Collaborate to Innovate: Unlocking Success in Nonprofit Partnerships

Michelle Shumate is the founder and owner of Social Impact Network Consulting (SINC). Through SINC, she helps social impact leaders find nuanced solutions through coaching and consulting. She is the author of the forthcoming book, Networks for Social Impact (Oxford University Press). Her work has been featured in Stanford Social Innovation Review, Nonprofit Quarterly, and Youth Today. Michelle is the founding director of Network for Nonprofit and Social Impact (NNSI), the Delaney Family University Research Professor, and Associate Faculty at the Institute for Policy Research at Northwestern University. She is also spouse to Michael, mom to Oliver and Alex, and an avid backyard birdwatcher.

Sustained Collaboration is a powerful strategic tool for nonprofit leaders to build resilience and increase their social impact. I’d like nonprofit leaders and clergy to: 1. Learn about the types of sustained collaboration available, including mergers, asset transfers, shared service arrangements, shared projects, and alliances. 2. Consider these types of collaborations as strategic tools to (a) embark on a strategic transformation, (b) establish new programs or improve and expand existing programs, (c) develop new efficiencies through shared assets, (d) create policy wins, (e) encourage innovation, and (f) produce better quality outcomes for clients and the community.

More information at the following sites:

https://sustainedcollab.org 

https://michelleshumate.com

Participate in Future Interviews live on Zoom

The Interview Transcript

Collaborate to Innovate: Unlocking Success in Nonprofit Partnerships with Michelle Shumate

Hugh Ballou:
Greetings, this is Hugh Ballou for a new episode of The Nonprofit Exchange. And wow, we keep having great guests, and this one is no exception. And it’s a really, really crucial topic for our time. It’s always been important, but it’s more important now than ever before. So our topic is Collaborate to Innovate, Unlocking Success in Nonprofit partnerships. And my guest today is Michelle Schumate. So, Michelle, give people a little idea of who you are. Why do you do this work?

Michelle Schumate:
Yeah. So I am, among other things, a professor at Northwestern University, just north of Chicago. And I teach nonprofit management topics at all levels. And in addition, I run a small consulting practice where I work with organizations who want to take their collaboration to a next level. And I got started doing this work because I really just became impressed with the idea that a lot of the best ideas that nonprofits have weren’t being shared, weren’t being taken advantage of. And that a lot of our organizations, our nonprofits are pretty small and that we can do a lot more if we work together to innovate and to right size solutions to some of our biggest problems. Began really doing that work by working with some folks out in Los Angeles and then have continued it across my 20 year career.

Hugh Ballou:
My, my, my, my 20-year career, you started when you were very young. You have a lot of wisdom for those years, but let’s, I remember the quote, I can’t remember who it’s from, but it was about communication. The illusion is that it actually happened, and you could move that definition to collaboration, except I don’t find many organizations that can define what that means. So help us, what is your definition of collaboration and why is it beneficial?

Michelle Schumate:
Yeah, I think that sometimes we have a problem defining collaboration because it can mean a lot of different things, right? We were doing research once and And we were in Costa Rica and we were asking folks, you know, how many organizations you collaborate with? And they were listing hundreds of organizations. We were like, this is amazing. We should be studying more here. And then we started asking, well, how often do you meet? And they say, well, once every three or four years. And that’s not what I mean by collaboration, right? We don’t just mean meeting every few years at a conference. We don’t just mean having breakfast together quarterly. What I mean by collaboration is whenever we have two or more organizations working together in a way that fundamentally changes the organizations involved. It has to change something about them. If you walk away and the organizations are no different, that’s not really collaboration. So we talk about in the research all the way from what we call integrated organizations, which includes mergers and asset transfers, right? So you have fundamentally a new organization as a result. We talk about collaborations that are shared projects and services. You have a new program or a new set of services available for the organization that does something different as a result. And then there are alliances and networks, and there you have more than one organization coming together. And by working together, they produce something they could not produce alone, right? That’s the fundamental criteria. It has to be transformative for me.

Hugh Ballou:
has to be transformative. That’s the work we’re supposed to be doing anyway, isn’t it?

Michelle Schumate:
I hope so. When we think about some of the big problems of our time, they need us to be transformative. The folks need us to be able to step up and find new solutions. And I’m here to talk about how collaboration can help you do that.

Hugh Ballou:
So I find And not in just the field of nonprofits or faith organizations, but in any kind of organizations that we have our own set of myths that we operate by. And in this particular topic, there’s some myths that make people not want to collaborate. Have you surfaced any of those? Like some I hear, oh, we’re going to have to lose some job positions if we collaborate, or we’re going to have to give up some of our income. And then I don’t think there’s any basis for either one of those.

Michelle Schumate:
I think it’s true that the collaboration costs you something, right? In order to do it right, it does often cost you something. At least it costs you time, right? To do a true collaboration, you’re going to have to give up staff time to sit in those meetings, to work on the new project, to figure out how to do the due diligence around the merger or the asset transfer. It does take time. But it doesn’t necessarily mean you’re going to give up lots of money or doesn’t mean that you’re going to give up positions. In fact, in the successful collaborations that we studied as part of this research, we did 20 in-depth case studies of collaborations who are successful. What we found is, in fact, most of them grew. They grew the number of positions they had, they grew the programs that they had offered, and they also grew the amount of money that they were able to raise because they were able to do things in a more innovative way, in a more efficient way, in a way that better aligned with what their mission ultimately was.

Hugh Ballou:
Did they also grow their impact?

Michelle Schumate:
Yes. And let me tell you a little bit of a story. And so, because I know I’ve talked to your audience before, you have so many faith leaders. Let me tell you a story about integrated organizations among two faith-based nonprofits. One of them was a little, they were doing food distribution, like a food pantry out of a church. And then they were also doing some kind of utilities payments and they were sitting in one church. Church across the street had an infant kind of providing infant diapers and those kinds of things. And they were also doing a closed closet, right? Two different churches running two different ministries. So one more directly involved with the church, one more loosely involved with the church. And they realized, wait, we’re seeing the same clients. And we’re open one day and that program over there is open a totally another day. So the clients that we’re seeing are going to have to come to our place one day and they’re going to have to figure out their whole situation and come to the other place another day. How is this making any sense? This isn’t good for their clients, right? So they got together. It’s the middle of COVID. They’re in the backyard of somebody’s house. They’ve got a consultant to resume. They’re outside talking about how do we bring these things together? And what they ultimately decided to do was to merge them into a new nonprofit organization. They called Outreach House. It’s here in Lombard, Illinois, not too far from us. What happened as a result of it? Well, they saw more clients, but not only did they see more clients, they gave away over a hundred percent more food. They gave away more diapers. They were able to give away and meet people’s needs. They’ve developed real relationships with their clients, and they were able to do it in a way that they became a one-stop shop, right? So they didn’t have to, their clients didn’t have to go from one place to another. They figured out how to come together and create this one-stop shop that covered all of their needs at the same time. That’s a great social impact, right? And why did they do it? Because they sat down and thought about, not just this is our program at this church, or this is our program at that church, but what do our clients need? How can we better meet their needs? Let’s organize ourselves to do that.

Hugh Ballou:
That’s the antithesis of some of those myths that I heard, those objections people have. And it, you know, it doesn’t happen. You got to invest in it. It’s what, what I heard you say, there’s, there’s an investment of time and money. The return on that investment is substantial though, is what I’m hearing you say.

Michelle Schumate:
Absolutely. It’s been huge for them. It’s been in terms of the revenue they’ve been able to bring in, they have more volunteers as a result. They’re better able to serve their clients. So when around all around, but it took. leaders being willing to sit down and meet in that backyard for a period of time to figure out how to make it work.

Hugh Ballou:
and to open their mind to something that’s different. You know, we sort of get in a rut and do the same old thing and then we complain because we get the same results. So this is like a pivot and it’s setting a new paradigm. So you’ve talked about the research, tell us about what the research was and what are some of the key findings and recommendations from, so go from the beginning, explain the research and tell us what you discovered.

Michelle Schumate:
So we started out with a set of 58 collaborations that were nominated by this group of funders who had supported these collaborations over time. 45 of them agreed to participate. From then, we selected 20. And we wanted to select some that were from these different types of collaborations I mentioned earlier for integrated organizations, shared projects and services and alliances. Um, we had some of those were successful. They had to have documented positive outcomes to appear in our research. We also picked in each type, a couple who are not as successful. So we could have a comparison point. Um, and we wrote 20 in-depth case studies. And to do that, we did over 118 interviews with leaders from their board members to their staff. We looked at their documents to really develop these rich stories and. What I found really rewarding about that process is one, you know, people give these kinds of platitudes about collaboration, but every single one of those 20 are different, right? It’s very contextual. It’s all driven by what the real needs are in their community. And what I also loved about doing the research is that I got to hear from so many just thoughtful and amazing leaders who are willing to step into these spaces and figure things out. Kind of the, one of the big takeaways I would say from the report Is that many leaders are thinking about how to do collaboration, not just because, well, we ought to collaborate, but they’re thinking about it because they want to innovate. They want to do something different than they’ve been doing previously that they think is going to make a big difference. And it’s often situated around that client need. Um, so let me give you an example. Love to tell the stories of these things. One of my favorite collaborations out of them that I looked at was this group called DV Beds. DV Beds was, you know, I know that you’re heading to Dallas soon. They started in Dallas, Texas. And they were a group of domestic violence organizations who were realized that the shelters in Dallas couldn’t meet the need of the community to help survivors of domestic violence. They didn’t have enough beds, right? And they also recognized when they came together that what they were doing as a result of this lack of need was harming their clients. Because a client would finally get into a safe space, they’d find a phone, they’d call, they’d tell the most horrific things that are going on in their lives. And they would get through all of that just to be said, here’s a list of four other places you can call, we don’t have room. right? Not what you want to do. They recognized there was a real problem there. So they created this collaboration called DVBeds, which is a system where every shelter in the system enters the number of beds they have available every single day. And what kind of beds they are, does it, you know, can you take a teenager, you know, do you allow pets, all of those pieces, right? And what that has meant is now if somebody calls any of those shelters and says, I have a need, they look, they go, we don’t have a space. They can quickly look up which shelter has a space that would fit the needs of that particular survivor, right? Which will have all of the things that they need and say, hold on, let me transfer you, right? And they can call the shelter who has a space available for them. And it’s only one transfer, one call, they can make a warm handoff, right? They started out super small, only in Dallas. Now they cover the state of Texas and part of Oklahoma. Um, and they have over 40 organizations who are participating in it. And it’s been a huge win for the organizations involved. They’re using their space available, which is great. It’s been a bigger win for the folks who are certainly survivors who are not having to make those calls. And it’s also been really good for the staff, right? Because you don’t want to be the person constantly saying, no, we don’t have no room. No, we don’t have room. No, we don’t have room. That’s hard. on a staff member. And now they can always say, yes, I have a solution for you. Hang on, let me transfer you to the right person. I’m going to get them on the line right now. Huge win. That’s the type of innovation that I hope that folks walk away from this research, just inspired by it. Yeah, we can do something different here.

Hugh Ballou:
Oh, that’s a great story. Yes, we can do something instead of turning people away. Oh, we don’t do that here. That’s a great story. So that not only breaks up the myths, but it opens up possibility thinking. And really, Michelle, the word that we use, nonprofit, isn’t a text. It’s a text classification, not even an official word in IRS. It’s not a philosophy. We’re actually running a for-purpose business. And it’s not about the money until we don’t have money. It’s really rethinking the organizational structure. We got the purpose, but the 90 percent, the infrastructure allows us to accomplish that purpose. So really what you’ve talked about is people thinking about how we do things and becoming more efficient. In a business, you go out of business because you’re wasting too much money. And so we’re stewards of other people’s money. So being practical with that is so important. That is a great story. And you’ve raised the impact, probably lowered the stress and the workload for every participating organization, and we’re able to help more people. And then they raise the budget, they attract more revenue.

Michelle Schumate:
They have.

Hugh Ballou:
You know, there is a trend, especially private foundations to look at mostly and sometimes it’s a requirement for groups that are collaborating with others in the communities.

Michelle Schumate:
Yeah. And I think that, you know, for private foundations to come along, one of the great lessons I’ve learned through working with the foundations who are part of the sustained collaboration network is that foundations have a role not only to require it, but to support it. Right? So I, you know, private foundation leaders also have a big role to play here. And all these collaborations who are, who are part of the study were supported through grantmakers who were willing to pay for a little bit of money for a consultant to help do feasibility or a lawyer to do due diligence or those pieces. It’s not free to get these set up for sure. But it also pays dividends and that’s why they are willing to invest in the front end because they recognize ultimately organizations are going to be better on the other end of this if they can make that investment.

Hugh Ballou:
That’s a key word, invest. We think of it as a cost when really it’s an investment which pays dividends, and not in ROI like we think, but return on impact, really. Yeah. So it’s a return in many ways. And ROL, return on life, because that’s what we’re about. We’re in a transformation business. So you’ve got this research. So the we is the collaboration network you talk about that did the research. And the funders want to see it happen, right?

Michelle Schumate:
Yeah, absolutely. And they want to see it happen in a very particular way. And so let me just kind of point out how funders support this effectively. They support it by doing what we call mini-grants, which are really about helping people learn. What’s the difference between an alliance and a shared project? What’s the difference between a merger and an asset transfer? There’s a lot of legalese technical pieces we don’t always talk about, and they do these little mini-education grants. No commitment yet. They do a second grant, which is what they call the exploratory grant, which is a chance for you to basically date before you get married. And I think that’s really important because we saw this in many collaborations, not every collaboration you’d explore is going to be a good fit. Right. And so they needed some funding to be able to explore and see if it’s the right fit for them. If there is alignment of values, that’s really important. if we can figure out how to get a common mission together. And so they supported that exploration process. At the end of that exploration grant, there’s a decision point, which is, yes, we go forward, we’re going to do this collaboration or no, we’re not. And either way is a success, right? Because you have learned whether or not it’s a good fit. And then they provide what they call an implementation grant. And that’s when they’re actually taking the collaboration forward is past the decision point. That three-step process is a really important way for those funders to support collaborations because we often want to jump straight to implementation. But in the research, what we found is each of those steps has an important marker in it that helps us to predict whether or not a collaboration is going to be successful.

Hugh Ballou:
These themes are important for all nonprofits globally, right?

Michelle Schumate:
Mm-hmm. Yeah, I think so.

Hugh Ballou:
So the fact that a funder stepped up and said, we want to do this research is very encouraging. So just give us a little snapshot of how you collected this data.

Michelle Schumate:
Yeah. So it spent a lot of time on Zoom, for sure. So this is kind of the format. We tried to collect data from the consultant who worked with them, with the funder who supported the collaboration, from a board member of one or both organizations to interview them, from staff who were involved at both organizations. And then I collected all of the documents that they produced as a result of their collaboration. So I spent a lot of time looking at reports of various kinds. And so from that, from those interviews, we were able to compile these kind of rich stories. And then looking across these rich stories or these case studies, we were able to garner insights that we highlight in the report.

Hugh Ballou:
Where do people find these reports?

Michelle Schumate:
So you can get your copy at sustained collab. C-O-L-L-A-B dot org. And that website will take you to all about us. And you can see under events and publications there, which is on the right hand side, you’ll be able to download those copies of the reports there.

Hugh Ballou:
or you go to Sustained Collab. Sustained, C-O-L-L-A-B dot org, O-R-G. And then there’s the menu across the top in the far right. She’s let you download these reports. That’s quite remarkable. So they don’t have to do the work, they can read it. So I’m showing it for people watching the video. If you’re listening to a podcast, just go, and there’ll be the link on the place that you’re hearing this. the narrative in the podcast or on the form of the page on the non-profit exchange, the non-profit exchange, TheNonprofitExchange.org. You’ll find this and 400 other episodes in the non-profit exchange. So this is a gold mine, Michelle. This is just so great that we have this resource and that we can get it for free. You spent, how long did you spend doing this research?

Michelle Schumate:
About eight months to all in all to be able to collect all of the data and write the stories and do the screenings.

Hugh Ballou:
This is pretty comprehensive to do in a month. So I commend you that took a lot of a lot of patience and commitment to collect that and then compile it. So people get to report and they read it. And I find this happens a lot. But what do you want people to do? What should they do after they read it?

Michelle Schumate:
I think the two things that I hope that folks will do at the end of this is spend some time learning about the different forms of collaboration, right? You don’t know what you can do in terms of collaboration and innovation, unless you’ve built some tools out in your tool belt. So learn about the difference between an asset transfer and a joint program, learn about the different tools, spend some time, more time learning, getting curious about them. That’s one of the things. And then the other thing I encourage everyone to do is to spend some time going, spending some time with, with other leaders who are concerned about the same problem you are, that you keep running up against over and over and over again. And consider whether collaboration is a tool that’s going to help you to solve that problem. Whether it’s a problem for your clients, like Outreach House found with the two different locations and clients trying to figure out which one had what, or You know, when you think about clients of DV beds calling the shelters, figure out what that problem is. There are examples of that when it comes to not having enough resources to do news coverage in an area. There are examples in the report about folks coming together around constantly having trouble staffing their organizations who figured out how to come together to make that solution. Spend some time thinking about what those problems are and seeing if there is a collaboration solution that might help all of you get to the next level.

Hugh Ballou:
So it would occur to me that if funders read these reports, they could learn some things. What could funders learn? And if a nonprofit’s looking for funding, should they refer a potential funder to these reports?

Michelle Schumate:
Yeah, so we spent, one of the things I loved about this is because this was funded, the research was funded by a group of funders. They wanted to talk to other foundation leaders and to really try to provide them with the tools that they needed in order to successfully nurture nonprofit collaborations. And so there’s one report in there that is just for funders, and it’s all about the tools that they need in order to sustain these collaborations. What things should they be funding? What are the particular types of grants that were most successful? And what are some of the resources that nonprofits need that are not money, but are essential for really making sure that those collaborations are successful? And so we talk about what that kind of partnership looks like. There are also in that report, a set of questions that you should ask of every grant proposal for one of these types of collaborations. And so we’ve tried to make it really practical for them.

Hugh Ballou:
Wow. That’s a lot of stuff in a really capsulized form. This is a short interview anyway, but you’ve really given us an immense amount of data and access to more data and a reason to go there. We talked a while back on another topic, but you’ve come back. and said, I got something new, and this is the purpose for being connected with people. Let’s talk about it. So thank you for asking to come back, because it’s just a great pleasure to interview you. So there’s another website which we could highlight. It’s your name, Michelle Shumate, M-I-C-H-E-L-L-E, S-H-U-M-A-T-E.com. What’s different about that, and what would people find when they go there?

Michelle Schumate:
So I’ve been working, the Sustained Collaboration Network funded this research and that’s what the sustainedcollab.org website takes you to is all of their resources. But if you would like to learn more about me, about my work as a consultant, the type of writing and speaking I do, you can spend some time on my website and it’ll take you to all the places.

Hugh Ballou:
A lot of data. We could spend a lot of time on that. But those are the links. People can explore those on their own. So what do you hope people who’ve listened to this will do now?

Michelle Schumate:
Well, first go check out the reports. Please take a look at them. I promise they’re super easy to read and they’re packed full of stories. If you’ve liked the stories I’ve told this far, that’s just a teaser of what’s in these reports. Um, in addition on that website under them, there are actually a little mini series of podcast interviews I did with some of the leaders of these organizations go listen to them. Right. So that’s number one. But second, I hope that you talk about this with another leader, right? I hope that you don’t just sit there and read this on your own and go, well, that’s nice and that’s interesting. I hope that this spurs a conversation. Maybe take a couple of folks out to lunch or to breakfast and say, hey, I’ve been reading about this. I’ve been thinking about this. Is there something potentially here to help solve this problem that we commonly have? What do you think about it? And start the conversation. Almost every collaboration that I talked with started out with some leaders sitting down over a meal and figuring out, hey, there’s something here that we need to solve together.

Hugh Ballou:
That makes so much sense. I hope people do that. And what if people say, I’m just too busy to do this?

Michelle Schumate:
It does take time. And so that has to be part of the conversation. But I think that often we as leaders in nonprofits and social impact organizations are on a treadmill. We’re too busy to do this because we’re solving the same problem over and over and over again. And if we just took the time to try to collaborate, it might transform the treadmill we’re on. So we’re not solving that same problem again and again.

Hugh Ballou:
Wise words, wise words. I was, I just threw you a hook. That’s a good one. Good one. So as we end this, what do you want to leave people with a thought or a challenge or what’s the big deal you want to leave them with?

Michelle Schumate:
I want to leave folks with the idea that you can do innovation on your own, but that’s kind of like working with a little shovel. in your garden. If you want to do innovation in a big way, like a backhoe kind of way, look for a collaboration to be able to take this, your social impact to the next level.

Hugh Ballou:
Michelle Shoemate, thank you so much for being our guest today on the Nonprofit Exchange.