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Section 3: Enabling the NGO of the Future 

We see a strong correlation between a focus on operational elements and the ability to anticipate disruption and embrace new approaches to impact.

Strategic Focus

For many respondents, strategic planning—assessing organizational strengths/weaknesses/positioning and reviewing the external environment to develop a coherent set of choices—is still a work in progress. INGOs with advanced strategy-setting processes involve staff at all levels to create organization-wide buy-in and exhibit a mission focus that does not always follow donor leads.

MSI’s strategic planning process led the organization to change its program delivery approach and develop a more effective organizational structure. The new strategy helped MSI double its impact in reducing unsafe abortions.

Evaluation and learning

9 of 10 INGOs surveyed have at least 1 staff member dedicated to program level or organizational evaluation, but this is a relatively new trend. More than two-thirds of those positions were created in the last 5 years. Global health organizations and larger INGOs (with $150+ million in annual revenue) tend to have more sophisticated evaluation processes, with organization-wide indicators and dedicated staff and budget.

PSI uses the disability adjusted life year (DALY) metric to assess progress. A DALY-averted analysis revealed the potential to reduce the disease burden of pneumonia. Just 3 years after PSI developed new, easy-to-use, prepackaged therapy kits to treat childhood pneumonia, the disease went from being a very low producer of DALYs averted to the organization’s third-highest.

Funding structure

The majority of INGOs surveyed rely on similar funders and approaches. The median organization receives nearly 60% of revenue from the U.S. government. Funding to surveyed INGOs is also becoming more restricted; 50% report unrestricted funds are less than 5% of revenue.

Save the Children, PATH, Mercy Corps, and Pathfinder International have created innovation funds. PATH’s Catalyst Fund, created in 2005, targets private funders—including foundations, corporations, and high net worth individuals—to provide flexible funds to invest in organizational infrastructure, experiment with untested but high-potential innovations, and scale proven interventions.

Organizational structure

Among the many organizational changes underway at INGOs, global governance and local structure have received the most attention. 25% of INGOs surveyed were in the midst of restructuring. For some, the transformation is a way to streamline operations and create a more efficient network of affiliates. For others, providing greater autonomy to local offices is a powerful motivation for organizational change.

The approaches to impact will drive organizational changes within INGOs. Mercy Corps’ shared value work is led by a “social innovations team” that includes 8 staff working under a new chief innovations officer.

Talent acquisition and rentention

INGOs are shifting from top-down training to encourage cross-office and cross-country learning. MSI has moved many technical support resources from London to local/regional offices, setting up a business-to-business training model.

More than 50% of INGOs surveyed intend to make major changes to recruitment and retention strategies for headquarters, expatriate, and local talent, echoing changes that occurred in the private sector two decades ago. The skills identified as critical for new local hires include fundraising, partnerships and negotiation, and deep issue-area expertise.

Section 4: A Call to Action >

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