The nonprofit sector and its philanthropic supporters still too often overlook the most effective pathway to exponential impact.

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By Rakesh Rajani & Tim Hanstad

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On a whim, an NGO leader walks into a fortune teller's booth. "My NGO has developed a proven intervention that is improving the lives of 10,000 people. We expect increased philanthropic funding over the next year. Please tell me how our impact will grow over time."

Gazing intently into her crystal ball, the fortune teller replies, "You appear to be at a crossroad. The first path has your NGO expanding your direct services. By growing your staff, opening new offices, and strengthening your fundraising, your organization could reach 50,000 people in five years and double that in 10 years. That is 0.1 percent of the 50 million people who could benefit from your work."

"The second path is messier," continues the fortune teller. "It involves what Co-Impact calls system change and Kevin Starr has dubbed the 'Big Shift' in a recent SSIR article on so-called 'big bet philanthropy.' This path involves engaging the government on their priorities and working with them to adapt your intervention. In this path, you must take a low-ego, low-logo approach and let the government both lead and shine. Because your efforts involve influencing and supporting the government, my crystal ball cannot guarantee your efforts will be successful. But, if they are, you have the potential to help the government reach 3 million people in five years and 18 million people in 10 years."

The NGO leader's face lights up. "That's an easy decision," she says, "I want to maximize impact. Of course, I will take the second path."

"I am not so sure," replies the fortune teller. "Nearly all of your peers have chosen the first path. And philanthropists appear more comfortable supporting that path."

You don't need a crystal ball to see the inconvenient truth behind our homespun fable: the NGO sector and its philanthropic supporters often overlook the most effective pathway to scale solutions to our planet's biggest challenges—partnering with government.

As Starr highlights, too many recipients of increased philanthropy are missing the opportunity to make the “big shift” toward exponential impact through partnering with government. Truth be told, as our fortune teller observed, this shortcoming is not unique to recipients of big bet grants. It afflicts NGOs of all sizes and budgets, and will require changes from both NGO leaders as well as funders.

That so many NGO leaders stick with a direct services model (including after receiving a big bet—future funding cliffs be damned), points to the challenges of making the big shift to government engagement and support. It is easier said than done. However, our collective learning as both NGO leaders and funders convinces us it is both possible and the best path to exponential impact. And, while receiving big bet funding can make it easier, it is not necessary to make the big shift.

Successful big shifts will require: 1) a clear-eyed recognition of why NGO-government collaboration is hard; 2) changes in NGO mindsets and muscles; and 3) shifts in the typical funding paradigm. Building on ongoing discourse, this article addresses all three.

Why NGO-Government Collaboration Is Hard

Why do savvy, strategic NGO leaders struggle to work with governments? Recent research by JustSystems highlights several critical gaps to effective collaboration, including:

• Negative conceptions of government run deep in the public psyche across the political spectrum. Poorly functioning bureaucracies, rising authoritarianism, and corruption are real problems, but government is no monolith and includes many leaders and departments striving to work better for people.
• Many civil society organizations and philanthropists do not understand the constraints, incentives and motivations within government systems. They approach public sector leaders with ready-made conclusions and solutions, and exercise little of the curiosity or empathy that would lead to better collaboration. As the leaders of EdelGive Foundation and Dasra noted in another recent SSIR article, "attracting and maintaining productive relationships with government agencies is rarely simple or straightforward."
• Political considerations are the biggest driver of systems change, but many within the NGO sector are trained to steer clear of politics. This makes it harder to see how windows of opportunity, such as a crisis or elections or leaders' desire for legacy, can be powerful moments for building new momentum for change.
• The mixed track records of government on gender equality, human rights, civil liberties, and/or the environment are often troubling, and some activists prefer to exert pressure from the outside rather than associate themselves with an imperfect partner. The risk of an outside-only approach is that it can be ignored or can limit the opportunity to build high-trust, constructive relationships with public leaders willing to make reforms.
• Most NGO funders and many NGO leaders are more comfortable supporting direct services, alleviating symptoms of suboptimal public systems, than the long-term work of addressing root causes of dysfunction or strengthening government capability. Moreover, NGO leaders and philanthropists often think shorter term than what is required to collaborate with government and to achieve durable impact at scale, as noted by leaders from Educate Girls and Last Mile Health.

How NGOs Can Develop the Mindset and Muscles for the Big Shift

To successfully navigate the Big Shift, NGOs need to go beyond minor adjustments. “Add government systems and carry on” will not work. Instead, it will take a different set of mindsets and muscles. We suggest the following five as among the most important:

Place Public Systems and Government at the Center:

Centering the government starts by realizing that a better question than "What can my NGO deliver more or better?" or "How can we scale up our work?" is "How does the public system need to change to work better for people, and what and who will it take to make that happen?" This mindset shifts from centering your organization to the system that needs to change. Doing so reorients how you engage with government.

Start with their agenda rather than yours. Seek more to understand than to be understood. Focus on learning what makes government work, what motivates government officials, what are the challenges from the government's perspective, and how government institutions change.

Compelling examples of this approach include Harambee's big shift from directly training young people for employment to facilitating a national platform that brings in government units and hundreds of NGO partners. Another is the SaveLife Foundation's partnership with government to reduce fatalities on India’s 100 most dangerous highways.

Co-create With Government:

Nobody likes to be told to line up behind someone else's idea. The big shift will not work if it becomes primarily about persuading a government to adopt, fund, and/or implement an intervention created by the NGO.

Evidence pulled together by Alix Bonargent from the International Growth Centre shows that co-designing a program with government from the beginning makes it more likely to succeed. Co-designing brings diverse perspectives to bear, allows for a keener appreciation of the problem and its roots, and builds trust.

That is why governments need to be approached not only as doers at scale but also thinkers at scale. Mariana Mazzucato, Yuen Yuen Ang, and others have demonstrated that government is capable of thinking and innovation. Nonprofit leaders need to be open to hearing their ideas and solutions.

Examples of co-creation include Samagra's work with political and public leaders in India to diagnose and address problems that undermine quality of life. Likewise, IREX works in partnership with Jordan's government and other stakeholders to improve public teacher education programs and to improve learning outcomes for early grade students.

Build Support and Trust, Including Frontline Workers:

Government is made up of people, many of whom are capable and seek to do well. The core question, as Gautam John put it, is not "how we scale solutions," but "how we scale the trust and conditions that make solutions possible." This is true even in big systems, research by JustSystems finds; trusted relationships and how people show up often make the key difference in whether a program will work at scale.

Indeed, Dan Honig's deep research demonstrates that empowering public servants through autonomy and trust, rather than imposing strict controls and oversight, is what leads to enhanced government performance and improved public welfare.

This includes enabling those at the frontlines, particularly women and other historically excluded groups, to exercise greater influence of change within the public system.

Last Mile Health's work supporting community health workers as they advocate for salaries and the support they need to improve health outcomes across Africa illustrates this approach, as does the Center for Effective Governance of Indian States' (CEGIS) partnership with state governments to design and implement effective governance reforms.

Build a Broad Coalition:

Deep systemic changes cannot be made by any one actor alone, however powerful. It takes a winning coalition of affected and influential actors to build sufficient support and sustain change.

Building an effective coalition requires a keen appreciation of how power is distributed in government, but also across society and key institutions. Elites matter – a lot – because things move when elites recognize that their long-term interests will be better met by coming together to advance social progress through a shared “development bargain.”

Successful examples of this approach include Ilifa Labantwana and the coalition for early childhood development in South Africa as well as Open Government Partnership’s broad multi-stakeholder coalitions across 77 countries.

Be Sensitive to Political Considerations:

As we said before, political considerations are the biggest driver of systems change, and there are particular windows of opportunity, such as a crisis, an election, or a leaders' desire for legacy, when the possibilities for change are most open.

Landesa, for example, has made much progress leveraging such political windows of opportunity, including reform windows in China in the 1980s and '90s, in several former Soviet republics in the 1990s and 2000s, and in Myanmar in the 2010s. The Chandler Institute of Governance, which works to strengthen civil service and improve government effectiveness, has done the same, forging partnerships with newly elected leaders in Malawi and Zambia to support good governance reforms.

To be clear, we are not saying that all NGOs need to or will be ready to make the big shift—to take on a systems change approach and work directly with government. In some situations, direct service delivery is necessary and timely. A healthy society also needs independent groups whose job is to research, amplify voices, or serve as a government watchdog. However, for organizations that seek to have durable impact at the scale of the need, the most effective way to do so is to work with government to make systems work better for people, and these five mindsets and muscles are among the most critical to success.

How Philanthropic Partners Can Better Support Impact at Scale

The primary responsibility for NGOs seeking to make the big shift rests on their own leadership and boards. But funders have an outsized influence, and most could do a much better job to create the conditions that are vital for organizations interested in partnering with governments to achieve durable systems change. Here are five actions that funders can take:

Understand the Why and How of the Big Shift:

We encourage funders to start with this core insight: that the well-being of people and planet is largely determined by how government systems are organized and operate.

After all, governments make the rules that determine what is possible in every sphere and sector; governments alone have the mandate to work for all people; and government delivery systems are typically larger than anything any NGO has built. What's more, government resources dwarf philanthropy's by an order of magnitude. (For example, annual government spending in India is more than 50x annual private giving; in South Africa it is more than 100x.) Understand that supporting an NGO to establish a health clinic in an underserved area is good, but supporting an NGO to help government extend its health services to an underserved area is even better.

We are not blind to the fact that governments can be and often are ineffective. Their activities can fail to translate into meaningful outcomes; resources can be spent in ways that are inefficient and wasteful; and people’s experience of government services and democratic processes can be frustrating, unpredictable, and downright disrespectful. This is precisely why NGOs and philanthropy should get involved to co-create innovations and improvements that work at scale.

Listen to and Learn From Government:

It will be challenging to support efforts to achieve population scale impact unless you understand the government's agenda, as well as their strengths and weaknesses in delivering on that agenda.

Engage with public sector leaders to understand their priorities and how you might support those you share. Invite public sector leaders to join funder-supported convenings, strategy design sessions, and board meetings.

Seek out and learn from facilitators experienced in building values-based partnerships between government and civil society leaders, such as Taaka Awori, Aidan Eyakuze, Adam Kahane, Mavis Owusu-Gyamfi, and Sanjay Purohit.

Reimagine Accountability as Relational Rather Than Adversarial:

Accountability matters. But how does one build accountability in practice?

Adversarial accountability—naming and shaming—can often inspire defensiveness. Instead, we posit that a relational capability approach may be better at getting things done. This involves saying to government, "we know the constraints are real, and the work is hard and long-term, but we are in this together and will support you and be co-responsible for achieving results." In this conception, as Varja Lipovsek has argued, trust is not antithetical to results, but rather enabling of the honesty and adaptation that is crucial to achieving results.

Do Not Privilege Attribution Over Impact:

It usually takes the alignment of technical, political, and resourcing factors to achieve large-scale change. Demanding NGOs account for the effect of a specific contribution or isolate their direct impact is unrealistic. Such expectations can preclude the very collaboration with governments and other actors that is crucial to achieving lasting change at scale.

Be Flexible and Use a Realistic Timeframe:

A project to deliver a service to 10,000 people can be done in a few years. An effort to transform a public system to benefit 18 million people is considerably more complex and thus will take longer and require more flexibility.

Short-term and inflexible grants incentivize partners to lower their ambition and prioritize deliverable outputs over more meaningful outcomes.

As an organization undertakes the big shift to both transform its own organization (acquiring new skills, developing new positions and tactics) and engage government, the single most important action a funder can take is to provide a long-term commitment of 5-10 or more years of flexible funding, with regular check-ins and honest conversations on progress and adaptations.

Funders may not be able to change all their funding in this direction towards supporting systems change, but they can consider taking a portfolio approach to shift 25-33% of their funding in this manner and continue learning.

Conclusion

We have no crystal ball. But our experience makes us certain of this: when NGO leaders and their funders stick with a direct services model and follow a growth strategy of scaling up their own work and organization—requiring ever greater increases in funding—they condemn themselves to a future on the perpetual fundraising hamster wheel, and of reaching only a small fraction of the need.

The upshot is clear: though significant and needed, NGO direct-service delivery and the funding that supports it can never alone address the scale of the challenges we face. The challenge is even more acute with drastic reductions in overseas aid. By overlooking the power of Global South governments, NGO leaders and their philanthropic funders are leaving on the table billions in funding and more sustainable delivery mechanisms. Instead, if at least some of their resources and capability were turned to help government put its far greater resources, infrastructure, and rule-making power to achieve more effective and inclusive outcomes, the impact could be much greater.

‍This article was originally published in the Stanford Social Innovation Review (SSIR).

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