Should the effectiveness of a nonprofit be measured in terms of whether or not it is merging or collaborating with other nonprofits? If so, then the Charlotte-Mecklenberg community may become the model for the rest of the country in how it is using mergers to strengthen its nonprofit sector.  A very interesting story popped up in my Google Alerts dated Sept. 28, 2009 from the Charlotte Observer. A county commission of very prestigious government and foundation institutions, including the United Way of Central Carolinas and the Foundation for the Carolinas, has formed to identify strategies for addressing the funding losses for the Charlotte-Mecklenberg community. There simply isn’t enough money to support the same number of nonprofits today as there was in the past; one estimate is that funding is down $171M for nonprofits.

The most popular suggestion from Charlotte residents and commission members for addressing this problem is for nonprofits to merge.  “There are absolutely too many nonprofits in Charlotte,” says Jennifer Roberts, who chairs the commission. With area unemployment at 12%, local experts expect donations to continue to decline. “Given where we are in our community, and where we are in our society, it does make sense for the nonprofit sector to look at ways it can restructure itself,” County Manager Harry Jones says.  “As a donor, I’m going to want to know that an agency I’m giving money to is not duplicating.”

Is this the beginning of donors looking for evidence of collaboration strategy in a nonprofit’s portfolio as a quality metric? Will the evidence of multiple nonprofits doing the same kinds of work in the same community turn off donors and make them feel like it’s a duplication of effort?  Write and let me know if you are seeing evidence of this in your community, or not.

imageJean Butzen, Mission Plus Strategy consulting, specializes in mergers and alliances in the Chicago area.