1. Delivering Value in the Third Sector Westminster Business School Alumni Liz Page UK Director, South Eastern 8th May 2012

2. Delivering Value in the Third Sector Introduction  Share with you the challenges we have in ensuring we deliver value  Use examples from Red Cross, based on experience  Link to measurement in the commercial sector so we can explore the differences

3. Third Sector Qualities Value-driven Third Sector Independent of government Reinvests surpluses generated in the pursuit of their goals

4. What is the Third Sector?  Service provider  Research/advocacy/ campaigning  Self-help groups  Clubs and societies  Intermediary organisations  Social enterprises Focus is social value Support to individuals Changes in policy/practice Direct support to each other Shared interest Skills and advice for sector Re-invest surpluses from business

5. Total Income and Expenditure in Cash Terms (£bn) Source: NCVO UK Civil Society Almanac 2012

6. Measuring Not-for-Profit v. Commercial Organisations Commercial Not-for-Profit Prime measure Means to an end Financial returns Non-financial measures Social value Financial measures

7. Funding Sources – British Red Cross Total: £213.8 million

8. British Red Cross: Key Information  Part of global Red Cross/Red Crescent movement of 188 national societies  British Red Cross: 3,500 staff and 32,500 volunteers  Vision: world where everyone gets the help they need in a crisis  Mission: to mobilise the power of humanity so that individuals and communities can prepare for, deal with, and recover from a crisis

9. Turning Vision/Mission into Delivery Programmes Changing world Shifts in government and government policy Financial survival Financial survival Opportunities for new programmes and partnerships Recognising complexity and ambiguity Legislative compliance Attracting funding and volunteers Strategic Direction and Plans

10. Planning models are very similar to those in the commercial sector Long-term strategic activity and funding plan Annual plans and budgets Implementation and regular review Individual programmes Outcomes – Outputs – Budgets – Inputs …more emphasis on social value.

11. Developing and Delivering Strategic Plan in Red Cross  Assess key external trends  Align strategic priorities between senior management team members in context of funding environment  Review with Board of Trustees  Engage staff and volunteers  Implement cycle of annual plans and quarterly reviews  Recognise need to adjust if major emergency occurs  Adjust and improve continuously

12. Key External Trends Identified for 2010-15 plan  Climate change and extreme weather  Conflict over resources, such as water, food and oil  Ongoing health crises like HIV/Aids and pandemic flu  Global recession, unemployment and government spending cuts  World population growth and urbanisation

13. Communicating the Strategy: Saving Lives, Changing Lives Delivery Priorities Enabling Priorities Emergency response Building resilience Individual health and social care crises Supporting partners in Red Cross movement Volunteering experience External positioning Efficiency and effectiveness Optimising net income

14. Measuring Social Value Social value How many people? What difference for each person? Beneficiary Reach -- Outcomes Value for Money Funding

15. Measuring Social Value for Care in the Home Programme Impact Reduced suffering in crisis Increased resilience Common outcomes Improve recovery after illness Greater independence Specific outcomes Less unnecessary time in hospital Ability to manage day- to-day activities Indicators Leaves hospital on own as medically fit Not readmitted within 28 days for same condition Diet/nutrition Medication etc. at appropriate level Beneficiary

16. Challenge is to measure at organisational level Social value How many people? What difference for each person? Beneficiary Reach -- Outcomes Value for Money Funding Measure reach Sample results

17. Conclusion: delivering value on the third sector Clear strategic aims to bring together efforts of staff and volunteers Programme goals based on impact for beneficiaries Skills to attract funders and “unlock” resources Measures which demonstrate social value as well as financial survival

20. Further reading The Public Value Scorecard : A Rejoinder and an Alternative to “Strategic Performance Measurement and Management in Non-Profit Organisations” by Robert Kaplan by Mark H. Moore Hauser Center for Nonprofit Organisations Harvard Univ. May 2003 The Blended Value Proposition : Integrating Social and Financial Returns Jed Emerson California Management Review Summer 2003 Inspiring impact Working together for a bigger impact in the UK social sector Tris Lumley et al. New Philanthropy Capital Dec 2011