For Nonprofits, Mergers Should Never be a Lifeline - Penn-Mar

For Nonprofits, Mergers Should Never be a Lifeline

Posted on November 15, 2019

By Gregory T. Miller, President and Chief Executive Officer, Penn-Mar Human Services | Chief Executive Officer, Penn-Mar Foundation

Far too often, mergers among nonprofits are viewed as a last resort; a desperate option that’s only on the table when the organization’s very existence is in doubt. Merging is never seen as joining forces, but as a solution to an overwhelming problem that cannot be resolved. Unfortunately, by adopting that mindset, many nonprofits are missing out on an incredible opportunity to not only become stronger and more organized but ultimately serve more of the people they’ve committed to supporting. After all, if our central goal isn’t to help others, than we’ve lost sight of what’s truly important. On the contrary, a merger with a healthy, stable, and like-minded organization can instantly boost your group’s ability to do more good on a wider scale 

When mergers within the nonprofit world take place, the results are typically very poor. But usually, the very reason for the merger is the cause of the failure. When one organization is desperate for help, important considerations like culture, team collaboration, autonomy, and identity are cast aside for the sake of simply continuing to exist. Eventually, this leaves at least one side feeling unfulfilled and unappreciated and the merger is viewed as a disappointment. But how can any relationship based on fear and anxiety survive, let alone succeed? 

Instead, nonprofit mergers should be a consideration when both parties are thriving and looking for ways to expand their footprint. The role of any charitable organization isn’t to stay in business or employ a team, but to provide services to those who are underserved. What better way to deliver on that commitment than by teaming up with another, similarly focused group? This is a process I have been fortunate enough to experience first hand.  

In July 2019, Penn-Mar Human Services and Change, Inc. agreed to a merger, aligning our services with one goal: achieve greater success and more prosperity for the people we had been individually assisting for decades. It was an idea that sprang from a single question: would a merger be better for those we supportThe initial response was that it could, and the idea was worth exploring. The next step was to assign a task force that could take a detailed look at both organizations and see if we would be better together in every way. If at any point, the task force found that the merger would not allow us to succeed because of trust, culture, ideas or a myriad of reasons, it would be called off. Happily, that never happened and the union has been a success ever since. How do we define success? More people are receiving access to our services and as a result, we’re doing more good for those across Baltimore and the region.  

So how can other nonprofits approach the possibility of a merger? It comes back to the idea of knowing why your nonprofit exists and having an allegiance to those you support. Consider the following questions: 

  • Would a merger be better for those you support and bring a higher quality of life? 
  • Could a merger present more opportunities to fulfill your work? 
  • Are there other local groups that share your mission? 
  • Would a partnership with that organization make you stronger? 
  • Does the organization share the same values, ideals, goals, and culture?

If the answer to all of the above is “yes,” than perhaps the time is ripe for fusion with another team. But remember that even the best unions are still very hard work, filled with potential speed bumps that could cause challenges. But isn’t that how you would describe any of life’s long-lasting relationshipsAnd like any great relationship, the best ones always start when both parties are happy, healthy, and most of all, not desperate for one another. 

This piece originally appeared in the BBJ and is reprinted here.

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