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VCF economy of scale "mantra"?

University study challenges the "mantra" that mergers and partnerships are always the best way forward for the sector

With government policy calling for charities to merge -  and Liverpool City continuing to set out a vision of mergers in social care as a way to survive the funding crisis - new academic research has challenged some of this thinking, and the assumptions that are driving the push for partnership working and bigger voluntary sector organisations.

The report says that "service commissioning and partnerships have been driven by a fixation with economies of scale", but thinks that, for local public services, personal relationships are often more important than systems

The study looked at partnerships in Third Sector organisations delivering services in Northern Ireland and concludes that benefits were sometimes limited and hard to generalise.They think that partnership should be weighed up on a case by case basis, rather than by general notions of ‘efficiency’and ‘economies of scale’.

The researchers think that there's a missing bit, that they call ‘economies of scope’. Things like customer empathy and team working are important in delivering what people want and needed, but were ofen not taken into account in commissioning.

They also found that

  • the voices of service users were not heard in commissioning - but their viewpoint could help identify the best way to do things
  • mandated partnerships and enforced competition were far less successful than voluntary partnerships - which arise out of the level of trust which is hard to impose from the outside

James Rees, David Mullins and Tony Bovaird, Partnership working, Third Sector Research Centre Research Report no 88, October 2012

More information:

Naomi Landau, Knowledge Exchange Team - Third Sector Research Centre
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