Affiliation Basics, the Public Health Management Corporation Story…

Abstract

Few nonprofits merge or affiliate with other nonprofits. This is in stark contrast to the private sector, where often part of business growth and development is mergers and acquisitions. When nonprofit leaders are asked in annual surveys from The Nonprofit Finance Fund and others, in spite of their financial situations, only a fraction (2–3%) of leaders respond that they are in discussions with other organizations about mergers and affiliations. For every one successful nonprofit affiliation and merger, there are hundreds that did not happen but should have. Why is this? And more important, what will it take for nonprofits to begin to work together more strategically to consolidate operations and focus on their missions?

The purpose of this article is to shed light on one organization’s affiliation model and its lessons learned as a pioneer in the nascent nonprofit affiliation and merger marketplace. Since 1989, Public Health Management Corporation (PHMC) has strategically used its infrastructure and size to partner with mission-aligned nonprofit colleagues through its affiliation model. The focus on these affiliations has been to drive down costs and enable the affiliate organizations to better focus their operational costs to better compete.