Sunday, June 6, 2010

Strategic Management - Case Studies

Sanjeev Michael Masih

Strategic Management of Nonprofits

December 15, 2009

Background

The Salvation Army has been operating in New York since the 1880s and extended its reach to East Northport, New York in approximately 1950s. As Salvation Army is a faith based organization, it provides a host of humanitarian programs to the community along with worship services. The humanitarian outreach has made it a vital part of the East Northport community. Other than worship services, it provides programs like: food and nutrition, transitional care and work release, emergency assistance in food and seasonal services, it also provides elder nutrition services along with senior citizen clubs. The East Northport Salvation Army branch also works with youth through: Boys’ and Girls’ Club, character building programs and community recreational programs. Over the year it had great funding sources from participating church members and the revenue from the clothing store to run many program but that support is dwindling. The decrease in church attendance, area demographic, mismanagement of the clothing store and constant change of personal has had adverse effect on its ability to effectively deliver the needed services to the community.

Demographics

According to the U.S. Census Bureau’s last census (1999), East Northport has a population of 31,250[1]. Data taken from the same census also states that 3,576 or 12.5% of the population speaks a language other than English in their homes. Take into consideration when the data was taken, I am certain that the number of non-English speaking population is much higher. In the recent year I have observed an influx of immigrants, mainly Hispanic, into the Long Island area. To take advantage of this trend, the Salvation Army re-locating more Spanish speaking pastors to their house of worship.

The census data suggests that there are significant numbers of households that are run by single mothers. According to the U.S. Census Bureau, there are close to 800 single female parents. Out of that, 10% are below the poverty line. (Please see attached “Data 1” sheet for U.S. Census Bureau information and see U.S. Department of Health & Human Services Poverty Guidelines for poverty guidelines)

Elderly also make a significant part of the single female parent population. There are 238 householders that are of age 65 and over; with 15 families below poverty line. Out of the 797 single mother families, only 324 had full-time job year around; with 6 falling below the poverty line even with a full-time job. In regards to families in general and poverty, 391 families fall 150% below the poverty line. While 528 families fall 180% below the poverty level.

Current State

The changing environments are creating significant headwinds for the East Northport Salvation Army (ENSA). In the past, the community was primarily composed of highly educated and wealthy white households but that is changing. With growing migration of the Hispanic population, decreasing traditional financial resources and increase in services demanding, ENSA must act fast to stay alive. Although ENSA is covered by the larger Salvation Army umbrella, it must be self sufficient and find ways to meet the Salvation Army mission “ to help those in need without discrimination.”[2]

Judging from the first hand experience, I’ve noticed some positive and some negative improvements. The current leader of the organization, Major Bender, has done a great job in increasing the church membership. In a strategic move, the Salvation Army relocated Major Bender to ENSA so he, along with his wife (who’s Hispanic), can better serve the growing Hispanic community in East Northport and the surrounding areas. Major Bender has also introduced different fundraising methods to increase the revenue. The annual golf tournament, weekend retreats and food drives have been some of the most successful. Never the less, the efforts are falling short of meeting needs. Most recently, there was a shortage of turkeys for the Thanksgiving program to assist families during the holiday season. The clothing store has been loosing money with adverse effect on the overall budget.

Applying the Four Frames

The East Northport Salvation Army should have a complete organization review to battle the growing problems. There should be review of their structure, human resources, political and symbolic make up. An organization can not successfully serve its mission without neglecting any one of these four aspects. If all four of these frames are executed in sync with each other and the mission, success will follow.

The Structural Frame

The structural frame is “a rational world and emphasizes organizational architecture, including goals, structure, technology, specialized roles, coordination, and formal relationships.”[3] (Bolman & Deal 15) Keeping in mind that the greater Salvation Army has jurisdiction over the structure of ENSA, I still believe that structural change can be applied. The subsequent levels of management, additional personal duties, responsibilities and roles are left up to the local leader to decide. Currently the roles in the organization are not well defined. This structure has served the organization well in the past but it should be modified. There are no formal responsibilities delegated to increase the volunteer program. Few times I have reached out to different people within the organization to start programs but no one knows who I should talk to. The organization should do a better job in identifying the roles while cross training personal to understand other aspects of the organization. To tackle the rigidness of the structure, all should understand the functions and objectives of the organization.

The Human Resource Frame

The human resource frame “centers on what organizations and people do to and for one another.”[4] (Bolman & Deal 117) Abraham Maslow suggests that people have a hierarchy of needs which they strive to fulfill. In the current organization, we know that people are not there for the money but instead are there to fulfill the self-actualization need. The challenge will be to fulfill this need while accomplishing the mission of the organization. Since this team is small, they often interacting with the served population, they must feel the sense of accomplishment of their work. With abundance of workload, running the worship services and multiple programs, the Major does not always have time to oversea everything effectively. This gives employees less oversight and leads to reduced productivity. The lack of efficient oversight, can also have other impacts. The employees tend to follow their own set of rules and beliefs which might not be alighted to the organizations goals. This perceptual distortion, ‘deliberately paying attention only to what we want to see’[5] (Vecchio 42), can lead to a divide between organization and the employees. Although ENSA has hired a Spanish speaking pastor, it does not have any Spanish speaking supporting personal. From my direct observation, there seems to be a hesitance from the existing support staff to deal with the new arrivers. I believe there is a breakdown in goal communication from higher management to the staff.

There is also no formal volunteer program. This vital free human resource is not being completely utilized and if managed properly, can be a great asset to the organization. The increase in Hispanic population is primarily composed of younger people who have the passion to make a difference. I’ve meet many people at the center who would love to get greater responsibility and create a large impact on the community.

The Political Frame

This frame says that “organizations are coalitions composed of individuals and groups with enduring differences who life in a world of scarce resources. That puts power and conflict at the center of organizational decision making.”[6] (Bolman & Deal 209) Without a proper structure, defined roles and HR strategy, a political battle is inevitable. Formally the political power rests with the Major of the center but informally the wife and the secretaries hold sway over the decisions. While deciding where to hold my wedding ceremony last year, I approached another Salvation Army pastor to perform the services. I was turned down because my wife is not a Christian. I then approached the Major Bender about the ceremony but he was reluctant to do for the same reasons. In the meanwhile, my wife (fiancĂ© at the time) came to church with me and got to know the Major’s wife. Overtime Major Bender decided that he can perform the ceremony for us. I believe this was a direct result of my wife’s interaction with Major Bender’s wife.

The formal power channels do not always have the power one perceives they do. While understanding this, Major Bender, should guide his organization’s objectives. He must find the political power silos to steer clear of political obstacles to accomplishing organizational mission. Another way to look at this frame is to understand that “activities taken within organizations to acquire, develop, and use power and other resources to obtain one’s preferred outcomes in a situation in which there is uncertainty or disagreement about choices”[7] (Vecchio 128) There will always be disagreements within the organization but as an effective manager, one must understand how you must implement the change needed to reach you objective. Politics has a negative connotation associated with it but it is not always negative in nature. We all part take in politics in our lives: playing good cop bad cop to get kids to do something, working the channels at work to gain the promotion or working on a group project. There is always some aspect of politics involved and it is important for a leader of an organization to understand this and know how to navigate through the political channels.

The Symbolic Frame

This frame “cents on complexity and ambiguity and emphasizes the idea that symbols mediate the meaning of work and anchor culture.”[8] (Bolman & Deal 209) Drilling down to the basics, symbols “communicate values, legitimize practices, and help to socialize members and build loyalty.”[9] (Vecchio 346) The Salvation Army brand has the reputation of community service going back to the Great Depression. It is known for its humanitarian efforts during the Katrina disasters. It is synonymous with providing disaster relief, food, shelter, drug rehabilitation and other programs that add value to the community. This image is the greatest symbol to the organization.

The symbolic image is heavily used throughout the organization’s center, communication and events. Great numbers of people come to the center just because of their reputation but they don’t know that it’s a faith based organization. I think that East Northport Salvation Army does a great job in using this frame.

Improvements

All four frames must be coordinated effectively to move the organization forward. Structurally there should be a conscious effort to understand individual responsibilities but also understand overall structure of the organization. The human resources should be better utilized with increase participation from volunteers and addition Spanish speaking personal. There should be an open discussion on employees being accepting of changing demographics and finding ways to better meet their needs. Under the current rotation methodology applied by the larger Salvation Army, Majors/Pastors do not stay at one location for more than 2 years. I think the organization at large should have a discussion to change that rule to better service the communities. The managers have a better grasp of the political framework of the organization. Specifically, the informal political channels give the greatest challenge and will require the most amount of work. The organization does an effective job of using symbolism of its reputation.

To have a better financial position, ENSA should close its clothing store, seek government grants, find innovative ways to raise funds and partner with other organizations. The high dependence on the larger Salvation Army for funding can be disadvantageous if ENSA continues to function in the red. It should also wean off of its dependence on church collections for funding.

To better serve the single mothers and elderly, it should partner with local food banks and/or soup kitchens to reduce cost. The job placement program of non-working single mother/householder should be made one of the top priorities. This can be done though local colleges/universities, unemployment office and job training programs. By utilizing volunteers, it should introduce baby-sitting/childcare programs for single mothers who have employment. This will relieve some burden on resource by moving clients toward self sufficiency.



[2] Salvation Army Greater New York Division <>

[3] Lee G. Bolman &Terrence E. Deal. Reframing Organization : Artistry, Choice, and Leadeship. San Francisco: Jossey-Bass, 2008.

[4] Lee G. Bolman &Terrence E. Deal. Reframing Organization : Artistry, Choice, and Leadeship. San Francisco: Jossey-Bass, 2008.

[5] Robert P. Vecchio. Organizational Behavior: Core Concepts. Ohio: South-Western, 2006.

[6] Lee G. Bolman &Terrence E. Deal. Reframing Organization : Artistry, Choice, and Leadeship. San Francisco: Jossey-Bass, 2008.

[7] Robert P. Vecchio. Organizational Behavior: Core Concepts. Ohio: South-Western, 2006.

[8] Lee G. Bolman &Terrence E. Deal. Reframing Organization : Artistry, Choice, and Leadeship. San Francisco: Jossey-Bass, 2008.

[9] Robert P. Vecchio. Organizational Behavior: Core Concepts. Ohio: South-Western, 2006.

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