1. mindaustralia.org.au Thriving (not just surviving) in today’s not for profit environment Dr Gerry Naughtin Chief Executive, Mind Australia

2. mindaustralia.org.au Purpose Offer some thinking about new ways of doing business in human service organisations Illustrate this in a practical way by outlining the challenges and opportunities faced by Mind Australia in reframing its business to the emerging market place

3. mindaustralia.org.au Context - Thriving in uncertain times Business development is occurring in environments of increasing complexity and uncertainty Governments are looking to improve efficiencies and outcomes while containing cost growth Government’s Federation White Paper and uncertainties about Commonwealth and State\Territory responsibilities Growing focus on civic society and citizen-centric services

4. mindaustralia.org.au Context Use of market mechanisms and private\NFP competition to drive reform, improve outputs and deliver cheaper services Increased policy focus on three themes: – Individualisation – Competition – Connecting up services Budget Uncertainty – Melbourne University not adopting a budget for 2015 because of uncertainty

5. mindaustralia.org.au Characteristics of NFP’s that may thrive DriverCurrentFutureSuccess factors Unique value propositionCommonality with other funded agencies Understanding unique value proposition and differentiation Understanding differences and commonalities Service delivery focusPrescribed by funder – outputs and outcomes Participant engagement because of participant perception of the value proposition Effective marketing strategy, brand recognition and perceived value of $ Staff performanceSimilar to other agencies Add real value, personalise and contribute to satisfied and engaged customers Effective workforce attraction and retention factors Service user expectationsNot important because of geographical monopolies or funding contracts CriticalUnderstanding and framing expectations

6. mindaustralia.org.au Characterising the emerging system drivers DriverCurrentFutureSuccess Factors Geographical coveragePrescribed by funder with geographical coverage of national programs Choice of provider within regions Opening up of historical service provision patterns Capacity to broaden geographical reach at affordable cost and use of IT RegulationDetailed reporting accountabilities Reduction of red tape Simplification of accreditation requirements Government and consumer interest in service competency, popularity and outcomes for them PerformanceOutputs and data reporting highly prescribed Focus on outcomes, service popularity and IT connectivity Consumer satisfaction and connectivity will be critical

7. mindaustralia.org.au Characterising the emerging system drivers DriverCurrentFutureSuccess Factors CostStandardised unit of funding Known $ for defined funding period Funding variable based on demand Government and consumer focus on value for $ Scale a key driver of cost reduction. Cash flow critical Scale, brand recognition and IT systems Focus on larger population centres Positive cash flow Sector fundingFunding to NGOOpening up market to private, statutory and NGO agencies

8. mindaustralia.org.au Mind Australia – a case example Specialist providers of community mental health services in South East Australia Target Group: people with severe and often long-term mental ill-health and their families and carers 40 years experience supporting people with mental health issues & their families & carers Budget 2013\2014 of $60 million with 75% of funding through government block grants Core service is the delivery of support services for people with serious mental health challenges & their families & carers

9. mindaustralia.org.au Mind clients & services Wide range of services for people with a psychosocial disability across 60 sites: -General information & referral including telephone and web-based -Individual support packages -Groups and day programs -Housing services -Deliver over 300 residential bed-based places every day -Family & carer specific services -Specialist services – including care co-ordination, Prevention Recovery Centres (PARCs) & specialist family therapy services, Partners-in-Recovery Program

10. mindaustralia.org.au Mind’s strategic challenge – in a nutshell: Mind operates a variety of business models prescribed by funders Policy shift from block funding to personalised packages 75% of funding for our service will transition to NDIS by July 2018 NDIS will result in significant new $ for people with psycho- disabilities but much less certainty for agencies Many of the current community mental health service models won’t be funded by 2018

11. mindaustralia.org.au Mind’s strategic opportunities Transform and reposition existing business models, or exit them Develop evidence-based models that consumers & families & carers will want to use Engagement of services users, families & carers as co-producers of resources and service approaches Develop new businesses Identify and invest in the organisational competencies and foundations that will underpin customer value and business success in the future While at the same time managing business as usual and usual growth – while it lasts

12. mindaustralia.org.au Mind film clip

13. mindaustralia.org.au The questions for thriving NFPs Old Question - What do you think of our services? How can we improve? to New Question - What kind of services or supports would you like us to deliver?

14. mindaustralia.org.au Issues for thriving as a NFP Delivering services defined by government policy and funding guidelines or delivering services that work for participants How to understand consumer\participant expectations and what works Reducing reliance on 1 or 2 income streams Attracting staff with the values, commitment and values to deliver Consumers in mental health not asked the question – “if you have a choice, where would you like the funding spent?”

15. mindaustralia.org.au Prioritisation of 13 ‘good life’ domains Research undertaken by Mind’s Research Collaboration with Melbourne University “People making choices” (Brophy 2014) Figure 1: Percentage of people who said each goal would be ranked in the top five good life goals

16. mindaustralia.org.au Top 5 Good Life Goals Figure 2: Top ‘good life’ goals according to participants’ prioritisation of each goal being in their Top 5

17. mindaustralia.org.au Reflections on new ways of doing business for CSO’s Understand the economic as well as social impacts of services e.g. prevention and early intervention Focus on population-based planning rather than funding stream planning Packaging services and supports across organisations and sectors – moving beyond “no wrong door” to more integrated service solutions Providing a differentiated product in a market with increasing pressure for standardisation – the race to the top or the bottom Using the strength of community knowledge and connections Investment in service development as well as business delivery Starting to rethink the contribution as SMEs in a growing corporatised market place: Are the business models of today, the business models of the future? Defining our future rather than having it defined for us Rearticulate the value proposition NFP’s of the future need to be values driven and commercially sustainable