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Learning outcomes
• Stronger understanding of how to identify and measure both internal and external risks
• Deeper understanding of how to mitigate against those risks
• Stronger knowledge of strategies to increase resilience
Organisational risk assessment
• Funding• Stability• Relevance• Relationships• Information• Internal consensus
Organisational riskWhat is it?
External influence
Governance & leadership
Management systems
Operational activity
Organisational risk
• External risks– changing political, economic,
environmental, social and technological environment.
– National, regional and local influences
Organisational risk
• Political risks– New government– Changing policies– Legal requirements
• Economic risks– Funding streams ending– Economic downturn– Trust funds – less money, more demand
Organisational risk
• Environmental risks– Environmental disasters– Structural changes
• Social risks– Changing demographics impact on
service delivery
• Technological risks– Increased reliance on technology
Organisational risk
• Internal risks– Governance and leadership– Management structures– Operational activity
• Governance and leadership– Good controls– Organisational risk assessments
Organisational risk
• Management structures– Strategic, business and financial planning– Financial systems– Legal compliance– Contract management– Asset and premises management
• Operational activity– Risk assessments– Staff and volunteer skills and deployment
Organisational risk
• An organisation is most at risk when:– Too many significant risk activities in
one area– A number of significant and medium risk
activities spread across more than one area.
PEST analysis
What are the current external influences:
• Political• Environmental• Social • Technological
Identifying risksExercise
• Discuss the external and internal risks that face your organisation.
• Use the template provided to complete the ‘Activity’ section, recording identified areas of risk in your organisation and whether you rank the risk as high, medium or low
Ranking risk
• How likely is that this risk will occur?• What is the likely outcome if it does?• How serious do we rank this
outcome?
Being resilient
The big picture– Having a strategic plan– Regular review of environment and
operation– Scenario planning– Diversified funding sources– Collaborating with others
Being resilient
The detail– Focus on core activities– Improving financial controls and
procedures– Making best use of staff and volunteers– Strengthening governance and
leadership– Being aware of the resources available
Building blocks for resilience
• Financial sustainability• Effective partnerships• Strategic planning• Governance and leadership
What is sustainable funding?
• Donor – Gift Economy
• Funder – Grant Funding
• Purchaser – Structured Market
• Consumer – Open Market
Asking
Earning
What is sustainable funding?
• Donor – Gift Economy– Unrestricted funding– The organisation becomes known– Enthusiasm can gather for your cause– Donations from many sources, including:
• Community Fundraising• Individual support• Corporate support• Major donors• Legacies• In Memoriam Giving
What is sustainable funding?
• Funder – Grant Funding– Restricted funding– Many charities are funded in this way– Increased competition and less money– Criteria to meet and evidence– Prepare in advance – full cost recovery– Research funders – key websites
What is sustainable funding?
• Purchaser – Structured Market– Central and local government contracts– Earned income– Grants, tenders and or capacity building– Legal obligations and reporting– Full cost recovery and full value– It should meet your objectives– It enables the VCS to influence services
What is sustainable funding?
• Consumer – Open Market– Unrestricted funding– Trading generates extra income– Charities can trade– Trading reduces dependency – Be prepared– Select trading opportunities carefully– Examples – translation; gardening;
intellectual property; charging for leaflets
Financial stabilityExercise
• Action planning for funding– List your current funding sources and
when they end– Consider the 4 sources in the funding
spectrum and complete the table
Effective partnerships
• Collaborating with others• Strategic partnerships for influence
The collaboration continuum
Encounter Sharing without merging Merge
Network Consortiumtendering
Joint venture
Share ‘back office’ functions
Co -location
Group structure
Acquire Equal merger
Collaboration – sharing not merging
• Networking– Coming together to share information– Local, regional national networks
• Consortium tendering– Nothing new, but…– Hasty partnerships can equal problems
• Joint venture– Many organisations work this way– Good use of resources, improved services– Precursor to consortium tendering– Examples of successful ventures
Collaboration – sharing not merging
• Sharing back office functions– Information management and technology– Financial services– Managing payroll– Human resources– Purchasing
Collaboration – sharing not merging
• Co-location– Shared and/or owned premises– A variety of co-location– Co-location as a resource centre
Collaboration – as merger
• Group structure• Acquisition• Equal merger
CollaborationExercise
• Collaborating with others to reduce risk and become resilient
– Who are we working with and could we do more?
– Who else could we collaborate with to become more resilient?
– What do we need to know about them?
Steps to collaboration
• Know what users want• Involve your Board• Organisational health check• Improve and develop services• Other player analysis
Strategic planning
• Led by the Board• Involves trustees, staff at all levels,
volunteers and users• Flows from mission statement• Determines direction, sets overall
goals• Covers 3-5 years• For annual review
Business planning
• Provides a route map to deliver the strategic plan
• Prepared annually• Enables organisation’s staff and
other resources to be deployed and managed appropriately
• Includes data for use in funding bids
Governance and leadership
6 Principles of Good Governance• Understands role• Ensures delivery of purpose• Works effectively -individuals and
team• Exercises effective control• Behaves with integrity• Is open and accountable
Understanding role
• Setting and safeguarding the vision, values and reputation of the organisation
• Overseeing the work of the organisation
• Managing and supporting staff and volunteers, where appropriate
Delivery of purpose
• Ensure purposes remain relevant and valid
• Developing and agreeing long term strategy
• Monitoring progress and spending against plan and budget
• Reviewing and amending plan and budget as appropriate
Governance review
• Audit of core governance documents• Self assessment by Board of
performance against 6 Principles• Self assessment by Board of skills
and experience they bring• Board Development Plan
Governance and leadershipExercise
What is the role of your Board, manager, staff, volunteers and users in:
• Developing the strategic plan• Identifying and following up funding
opportunities• Building links with other organisations• Assessing and monitoring
organisational risks
Planning for resilienceExercise
• Use the template you used earlier to identify the risks facing your organisation.
• Now complete the ‘Action to take’ section.
