Third Sector Partnering

BE0964 Partnership and Collaborative Working

Dr. Alex Hope

Introduction

• What is the ‘Third Sector’

• Why Partner

• Models of Partnering

• Key Issues

• Examples

The Third Sector

“the part of an economy or society comprising non-governmental and non-profit-making organisations or associations, including charities, voluntary and community groups, cooperatives, etc..”

Oxford English Dictionary (online) 2014

Variations on the theme…

Some Definitions

• independent of government. This is also an important part of the history and culture of the sector;

• ‘value-driven’. This means they are motivated by the desire to achieve social goals (for example, improving public welfare, the environment or economic well-being) rather than the desire to distribute profit; and

• reinvest any surpluses generated in the pursuit of their goals. For this reason TSOs are sometimes called ‘not-for-profit organisations’. A better term is ‘not-for-personal-profit’. In many cases, TSOs need to make surpluses (or ‘profits’) to be financially sustainable.

TSO Attributes

TSO Legal Status• TSOs can take a number of legal

forms.

• Many are simple associations of people with shared values and objectives.

• Many have company status but with a not-for-personal-profit approach.

• Very many have charitable status or are community interest companies, industrial and provident societies or co-operatives.

TSO Significance• The presence of a large non-profit

sector is sometimes seen as an indicator of a healthy economy in local and national financial measurements.

• With a growing number of non-profit organisations focused on social services, the environment, education and other unmet needs throughout society, the nonprofit sector is increasingly central to the health and well-being of society.

• It has been suggested that the nonprofit sector provides an excellent outlet for a variety of society's labor and skills.

TSO North East UK

TSO Partnering

History of TSO Partnering• There has always been a mixture

of state-market-voluntary sector provision, involving widely varying interactions with civil society in the provision of welfare services over history, both in the UK and internationally

• Nineteenth century philanthropy (e.g. in the form of limited profit housing trusts) and mutual activity (such as the building societies) pre-dated state intervention on these fields and the eventual foundation of the welfare state

History of TSO Partnering• The interactions between the sectors is

complex and multi-dimensional, with relationships varying in terms of funding/finance, ownership and provision, and regulation and the role of choice

• Perhaps the most important form of partnership historically has been that between the state and the voluntary sector, particularly in healthcare

• TSO and public partnerships are increasingly common in the UK and EU as we move towards a ‘Big Society’ model of welfare provision

• Partnering between business and TSO is growing in popularity

TSO-Public Sector Partnering (PSP)

‘A strategic partnering arrangement which involves the third sector earlier and more deeply in the design and commissioning of public services’.

Scot Gov (2011)

Types of PSP Partnerships• Separate organisations maintain their

independence, but work jointly on some activities or functions.

• Organisations with resources or expertise offer assistance to other organisations, e.g. a large national organisation working with a small local group.

• A new organisation to do joint work on some activities or functions.

• A group structure where a 'parent' organisation governs a group of 'subsidiary' organisations.

• Merger to form a new organisation working as one body on all activities.

PSP Drivers• Bidding for and undertaking contracts –

and the move to ever bigger contracts might be pushing TSOs to consider collaboration even more seriously (which may be viewed as imposed and therefore problematic). !

• Desire for market entry – partnership working and collaboration supports scale, shared resources and expertise, and therefore potentially the achievement of better outcomes (although this remains an open question). !

• Desire to share the costs: of maintaining a back office, covering procurement, treasury management, IT, HR procedures, and training for example.

PSP Drivers• Bringing together expertise and increasing

influence – including through lobbying and through attaining ‘critical mass.’ !

• Outcome-based commissioning, by working jointly on pathways to better outcomes (e.g. health, homelessness ‘pathways’, wellbeing, social inclusion, rehabilitation from offending, employment). !

• Personalisation and personal budgets – these developments are already pushing providers to consider collaboration in order to be able to offer a wider range of services which people with personal budgets can commission.

!• Public spending cuts – as these deepen, TSOs

may get into some financial difficulty, so many will look for more security and will not want to be reliant on just one contract for survival.

PSP Benefits

• Understanding of the needs of service users and communities that the public sector needs to address;

• Closeness to the people that the public sector wants to reach;

• Ability to deliver outcomes that the public sector finds it hard to deliver on its own;

• Innovation in developing solutions; and

• Performance in delivering services.

Public services can gain a lot from working with third sector organisations. The benefits vary across policy and geographical areas. But some of the common themes are TSOs’:

PSP Importance

• Services are not designed in isolation

• Greater agility to find creative solutions to service user requirements

• Helping to break down intra-organisational bureaucratic barriers and risk averse cultures

• Supporting the delivery of wider social and economic benefits focused upon communities

• Promoting the sharing and transfer of skills and knowledge between partners opening markets for the third sector

Successful adoption of the Public-Social Partnership approach to the design and delivery of services can engender significant benefits:

Challenges• Lack of public sector

understanding of the role that TSOs play

• Poor relationships between the two sectors

• Lack of a united sector voice

• Lack of TSO resources and capacity

• Reluctance to collaborate

• Five-year partnership aiming to put housing back on the national agenda

• Transform the standards of Britain’s homes, especially in the private rented sector,

• Help people struggling with bad housing or debt.

Example

TSO-Private Sector Partnering

Why Partner?TSO - Business Collaboration

Ählström & Sjöström (2005)

• Capacity building • Access to core funding • Access to skills, insights

and assists of a business

• Opportunity to transform performance over time

• Deeper understanding of business sector approaches

Whats in it for TSOs?

• Improve quality of service

• Better understanding of clients/customers

• Brand differentiation • Improved reputation • Corporate Social

Responsibility (CSR) • Increased trust in brand

Whats in it for Business?

• Increased expertise from TSO and business partners

• Increase in long term support capacity

• Greater efficiency and productivity in TSO

• Business making a contribution to long term public good

• Improvements in services

Societal Benefits

ChallengesAreas of potential tension between core logics of Market and

Civil Society

Key differences between Private and TSOs

Good Practice• Share organisational values and be

transparent

• Clarify motives and aims

• Establish good governance mechanisms internally and externally

• Create measurable targets, reporting requirements and monitor performance standards

• Have clear, open communication channels

• Conduct ‘due diligence’ on partners prior to collaboration

British Gas - Shelter• Five-year partnership aiming

to put housing back on the national agenda

• Transform the standards of Britain’s homes, especially in the private rented sector,

• Help people struggling with bad housing or debt.

Example

Homes for Britain• Improve a million homes through

practical changes such as better insulation and energy efficiency

• Provide debt and housing advice

• Involve British Gas customers in the partnership

• Engage British Gas staff

• Be energy efficient

• Public promotion

Results?

• Benefits to British Gas?

• Benefits to Shelter?

• Benefits to Society?

Summary

• What is the ‘Third Sector’

• Why Partner

• Models of Partnering

• Key Issues

• Examples

Waddell, S. (2005) Societal Learning and Change. Sheffield UK: Greenleaf.

Ählström, J., & Sjöström, E. (2005). CSOs and business partnerships: strategies for interaction. Business Strategy and the Environment, 14(4), 230–240. doi:10.1002/bse.470

Scottish Government (2011). A Practical Guide to Forming and Operating Public Social Partnerships. Available at: http://www.scotland.gov.uk/Resource/Doc/48453/0119024.pdf

Rees, J., Mullins, D., & Bovaird, T. (2012). Third sector partnerships for public service delivery: an evidence review. Retrieved from http://www.bhamlive.bham.ac.uk/generic/tsrc/documents/tsrc/working-papers/working-paper-60.pdf

Further Reading