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Page 1: Social Service Nonprofits: Navigating Conflicting Demands · Private philanthropy is behind some of this push towards increased collaboration, even while it plays a relatively small

SocialServiceNonprofits:

NavigatingConflictingDemands

JenniferE.MosleySchoolofSocialServiceAdministration

[email protected]

Forthcomingin:TheNonprofitSector:AResearchHandbook(3rded).W.W.PowellandP.Bromley,Editors.PaloAlto,CA:StanfordUniversityPress.AbstractMostsocialservicenonprofitsintheUnitedStatesdependsubstantiallyonthegovernmenttosustaintheiroperationsand,increasingly,playimportantrolesinpolicyformulationandimplementation.Thischapterarguesthatthissectoralblurringofrolesandresponsibilitiesatthegovernment-nonprofitlevelhasalsohadtheconsequenceofincreasedblurringbetweennonprofitactivityandmarketactivity.Notably,theconcernsaroundaccountabilityandimpactfoundinthisprincipal-agentrelationshiphaveledtogovernment-setincentivesforsocialservicenonprofitstolook,feel,andactincreasinglylikefor-profitbusinesses,whileatthesametimehavingincreasedpoweringovernancearrangementsandasrepresentativesofmarginalizedpopulations.Currently,socialservicenonprofitsarechallengedtomeetthenormativeexpectationsmanypeoplehaveforthenonprofitsectoraroundvoluntarism,communityconnections,andindependencefromgovernment.Theyhavestrongincentivestobecomemoreprofessionalized,larger,moredatadriven,andtomakedecisionsregardingserviceprovisionandadvocacybasedonresourceavailabilityratherthancommunityneeds.Theresultingtensionisreflectedintheinconsistentpolicies,practicerecommendations,andevenscholarshipassociatedwiththesector.

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NonprofitorganizationshavelongdominatedthesocialservicessectorintheUnitedStates.Historically,socialservicesprovidedbynonprofitshaveoftenbeenconceptualizedasresidual,addressinggapsunfilledbygovernment,butthatviewisnotquiteaccurate(Salamon,1987a).Thegrowthofthemodernwelfarestate(particularlyonethatishesitantandlargelyprivatized)hasresultedinaparallelgrowthinthesocialservicenonprofitsectorthatfunctionsprimarilyasacomplementtogovernmentactionandatoolforenactingthesafetynet.Growthinthesocialservicenonprofitsectorhascomethroughshiftsinthesafetynettowardsserviceprovisionandawayfromcash-basedassistance,andinanongoingpreferencetowardscontractingoutgovernment-fundedsocialservicestononprofitorganizations.Asaresult,mostsocialservicenonprofitsintheUnitedStatessubstantiallydependonthegovernmenttosustaintheiroperations,andtheyplayincreasinglyimportantrolesinpolicyformulationandimplementation.InthischapterIarguethatthissectoralblurringbetweentherolesandresponsibilitiesofgovernmentandsocialservicenonprofitshasalsoblurredthedistinctionbetweennonprofitactivityandmarketactivity.Specifically,theconcernsaroundaccountabilityandimpactfoundinsuchaprincipal-agentrelationshiphasledtogovernment-setincentivesforsocialservicesnonprofitstolook,feel,andactincreasinglylikefor-profitbusinesses,andthesectorhasrespondedaffirmatively(Maier,Meyer,&Steinbereithner,2016).Today,exceptfortheirfundingmodel,manysocialservicenonprofitsarealmostindistinguishablefromfor-profitbusinessesatthegroundlevelinregardstotheirattentiontothebottomline,levelofprofessionalization,andambivalencetowardstheirlargercivicrole.Atthesametime,theyhaveincreasingpoweringovernancearrangementsandasrepresentativesofmarginalizedpopulations.Theresultingtensionisreflectedintheinconsistentpolicies,practicerecommendations,andevenscholarshipassociatedwiththesector.Whyshouldwecareaboutthisturntowardsamarketmodelforsocialservicenonprofits?AsPowell(thisvolume)notes,nonprofitsareoftenseenastoolstoaccomplishatask(generallydeterminedbyafunder)andalsoas“amediumfortheexpressionofvaluesandcommitments”(e.g.topromotewell-being,communitydevelopment,civicengagement,voluntarism,etc).Inotherwords,althoughtheyperformanimportantinstrumentaltaskindeliveringsocialservices,theyarealsoascribedkeyexpressivefunctions,suchasprovidingcommunitycohesion,advocatingforthevulnerable,andpromotingground-levelsolutionstoimportantsocialproblems.Thistensionbetweeninstrumentalityandexpressivenessisparticularlyfraughtinthesocialservicessector,asdemandstomeetoutcomegoals(relatedtotheirinstrumentalrole)havebecomemoredominantandprocessgoals(relatedtotheirexpressiverole)aresacrificedtoprofessionalization,efficiency,andimpact.This“entanglementofthegrowthofvoluntaryassociationsandthenonprofitsectorwiththedevelopmentofcapitalismandthecorporateorder”(Soskis,thisvolume)hasledtoworriesaboutaccountabilityandcapacity,andthusagrowthindemandsatthefieldleveltopursue“impact”and“efficiency”ascentralvalues.“Impact”and“efficiency”demandsaretypically:Thesedemandsareoften:

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• Onlyproventhroughincreaseduseofdataandperformancemeasurementschemes;• Framedasproperstewardshipoflimitedresources;• Supportiveoffundingbeingdirectedtowardsmeasurableprogrammaticfunctionsrather

thancivicengagementandadvocacy;• Co-constitutivewithprofessionalization;• Tiedtothegrowthofevidence-basedpracticeandtheresultingtensionsbetweenthat

movementandmore“traditional”nonprofitnotionsofperson-centeredcare,co-productionofservices,anddeeperconnectionstocommunity.

Theembraceofmarketvaluespresentsanumberofchallengesforthesector.Forexample,consolidationandmergershaveincreasedasbig,multiserviceorganizationsareincreasinglybestsituatedtocompeteinthedata-driven,professionalizedmarketplace.Althoughthesectorcontinuallygeneratessmallerprovidersthatattempttorecreateorenactamorecommunity-ledorcommunity-engagedstyle,therearefewexternalrewardsforthattypeofwork,andcompetitionisfierce.Thus,traditional“economic”theoriesofthesector(Hansmann,1987;Steinberg,2006;Weisbrod,1991)arecalledintoquestion.Aresocialservicenonprofitsreallyservingnicheneedsbecauseofcloseconnectionstoreligious,ethnic,orgeographiccommunities?Dotheyreallyinspiremoretrust?Additionally,mostadvocacybysocialservicenonprofitsisnowfocusedprimarilyonmaintaininggovernmentfinancialsupportinparticularindustriesorsubfields(Mosley,2012).Thiscallsintoquestiontheabilityofthesectortopromotesubstantivesocialchangeasitisintheself-interestofmostsocialservicenonprofitstomaintainthestatusquo.Traditional“political”theoriesofthesectorwillhavetobeadjustedifmanyorganizationsarefunctioningmoreasinterestgroupssupportinganindustrythanasrepresentativesofmarginalizedcommunities(Clemens,2006;Eikenberry&Kluver,2004).Atthesametime,weareseeingalargerrolefornonprofitsocialserviceprovidersingovernance,largelythroughtheirparticipationincollaborativegovernanceprocesses.Collaborativegovernanceisatermthatdescribesthevariouswaysthatnonprofitsareinvolvedinmulti-stakeholderdecision-makingaboutpublicpolicyandprocesses.Nonprofitsareincreasinglyaskedtoparticipateinsuchprocesses—oftentermed“taskforces”or“advisorygroups”—inordertohelpmeetaccountabilitychallengesattheadministrativelevel,fillinforthe“hollowstate”associatedwithcontractingregimes,provideneededexpertise,andpromotecoordinationacrossfragmentedpolicyareas(Ansell&Gash,2008;Emerson&Nabatchi,2015;Milward&Provan,2000).Theirparticipationisoftenalsoconceptualizedasaproxyfortheparticipationofcitizens,andthusawayofadvancingdemocraticnorms(Levine,2016;Mosley&Grogan,2013).Theseprocessesarebeinggivenincreasingpoweroverregulatory,funding,andimplementationmatters,butthedegreetowhichsocialservicenonprofitsareadequatelyrepresentingthepopulationstheyserveisunknown.Giventhechangeswehaveseeninadvocacynorms,andtheincentivesforthoserunningtheprocesses—generallygovernmentadministrators—toexcludedissentingvoices,thedemocraticimpactoftheirparticipationisunclear(Dean,2018).

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Collaborativegovernanceisnottheonlywayinwhichsocialservicenonprofitsparticipateinnetworksthathavecommunity-wideeffects,however.Socialservicenonprofitsfacestrongpressuresfromfunderstoparticipateinbothintra-andinter-sectoralcollaboration,includingsigningontopackaged,promotedconceptssuchasthe“collectiveimpact”model(Kania&Kramer,2011).Thereislittledoubtthatstrongnetworksareimportantforeffectivenessinbothserviceprovisionandadvocacy.Butthefieldiscurrentlychallengedtocreatelargescalecollaborationthatdoesn’tresultincreamingofparticipants(e.g.,selectingclientsbasedontheirlikelihoodofsuccess)anddeepeninginequitiesbetweenproviders(Wolffetal.,2017).Privatephilanthropyisbehindsomeofthispushtowardsincreasedcollaboration,evenwhileitplaysarelativelysmallroleintheoverallbudgetofmostsocialserviceorganizations.Currently,socialservicenonprofitsareusuallymoredependentongovernmentdollarsthanonprivatephilanthropyandoftenlooktoindividualdonorsasasecondarysourceofincome.Thisisbasedinthecommonbeliefthatfoundationdollarsareasdifficulttogetasgovernmentdollars,butdon’tlastaslongandaregenerallyforloweramounts.Foundationsstillplayimportantrolesinshapingcurrentconditionsinthesector,though,byfocusingtheirdollarson“innovation”andinleadingthechargetowardsgreaterdemandsforimpactandoutputevaluation(Brest&Harvey,2018).Byservingasconvenersandthoughtleaders,organizedphilanthropyhasbeenshowntoradicallyreshapewhatservicetechnologiesareinvogue,whatissuesareimportanttoaddress,andevenwhatorganizationaltypesarebestsuitedtoaddressthem(Dunning,2018;Tompkins-Stange,2016).Inthisway,philanthropicfoundationshaveapowerfulhandinshapingthemarketfornonprofitsocialservices.Socialserviceorganizationsoperatingaccordingtomarketprinciplesareunlikelytopromotepracticessuchasadvocacy,co-production,communityrepresentation,civicengagement,andvoluntarism.Thiscallsintoquestiontheabilityofthesectortomakethecontributionstocivilsocietymanypeopleexpectofnonprofits(Eikenberry&Kluver,2004).Withoutthesecontributions,vulnerablecommunitiescouldsuffer,andresidentscouldpotentiallybecomemorealienatedfromthekindofhuman,social,andpoliticalcapitalneededtoimprovetheirlives(Alexander,Nank,&Stivers,1999).Meanwhile,theparticipationofsocialservicenonprofitsinagrowingwebofcollaborativerelationshipsandgovernancegivesthemincreasingpowerandresponsibilitybutlimitstheirabilitytomeaningfullyresistmarket-orientedtrends.Inthesectionsbelow,Ireviewhowthistensionplaysoutthroughthecurrentdemographicsofthesector,financingtrendsandtensionsarisingfromgovernmentcontracting,therelationshipbetweencontractingandperformance,professionalization,andefficiencydemands,andtheresultingchallengesdescribedabove.Welfarestatesacrosstheworldengageandsupportthirdsectororganizationsindifferentways(Esping-Andersen,2013;Salamon&Anheier,1998),andthischaptercannotreviewallofthem;itlargelyfocusesontheU.S..Therearesimilartrendselsewhere,however,asdocumentedinworkonblurringboundariesbetweenNGOsandgovernmentinKenya(Brass,2016),onthemarketizationofthenonprofitsectorinEurope(Bode,2017;Elstub&Poole,2014),andonthegrowthofsocialservicenonprofitsectorsduetoincreasedcontractingworldwide(Lu&Dong,

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2018).Giventhealready-dominantroleofgovernmentfundinginthesocialservicessectorintheU.S.,akeyquestion,then,iswhetherthesocialservicenonprofitsectorcaneffectivelybundletogetherthe“moralcharacter”thatmakesitappealingasanalternativetogovernmentandtheexpectedcostsavingsofanyoutsourcingendeavor.Theansweriscrucialtothefutureofsocialservices.Iscontractingwithsocialservicenonprofitsdesirablesimplybecausetheyare“notgovernment”—private,andbeholdentomarketforces—oristheresomethingabouttheexpressivecharacterofnonprofitsthemselvesthatitisimportanttomaintain?CurrentDemographicsandFinancingSocialservicenonprofitsincludeabroadrangeoforganizationsthatprimarilyprovideservicesintendedtopromotewell-being,improvelifeandlivingconditions,ameliorateinequalitiesanddisparities,orotherwiseassistindividuals,familiesandcommunitiesinneed.Inpractice,theirservicesincludementalhealthandlegalaid,jobtrainingandemploymentassistance,foodassistance,servicesforthehomeless,childwelfareservices,adultdayservices,andothers.Socialservicenonprofitscanbeunderstoodasasubsetofthelargerhumanservicesfield,whichalsoincludeseducationandhealthcarenonprofits.Thoseorganizationsaregenerallystudiedseparately,however,astheytypicallyhavesubstantiallydifferentfinancialmodels,operateinfieldsthataremoremixedwhenitcomestosector(i.e.astrongerroleforfor-profitandpublicorganizations),andserveamoreuniversalclientele. Althoughitisimperfect,theNationalTaxonomyforExemptEntitiesisthedominantsystemusedtocategorizenonprofitorganizationsbytheirfieldofpractice(Fyall,Moore,&Gugerty,2018;Grønbjerg,1994).Inthissystem,socialservicesaregenerallyoperationalizedascodesF,I-M,OandP(includingbutnotlimitedto:mentalhealth,crimeandlegalservices,employment,foodandnutrition,housing,disasterrelief,andyouthdevelopment).AsseenatthebottomofTable1,comparedtoeducationorhealthcarenonprofits,socialserviceorganizationsarerelativelyhighinnumberbutsmallinsize.ThereoverfivetimesmoresocialservicenonprofitsintheU.S.thantherearehealthcarenonprofits,buttheyare,onaverage,aboutatwentieththesizeofahealthcarenonprofit(andabouthalfthesizeofaneducationnonprofit).From2006to2016,insocialservices,revenuegrewmuchfasterthanthenumberoforganizations.Everysocialservicefield,withtheexceptionofdisasterpreparednessandrelief,sawadoubling(atleast)inmedianrevenueoverthatten-yearperiod.Revenueisgrowingeveninfieldsthataredeclininginnumber(likeemploymentservices),whichdemonstratesconsolidation.Intermsofnumbersoforganizations,brokendownbyfield,weseeparticularincreasesduringthattimeinyouthdevelopmentandfood,agriculture,andnutrition,andamoderatedecreaseinthefieldofemploymentservices.

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Table1. SizeandScopeofSocialServiceNonprofitsintheUnitedStates,2006-20161 Total#of

organizations(2016)

Percentchangeinnumberof

organizations2006-2016

Mean/Medianrevenue(2016)

Percentchangeinmean/median

revenue2006-2016

MentalHealth&CrisisIntervention(F)

17,106 -0.7% $3,391,936/284,912

74.1%/114.5%

Crime&Legal(I)20,899 1.5%

$960,272/130,497

81.8%/187.7%

Employment(J)32,876 -17.3%

$2,418,644/260,880

91.5%/149.7%

Food,Agriculture&Nutrition(K) 18,016 22.8%

$1,897,841/137,686

143.4%/127.7%

Housing&Shelter(L) 33,618 -1.7% $1,222,854/243,164

76.2%/102.1%

PublicSafety,DisasterPreparedness&Relief(M)

23,150 4.8% $298,254/102,761

64.6%/89.2%

YouthDevelopment(O), 32,795 41.1% $839,890/128,385

64.5%/144.0%

GeneralHumanServices(P)98,297 13.5%

$2,764,556/241,815

64.0%/129.7%

ALLSOCIALSERVICES276,757 7.1%

$1,972,487/190,178

73.5%/122.3%

Incomparison:

Education(B) 210,559 10.1% $4,132,595/96,246

95.0%/194.5%

HealthCare(E) 45,130 1.5% $38,997,141/497,421

92.6%/90.6%

FinancinginSocialServiceNonprofitsSocialservicenonprofitsaretypicallyfinancedthroughamixtureofgovernmentgrantsandcontracts(~65%),privatefoundationsandindividualdonors(~18%),insurancepaymentsandfeesforservices(~6%),andothersourcesofrevenue(e.g.,investmentandbusinessincome)(~10%)(Morris&Roberts,2018).Thismixturevariesconsiderablybyfield(somefieldsattractmoreorlessgovernmentorprivatedollars)andregion,dependingonthepoolofpublicandprivatefundingavailableindifferentstatesandlocalities.Eachtypeoffundingcomeswithchallengesandopportunitiesfororganizationalindependence,stability,andmissionalignment.Theabilitytoearnmoneythroughfeespaidforservices(eitherdirectlyorviainsuranceorMedicaid/Medicare)variesgreatlybyfield.Forexample,mentalhealthclinicsandearlychildhoodprogramsareusuallyabletoeitherchargeonaslidingscaleorarereimbursedbyinsuranceorstateprograms.Medicaidreimbursements,inparticular,makeupanincreasingproportionofrevenueinsomefields,especiallysubstanceabuseservices(Allard&Smith,2014).Inothersocialservicefields,incomederiveddirectlyfromclientsintheformoffeesis

1IgratefullyacknowledgetheworkofJadeWonginpullingthesenumberstogether

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typicallylow,asmanysocialservicenonprofitsprovideservicestopeoplewithlowincomes.Chargingfeesiseitherimpossible(e.g.servicesforthehomeless),orwouldcompromisewhoisabletotakepartintheprogram(e.g.servicesforyouthoremployment-basedservices).Chargingfeescanbecontroversial.Somearguethatitmayleadtostrongerbuy-inbyparticipants,whileothersarguethatitcanleadtoexclusionofthemostvulnerable.2Fees,ofcourse,aredifferentthandues.Althoughrare,membershipmodelsofsocialservices(likeworkercentersorself-helpgroups)oftenchargeduesand,dependingonthescopeandcostofservices,canachieveconsiderablefinancialindependenceinthatway.Althoughoftenlumpedtogetherinroutinereporting(becauseofhowthisincomeisreportedtotheIRS),fundraisingfromindividualsandprocuringgrantsfromprivatefoundationsrequireverydifferentorganizationalpractices,andhavedifferentstrengthsandweaknessesfromamanagerialperspective.First,solicitingindividualdonationsthattotalameaningfulamountofmoneyisaverystaff-intensiveprocess.Eachdonorneedstobesolicitedindividually,andlargedonorscanbedemandinginthekindofengagementtheyexpectfromtheorganization.Manysmall-tomedium-sizeddonorsareneededtomakeupforjustafewlargergrantsorcontracts.Althoughindividualdonorstypicallydonotinsistonquantitativeassessmentsofoutcomes,theyaretypicallyveryresistanttogivingmoneyto“overhead.”WebsiteslikeCharityNavigator,withtheirratingsystemsthatpunishorganizationsthatinvestininfrastructureorcapacityneeds,underlinetheconcernmanydonorshaveregarding“efficiency”and“trustworthiness.”Thiscangreatlyhamperorganizations’abilitytogrowandretainflexibilitytomeetchangingconditionsontheground.Individualcontributionscanalsovarywidelyfromyeartoyearandmayrequiresubstantialboardinvolvement(Hodge&Piccolo,2005).Finally,thereisconsiderablecompetitionforthosedollars,asmostindividualdonationsintheUnitedStatesaregiventoreligiousorganizationsandhighereducation(GivingUSA,2018).Philanthropicdollarsareprizedtothedegreethattheyprovidemoreopportunityformissiondrivenprogrammingandmoreflexibilitythangovernmentcontracts,whiletheirfundingislargerandlesscapriciousthanindividualdonors(Froelich,1999).Privatefoundationsvalueinnovation,whereasgovernmentfundersgenerallyfavoralreadytestedprogramming(Bushouse,2009).Thiscanmakefoundationfundingappealingfororganizationstryingoutnewmodelsofservice.Ontheotherhand,becausemostprivatefoundationsseetheirstrengthasfundinginnovation,theytendnottofundlongterm,safetynet,“charitable”servicesthatmanysocialservicenonprofitsprovide(e.g.,communitymentalhealth,foodpantries,fostercare)(Hammack&Anheier,2010).Grantsfromprivatefoundationsalsotendtobesmallerthangovernmentcontractsbutstillrequiresubstantialdatacollectionregardingperformanceandimpact.Theytendtobemoretime-limited(e.g.a2-3yeargrantwithamaximumofonerenewal)and,likeindividualdonors,sometimessharplylimitfundingforgeneraloperatingexpenses.Finally,successfullyraisingmoneyfromprivatephilanthropydependsonestablishingconnectionsandrequiresahighdegreeofprofessionalskill.Forthesereasons,grantsfromprivatefoundationscomprisearelativelysmallproportionofthefinancialportfolioformany

2Foraninterestinghistoryoffee-charginginthesocialservices,seeBrown(2018).

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socialservicenonprofits.Despitethis,philanthropicfoundationsdoplayanimportantroleinsettinganideologicalagenda,whichisdiscussedbelowunder“currentchallenges.”Thus,formanysocialservicenonprofits,theremainingfundingcategory—governmentfunding—iswheretheactionis.Whetherstate,local,orfederal,governmentfundinghasbecomeveryprominentinthissector,andunderstandingitsroleandimpactisvitaltounderstandingthechallengesfacedbysocialserviceorganizationsmovingforward.Asnotedabove,governmentfundingcomprisesapproximately65%ofthebudgetoftheaveragesocialservicenonprofitintheU.S.Thisfigureobscuresconsiderablevariation,however.Insomesubfields,likechildwelfareorhomelessservices,thataverageismuchhigher—closerto90%—whereasinotherfields,likelegalservicesforundocumentedimmigrants,thepercentagemaybeclosetozero.Dependenceongovernmentfundingalsovariessignificantlybystate.Thefederalismofgovernmentcontractingperhapsmattersfornootherpartofthenonprofitsectormorethansocialservices.Governmentfundingcancomeinmultipleforms(e.g.,grants,fixed-pricecontracts,pay-for-performancearrangements,vouchers)andfromfederal,state,orlocalsources.Thetypeandtheoriginofthemoneymattersalotforhowconsistentandsufficientitis,whomightbeeligibleforservices,andwhatitcanbespenton.Governmentfundinggenerallyoffersthelargestdollarfiguresandisthemostconsistent(e.g.,contractsaregenerallyrenewable).Insomefields,suchaschildwelfare,agovernmentcontractistheonlywaytoaccessthepopulationofinterest.Inotherfields,suchasservicesfortheformerlyincarceratedorpeoplewhoarehomeless,donationsfromindividualsorfoundationsareverylowrelativetothecostoftheserviceprovided.Governmentsupportmaybetheonlyfundingavailable.Shiftsinpolicythatfavorprovidingservicesinlieuofcashaid,3alongwiththeshifttowardfederalblockgrantstostates,haveledtoanincreaseinthetypesofprogramsgovernmentsfund.Despitetheseadvantages,however,socialservicemanagersarehighlycriticalofgovernmentgrantsandcontracts.Applicationsforfundingandthemandatedreportingrequirementsarecomplexandtime-consuming,midstreamchangestothecontractsoccur,paymentsarelate—allofwhichservetodisadvantagesmallerorganizationswithlesscapacitytoweatherfundingvolatilityandlessprofessionalizedorganizationswhomaybechallengedtomeetapplicationandreportingrequirements(Boris,deLeon,Roeger,&Nikolova,2010).Perhapsthemostseriouschallengeassociatedwithgovernmentfunding,however,isthatitgenerallydoesnotpayforthefullcostofservices,whichforcesorganizationstosupplementthefundingthroughothermeans(e.g.,takingondebt,increasingprivatecontributions,spendingdownreserves)(Borisetal.,2010).This“deficitmodel”ofsocialservicefinancingleadstolowerserviceperformance,reducedfinancialstability,andthreatstothesocialrightsofrecipients(Marwell&Calabrese,2015).

3Forexample,insteadofamonthlywelfarecheck,participantsmaybeofferedjobplacementassistance,childcarevouchers,and/orareferralformentalhealthservices.

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The2012bankruptcyandclosureofHullHouse,JaneAddams’legendarysettlementhouse,after123yearsofprovidingsocialservicesinChicago,Illinois,isaprimeexampleofthetroublesthatcanresultfromoverrelianceongovernmentfunding,giventheproblematicpartnershipcharacteristicsdescribedabove(Clemenson&Sellers,2013).AccountsofHullHouse’sdemisegenerallynotethatatthetimeofitsclosure,itwasmorethan90%governmentfundedandmorethan$3millionindebt.Thisdebtisgenerallyattributabletotheorganizationtakingoutbridgeloanstocoverlatepayments4forgovernmentcontractsthatdidn’tcoverthefullcostofserviceinthefirstplace.Atthetime,thestateofIllinoishadabacklogofabout$4billionindelayedpaymentstocontractorsandwastakingover6monthsonaveragetopayvendors.Becauseofthesizeofmanygovernmentcontracts,organizationseasilybecomeoverlyreliantonthemandexperiencethenegativeeffectsofresourcedependence(Pfeffer&Salancik,1978).Manycontractsincludemandatesregardingwhoiseligibleforservices(e.g.specificagesordiagnoses),whatservicetechnologiesorprogrammodelsareappropriate,andwhatoutcomesarepreferred.Allofthesemayruncountertoanorganizations’mission,butoncedependencehassetin,thereislittlemanagerscando.Inordertopromoteorganizationalstabilityandavoidresourcedependenceandmissiondrift,socialservicenonprofitsaretypicallyadvisedtodiversifytheirfundingprofiles(Carroll&Stater,2009;Froelich,1999),eitheracrossrevenuetypes(donations,grants,contracts,etc.)orwithintype.Todiversifywithintype,anorganizationmightseekgovernmentcontractsfromdifferentagenciesatdifferentlevelsofgovernment—forexample,maintainingfederalcontractstodeliverHeadStartprogrammingwhilealsomaintainingstatechildwelfareandearlyeducationcontracts(typicallyadministeredbydifferentagencieswithdifferentlevelsofpoliticalsupport).Someevidenceexiststhatthisstrategymaybegrowing,asgovernmentfundingbecomesbothmorenecessary(formaintainingcapacityneeds)andmoreprecarious(withongoingstatebudgetcrises)(Park&Mosley,2017).TensionsInvolvedinGovernmentContractingTheday-to-dayissuesthatsocialservicenonprofitsexperienceareconcerningformany,buttheycanalsoobscureamuchdeepersetoftensionsabouttheroleofthesectorandhowthatrolemaybeshiftinginresponsetoincreasedenmeshmentwithgovernment.AsReich&Lechterman(thisvolume)note,politicalattitudesdeterminetherolesthatthenonprofitsectorplays.Privatelyprovidedsocialservices,fundedbygovernment,havebecomestandardpartlybecausethisarrangementisappealingtopeopleacrossthepoliticalspectrum.Thisdevelopmentreflectsthelargeradoptionofneoliberalthoughtandtheattendantgrowthofmarket-orientedinterventionsineverysphereoflife(Birch&Siemiatycki,2016).Assuspicionofgovernment’sabilitytosolvesocialproblemsgrows—andcitizensareincreasinglybeing

4Bridgeloansareneededwhenpaymentsarelateinordertocoverthecostofprovidingservices,forexample,rentandpayroll.

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conceptualizedasconsumers—anonprofitsectorthatisgovernedaccordingtomarketprinciples(efficiency,competition,etc.)hasemergedasanobviousalternativetogovernment-providedsocialservices.Evidencesuggeststhat,intheUnitedStates,mostpeopleprefernonprofitstogovernment,trustthesectormore,andoftendonotrealizethatgovernmentfundingmakespossiblesucharobustsocialservicenonprofitsector(Mettler,2011;Park,Mosley,&Grogan,2018).AlthoughintheUnitedStatesthepopularconceptionofsocialservicenonprofitsincludesarhetoricalfocusonthe“moralcharacter”ofthesector,privatizationresolvestwoother,perhapsmorecentral,concerns.Theseare1)thedeepsuspicionsmanypeoplehaveofthestateinterferingwith“privatematters”—andalmostallsocialservicesaddresssuchmatters—and2)thedesireofthestatetosavemoneyandoutsourceresponsibility.Theseconcernssuggestthatitisindeedtheprivatenessofnonprofitorganizationsthathasledtoincreasedprivatization(asopposedtotheirgoodness).Theyare‘moral’partlybecausetheyareprivate.Tothatextent,thenotionthatpeoplepreferthemtogovernmentbecauseoftheirmoralcharacterisamyth,perpetratedbybothsidessoastogrowthecontractingrelationshipsthatbothsideshavebecomedependenton.Itisimportanttonotethat,intheUnitedStates,thestatehaslongcontractednonprofitstoprovidesocialservices(Salamon,1987b;S.R.Smith&Lipsky,1993).Privatizedchildwelfareservicesdatebacktotheearly1900s.Likewise,manyservicesthatweconsider“privatized”werenever“public”inthefirstplace.Theyweredevelopedafterprivatecontractingofpublicwelfareserviceswasestablishedasthedefaultmodeofdelivery.ExamplesoftheseincludedomesticviolenceandHIV/AIDSservices,bothofwhichcameaboutafterlongadvocacycampaignsbypeopleworkinginthefield.Inotherwords,fieldsthatdevelopthroughprivatefundingcansuccessfullyworktoconvincepolicymakerstotakeuptheircauses,encodingthemasstatutoryappropriations.Thus,whatwehaveseenismoreaptlydescribedasagrowthingovernmentfundingofsocialservices—andthemechanismofcontractingouttodeliverthem—ratherthanprivatizationperse.Therehasalsobeenashiftinprovidinghelptothepooranddisadvantagedintheformofsocialservices,ratherthandirectcashaid.Ofcourse,thatshifthasledtoyetmorecontractingandengagementfromprivatesocialservicenonprofits.Despitethislonghistory,numerousscholarsandcriticshavedecriedtheeffectsofcontractingonthenatureofsocialservices(Alexanderetal.,1999;Eikenberry&Kluver,2004;Hasenfeld&Garrow,2012)—somegoingasfarastolabelthephenomenonthe“nonprofitindustrialcomplex”(A.Smith,2007).Others,however,havepraisedtherelationshipasoneof“partnersinpublicservice,”inwhichnonprofitsgainresourcesandlegitimacywhilegovernmentgainsgreaterflexibilityandefficiency(Berger&Neuhaus,1977;Salamon,1995).Whenassessingthiscontroversy,therearetwoissuesathandthatareconceptuallydistinct:First,thetheoreticalandpragmaticrationaleforcontracting,andsecond,thenatureofhowcontractsarecurrentlyawardedandadministered.Althoughtheyareoftendiscussedintandem,theyneedtobeunderstoodseparately,asthesecondisfarthornierthanthefirst.

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Onthefirstpoint,contractingisunlikelytoslowdownforbothpragmaticandphilosophicalreasons.Itisbakedintoourwelfaresysteminsuchawaythatdismantlingtheapparatuswouldbenexttoimpossible,anditisbasedonargumentsharkeningbacktonotionsofgovernment,market,andvoluntaryfailurethatfewpeopledisagreewith(Steinberg,2006).Widedistrustofthegovernmenttoprovideservicessensitivetoandtargetedatcommunityneeds—alongwithgovernment’sreticencetotakeonthecost—meansthatitisunlikelytoadoptalargerroleindirectlydeliveringsocialservices.Anddespitethegrowthinsocialentrepreneurshipitisnotfeasibletothinkthefor-profitsectorwilltakeonacomprehensiveroleinsocialserviceprovisionoutsideofcontractingrelationshipsbecausethereislittlemoneytobeearneddirectlyfromserviceconsumers.Withprivatedonationscomprisingonlyabout20%ofthetotalrevenueforthesector—andlittleevidenceofcrowd-out(Bekkers&Wiepking,2010;Payne,1998)—inordertomaintainourcurrentlevelofsocialservices,governmentcontractingisgenerallyseenasnecessary.Itisthesecondpoint—thenatureofhowthosecontractsareawardedandadministeredinpractice—thatismuchmorecontroversial.Thisgoessignificantlybeyondthefundinginsufficienciesandpoorpartnershippracticesengagedinbymanypublicsectoragencies(themselvesunderfunded).Becausecompetitionisembeddedinthecontractingrelationship—itis,infact,partofitsappealtomany—thecontroversyreallystemsoverbeliefsaboutwhatthatcompetitionisbasedon:efficiencyoreffectiveness.Tosocialservicenonprofits,contractcompetitionoftenseemstobeaboutblindefficiency—whichorganizationcanprovidethegreatestamountofservicesforthelowestcost(Borisetal.,2010).Thosewhoseeitthiswaytypicallybelievethatcostconcernsactuallydiscouragethekindofinnovationandinvestmentthatmayallowforgreatereffectivenessoverthelongrun.Others,particularlyproponentsofNewPublicManagement—amovementtomakegovernmentmore‘businesslike’—framecontractcompetitiondifferently.Althoughtheymentionefficiencyandcostsavingsasbenefits,theypresentcontractingasawaytoboosteffectivenessbyraisingperformance,promotinginnovation,andincreasingresponsiveness(Heinrich&Choi,2007;Kettl,2011).Researchshowsthatcontractingdoesnotnecessarilysavemoneyorimproveperformance—infact,inhealthcareithasbeenshowntodotheopposite(Duggan,2004).Otherresearchindicatesthatpublic-nonprofitpartnershipshavenoeffectonefficiency,effectiveness,orequity(Andrews&Entwistle,2010).Buteitherway,ifmanagersofsocialservicenonprofitsbelievetheyarebeingrewardedprimarilyforefficiency,thatiswhattheywillaimfor,potentiallyleadingtotheperverseoutcomeofsacrificingeffectiveness.Thisistroublingbecauseevidencesuggeststhat,insocialservices,competitionmayactuallybemoremyththanreality(Lamothe&Lamothe,2009;VanSlyke,2003).Inmanylocales,therearenotenoughproviderstocreatemeaningfulcompetition,andlackofcapacityinadministrativeagenciesmeansthatcontractsarepoorlyoverseen.Thesefindingsstrengthentheargumentthatcontractingmaybelessarationalchoicethanasymbolicandpoliticalone.Regardless,asaresultofmandatesembeddedincontracts,socialservicenonprofitsarecurrentlyexperiencinganuptickindemandsforperformancemeasurement,professionalization,andefficiencythatmanyarestrugglingtoadaptto.Furthermore,thesedemands—drawnfrommarket-oriented

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thinking,butdrivenbygovernment—areironicallywhatisleadingsocialservicenonprofitstobecomemorebusiness-likeintheirpractices,potentiallythreateningthe‘character’ofthesectorthatisheldupaspartofthepurposeforcontractinginthefirstplace.Performance,Professionalization,andEfficiencyDemandsCriticshavelongaccusedsocialservicenonprofitsofunderperformanceandinefficiency,andnotwithoutsomejustification.Thus,growthincontractinghasraisedsignificantconcernsaboutaccountability,notuncommoninprincipal-agentrelationships.Theimpressionofwasteinpublicagenciesandsuspicionregardingsocialwelfareparticipants,whoareoftenconstructedtobelazy,dependent,scammingthesystem,orunabletoberehabilitated(Fraser&Gordon,1994),onlyheightenstheseconcerns.Giventhislevelofdistrustallaround,socialservicenonprofitsnowwidelyusequantitativeperformancemeasurestodemonstrateproperstewardshipoflimitedresources,andprovideevidenceofeffectivenessonwhichfuturefundingcan(theoretically)bebased.GroundedinprinciplesofNewPublicManagement,avastinternationalliteraturedescribeshowthehabitsandincentivesofbothindividualsandorganizationshaveshiftedasaresultofagrowingauditculture(McLaughlin,Ferlie,&Osborne,2002;Power,2003).Performancedataisrequestedandusedindifferentways,withdifferenteffectsfororganizations.Coercivepressuresforsuchdatafromfundersforaccountabilitypurposeshasledtoagrowthinsharedinstitutionalnormsaroundthevalueofsuchdatafordeterminingimpact.Thisisavaluethatorganizationsareexpectedtoshareandthusproducedatathatcanbeusedforinternalcontinuousimprovementprocesses,aswellasexternallyorientedaccountability(Lynch-Cerullo&Cooney,2011).Inaddition,althoughmostcontractsdemandsomekindofdataregardingperformanceoutcomes,therehasalsobeenagrowthinperformance-basedcontractingandpay-to-succeedmodels,inwhichthenonprofit’spaymentisbasedonitsabilitytomeetpre-settargets(McBeath&Meezan,2010)—asignificantstepupinaccountabilityexpectations.Socialimpactbondsareanotherformofperformancecontractingattractingsubstantialattention.Socialimpactbondsaremulti-partycontractsbetweengovernments,privateinvestors,andsocialservicenonprofitsinwhichtheinvestorsprovidemuchoftheinitialcapitalfortheprogram,buthavemoresayinhowitisrunandstandtoreapprofitsiftheprogramissuccessful(Olson&Phillips,2013).Theseinitiativeshavebeenpraisedfortheirabilitytoinjectneededcapitalintothesectorandforrigorouslyevaluatingperformance.Critics,however,findfaultwiththenotionthatprivateinvestorsbenefitfromtheperformanceofnonprofitsattheexpenseoftaxpayers(andstaffsalaries),andtheydonotagreethateverythingimportantaboutaprogramcanbequantifiableasa“socialreturnoninvestment”(Brest,thisvolume).Whileperformancemeasurementhasgrownsubstantiallyinbothscopeandpractice,itseffectivenessinactuallyimprovingservicesisquestionable.Forexample,KoningandHeinrich(2013)findthatascontractsmovefrompartiallyperformance-basedtofullyperformance-based,organizationsaremorelikelytotrytogamethesystemthroughcreamingandother

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strategiesforartificiallyraisingperformancenumbers,buttheydonotfindevidenceofimprovedprogramoutcomes.Instead,theyfindthatwhilefullyperformance-basedcontractsledtoincreasedperformanceonshort-termmeasuresofsuccess(e.g.jobplacement)theydidnotleadtoimprovementsonlong-termmeasures(e.g.jobduration).

Becauseweknowthatperformancemeasurementcanleadorganizationstounhealthypractices,yetresistingmeasuremententirelyalsoseemsunhealthy—afterall,organizationswanttobeeffective,confidentintheirapproach,andinvestinthingsthatwork—alargeportionoftheliteratureonperformancemeasurementisfocusedonhowto“doitright.”Peopleworryaboutimprovingindicators,whattomeasure,connectiontomission,howtocreateanew‘culture’ofdatause,andmore(Janus,2018).Atthesametime,demandsonorganizationsto“domorewithless”andthefactthattheirverysurvivaldependsoneverimprovingoutcomesincentivizesorganizationstodecoupleperformancemetricsfromday-to-daypractice(Meyer&Rowan,1977).Organizationsmayengageinoutrightfalsificationorsimplytakeupthecommonpracticeofdoingcasenotesandotherpaperworkattheendofthemonth(meaningitisnotactuallyusedfortreatmentpurposes,merelyforauditing,leadingtoinefficiencies).Socialservicenonprofitsoftenworkwithstigmatizedandpowerlesspopulationsandfeelstigmatizedandpowerlessthemselves,leadingtonotonlydecoupling,butalsothehusbandingofresourcesandamindsetfocusedmoreonshort-termsurvivalthanlong-termimpact.Considerableworkexistsshowingsharpdivisionsbetweenfrontlineworkersandthedatasystemswithwhichtheyarecoercedtocomply.Workersoftenperceiveamismatchinbeliefsaboutthenatureandgoaloftheworkbetweentheirorganizationandtheirfunder(Meagher&Healy,2003).Thesedivisionsleadtostafffeelingdiscreditedandalienated,sometimesbelievingthatprogrammaticdecisionsdonotmatchlong-heldpriorities(Spitzmueller,2018).Accountabilitydemandsareoftentiedtorestrictionsonhowfundingisdirectedinternally,whichcanchangethenatureoftheservicesprovidedortheprogrammixoverall.Forexample,fundingmayberestrictedtomeasurableprogrammaticfunctionsratherthancivicengagementandadvocacy.Fromaclinicalperspective,fundingisoftentiedtotheuseofspecificevidence-basedpractices.Suchpractices,oftenroutinizedandwithlittleattentiongiventoculturalorcontextualdifferencesbetweentargetpopulations,canconflictwiththetraditionalvaluesocialservicepracticeplacesonperson-centeredcareandco-productionofservices.LehnBenjaminandcolleagues(Benjamin,2012;Benjamin&Campbell,2015)furtherdirectourattentiontomisalignmentsbetweenaccountabilitydemands,thenatureoffrontlinepractice,andtheroleofclients.Theyarguefrontlinesocialservicesgenerallyentailworkinginpartnershipwithclientsinwaysthatfundamentallyresistmeasurement,becausesocialservicepracticeisnuanced,notreplicable,andbasedonsocialandprofessionalskill,notroutine.Inotherwords,therearesomecomponentsofgoodpractice—orsometypesofpractice—thatyoucannotquantitativelymeasurebutthatarestillworthdoing,suchashelpingclientsmaintaintrustingrelationshipsorbuildconfidence,helpingcommunitiestakeownershipofdecisions,orcertainkindsofsocialcapitalbuilding.Inthisview,socialserviceprogramsarenot

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equivalenttosocialservicepractice,improvementsinwhichareunlikelytobegainedthroughmorerigorousmeasurementsystems.Atthesametime,performancemeasurement,datademands,andreportingrequirementsallrequireincreasedprofessionalizationinthesector(Suárez,2011).Theyare,infact,co-constitutivewithit,asprofessionaltrainingisoftenneededtokeepupwithanalyticandstrategictrends,butalsopushesthosetrendsfurtherasleadersandorganizationscompete.Whileprofessionalizationwasalreadyontheriseasaresponsetoothertypesofinstitutionalpressures,theperceivedneedforprofessionalleadershipmakesitdifficultforsomesmaller,community-basedorganizationstomaintaintiestothecommunityandinternallyreflecttheclientbasetheyserve.Itmayalsobeleadingtodecreasedvoluntarism.Manysocialservicenonprofitsarealmostcompletelyprofessionalized,involvingveryfewvolunteers,duetorequirementsaroundconfidentiality,specializedtraining,andtheneedforaccountability.NavigatingConflictingDemandsUltimately,thesetrendsofprofessionalization,performancemeasurement,andefficiencydemandshaveledtosocialservicenonprofitslookingandactingmuchlikefor-profitbusinesses,largelyatthedemandofgovernment(andsometimesprivatephilanthropy).Outcomegoalsareprizedoverprocessgoals,whichcreatesinternalconflictfororganizationswhosemissionsrelyonanuanced,indeterminate,non-standardizedprocess.Figure1demonstratestherelationshipbetweengovernmentfunding,theaccountabilityandperformancedemandsdiscussedabove,andthechallengestosocialservicenonprofits’expressiveroles(generallyseeninacommitmenttovoluntarism,strongcommunityconnections,promotionofcivicengagement,andparticipationinadvocacy).Essentially,contractingregimeshaveraisedconcernsaboutaccountability,whichhasledtoincreasedperformanceassessmentandprofessionalization.Thosedemandshave,inturn,ledtoanemphasisoninstrumental,market-orientedoutcomegoalsandthedevaluingofexpressiverolesandprocessgoals.

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Figure1. Relationshipbetweenincreasedgovernmentfundingofsocialservicesandcrowdingoutofnonprofits’expressiveroles.

Argumentsthatnonprofitsarebecomingmorelikefor-profitormarket-orientedorganizationsarenotnew(Weisbrod,1997),buttherecentemergenceofhybridorganizationsandsocialentrepreneurshipmodelsinthefor-profitsectorhasledtoaresurgenceofinterestinthetopic.UsingScott’s(2013)theoryofthethreepillarsofinstitutions(regulatory,normative,andcultural-cognitive),Child,Witesman,andSpencer(2016)arguethatalthoughsectoralconvergenceisarealitytosomeextent,stronginstitutionalnormsupholdsectoraldifferencesinthemindsofpractitioners.Overtime,however,theyfindthatperceptionsofhowsectorsdifferlegally(intermsofregulationsandfunding)arestrongerthanperceptionsofhowtheydifferintheirexpressiveroles.BromleyandMeyer(2017)alsotakeaninstitutionalviewofsectoralconvergence.Theyfocusourattention,however,onthewaythatallsectorsarechanging—notjustnonprofits—andnotethatthesechangesaregenerallyculturalinnature.Itisnotthatnonprofitsarepassivelyrespondingtopressuresputonthembygovernment,butthatallthreesectorsarerespondingtoalargersetofculturalshifts,startinginthewakeoftheSecondWorldWar,thatplaceahighvalueonscientificrationality,whilesomepracticesassumedtobe“business-like”inthenonprofitsector—suchasbureaucraticstructureandcodesofconduct—havetheiroriginingovernmentandhighereducation.Thus,whilesectoraldifferencescontinuetoshaperegulation(e.g.howorganizationsareallowedtogenerateandspendresources,individualvs.boardgovernance),Iarguethatthenormativeandcultural-cognitiveinstitutionalexpectationsoftheproperexpressiveroleforsocialservicenonprofitsmayberelaxing.First,normativeexpectationsaboutthe“right”waytobehave(eitherexternallyorinternallyimposed)arenowlargelythesameforallsectors—efficient,entrepreneurial,andoperatingataprofessionalremove.Second,inthecultural-cognitivesense,itisnowtakenforgrantedinthenonprofitsectorthatafocusonperformance

Governmentfunding&contracting

Accountabilityconcerns

Demandsaroundperformancetracking&evaluationGrowthinprofessionalization

Focusoninstrumental,market-orientedoutcomegoals

Crowdingoutofexpressiverolesandprocessgoals

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(asopposedtoexpressivefunctionssuchascommunityconnectionorvoluntarism)isneeded,thatlargergrantsandcontractsdemonstrateamoresustainableoperation(asopposedtorelyingmoreonsmallerdonationsoriginatingfromthelocalcontext),andthatcost-benefitassessmentsareavalidwayofevaluatingtheworthofaprogram.Thus,sectormattersinthatitremainsrelevantandconsequentialtothefinancialviabilityandrevenuemodelofnonprofitsocialserviceorganizations.Itislessclearthatitmattersintermsoftheirinternaloperations,staffingpatterns,programmodels,andrelationshipwithcommunitymembers.Itisdifficulttoseehowtraditionalexpressivecommitmentstovoluntarism,strongcommunityconnections,promotionofcivicengagement,andparticipationinadvocacywillbemaintainedevenifthosearethethingsthatdrewmanypeopletothenonprofitsectorinthefirstplace.Contractingandaccountabilitypressuresleavesocialservicenonprofitsinaliminalposition,asthemultiplexbeliefsbehindcontractingfundamentallyconflict.Governmentcontractswithnonprofitsbecauseoftheircommunity-basedcharacterbutalsobecausecontractingissupposedtobemoreefficient.Thus,itmakessensethattheywouldbeheldtotraditionalexpectationsofthenonprofitsector,butalsoexpectationsnotunlikethosethatwewouldplaceuponfor-profitorganizations(Sanders,2015).Wesomehowbelievethatsectorshouldmakeadifferenceinexpressivecharacter,butthatitshouldnotininstrumentalroles.Althoughnonprofitscholarsandpractitionersoftenmakenormativeclaimsaboutthevalueofthesectorforadvancingcivilsocietyandpromotingthepublicgood,whenitcomestosocialservicenonprofits,fundersemphasizegettingthejobdone,donewell,andascheaplyaspossible.Thecaseoffaith-basedsocialservicesThecaseoffaith-basedsocialservicesshowsthatevenwhenexpressivecharacteristicsareprized,theinstitutionalizednatureofsocialserviceprovisionisapowerfulforce.Thefaith-basedsocialservicessubsectorreceivedagreatdealofattentionintheearly2000’sforitshypothesizedabilitytoprovidebetterresultspreciselybecauseofitsexplicitly“values-based”approach(Kennedy,2003).Faith-basedorganizationsareoccasionallypointedtoasemblematicoftheexpressivequalityofthenonprofitsector(Olasky,1995).Whilethereisinitialevidenceindicatingthat,giventherightmatchbetweenorganizationandconsumer,faith-basedsocialservicesmaybemoreeffective(presumablyduetothewaytheserviceisprovided)(Monsma,2006),evidenceonthispointislimitedandmixed.Forexample,Wuthnow,Hackett,andHsu(2004)foundnodifferencesinrecipients’perceptionsoftheeffectivenessandtrustworthinessoffaith-basedversusnon-sectariannonprofits.Mostresearchshowsthat,ultimately,faith-basednonprofitsarenotallthatdifferentfromsecularones(Sosin&Smith,2006;Wuthnow,2004).Ingeneral,theiropennesstoasecularworldandresponsivenesstothesamesetofinstitutionalpressuresislikelyasimportantinshapingthenatureandcharacteroftheirprogrammingaswhetherornottheyreceivegovernmentfundingorthefactthattheyarefaith-based(foranexceptionseeVanderwoerd,2004).Inperhapsthestrongesttestofthisargument,ChavesandTsitsos(2001)findunequivocallythatthesocialservicesreligiouscongregationsprovidearenotmoreholisticorintensivethan

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othernonprofits,andthosecongregationsthatcollaboratewithgovernmentarenotlesslikelytoprovidethosekindsofpersonalizedservices.Theyfirmlyconcludethat“[r]eligiouslybasedsocialservicesare,ingeneral,hardlyanalternativetosecularnonprofitorgovernment-supportedsocialservicedelivery.Theyare,rather,partofthatworld,likelytoriseandfallwithitratherthanincounterpointtoit.Liketherhetoricportrayingnonprofitsingeneralasanalternativetogovernment,therhetoricportrayingreligiousorganizationsascarriersofasocialservicealternativethatispeculiarlyholisticandtransformationalobfuscatestheempiricalreality.”(p.680).CurrentChallengesResultingfromBlurringofRolesTheconsequencesofthisblurringofrolesbetweensectorsaremany.Thissectionreviewsthreeofthem:1)consolidation,2)changesinadvocacynormsandanincreasedroleforsocialservicenonprofitsingovernance,and3)newrolesforprivatephilanthropyandcollaborativeefforts.

ConsolidationandmergersIncreasedcompetitionforfunding,theneedforsubstantialreserves,anddemandsforperformanceandaccountabilitydataallhaveputsignificantpressureonsmall,community-basedsocialserviceorganizations.Atthesametime,contemporarysocialservicemanagementhasbecomesignificantlymoreprofessionalized,executivedirectorsaretypicallyrewardedprimarilybasedonorganizationalgrowthratherthanconsumersatisfaction,andboardmembersareoftenrecruitedfortheirconnectionsandabilitytobrokerfundsratherthanforsubjectareaexpertise.Thesetrends,together,haveresultedinanincreaseinmergersandtakeoversinthesocialservicesnonprofitsector,aconsolidationresultinginlarge,professionalizedorganizationsoperatingatsomeremovefromthecommunitiestheyserve.Consolidationalsoadvancesinstitutionalization,asgenerallythenormsandpracticesofthedominantorganizationwilloverridethoseoftheweakeroneinanymergerortakeover(Field&Peck,2003).Becausesmallsocialserviceorganizationsoftenhaveatleastafewcontractswiththestate,andsometimesownvaluablerealestate,theyhavebecometargetsforacquisitionbylargersocialserviceagenciestryingtoconsolidatetheirmarketposition.Whileanacquisitionissometimespresentedasawayofenhancingclientservicesorimpact,itgenerallyalsostemsfromthedominantpartner’sdesiretoreducecompetitionandimprovevisibility,perhapsinanewfieldorgeographiclocation(Benton&Austin,2010).Suchamoveisaclassicwayofmanagingtheexternalenvironment(Pfeffer&Salancik,1978).Consolidationamongsocialserviceorganizationscallsintoquestiontraditionaleconomictheoriesofthenonprofitsector(Hansmann,1987).Organizationsarecaughtbetween1)traditionalexpectationsofclosecommunityconnectionsandpersonalconnectionsthatfacilitatetrustinconditionsofinformationasymmetry,and2)theneedtomakebusiness-orienteddecisionstomaintainandgrowprogramsthatarefundedbythestateandjettison

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programsthatarenotlucrative—akeyconsequenceofmostmergers.Theseconflictingdemandsoftenresultindecision-makingbasedonprofit-makingcalculus—similarinessentiallyallrespectstoafor-profitcompany.Inthiscase,whatdifferencedoesnon-profitnessmake?Atthesametime,thepoliticalandcivicroleofthesectorisalsochallenged:whileamergermayincreasecapacityintheareasofdataandperformancemeasurement,marketing,governmentrelations,andfundraising,itisunlikelytofacilitatecivicengagementefforts,clientinvolvementintheorganization,ormorelegitimaterepresentationofcommunityneeds.ChangesinadvocacynormsandincreasedroleingovernanceSomearguethatthattheadvocacyandrepresentationrolethatnonprofitshavetraditionallyplayedonbehalfoftheirconstituentsiswhatdistinguishesthemfromthefor-profitsector(Berry&Arons,2003).Traditionally,peoplehavepointedtoadvocacyengagementasevidenceofnonprofits’commitmenttomissionandwillingnesstostandwithandforthecommunitiestheyserve.Doestheadvocacythatsocialservicenonprofitscarryoutreallydemonstratethis,however?Researchshowsthatdependenceongovernmentfundingisassociatedwithadvocacythatlargelysupportsthestatusquo(Mosley,2012).Insteadoffocusingonsubstantivepolicychange,giventherelianceoncontractsinthesector,advocacyhasbecomeanimportantwayformanagerstoinfluencetheirfundingenvironmentandmaintainorganizationalstability(Marwell,2004).Organizationsthatarereliantongovernmentfundingarestronglyincentivizedtoadvocateinordertobuildsupportforpreferredpracticeideologies,increaselegitimacywithdifferentstakeholders,andgenerallyworktosupportincreasedpublicfundingintheirareaofservice.Thisadvocacyislargelybuildonestablishingtrusting,reciprocalrelationshipswithkeyadministratorsandlegislatorsandisfocusedlargelyoninsidertactics.Totheextentthatthesectorhasbecomeanarmofthestate,itcannoteffectivelypresentameaningfulcounterforcetoit(Hasenfeld&Garrow,2012).Ratherthanhelpingtomodifypowerimbalancesinsocietybyusingtheirownpowerandlegitimacyonbehalfofthepopulationstheyserve,socialserviceorganizationsfrequentlyseektoconsolidatetheirpowerinthesystem—resemblingatraditionalinterestgroupratherthananadvocateforsocialjustice.Alongwithagreaterfocusoninsidertacticsandmaintenanceofgovernmentfunding,socialservicenonprofitsareincreasinglyplayinganimportantroleincollaborativegovernanceregimes.Definedasa“modeofgovernancethatbringsmultiplestakeholderstogetherincommonforumswithpublicagenciestoengageinconsensus-orienteddecisionmaking”(Ansell&Gash,2008,p.543),collaborativegovernanceisanessentialpublicmanagementtacticinwhichpublicagenciescollaboratewithprivatestakeholders,likesocialservicenonprofits,toimproveservicecoordination,implementpolicy,andpromoteaccountabilityacrosssectors.Representativesofgovernmentjoinstakeholdersfromthecommunity,includingrepresentativesofsocialservicenonprofits,toformadvisoryboards,taskforces,orsteeringcommittees.Thesecollaborativegovernanceentitiesaregrowinginnumber,andsocialservice

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organizationsinfieldslikementalhealth,childwelfare,homelessness,andearlychildhoodeducationareveryactiveandinvolvedparticipants.Collaborativegovernanceopensupconsiderableopportunitiesforsocialservicenonprofitstobeinvolvedinthepolicyprocess,provideinputoncrucialdecisions,andshareexpertisebecauseitquiteliterallygivesthemaseatatthetable.Althoughperhapsunconventionalforthosewhothinkofadvocacyasstandingonthestepsofthestatehousewithasignandamicrophone,participationincollaborativegovernanceprovidesanewadvocacyvenue,andemergingevidencesuggeststhatprovidersseeitassuch(Mosley,2014).Thislargerroleingovernance,however,raisesavarietyoflong-standingquestionsaboutindependenceandlegitimacyofrepresentation(Levine,2016).Advocacycanbeusedtoimprovedemocraticrepresentation,raisingthevoicesandtheinterestsofthosewhoarenotwellrepresentedinformalpolitics.Butthatcanonlyhappeninalegitimatewayifclientsareinvolvedandhaveanopportunitytogiveinput—whichisrareinanincreasinglyprofessionalizedsocialservicesector(Mosley&Grogan,2013).Leadersofsocialservicenonprofitsareoftenaskedtospeakonbehalfoftheircommunityorclients,buttheycanendupspeakinginsteadfortheinterestsoftheirorganizationortheirindustry.HowdifferentisthisfromAstroturfadvocacycarriedoutbycorporateinterestgroups(Lyon&Maxwell,2004;Walker,2016)?Granted,participationinagovernanceroleisdifferentfromlobbyinggovernment(Marwell&Brown,thisvolume),butintentionsandthelegitimacyoftheresultingrepresentationstillneedtobeinterrogated.Collaborativegovernanceprocessescanalsoleadtoexclusivityanddivisiveness(Johnston,Hicks,Nan,&Auer,2011).Whichorganizationsarechosentoparticipate?Iforganizationscanfreelyjoin,whichhavetheirvoiceheardclearly?Towhatextentaredivisionsinthefield—betweenlarger,professionalizedorganizationswithsubstantialgovernmentfundingandmorecommunity-basedorganizations—reflectedinthosediscussions?Interestingly,socialserviceproviders’pursuitofmorereciprocalrelationshipswithcontractmanagers—tomovethoserelationshipfromaprincipal-agentmodeltoaprincipal-stewardmodel(VanSlyke,2007)—andgrowthincollaborativegovernancehasledtoincreasedadvocacyopportunitiesandthepotentialforgreaterinfluence.Asaresult,advocacyisincreasinglypartofeverydaypracticeforsocialservicenonprofits.Contrarytosomeassumptions,governmentfundingincentivizesadvocacyengagementratherthansuppressingit,andcloserrelationshipswithgovernmentagentsprovidesincreasedopportunityandaccess(Chaves,Stephens,&Galaskiewicz,2004;DeGraauw,2016;Mosley,2010).Atthesametime,advocacyislikelytobemoreamicable,lessoppositional.Thereareincreasedopportunitiesforcollaborationandimpactthroughformalandinformalchannels,butatthesametime,thereisanincreasedriskofcooptation(Piven&Cloward,1977).Insomeways,socialservicenonprofitshavebecome“theloyalresistance”:advocacyispresent,butmostlyaimstoworkwithinstate-sanctionedsystems,hopingtogatheralargersliceofthepie—ratherthangrowingthepieforallorchallengingbasicassumptionsaboutthe

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socialrightsofcitizens.Thisclearlycallsintoquestiontraditionalpoliticaltheoriesofthenonprofitsectoranditsabilitytomaintainanindependentvoice(Clemens,2006).NewrolesforprivatephilanthropyandcollaborativeeffortsA‘hollow’statethatlacksinternalcapacityandismorefocusedoncontractingoutthanonprogramdesignhadledtoopportunitiesforideologicalleadershiponthepartofprivatephilanthropy.Inthisway,eliteinterestsarereproducedinthesector,whichisusedasa‘trialground’fornewideas(Reich,2016).Charterschoolsaretheexamplethatcomestomostpeople’sminds(Reckhow,2012),butthisphenomenonhappensinsocialservicestoo,notablyaroundsocialentrepreneurshipmodelsofserviceandthepromotionofspecificinterventionmodels.Socialservicenonprofitshavelongbeenpulledtorespondtomultiplestakeholders:communitymembers,consumersofservices,activists,boardmembers,individualdonors,philanthropicpatrons,andothers.Oftenthereisalignment—butwhenstakeholders’interests,desires,orbeliefsconflict,whichgroupisgivendeference?Inordertomaintainbothlegitimacyandnonprofits’bottomline,itisusuallyfundersorpotentialfunders(DiMaggio&Powell,1983;Pfeffer&Salancik,1978).Inthissense,whilephilanthropydoesstrengthentheinnovativecapacityofthesector,itisalsochannelsattentionandultimatelylikelyhasalargerimpactonsocialservicesthroughitsideologicalleadershipandinvestmentinconceptsandprogrammaticinnovationsthanitdoesthroughdirectdonationstosocialservicenonprofitsthemselves(Bushouse&Mosley,2018;Reckhow&Tompkins-Stange,2018).Onewaywehaveseengrowthintheinfluenceofprivatephilanthropyisthroughinitiativestogrowcollaborativeapproaches.Collaborationacrosssocialservicefieldsisconsideredcriticaltosolvingwickedproblems(likehomelessnessorsubstanceabuse)byreducingfragmentation,promotingaholisticapproach,andfacilitatingmutuallearning(Thomson&Perry,2006).Fundersvalueparticipationincollaborativeeffortsbecauseitsignalslegitimacy,asupportsystem,anunderstandingofthecomplexityofproblems,andacknowledgementofrisksharing.OneofthebestknownofthesecollaborationeffortsistheCollectiveImpactmodel,astructuredformofinter-organizationalcollaboration(Kania&Kramer,2011).Generallyfunderdriven,collectiveimpacttakesmuchofwhatthescholarlyliteratureoncollaborationhasbeenarguingandrepackagesitinapractitioner-friendlyway.Ithasseenwideuptakeinjustafewshortyearsasatooltobringcommunitiestogether,coordinateefforts,anddemonstrateoutcomesthroughsharedmeasurementsystems.Thistypeofcollaborationcomeswithahostofwarningsandcritiques,however.Somequestionsthathaveariseninclude:Doesmostofthecreditandfunding,becauseofinternalpowerdynamics,gotothebiggestorganizationsandrequired“backbone”organizations?Whichorganizationsarebroughttothetable?Dotheyadequatelyrepresentthecommunitiesconcerned?Haveissuesofequityandracialjusticebeenseriouslyconsidered?Doesthecollaborationchanneleffortsinapre-determineddirection,ultimatelystiflingtheworkofground-levelactivists(Wolffetal.,2017)?Withindependentfundingtopromoteideasandpreferences,philanthropycontinuestobeabletoexerciseitsexpressiverole,butsocialservicenonprofitsareoftenseenas

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philanthropists’instruments—toolsorsitesinlargerschemesforenactingsocialchange.Top-downinnovationdoesn’tgenerallyallowforlearning,whichcouldtakeplacefromseeingwhatnonprofitsonthegroundaredoingandwhatiseffectiveindifferentcommunities.Italsotendstodependheavilyonprofessionalandmanagerialexpertiseinsteadoffield-basedandlocalizedknowledgeandisdesignedtotranscendcultureandcontext(Ganz,Key,&Spicer,2018).Ithasaveneerofneutrality,buttherationalizedframingusuallyomitstheperspectivesandexperienceofthoseclosesttotheproblem(Tompkins-Stange,2016).Wheninnovationisseenonlywhenitcomesasahigh-profile,disruptiveforce,ratherthantheresourcefulnessandcreativityenabledbydeepexpertiseandextensivetraining,philanthropybecomesmoreremovedfromanauthenticanddemocraticunderstandingoftheproblemsitistryingtosolve(Tufekci,2018).ConclusionUltimately,socialservicenonprofitsarenotjustdeliverersofservicesbutpartofamuchbiggerwebofgovernanceintheirrolesasadvocates,collaborators,andground-levelinnovators.However,thereisarealtensioninthefieldastowhethersocialservicenonprofitsshouldbeseenasgapfillersrespondingtomarketandgovernmentfailureorasvehiclesforstrengtheningcommunitiesandmakingpolicymoreresponsiveandequitable.Currently,socialservicenonprofitsarechallengedtomeetthenormativeexpectationsmanycitizenshaveforthenonprofitsectoraroundvoluntarism,communityconnections,andindependencefromgovernment.Theyhavestrongincentivestobecomemoreprofessionalized,larger,moredatadriven,andmoreattentivetoresourceavailabilitythancommunityneeds.Theapplicationofmarketlogictosocialservicenonprofitsemphasizesthatattentiontothebottomlineissimplygoodmanagementandessentialtocapacityandquality.Whatdistinguishesthesectorislessthenatureoftheprogrammaticofferingsandmorethepersonalityorcharactersocialservicenonprofitsbringtotheirwork.Thechallenge,then,inthefaceofthislogic,ishowtostayfocusedonmissionandrelationalworkwhenthemarketbecomesevermorepresentintheirwork.Optimistsassertthatrobustlydefiningtheoutcomesthatmatter,withfundingthatiswell-alignedtothoseefforts,couldhelpsocialservicenonprofitsmeetbothinstrumentalandexpressivegoals.Certainly,thecapacitytousedatawellwillcontinuetobeaskillthatdefinessuccessfulorganizationsfromthosewhostruggle(Janus,2018).Onesuggestionisfornonprofitstoleanintotheirexpressive,value-drivennatureandhighlightitasauniquestrength.Unlikefor-profitsoptimizedforinstrumentality,nonprofitscanleveragecommunityconnectionsandaclient-centeredapproachasstrengths,potentiallymakingthemmorecompetitivethantheirfor-profitpeersintacklingmorecomplex,barrier-richsocialissues(Frumkin&Andre-Clark,2000).Pessimistsarguethatahealthycivilsocietyissimplyincompatiblewithnonprofitdependenceongovernmentfunding.Inthisviewthepursuitofgovernmentfundingcreatesperverseincentivesfornonprofitsthatleadthemtobecomeevermorefocusedonmeetingthedesiresoffundersratherthanthecommunitymemberstheyseeeveryday(Dolsak&Prakash,2015).

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Atthesametime,thefederalizednatureofgovernmentcontractskeepsnonprofitsfromcollectivelyorganizing,asdoesthefactthatthesocialservicesarehighlysiloedbyprogramarea(e.g.,mentalhealth,childwelfare,etc).Theseaspectsofpolicydesignnotonlymakesitdifficulttononprofitstohaveastrongadvocacyvoice,butactivelydiscouragesindividuals(nonprofitstaffandconsumersalike)fromgettinginvolvedorseeingtheirfatesaslinked(Michener,2018).Nonprofitdependenceongovernmentfundinghasnotablycomeaboutpreciselythroughtherejectionofgovernmentasatooltosolveproblems(and,infact,sometimesasthesourceofthem)andtheembraceofmarketprinciplesasanalternative.Solutionstosocialproblemsare,inturn,seenastechnicalandknowledge-basedratherthanpoliticalandpower-based(Ganzetal.,2018).Recognitionoftheinequalitiesbakedintoourcurrentpoliticalsystemwouldmandateincreasedinvolvementofsocialservicenonprofitsincivicengagementandcitizenmobilization.Ourcurrentfocusoninnovation,data,andperformancemeasurement,bycontrast,privilegestheshort-term,individual-by-individualapproachtomeetingsocialneedsandtherebyfavorsthestatusquo.Increasedenmeshmentwithgovernmentgivessocialservicenonprofitsmorepowerandresponsibilitywhileatthesametimelimitingtheirabilitytomeaningfullyresistmarketizationtrends.Thisphenomenoncanbeseeninotherfieldsaswell,suchashealthcareandeducation.Growingausterityandcontractcompetitionlimitpossibilitiesfordissentandalternativeconceptionsofthesector(Dodge,2010).Currentrelationshipswithgovernmenthavebeenconceptualizedasprincipal-agentinnature,implyingverticalaccountability.If,throughchangesincollaborativegovernanceandcollaborativepracticesgenerally,socialservicenonprofitsaretohavealargervoiceandexercisemorecontroloverthesocialservicesystem,wewillneednewtheorizingofhorizontalaccountabilityinthesocialservices(Hill&Lynn,2005;VanSlyke,2007).Thefutureofthesocialservicenonprofitsectorisuncertainbutcouldbetellingforotherpartsofthenonprofitsectorthatarenotyetasfullyenmeshedwithgovernmentpartners.References

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