DISCUSSION LED BY:

Mrs. Sudha Prakash
49, Aga Abbas Ali Road, Bangalore - 560 042, India. Ph: 5599078

Many international donor organisations fund programmes for a short period of time, as a temporary measure to tide over a crisis or to initiate a change. These funds depend to a great extent on the trends in the western world. The donors may not also seriously consider the validity of the project proposal in its context, and may sometimes engage in projects on unproved experimental methods, which may destroy the indigenous efforts permanently. There are times when projects started with much publicity and excess funds, attract people with wrong motives, and do not sustain the efforts to achieve their goals. Such programmes, which change their focus every two years to access new funds, are unlikely to create the desired impact.

Contemporary issues related to financial sustainability of `Not for profit' organisations

1. Rising costs due to inflation. 2. Recession in most parts of the world reducing the availability of philanthropic funds. 3. Larger number of organisations competing for the same amount of funds. 4. Inability to find donors for long-term support. 5. Need to avoid dependency and to achieve self-esteem. 6. Need to achieve financial sustainability. 7. The feeling that power of competition will improve efficiency. 8. Availability of a growing commercial market, especially in services. 9. Influence of capitalism and market orientated economy. 10. The ideology that if welfare organisations can find their own income, philanthropic funds can be spared and utilised exclusively for subsidies.

List of changes necessary before venturing into commercialisation of not for profit organisations

1. Develop policies with the participation of all the stakeholders and disseminate them widely.
   • Commercialisation does not conflict with the original mission
   • Possible to identify areas suitable for commercialisation that are in line with the organisation's mission
   • Able to identify the groups which need full subsidy or partial subsidy
   • Able to identify third parties who may have a vested interest in the organisation and who can be associates without having a conflict with the organisation's mission
2. Initiate monitoring systems which identify flaws in the process and express the results rather than activities.
   • Risk of new commercial venture to fail in 8 years is about 70%, which can be reduced with good monitoring systems.
   • Makes the organisation see the activities as cost centres, closing down non-priority activities, activities that do not relate to the mission and make losses; also to see the value in monetary terms, relate them to the available resources, and reduce redundancy in personnel.
3. Initiate periodic evaluations to identify if the organisation has been fulfilling its mission, whether the objectives are completed, and if the programme is viable and sustainable.
   • In perfect competitive markets commercial ventures make just enough money to cover costs and compensate capital providers with reasonable returns (often just more than the prevailing interest rate commensurate with risk on the capital).
   • Evaluations show if the return on the investment is adequate to justify the activity and if there has been substantial variation from the feasibility study before the start.
   • Evaluations show opportunities to maximise advantages such as reduction in capital costs through the use of philanthropic funds, best use of suppliers' discounts, tax advantages and volunteers.
   • Evaluations also identify the need for change in the organisation's culture to orient it to the market realities.
4. Initiate a feasibility study before venturing to change towards commercialisation.
   • A feasibility study will identify the extent to which the organisation can operate at the commercial end of the spectrum, the potential of the organisation to generate commercial income, the potential of its beneficiaries to pay for services, whether it is desirable, and other potential sources to raise resources.
   • The feasibility study will also identify the other incremental costs (hidden costs like bribe etc) and administrative costs.
   • The feasibility will identify the reliability of the commercial income for a long period of time, over philanthropic fund.
5. Disseminate the feasibility report and evaluation report widely to all stakeholders and experts for their feed-back, because the future plans are best made collectively.

Options for change

1. Complete philanthropic support of the programme.
2. Partial self-sufficiency.
   • Have debt funds but avoid equity funds.
   • Start full payment for services with cross subsidies
   • Start multi-unit activities with commercial and welfare activities separated from each other.
   • Take up supplementary activities such as endorsing on advertisements to add value to the products of an associate.
   • Start working out a financial objective apart from a welfare objective and reorient towards a market related efficiency.
3. Full self-sufficiency

Some of the methods commonly used

1. Have board members with relevant business experience.
2. Have volunteer consultants who are business managers or business school students.
3. Establish alliances with commercial business houses to provide skills and training in business methods.

" The process of commercialisation of `Not for profit' organisations should not drive out the philanthropic activities altogether, but should achieve the mission related objectives with better self reliance".

All forms of employment of disabled persons will require barrier free environment and adaptation of the work situation. Unemployment of disabled persons will depend on the rate of unemployment in the general population and certain unique factors related only to disabled persons.

Specific factors influencing employment of disabled persons

1. Negative community attitudes.
2. Minority status of the disabled persons.
3. Problems of transportation to the work place.
4. Physical barriers at work place.
5. Lack of job skills in employment that has market demand.
6. Inadequate training in skills that are required for the job at hand.

Dr. Maya Thomas & Dr. M J Thomas
J-124, Ushas Apts, 16th Main, 4th Block, Jayanagar, Bangalore - 560 011, India
Tel and fax : 91-80-6633762
Email : thomasmaya@hotmail.com

Printed at :
National Printing Press
580, K.R. Garden, Koramangala, Bangalore - 560 095 Tel : 080-5710658

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