How organisations can thrive and remain resilient in 2021.

2020 reflections / 2021 predictions

If you haven’t heard anyone call 2020 an unprecedented year, you’ve been living under a rock! Yet, as cliched as the word became, our lives were anything but normal in 2020. The for-purpose sector was not immune to the impacts of COVID-19, with many for-purpose organisations having to demonstrate their resilience. However, resilience is nothing new to the sector and we saw these organisations pivoting, enhancing and improving the way they support our nation and its most vulnerable communities.

In this blog, the Spark team reflect on 2020 and explore trends and disruptions we anticipate will impact the for-purpose sector in 2021. We also pose a range of practical and strategic questions that we believe will help set for-purpose organisations up for success into the year.

Funding

Top of mind for for-purpose organisations was the security of their funding and income streams. Leaders from across the sector began realising the importance of income diversification. For-purpose organisations, especially those who relied on in-person channels for income struggled, with corporate, private and sponsorship dollars decreasing in 2020. That being said, the philanthropy sector responded quickly and came together to sign pledges to support the NFP sector and private ancillary funds (PAFs) changed their funding rules to be flexible around their distribution limits. We are now seeing a shift whereby for-purpose organisations are working with trusts, foundations and major donors as opposed to being reliant on individual giving.

Likewise, many organisations that rely on volunteers to carry out their mission were also greatly impacted. Whilst many would’ve expected to see a lot of for-purpose organisations wind-down in 2020, this wasn’t realised, perhaps in part due to the Government’s stimulus payments. This could change in 2021 as Government payments such as JobKeeper and JobSeeker are set to reduce and the reality of the pandemic will kick-in. For-purpose organisations who planned and pivoted to counter the impacts of the pandemic will most likely remain resilient post the government stimulus packages.

Looking ahead, we predict a range of grant opportunities will become available. We also expect for-purpose leaders to reconsider their business model and their income streams. On the other hand, we expect funders to ask for-purpose organisations to clearly articulate and demonstrate their impact. A theory of change is a powerful tool for organisations to link their strategic direction with the ultimate community impact they are looking to create, for whom, and through what activities.

Social Innovation

The pandemic was an opportunity for us all to reflect on reshaping our systems, structures, institutions and communities to benefit the triple bottom line of people, planet and the rethinking of profit to profit for purpose. Many of us believe that this time of rapid, and in many ways undesirable, change has real potential to catalyse transformation and major positive impact.

Regeneration has been a school of thought which denotes ‘re-birth’ and in the context of the for-purpose sector, there is ample opportunity for redesigning our systems to better serve our communities. It goes one step further than systems thinking and collective impact, to consider the importance of ‘doing more good’ than ‘less harm’ by evolving our thinking, assumptions and existing structures. Regen Melbourne is a tangible example of how regeneration and collaboration bring together doughnut economics but also how we can build back better.

Similarly, the United Nations Sustainable Development Goals (UN SDG’s) which has existed since 2017 is regaining momentum. It calls upon organisations to consider their contribution to the greater good. The UN SDGs are a “blueprint for peace and prosperity for people and the planet, now and into the future”. They are a global framework to guide our collective efforts, and the COVID19 pandemic has emphasised their importance and relevance. We are seeing funders requesting applications to detail how they align with SDGs and how they collect evidence to demonstrate the SDG targets and indicators.

Political and budget

2020 saw a profound shift in our expectations of and attitudes towards Government. In fact, it would be fair to say that Government involvement in our business, health and personal lives was at unprecedented levels. We experienced stimulus payments that were amongst the highest in the world as well as lockdown restrictions that were amongst the strictest. Yet, by and large, Australians were compliant with and supportive of Government decisions and advice.

Our analysis of the Federal budget found it to be largely disappointing for the for-purpose sector. We saw cuts to homelessness, only token gestures towards tackling climate change and gender equity as well as the arts and culture sector completely ignored. Positively, mental health and the NDIS did receive much-needed boosts.

Early signs have suggested that the response of Government will help Australia fare better from public health and economic perspective compared to the rest of the world. Yet, initiatives such as JobKeeper and JobSeeker will come to an end in 2021 and that will require for-purpose leaders to re-evaluate their organisational sustainability.

Equity and diversity

COVID-19 showed us that we still have a long way to go when it comes to creating an equitable society. Women, young people, culturally and linguistically diverse people and those most vulnerable were all disproportionately impacted by the pandemic’s effects. As we adapted to working from home arrangements, traditional and outdated gender roles were re-established and the need for domestic violence support services increased. Similarly, some of our most vulnerable population groups were amongst the hardest hit from public health, employment and safety perspective.

Positively, we saw the JobKeeper and JobSeeker programs pull pockets of our population out of immediate poverty. This has prompted campaigns to permanently increase the support and welfare available to these groups. We also saw for-purpose organisations recognise the importance of considering problems from a holistic perspective, with consideration to social determinants of health. In 2021, we expect to see more for-purpose organisations discuss and tackle the broader social, cultural and socio-economic factors that contribute to the causes they are championing.

Climate change

Unfortunately, climate change action was a massive loser in 2020. The conversation and action towards addressing climate change stalled while organisations, governments and society at large focused on the immediate impacts of the pandemic. In fact, in January 2021, the Federal Government formally updated our UN climate policy without committing to any improvement to Australia’s 2030 target to cut carbon emissions.

While some may argue that greenhouse gas emissions dropped in 2020 for the first time in decades, this can largely be attributed to the impacts of the lockdown restrictions. Despite this temporary drop, carbon dioxide levels in our atmosphere continue to rise. It remains on an upwards trajectory. At Spark, we have been advocating for using COVID-19 as an opportunity to re-imagine the sector. 2021 is a great opportunity for organisations to consider they will boldly take steps towards climate action in their strategic plans.

Technology

Lastly, but certainly not least we saw for-purpose organisations transform their thinking around technology. It is often thought that technology can be complex, timely and costly. However, in the context of the pandemic, a large number of organisations accelerated their digital transformation plans. The mindset around technology turned from complexity to opportunity for communication and greater accessibility. We predict that technology will remain a pertinent enabler for organisations as they tackle their strategic agenda for 2021.

Strategic Checklist

As organisations look to plan for a successful 2021, we have identified a list of key strategic questions leaders should be asking themselves:

1. What are your current income streams and are they diversified? If one source of income abruptly ended, how will you be impacted?
2. How do you measure your impact and if you have been successful in your mission? Do you have a theory of change?
3. How is your organisation incorporating the climate change agenda in future planning? Do you have a climate change commitment?
4. How do the social determinants of health, diversity and equity impact the way you design, deliver and adapt your services?
5. How do frameworks such as the UN SDG’s and regeneration reshape your thinking, activities and planning for 2021?

 

If you’d like to learn more or share your own examples of how 2021 is shaping up to be a resilient and bigger year for you. Don’t hesitate to get in touch at info@sparkstrategy.com.au