Posted by: knightbird | September 8, 2010

Building a Bigger Pie

We always run head first into scarcity when running a non-profit. We never have enough resources to satisfy the needs we have. One way to proceed with management of customer expectations is to deflect the inevitable criticism that comes your way by pleading poverty—we don’t have enough resources so we can’t meet your needs. Another way to deflect criticism is to complain about your people—we just can’t get good help because we can’t pay much for salaries. And when confronted with scarcity, we lay people off and let a proven need go unmet, or else we put the burden of the terminated employee on the remaining employees, without additional compensation. When confronted with a lack of resources, my executive team made different choices.

For one, we vowed to create a “Bigger Pie.” This vow had 2 parts. The first part was that we would do everything we could to come up with more money for services and programs. We actually hired a third grant writer to help us write more grants. We created a second fire crew for the revenue it brings in. We worked on collecting more third party revenue. We purchased a building to house our operations, and used lease payments to help pay for purchasing the building and for operating costs. And we joined the chorus of similar organizations crying out for more resources—increase federal revenue, fund more grants, and compete with each other for the small pots of money available.

Did it work. Absolutely. We pulled in almost $4.0 million in new revenue during the first full year I was here.

As for joining the chorus of voices crying out for new resources—not so much. In the Bush 2 era, the Indian Health Service and the Bureau of Indian Affairs were horribly neglected. The first years of the Obama administration did see some revenue increases.

Our second choice involved the adoption of Lean Management. Most businesses don’t think about building a bigger pie through management efficiency. We did. Philosophically, we weren’t thinking about saving money, but about increasing both the quantity and quality of services to our customers. But we did save money, about $1.0 million annually (conservatively estimated) And we wanted to increase services without having to answer that typical response of front line managers when asked to increase services, which is to budget more money for their department. Lean helped us do both.

We built this bigger pie by eliminating waste in our processes. We didn’t just focus on the obvious problems facing us, but on every process facing us. We deployed Lean wherever we started to get buy in, so obviously some parts of our operations improved more rapidly. Their successes started encouraging others to try Lean. When I wrote about the Snoopy Dance earlier in this series of blogs, I was citing an example of buy in. Our Health Care division bought in only after a wholesale exodus of practitioners, but today we no longer have the 2 week wait for appointments our patients used to endure. And we have broadened our range of service delivery. The same is true for our Dental Program. To have even one of our Tribal Villages cavity free is a tremendous accomplishment for our staff.

And that third grant writer we hired to help us write  more grants. That position is gone. As is the second grant writer position. Our staff writes a substantial number of grants with just one grant writer on staff. The grants are of higher quality, they are quickly written, and we don’t miss grant deadlines like we used to do regularly. For me, building a bigger pie is the best of all worlds. Now we are able to meet more customer expectations with a higher level of quality. That is why I like Lean. Now I only wish I could get our Tribal partners to build a bigger pie for my customers who have to use them.

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