from the voluntary sector.

Around 6,000 new charities are registered in the UK every year. The common business view of this proliferation of good causes is that it's a bad thing - too many charities chasing too little cash and, at the same time, duplicating effort.

There is also the belief, among those outside the voluntary sector, that if business people took over the running of charities, things could be sorted out quite rapidly and mergers achieved quickly, all leading to the 'economies of scale' so beloved of the commercial sector.

All these misconceptions are tied up with the belief that the voluntary sector is rather amateurish and unimportant.

It is useful to examine the reality of the situation:Y The voluntary sector forms around 9% of gross domestic product.Y It is vastly outperforming the commercial and statutory sectors in terms of rate of growth. YIt employs over one million people and millions of volunteers.

YMore than 50% of managers in the top 200 British charities have commercial or statutory backgrounds and many have business qualifications. At the Royal National Institute for the Blind (RNIB), three out of the six directors have MBAs.

Things have moved on apace; lessons have been learnt from business in order to meet the needs of an increasingly sophisticated market. At the same time, the sector has long been practising successful business techniques that the commercial sector only discovered recently.

Franchising, for example, was pioneered in the voluntary sector 60 years ago. Age Concern has a network of 1,100 independently registered charity groups across the country all operating to agreed national standards.

'Proliferation' is therefore a very practical method of devolving power and addressing local needs at local level - UK charities 'think national and act local'.

That other successful business prerequisite, customer involvement, is also central to the way charities operate. For example, RNIB is a needs-led, customer-driven organisation and all decisions are based on research with customers, communication with trustees, and through talking to front-line staff.

RNIB has a workforce of 2,500, a volunteer force of 250,000, a turnover of £70 million a year and spends £1 million a year on customer research.

Many people outside the sector think that charity marketing is a bit of a misnomer, but it plays a very powerful role in service delivery.

At RNIB we have about 50,000 members of the Talking Books Library and are able to profile readers, segmenting them by age, gender, reading preferences and home address. We also analyse usage patterns. The average borrower reads one book a week. Market research enables us to invest in recording the kind of books people want to borrow.

On the issue of duplication or overlapping by charities, it may appear that, for example, Help the Aged and Age Concern are competing against one another for donations and providing related services. But there is so much unmet need in society that the combined efforts of these two charities are nowhere near meeting the needs of older people. Help the Aged raises around £63 million per annum and Age Concern England a total of £24 million.

For all the money a merger might save, it is unlikely that the merged charity could raise £87 million.

In addition, the legal basis of charities makes mergers hard, if not impossible, to achieve. A charity has to be registered in law with the Charity Commission and a takeover cannot happen without the full agreement of the trustees of both charities.

Many people find the whole idea of competition in the charity sector quite distasteful but the UK system makes this virtually inevitable on the fund-raising side. That's not to say that charities in the same service area cannot co-operate on service delivery. All the major charities in the blind and partially sighted field, including RNIB and Guide Dogs for the Blind (GDBA), have formed a partnership under an umbrella organisation, the Visual Handicap Group, which meets regularly to exchange service plans and agree on areas where it would be useful to co-operate.

The voluntary sector is very good at managing campaigns, many of which are long-running and require considerable input in terms of time and resources.

Charities are also engaging more and more with business on the basis of mutual benefit and, in the disability world, there are a number of things the sector can offer commercial companies. Among these is approval among its buying public. Research now shows that consumers prefer to buy from companies associated with good causes, thereby giving them competitive advantage.

Charities can also help commercial companies target markets they might otherwise have difficulty reaching, such as blind and partially sighted people.

Charities are also working in partnerships with commercial organisations to improve the lives of disabled people. For instance, 20 years ago, keyboard skills combined with voice output gave blind people access to computers but, these days, advances such as the graphic user interface and the mouse present a barrier. RNIB is working with Microsoft and other leading computer firms to persuade them to make the latest technology more accessible.

At the same time, direct action in the form of training materials, such as Windows 98 manuals in Braille, is helping to give blind and partially sighted people new opportunities to achieve greater equality in the workplace.

Find this article useful?

Get more great articles like this in your inbox every lunchtime