There are very few merger resources that speak directly to the needs of small community-based organizations and nongovernmental groups. Through hands on work
with mission-driven clients Potomac Group has developed a merger model and checklist. Offered below is an article that will help readers understand and prepare for the mechanics of a merger.
Some of the common myths or misconceptions talked about in the article include:
- Overestimating cost savings. So many groups already have administrative infrastructures that are below their needs. A merger actually increases costs.
- Merging two struggling or vulnerable organizations with an unexamined belief it will result in one stronger organization.
- Thinking the hard work is all done prior to the merger and “letting it ride” after the legal merger. There is a lot to be done pre-merger to be sure. The post-merger work, if not properly attended to, can drastically reduce the effectiveness of the organization and in some cases topple it.
- Using a merger to avoid answering the question, “should we close?”
Potomac Group is intending on releasing a series of articles over time that touch on the hidden or less covered aspects of mergers. These include: preparing change leaders, group dynamics, managing emotions, and the process of letting go. Rather than being at the margins, these issues are at the heart of a successful merger process. Until then, enjoy this article and please do comment with your own experience and thoughts on the issue…
First, groups considering a merger are often looking to reap savings from combining administrative overhead (office space, bookkeeping, training, copier service, tech support, contract / consulting support, etc.). Although this is a benefit that most groups seek, small community-based groups run a particular risk of putting themselves in harm’s way by overestimating potential savings. That’s because small groups engaged in service, advocacy and organizing efforts typically operate with limited budgets to address unlimited needs, and routinely under resource their infrastructure…Click here for Full Article
