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Strategic Philanthropy

UWA adopted a business model to show program impacts. UWA encourages, but does not require, local chapters to define community priorities tightly and adjust philanthropic grants to fit these priorities. UWA chapters are implementing community impact models and outcome measurement systems to show added value results attributable to their grants. This entails change in philanthropic strategy: from guaranteed funding to a set of designated member agencies year after year to community impact funding, which may add open bidding by nonprofits for funds in designated program areas. This shift is the biggest change for UWA in a century. While this strategy is not unique to UWA, its adoption and the public appeal of deliberate, accountable philanthropy may be the edge UWA needs to restore its standing.

While UWA advises local chapters to adopt a strategic philanthropy model, this shift requires components that may be a challenge to medium and small UWs. First, community needs must be identified. To do so, UW can rely on community needs assessments (CNAs); surveys of priorities, assets, and needs (SPANs); community indicators; and similar strategies. Objective data are available from local planning authorities or analyses of existing data sources (e.g., U.S. Census, Bureau of Labor Statistics). To be of use, data must be expertly analyzed. To that effect, academic centers may assist UWs in objective needs assessment. The second criteria, determining community priorities on the basis of objective needs, is often a strength of UWs. Input of stakeholders – donors, business leaders, agencies, local philanthropies, advocates, researchers, boards – can be secured through strategy meetings. A sensible approach is to use the needs assessment to elicit data-driven discussions and subsequently identify priorities.

The next steps are more difficult and entail, respectively, the UW's capacity to change its strategy and operation, capacity of member agencies to conduct outcome measurement, and UW's capacity to monitor and collect performance data and determine actual community impact. These steps require community and UW capacity building.

Impact of this realignment can be significant. In attempting to implement strategic philanthropy, many UW branches reduced their core areas and defunded partner agencies. In Rhode Island, UW stopped funding twenty-five nonprofits (40 percent of their member agencies), while in Massachusetts, UW of Merrimack Valley (e.g., Lawrence, Lowell) stopped funding twenty-five agencies (50 percent of their member agencies), to fund other nonprofits that better fit their new priorities. Some unfunded agencies, long-term UW partners, in spite of receiving ample notice and one or more years of transition funding, faced service cuts or closed. UW chapters ran into conflict with advocates and eroded their political base.

The UW advisory is a good strategy at risk of failure, yet UW should be able to determine community needs and target philanthropy without disruption, deriving not so much from the strategic realignment but from a drift away from UW core principles. UW is not an endowed foundation, and it relies on an annual fund-raising drive, a drive that depends on and is bound to its partners, member agencies, and volunteers. Partner agencies are not the enemy, even if they do not meet new priorities. Ability of local chapters to connect the community to its fund-raising and charitable decisions is UW's strategic advantage. Actions that undermine this network and political base run counter to UWA's civil society principle. A more reliable path may be to seek the needed realignment within UWA's civil society framework.

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