Frontiers of Entrepreneurship Research
1996 Edition
SUMMARIES

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TOWARD TRANSFORMING VOLUNTARY SOCIAL SERVICE AGENCIES IN ONTARIO


Mary K. Foster
Agnes G. Meinhard

Ryerson Polytechnic University
Toronto, Ontario M5B 2K3

Telephone: (416) 979-5000 ext. 6734/6739
Fax:(416) 979-5266

Principal Topics

Voluntary social service agencies in Ontario traditionally have operated with significant support from government funding programs. Consequently, developing marketing and entrepreneurial skills has never been a priority, since funding was more or less assured. Likewise, they did not seek out those skills when hiring staff for their organizations. The drastic reduction in government support has jeopardized the ability of these organizations to deliver current programs, and in some cases survive. In order to deal with the new reality, these organizations must develop effective plans including both cost cutting and revenue generating programs. Organizational flexibility is key and entrepreneurial skills will be necessary to recognize and seize opportunities. The purpose of this study is to gauge the predisposition of voluntary social service agencies in Ontario to adopt strategies which require marketing and entrepreneurial expertise to execute.

Method

The Executive Directors or Presidents of about 200 voluntary social service agencies, chosen randomly from the Metropolitan Toronto Community Directory, were contacted and asked to participate in this survey. One hundred and eighteen organizations agreed to complete the questionnaire which was mailed or faxed to them. By the field work deadline, 100 questionnaires had been returned. Data were analyzed using SumQuest, a software package especially designed for market survey analysis. The questionnaire investigated how these agencies are responding to the new budgetary reality, what consequences and challenges they anticipate as a result of the new budget, what skills are present within the organization to handle their current challenges and whether they would be willing to look outside their organization for assistance. In addition, information was gathered about the organization92s background (mandate, size and structure) and a set of questions was designed by the authors to determine the entrepreneurial characteristics of the organization.

Major Findings

As a consequence of the government92s movement out of social welfare, two-thirds of survey participants anticipate an increased demand for their type of support service to fill the vacuum. Not only do the voluntary social services have to absorb budget cuts, but also at the same time they will need to increase services to the general public. Preliminary analysis indicates that, according the scale used in the questionnaire, almost half of the participating organizations do not currently display the entrepreneurial characteristics that will be necessary to deal with the immediate challenges to the sector. In addition, they do not see the need to develop these skills in the future. Interestingly, in response to the budget cuts, agencies are giving more consideration to revenue-generating activities than to cost cutting initiatives; precisely, the area in which marketing and entrepreneurial skills will become paramount. One option for developing marketing and entrepreneurial expertise is to get outside consulting assistance. About 40 percent of participants would consider using an outside consultant. Of those, 25 percent would find a university consulting service most appealing, mostly because of its perceived cost effectiveness. A major resistance to dealing with a university is its perceived lack of experience with the voluntary sector.

Implications

Voluntary social service agencies recognize that they will have to change to meet these budgetary challenges and that revenue-generation is the preferred strategy. However, many of the organizations do not have the internal capacity to operate within the marketing and entrepreneurial focus required. For this reason, a real option is to seek outside expertise. If a university consulting service hopes to obtain contracts from the voluntary sector, it must first convince potential clients that it has experience with and expertise in the voluntary sector. Below competition pricing is an essential feature of this service92s appeal. They key topics that should be offered to the sector are marketing skills and fundraising strategies and tactics.

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