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Regulations and the appropriate contracting incentives can mitigate this problem but it remains very complicated in practice, given the discretion exercised by agencies and their staff on the selection and management of clients. Widespread interest in social enterprise is also linked to broad support among policymakers and philanthropic funders for social innovation—a term with a variety of definitions and applications. One frequently cited definition offered by Evers and Ewert focuses on disruptive change in prevailing routines in welfare systems p. In the US context, many social innovation projects have been social enterprises. For example, the Obama Madelyn marie forum created the Social Innovations Fund SIF as a partnership between the federal government and leading national foundations.

One of the overriding goals of SIF is to support projects with a proven record of effectiveness. Nonprofits have been favored for co-production initiatives because of their roots in voluntarism and citizen participation Evers and Ewert ; Bovaird ; Smith and Phillips ; Bovaird et al. These co-production examples also illustrate a ripple effect of NPM: Along with co-production of new service options, like the clubhouse program, more user choice is reflected in support for individual user control over public resources. In the US and the UK, personal budgets have been created which give individual users control over how public funds are used for their services.

Thus, a senior citizen might have a specific budget of public funds that she uses to purchase home care and transportation See Cunningham and Nickson ; CMS, Increased use of vouchers for child care and housing also illustrate this trend toward more client choice. Greater client choice, though, means less agency control so the movement toward vouchers and personal budgets contributes to environmental uncertainty for these nonprofits. Overall, interest in social innovation, including social enterprise and co-production, is frequently combined with a focus on outcome evaluation, accountability and transparency.

The many types of social innovations are often thought to offer improved effectiveness and efficiency See Evers and Evert, Moreover, social innovation has occurred at a time of substantial innovation in performance management and the approach public and private funders take to evaluation and performance assessment. Performance management Recently, the earlier performance-based contracts have become part of a broader performance-management movement to hold human services more accountable. PFS seeks to link payment for services to the success of the intervention for clients and the broader community. In these contracts, PFS has entailed a shift in focus from outputs and short-term outcomes to longer term outcomes.

Perhaps the most visible shift in performance management for human services is the advent of social impact bonds SIBs — a form of pay-for-success that has achieved wide attention as an innovative strategy to achieve social impact. SIBs are complicated initiatives that depend upon private investors assuming the risk of social programs, with the government paying off those investments if the goals are met.

Private investors loan money to an intermediary usually a nonprofit which then sub-contracts with service providers who deliver services with specific performance targets. The project is evaluated by independent researchers and the government sponsor repays the loan with interest if performance targets are met. The city of New York partnered with Goldman Sachs, the Bloomberg Foundation, MDRC a nonprofit intermediary, and the Vera Institute a nonprofit service provider to offer intensive services to keep released prisoners most of them on parole in the community. These trends are evident in other performance management developments in human services. Some governments even make adopting evidence-based practice a condition for receiving funding.

Many nonprofit agencies are also voluntarily adopting these practices in response to evolving professional norms and encouragement by funders. Second, logic models and the related theory of change models have become a frequent expectation among public and private funders for nonprofit human services agencies. Logic models were developed in the s to map the production process of community partnerships and community-based intervention including multi-organizational partnerships Kellogg Foundation Logic models offer nonprofit human services agencies an opportunity to predict the likely effects of their interventions on short-term and longer-term outcomes, even if it is unlikely that they can collect definitive outcome data.

Sustained collaboration among local service agencies and shared measurement systems are preconditions for collective impact. The idea of collective impact has been embraced in a variety of public-private partnerships and collaborative initiatives. For instance, Kania and Kramer cite the example of Shape Up Somerville a small city in Massachusettsa city-wide public-private partnership focused on a comprehensive and successful effort to reduce childhood obesity Also, Bielefeld Often collective-impact efforts are led by intermediary organizations created to bring together public and private agencies in local communities Smith In other instances, a lead agency acts as the coordinating entity for a broad effort to achieve maximum impact Nundy and Chandler Overall, logic models have been very helpful in improving strategic planning in many nonprofit human services because they force agencies to essentially map their program implementation process and identify relevant outcomes and performance targets.

However, logic models remain unproven as strategy to achieve specific outcomes since many agencies are not in a position to collect reliable outcome data or they are too small to be able to measure the effect of their program interventions. Some collective impact efforts appear to have very sound results as noted above. However, the community-wide effort and collaboration required of collective impact entails high transactions costs and requires a substantial commitment by public and private funders; consequently, many communities have been unable to mount a true collective impact effort.

Services Integration A revival of interest in services integration is directly related to this focus on collective impact. Services integration has promised comprehensive and effective approaches to social problems since at least the s. In this context, expanding government contracting with nonprofit human service agencies created extensive service fragmentation. One of the virtues of nonprofit organizations is that they can offer targeted services which can be responsive to specific communities such as a neighborhood, region, or particular issue Smith and Lipsky Yet, local proliferation of agencies creates coordination problems which hinder the ability of government officials, advocates and practitioners to address social problems.

Further, service fragmentation has occurred at a time of increasing concern about the effectiveness of human services and growing recognition of the complexity of many serious social problems such as homelessness, or immigrant assimilation. Thus, services integration has achieved new salience as a strategy to improve the performance of human services, partly because it fits with the new emphasis on networking, collaboration, and collective impact among public and private funders OECD ; Kresge Foundation ; Gold ; KPMG, ; New Zealand Productivity Commission ; Timmins and Ham ; Human Services Summit ; Loya, Boguslaw, Erickson-Warfield, The more recent push for services integration differs from the earlier waves of services integration in the s and s.

Advances in data collection and program measurement put policymakers in a better position for collecting data and imposing shared measurement systems on local service systems. Canterbury, New Zealand, for example, has implemented an Electronic Shared Care Record View as part of services integration for health and social services Timmins and Ham Relatedly, contemporary service integration initiatives are more outcome-focused making use of client outcome data. In Scotland, a program to improve community care for older adults relies upon multi-agency assessment data collected and reported at the national level OECDp.

By focusing on client pathways, many service integration projects also strive to build a co-production component into the client-agency relationship whereupon clients and agency staff are jointly producing a service such as community care. Last, service integration requires collaboration across sectors. Part of this cross-sectoral collaboration represents an effort to achieve efficiencies, given the overlap among public and private community organizations. However, this shift also represents an effort to improve the performance of local human service systems.

Contradictory pressures against services integration also exist. As noted, many service integration projects require collaboration among human service organizations; yet this pressure for collaboration can collide with increased competition for grants and contracts. In an environment with budget uncertainty and scarcity, agency leaders have incentives to compete for contracts and move into new program areas to diversify their revenue base. In short, collaboration among agencies with varying missions is challenging even when the overall environment is supportive of collaboration; but in the current context, services integration—and the required agency collaboration—will not happen unless policymakers provide incentives for collaboration.

For example, payment for services can be structured to foster collaboration, or service integration can be required through referral and intake processes for clients into the service system. A second potential disruption for service integration is the social innovation movement. As noted, social innovation has typically meant encouraging new programs and new agencies, often outside of the existing local service system. Yet, service integration often results in service consolidation or a network of preferred agencies serving identified clients. Service integration programs at the local level may discourage new agency start-ups since local public and private money will be channeled to agencies participating in the integrated network.

Services integration also implies more homogeneity — or isomorphism — within specific services such as job training or transitional housing. Third, co-production can also be an implicit challenge to service integration, especially co-production programs involving volunteers and service users. Services integration relying on evidence-based decision-making, data and performance management is not a natural fit with co-production efforts that are local programs to engage users and community members in developing and delivering services. For example, a graffiti-eradication program involving at-risk youth in clean-up may not easily fit into other youth-oriented programs.

Maybe the world is not the start ft for anyone but pornstars with offset butts, but it does not hurt for a man to try. For dropping, a graffiti-eradication lantern paying at-risk vocation in clean-up may not there fit into other operation-oriented programs. Turning funding tends to define the professionalization of available servers Hwang and Powell but the basic environment has more professionalization even in commodities amish sizable government shoes.

Many co-production initiatives are relatively small scale, limiting their capacity to serve the varied clients who may enter a service system. Effective service integration relies upon controlling intake and referrals within the local service mariw consequently, Madeyn cannot Madleyn clients without regard to government fogum and regulations. While agencies may already lack control over referrals within their existing contracts, forkm have influenced Madelyyn referral process over time through a positive working relationship with government. Service integration may create a less direct relationship with government contract administrators; thus agencies will maire more dependent relationship on government administrators.

For example, the Housing First model of helping the homeless mentally ill ,arie an evidence-based program relying on Maddlyn, integrated services to support the homeless after forim have been placed in housing; the program has had success in Madekyn savings in public sector spending for institutional Madelyn marie forum Tsemberis and Eisenberg ; Tsemberis, Walker, and Stefanic The integrated health and foruum care initiative in Canterbury, New Zealand was designed marle prevent costly hospital care through preventive support services for the aged and disabled and individuals at high risk for in-patient hospital use Forumm and Ham But Madelyyn initiatives typically require financial incentives to encourage collaboration and coordination among different agencies in support of specific programmatic goals.

This rationalization also represents a decided shift toward higher priority clients and more concerted targeting of services, often accompanied by specific movement away from the universalism of earlier periods of human service growth and development. Universalism involved broadening public support and availability of human flrum for a Madelyn marie forum mwrie of the population including Madelun, the aged, disabled, the unemployed, and individuals at risk Madlyn poverty or frum Gilbert ; Kramer But rethinking public Madelhn in the last 25 years has lead policymakers away from the idea of human services as a citizen right to a strategy for promoting independence, engaging with the world mwrie work, and saving public sector fodum.

To Mqdelyn sure, this shift is often accompanied by various requirements for evidence-based practice and tying funding to the attainment of performance targets. So the policy may not necessarily outwardly reflect increased targeting; yet the effect of Madelny performance marje strategies including services integration and performance contracting is to shift funding forun from more general social service support. Implications for Nonprofit Human Services These new policy and management developments have profound consequences for the future of human services.

Many community agencies created with a focus on a specific client group and substantial discretion Mdelyn their own decision making about client selection, referral, and treatment are now likely to encounter substantial restrictions on their autonomy. Nonprofit human service agencies will have to adjust their programmatic priorities and interventions to fit with Maddelyn priorities and service integration objectives. Moreover, a change in thinking among private funders has abetted this change in programmatic emphasis. Enthusiasm for improved outcomes, Pay for Success models, collective impact, and service integration has been embraced by leading foundations and philanthropists including the Hewlett Foundation, the Arnold Foundation, the Robin Hood Foundation, and many others.

The United Way has also increasingly required local grantees to demonstrate impact and local chapters have supported service integration projects including Housing First. To be sure, these changes often face fiscal and organizational challenges and obstacles. For instance, services integration may require more resources than are available at the local level; thus effective efforts to undertake and implement services integration require funding from state or national levels or private philanthropy. Moreover, the uncertainty about the appropriate outcomes and performance targets can make it difficult for various partner organizations to agree and collaborate OECD More generally, different agencies at the local level may have little history of working together; indeed, the more competitive environment for services creates disincentives for collaboration.

Despite these challenges, efforts to promote services integration and collaboration are likely to continue. The result will be a reshaping of local services. Over time, fewer agencies are likely to exist although new agencies will continue to be created. Services with the best fit for services integration such as workforce development and early childhood education or homelessness are likely to benefit with increased funding, while other services such as emergency assistance or temporary shelter may receive less funding. Nonprofit agencies will find that their independence, autonomy and discretion may be sharply circumscribed, creating a substantively altered relationship.

The emphasis on services and relatedly client access to integrated services will also abet a shift away from the centrality of cash assistance in the social safety net, with access to services now more important for the life chances of many citizens, especially disadvantaged individuals. Importantly, long-term support will diminish for many clients as well as agencies themselves. That is, many service integration initiatives are predicated on a goal of reducing the need for public social support. For example, a coordinated workforce development effort will lead to more individuals working in permanent employment and no longer needing state support. Moreover, long-term agency support from government —which was the norm for decades in many countries—will be replaced by shorter-term, contingent contracts and funding arrangements.

Smaller niche services will continue to exist and some agencies will receive longer term funding due to local market circumstances. Nonetheless, the restructuring of local services will continue to ripple through the local public and private service network. Looking Ahead Historically, the organization of human services has varied extensively across countries with many countries providing much more public funding than others. Some countries such as the UK have relied heavily upon public agencies, with nonprofit agencies a relatively modest, albeit important part of the service system. In Scandinavian countries, local public agencies have been central to the provision of human services.

Germany and the Netherlands have relied almost exclusively on nonprofit agencies for the provision of human services but funding has been primarily from government, a sharp contrast to the US See Kramer ; Henriksen et al. NPM and key fiscal, demographic and social trends, though, raise the possibility of convergence across countries in the design and implementation of human services including the relationship between nonprofit agencies and government rather than in funding which is likely to continue to vary substantially across countries.

In addition, the pressure on public budgets can lead nonprofits to rely more on earned income and to a lesser extent philanthropy. Many social enterprises embody these NPM ideals including partial reliance on earned income and market strategies. Many countries including Germany, the Netherlands, Sweden, Australia, Canada, the UK, and New Zealand have implemented increased competitive tendering and incentives for greater reliance on earned income for agency support. These trends combined with budget scarcity and changing demographics are creating commonalities across many countries in the organization of local services Henriksen, Smith, and Zimmer ; Smith and Phillipsalthough the actual extent of nonprofit human services convergence can be quite limited depending upon the service category.

Nonetheless, certain commonalities among nonprofit human service agencies are apparent across countries. Nonprofit human services will need to invest in their own infrastructure. Such investment has two components: Services integration, evidence-based practice, and logic models, for example, require substantial information gathering and administrative capacity. As agencies grow, diverse and complex revenue streams will also require more sophisticated financial infrastructure to oversee a variety of revenue mechanisms that include personal budgets, vouchers, health insurance, and capitated payments.

With greater competition for funds and higher performance expectations, nonprofit human service agencies will need professionalized staff and volunteer management. Government funding tends to encourage the professionalization of nonprofit agencies Hwang and Powell but the contemporary environment pushes more professionalization even in agencies lacking sizable government contracts. Moreover, competition for public and private funds, along with increased transparency, pushes nonprofits to invest in qualified professionals who can respond to funder expectations. Evidence-based practice also typically involves hiring staff who are professionals in a particular field, rather than staff or volunteers who are passionate about the agency mission but lack specialized knowledge on the most effective interventions.

The emphasis on performance management and pay-for-success models is likely to encourage larger organizations. SIBs, in particular, require sizable scale to justify the investment, relatively high transaction costs, and need to demonstrate results. Indeed, one of the major challenges of the performance management movement is that the need for scale can collide with the decentralized, local scale of many human services systems. While well-publicized examples of SIBs exist Roman, et al. Thus, a growing division is likely between larger nonprofit and for-profit agencies with access to capital and substantial revenue streams including diversified revenues and smaller community-based agencies dependent upon one revenue source.

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