Risk and Resilience Delivered by Alba

Learning outcomes Stronger understanding of how to identify and measure both internal and external risks Deeper understanding of how to mitigate against those risks Stronger knowledge of strategies to increase resilience

Organisational risk assessment Funding Stability Relevance Relationships Information Internal consensus

Organisational risk What is it? External influence Governance & leadership Management systems Operational activity

Organisational risk External risks –changing political, economic, environmental, social and technological environment. –National, regional and local influences

Organisational risk Political risks –New government –Changing policies –Legal requirements Economic risks –Funding streams ending –Economic downturn –Trust funds – less money, more demand

Organisational risk Environmental risks –Environmental disasters –Structural changes Social risks –Changing demographics impact on service delivery Technological risks –Increased reliance on technology

Organisational risk Internal risks –Governance and leadership –Management structures –Operational activity Governance and leadership –Good controls –Organisational risk assessments

Organisational risk Management structures –Strategic, business and financial planning –Financial systems –Legal compliance –Contract management –Asset and premises management Operational activity –Risk assessments –Staff and volunteer skills and deployment

Organisational risk An organisation is most at risk when: –Too many significant risk activities in one area –A number of significant and medium risk activities spread across more than one area.

PEST analysis What are the current external influences: Political Environmental Social Technological

Identifying risks Exercise Discuss the external and internal risks that face your organisation. Use the template provided to complete the ‘Activity’ section, recording identified areas of risk in your organisation and whether you rank the risk as high, medium or low

Ranking risk How likely is that this risk will occur? What is the likely outcome if it does? How serious do we rank this outcome?

Being resilient The big picture –Having a strategic plan –Regular review of environment and operation –Scenario planning –Diversified funding sources –Collaborating with others

Being resilient The detail –Focus on core activities –Improving financial controls and procedures –Making best use of staff and volunteers –Strengthening governance and leadership –Being aware of the resources available

Building blocks for resilience Financial sustainability Effective partnerships Strategic planning Governance and leadership

What is sustainable funding? Donor – Gift Economy Funder – Grant Funding Purchaser – Structured Market Consumer – Open Market Asking Earning

What is sustainable funding? Donor – Gift Economy –Unrestricted funding –The organisation becomes known –Enthusiasm can gather for your cause –Donations from many sources, including: Community Fundraising Individual support Corporate support Major donors Legacies In Memoriam Giving

What is sustainable funding? Funder – Grant Funding –Restricted funding –Many charities are funded in this way –Increased competition and less money –Criteria to meet and evidence –Prepare in advance – full cost recovery –Research funders – key websites

What is sustainable funding? Purchaser – Structured Market –Central and local government contracts –Earned income –Grants, tenders and or capacity building –Legal obligations and reporting –Full cost recovery and full value –It should meet your objectives –It enables the VCS to influence services

What is sustainable funding? Consumer – Open Market –Unrestricted funding –Trading generates extra income –Charities can trade –Trading reduces dependency –Be prepared –Select trading opportunities carefully –Examples – translation; gardening; intellectual property; charging for leaflets

Financial stability Exercise Action planning for funding –List your current funding sources and when they end –Consider the 4 sources in the funding spectrum and complete the table

Effective partnerships Collaborating with others Strategic partnerships for influence

The collaboration continuum EncounterSharing without mergingMerge NetworkConsortium tendering Joint venture Share ‘back office’ functions Co - location Group structure AcquireEqual merger

Collaboration – sharing not merging Networking –Coming together to share information –Local, regional national networks Consortium tendering –Nothing new, but… –Hasty partnerships can equal problems Joint venture –Many organisations work this way –Good use of resources, improved services –Precursor to consortium tendering –Examples of successful ventures

Collaboration – sharing not merging Sharing back office functions –Information management and technology –Financial services –Managing payroll –Human resources –Purchasing

Collaboration – sharing not merging Co-location –Shared and/or owned premises –A variety of co-location –Co-location as a resource centre

Collaboration – as merger Group structure Acquisition Equal merger

Collaboration Exercise Collaborating with others to reduce risk and become resilient –Who are we working with and could we do more? –Who else could we collaborate with to become more resilient? –What do we need to know about them?

Steps to collaboration Know what users want Involve your Board Organisational health check Improve and develop services Other player analysis

Strategic planning Led by the Board Involves trustees, staff at all levels, volunteers and users Flows from mission statement Determines direction, sets overall goals Covers 3-5 years For annual review

Business planning Provides a route map to deliver the strategic plan Prepared annually Enables organisation’s staff and other resources to be deployed and managed appropriately Includes data for use in funding bids

Governance and leadership 6 Principles of Good Governance Understands role Ensures delivery of purpose Works effectively -individuals and team Exercises effective control Behaves with integrity Is open and accountable

Understanding role Setting and safeguarding the vision, values and reputation of the organisation Overseeing the work of the organisation Managing and supporting staff and volunteers, where appropriate

Delivery of purpose Ensure purposes remain relevant and valid Developing and agreeing long term strategy Monitoring progress and spending against plan and budget Reviewing and amending plan and budget as appropriate

Governance review Audit of core governance documents Self assessment by Board of performance against 6 Principles Self assessment by Board of skills and experience they bring Board Development Plan

Governance and leadership Exercise What is the role of your Board, manager, staff, volunteers and users in: Developing the strategic plan Identifying and following up funding opportunities Building links with other organisations Assessing and monitoring organisational risks

Planning for resilience Exercise Use the template you used earlier to identify the risks facing your organisation. Now complete the ‘Action to take’ section.