Skylark
Charity Support Network
Graham Whitney
Skylark
Charity Support Network
Providing pro bono support to
small/medium size charities
wishing to merge or collaborate
Perspective on Mergers
in the Charity Sector
www.skylarknetwork.org.uk
Notes
• Skylark been running 15 years
• Senior Management Consulting
Professionals plus 15 Associates
• Provides:
• Process method for
mergers
• Challenge
• Independence
• Project Management
• Support for Senior
Leadership
• Why have mergers got such a
bad name in the 3rd Sector?
• Loss of independence
control?
• Failure?
• Merger can be an important
strategic option
Further information:
graham@skylarknetwork.org.uk
Skylark
Charity Support Network
Mergers….what are the drivers?
Notes
•
Other
Suppliers/ New
Entrants
•
•
Reducing costs is a
catalyst but is insufficient
to justify a merger
Changing needs of
beneficiaries &
requirement from funders
are real drivers
Clear articulation of “Size
of the prize” is critical
Funders
Beneficiaries
Buyers of
Services
A positive strategic option
Skylark
Charity Support Network
Mergers….at the right life stage of development
Notes
•
After a growth period, charities
typically go through a transition
•
Merger can be an option to lift the
charity to the next stage of growth
•
Where are you ? Where is your
partner?
•
“Two drunks don’t make a good
team”
•
170,000 charities is not wrong but
consolidation is needed in
fragmented sectors to allow space
for start ups to bring new ideas &
energy
The “S “ Curve
Skylark
Charity Support Network
Mergers…made by people thinking outside the box
Trustees
CEO
Trustees
CEO
Notes
• Trustees have a responsibility for their
beneficiaries not just their charity
• Scanning externally and identifying
possible merger candidates is a new
role for Trustees
• Putting their beneficairies before their
own position is the hallmark of a true
leader
Beneficiaries
Skylark
Charity Support Network
Mergers….breaking it down
into steps
Notes
• How to do a merger is intimidating
but can be achieved by using a
clear process
• Using good professional advice
• Having independent support
The Skylark Merger Framework
A four stage approach to mergers within the charity sector
Stage
II
I
Merger Strategy
Guided by the
Business Strategy
determine a shortlist of target merger
candidates.
Integration
Planning
Feasibility
Exploring the potential
benefits and risks of
merging. What
opportunity would the
merger deliver both
parties? Are the
charities’ cultures
compatible?
Joint
END OF
agreement
STAGE
to pursue
MILESTONES
IV
III
Detailed Integration
planning: How will the
charities come
together? How will
the transition be
handled? Formal due
diligence.
Agreement in
principle of
‘How’ they will
come together
Integration/
Execution
Implement the agreed
plan, review and
measure associated
short and long term
benefits. Transition
NewCo to be fully up
and running as
‘business-as-usual’.
GO/ NO-GO
joint
decision
NewCo fully
up and
running