Two New York Charities Share a Leader — and a Host of Administrative Tasks — to Strengthen Both Groups

BRAINSTORMS

By Sharnell Bryan

The Door was creaky.

Five years ago, the New York youth-services organization, was suffering from a budget deficit of more than $700,000 and was operating in neglected building marred by peeling paint and torn carpeting. The organization, which was created in 1972had grown sluggish about pursuing new financing sources and had more staff members than it needed or could afford.

Michael Zisser, then a member of the group’s board, wanted to help. To develop a plan, he sought help from board of the charity he ran, University Settlement, a 119-year-old social-services group that assists recent immigrants and other low-income New Yorkers. University Settlement was interested in learning more about the innovative approached adopted by the Door to help young people. And University Settlement was already giving the organization some managerial advice under an arrangement it formed with the Door a year earlier.

Before long, the groups merged their administrative operations — and Mr. Zisser was appointed to oversee the management of both organizations.

The partnership is unusual because University Settlement is a multiservice organization, while the Door is more narrowly focused, says Nancy Wackstein, executive director of United Neighborhood Houses of New York, a federation of local settlement houses and community centers that supports University Settlement with guidance and other resources. Usually, when one charity takes over management of another, the two groups have identical missions. “It wasn’t necessarily a natural affiliation.”

In the five years since Mr. Zisser took over, the Door’s budget has grown by 60 percent, to an annual total of $8-million, while University Settlement’s budget has grown 40 percent, to $14-million. The savings both charities have achieved by sharing administrative tasks total, after about a year of streamlining, about $500,000 collectively each year, says Mr. Zisser.

Since the new approach to sharing management operations went into effect, the Door’s building has been renovated, the organization is more efficiently staffed, and fund-raising efforts — now shared with University Settlement — have been re-energized, Mr. Zisser says. The charity is also serving more clients: Last year, according to its latest annual report, the group served at least 7,000 people, more than 3,000 of them new in 2004.

“It’s been a great deal of work and running back and forth,” Mr. Zisser says. “In the first few years it took seven days a week to get this done. Fortunately we have an excellent staff at University Settlement and the Door, so that responsibilities are shared among a staff that works well together.”

Charles Hamilton, executive director of the Clark Foundation, in New York, says the partial merger has been successful. The foundation, which supports education and job-training programs, has been a longtime benefactor of the Door, though it did stop awarding grants to the charity for a time because it thought the quality of the programs had suffered during the Door’s hardships, says Mr. Hamilton. It resumed support in 2003, he says, after seeing improvements. That same year, the Clark Foundation, along with another New York grant maker and Door supporter, the Tiger Foundation, worked with the Door to begin Career Pathways, which focuses on job training and work-skills development for young adults who dropped out of high school or graduated.

“We were impressed by the leadership,” Mr. Hamilton says. “The quality and the sustainability of the programs were my concerns. The turnaround has been very successful.”

Tough Decisions

The Door’s problems began long before the transition took place. In 1990, the organization bought its building, but interest and other housing-related charges began gobbling up more of the budget as time passed, says Bob Howitt, who was interim executive director at the Door from 1992 to 1994, and later served as the group’s board chairman during the transition in 2000. Mr. Howitt also once headed University Settlement.

“They didn’t understand the total ramifications of it, particularly when adversity struck,” he says.

In the 1990s, Mr. Howitt says, the Door saw a lot of turnover in the executive-director job, which exacerbated its problems. The board of directors, says Mr. Howitt, began to cast about for ideas to save the organization. “There was not a long range of alternatives, because at some point you get tired of fighting the same battle, and you wanted to think more innovatively,” he says.

Mr. Zisser, a former professor of city and regional planning at the Pratt Institute who has led University Settlement since 1988, took the helm of the Door in June 2000, after a monthlong discussion with the two groups’ boards. After the two boards voted to give him the dual job, the Door’s co-directors left the organization, and Mr. Zisser began cleaning house.

At first, the new leader — and the changes he sought — faced resistance from the Door’s staff members, he recalls. “The morale among the staff was low in the beginning because of the condition of the agency at that time, and because they were not sure what would happen once University Settlement got involved,” he says.

Jackie Lee, the Door’s director of programming and a member of the staff for 10 years, echoes her boss’s memory of the transition time. Although the charity’s trustees were familiar with University Settlement and its leader, many of the Door’s employees were not, she says.

“It was difficult because all of a sudden there was this agency coming in that no one had heard of,” she says. “It wasn’t communicated well by the administration at the Door, so there were a lot of people who were upset because they didn’t know what was happening. It’s essential that there’s a lot of communication between the staff and administration so that people know what’s happening and what’s going to become of the agency that they’re a part of.”

Mr. Zisser’s leadership methods were unfamiliar to many veteran Door employees, says Jim Kagen, a University Settlement board member who also became a Door trustee after the transition and now serves as vice president for programs for both groups. “People had worked there for years and didn’t know him and weren’t used to aggressive, involved management,” Mr. Kagen says. “They just weren’t used to management spending a lot of time interacting about programs and helping raise money.”

From the time he took over, Mr. Zisser says, it took a full two years to see morale increase and for the staff to feel comfortable with the changes. But getting there, he says, involved sacrifices: Since he assumed leadership, the Door’s staff of 120 has turned over about 40 percent, with a total of 50 staff members leaving the organization during the course of the transition. “In order to make everything work, there were times where people had to be asked to leave,” Mr. Zisser says. “Sometimes they were fine as employees, but we just couldn’t support everyone.”

But no programs had to be cut, he adds, and since the organization is larger now than it was five years ago, all of the positions have been refilled. New fund raisers were hired, and the search for more financing has expanded.

“You have to be willing to make the tough decisions in order to ensure the survival of certain programs,” he says. “I do have to make choices sometimes with limited resources.” At University Settlement, the adjustments required for the consolidation effort to work were less drastic, says Mr. Kagen. Although Mr. Zisser was often absent, preoccupied with matters at the Door, his absence created opportunities for University Settlement’s senior managers and staff members to exert more autonomy.

“In some sense, we’re almost grateful that this challenge for management came along,” Mr. Kagen says. “It gave everybody at the Settlement a change to take a step up and have a greater impact on the community. Management got more responsibility and got to deal with more interesting stuff at a higher level, and the same is true for Michael.”

Cultural Differences

From the start, says Mr. Zisser, he tried to remain sensitive to the two groups’ disparate office cultures and preferred means of carrying out programs.

“We paid very close attention to the issues,” he says. “Right from the beginning we made the decision that we’re not going to change those cultures, that there was some positivity about those things. We wanted to preserve those things and their integrity.”

For instance, he says, at the Door, almost all of the managers like to be fully engaged with the children instead of just doing administrative work, whereas senior-level University Settlement staff members focus more on their performance as managers. The Door’s single location features open space, making it easier for children to move from one program to another. However, at University Settlement, which has several sites, the programs are more likely to be segregated in different buildings and on different floors.

In deciding how to share the two groups’ administrative functions, Mr. Zisser says, he examined the two budgets and carefully considered the best ways to allocate the funds, sometimes transferring money from one group to another to pay for shared services. Ultimately, in addition to a shared leader, the two groups combined their fund-raising, human resources, and information-technology departments.

The merging of these functions, he says, has freed both organizations to focus on enhancing and growing their programs, such as looking at adding more programs for teenagers. (Among those programs under consideration is one focusing on pregnancy prevention.) It has also prompted the two groups to take a hard look at what each does best, says Mr. Zisser, who notes that some of the two charities’ programs overlapped in their missions. The two groups began to consider which of them would be the stronger or more appropriate one to pursue particular grants.

The Door’s former management woes made it difficult for the organization to grow and attract financing, he says. But the fresh start — and shared fund raisers — have made it easier to raise money. During the fiscal year that ended in 2004, the Door raised $1.4-million in foundation grants and other donations from private sources as part of its total budget of $7.8-million, up from the previous fiscal year’s $800,000 in money from private sources. (The rest of the charity’s revenue, says Mr. Zisser, comes from government contracts and rental income from space The Door donates to other nonprofit groups.) In addition, says Mr. Zisser, The Door is also aggressively seeking government grants, and plans to start a campaign to solicit big gifts in the new fiscal year.

Continuing Challenges

Throughout the five-year effort to pool the resources of the two charities, Mr. Zisser says, some concerns have persisted. For example, he says, both groups are still working on making sure the two staffs communicate smoothly and are considering all the program opportunities that are available to them, and both strive to market their work more effectively.

“The nonprofit world is increasingly more competitive and requires more agencies to be more creative,” he says. “That’s more possible these days if you combine the strengths of the organizations. The Door and University Settlement together are much more capable of responding to challenges in the community that we could not have responded to a few years ago.”

Since Mr. Zisser began leading the two groups, he says, he has fielded inquiries from at least 20 other nonprofit organizations that are interested in how the Door and University Settlement were able to combine their administrative functions, but he refused to disclose those groups’ names. Ms. Wackstein says that currently two of United Neighborhood Houses’ member organizations are working with Mr. Zisser on ways to create an affiliated relationship, but she, too, declined to disclose those groups’ names.

Mr. Zisser advises those who wish to follow his charities’ example of a partial merger to proceed with caution. “Don’t do it unless you enjoy this type of organizational challenge,” he says. “Make sure you have trusted, solid people working with you, because there’s too many things that have to be done and too much expertise that is required for one person to provide. It’s a big help if you have a board of directors that can provide expertise and support beyond what organizations are usually capable of. No executive director can survive this by his or herself.”

The boards and staff members at both organizations played a major role in the restructuring process, Mr. Zisser says, helping with the Door’s fund-raising efforts as well as providing free expertise and services in the architectural, financial, human-resources, legal-work, and program-support areas of the transition. However, the Door’s 20-member board also saw an exceptional amount of turnover: All but two members are new since the transition.

A continuing challenge, Mr. Zisser says, is an effort begun two years ago to combine programs. “You have to take your time when you’re talking about programs,” he says. “It will go as fast or as slow as it needs to go in order to do it right.”

Already, though, some crossover efforts are under way. For instance, University Settlement has helped provide child-care services for participants of the Door’s Career Pathways program. The Door has also received a city contract to provide supplemental educational services to high-school students at an after-school program run by University Settlement. A residential sleep-away camp, sponsored by University Settlement, allows teenage participants from the Door’s youth-leadership program to work during the day as camp counselors and attend youth-leadership activities by the Door in the evenings.

“The goal is to break down the difference for someone participating,” Mr. Zisser says. “They wouldn’t know that it’s University Settlement and the Door. They see it as one big operation.”

Despite this goal, however, Mr. Zisser says he does not expect the two charities to ever merge all their operations. The current plan is to make sure each group maintains its independence, even as they pool some resources.

“They have very different histories and different cultures and different strengths, and we don’t want anything to disrupt that,” he says. “But we will do whatever possible to take advantage of the special relationship. I do not envision that the Door or University Settlement will ever disappear, but we hope it remains a good marriage for a long time.”