Real life tale of Earning and Organisational Development - Complementary Health Trust

From grants to a diverse contract funding base via significant organisational culture change

The story in brief
Origins
The need for change
Exploring the options for earning
Starting the change process
The value of supportive Trustees
The power of relationship building
Quality systems and outcomes
People drive change
What happens next?
Further information

The story in brief

In 2002 the London based Complementary Health Trust took steps to improve long-term sustainability by reassessing its priorities, focusing on its core mission, and taking the decision to concentrate on earning through contracts. Here, Hannah Kalmanowitz, Executive Director is honest about the challenges - but positive about the approach to earning and people-centred working that has sustained her organisation through significant change. 'It was painful. But it was a question of adapt and sustain - or we simply wouldn't have survived.'

Hannah Kalmanowitz, Executive Director talks about:

The importance of focusing on your organisation's core mission
Implementing effective cultural change
The value of supportive Trustees
The power of relationship building
Implementing quality systems in a medium sized organisation
Building on what you've got

Origins

The Complementary Health Trust (CHT) provides complementary therapy services under contract to hospices, NHS hospitals and other health centres. It exists to support people with severe health issues, to help them understand their condition better and to take greater control of their healthcare and lives through the use of complementary therapies. CHT employs one full time Director three part-time staff and around 60 volunteer practitioners. It aims to reach people who would not otherwise have access to treatment because of their health and/or economic circumstances.

CHT started life as the Immune Development Trust in 1991, with the aim of supporting people affected by life-threatening immune-related illnesses. The funding model was heavily dependent upon grants and other forms of voluntary income, as well as statutory-sector contracts. Yet, for all the Trust's demonstrable success, in order to survive long-term, its income base and set-up had to change. What followed was a substantial organisational review and period of transition during which the then Director also left, leaving Hannah, then Deputy Director, facing a steep learning curve-

CHT is now a very different and expanding organisation, and, after a very challenging period of change, is sustainable from its contract income alone.

This is the story of how this was done-

The need for change

Starting Out

CHT began as the Immune Development Trust in 1991, working out of a garden shed and offering free complimentary therapies to people diagnosed with HIV.

This was when public AIDS funding was at its peak. The early nineties also saw the move from grants to contracts between public funders and voluntary organisations. These two factors came together and created a very healthy funding climate for the Trust, and from 1991 to 1995 the organisation's income grew steadily.

The Trust's vision at that time was that services should be available to as many people as possible. The Trustees defined four patient groups that it particularly wanted to help - people with cancer, HIV, systemic lupus and multiple sclerosis (MS). They decided that no-one who had one of these conditions should be turned away because they were not funded by their local Health Authority - and so the Trust's funding model was that some clients were funded through contracts, and the deficit was made up through grant applications, events, and the usual mix of fund-raising activities. This worked for a while - but by 1998, it was becoming very difficult to sustain.

Liability or Asset?

By 1998, having come a long way from the garden shed, the heart of the organisation's work was a specialist care clinic in Islington, north London. An upward rent review, however, made an already insecure funding base increasingly insecure. Although 30% of treatments undertaken at the centre were paid for by local Health Authority contracts, the remaining 70% were subsidised by client donations and voluntary income. The Trust needed to reconsider its approach to funding.

Exploring the options for earning

Alternative earners

In 2001, the then Executive Director embarked on the year-long action learning programme run by the School for Social Entrepreneurs.

At the outset his idea was to exploit the Trust's existing credibility and intellectual property by building a private clinic alongside the main facility and develop this as a for-profit business whose surplus would underpin the organisation's main clinic and satellite services - a bolt-on 'cash-cow' to underwrite core mission.

But it soon became apparent that this route would generate insufficient funds.

The private clinic would face stiff competition from freelance practitioners operating from home or making home visits and well-established private clinics. The freelancers, with no building to service, enjoyed minimal overheads. Meanwhile, established private clinics achieve economies of scale and lower unit costs and enjoy greater marketing reach owing to the scale of their operation. In addition, city companies are developing corporate in-house treatments as a part of their employment packages and high street pharmacies such as Boots are extending their range of alternative and complementary medicines. The Trust's purported commercial venture could not realistically compete in an ever-more crowded market.

Back to the drawing board and client base

So the Trust went back to basics - it built a sustainable business plan by reappraising its organisational mission and reflecting hard on its core competencies and assets.

As his year at the SSE progressed the Trust's Director began to see that it was in its knowledge network and satellite services that the organisation's funding future lay, not in its central clinic-based approach. The organisation's competitive advantage (and therefore future viability) lay not in defining its work by patient groups, but by offering tailored services under contract to any patient group, under contracts with the NHS and a variety of hospices. This was the market niche - and the escape route from an increasingly uncertain financial future.

'We looked across the organisation. And, thanks, it should be said, to our service-evaluation work, we saw what we actually had.'

Starting the change process

Painful transitions

Following their re-evaluation the Trust relocated its head office premises and significantly downsized their central clinic, relocating it within Islington Council's HIV Unit - a process that involved considerable pain.

'The clinic was the organisation's fireside - people felt ownership for the clinic and through that for the organisation. It had huge and very legitimate emotional attachment. Our receptionists were all volunteers - it was a safe space - the family home. We had to completely turn around our thinking of what the core of the organisation was and that was really hard. But it was either that or cease operating.'

'In 2000 we ran at a deficit of almost £100,000 on a turnover of a quarter of a million - that had to be covered by philanthropic money - and in the long run it couldn't be.'

Having revisited their funding base, for 2003 the organisation projected a fundraising target of £10,000 to top up contract income of £280,000 - and that was sustainable.

The Trust's mission was the same as ever - they remained passionate about making complementary medicines, as widely accessible as is possible - but they'd modified the machine that delivered that vision.

New name, new beginnings

As part of this process of reappraisal, the Trust also realised it needed to revisit the way it promoted itself, including its name. This would ensure CHT could extend its work into new areas where people were in need, whilst maintaining its existing contracts.

During the last 6 months of 2002 the charity realised that the name 'Immune Development Trust' had become too limiting - 'to expand our services, we needed a new name that would say who we are; plus people didn't always realise what we did and often thought we were a research organisation', explains Hannah.

'So we looked at different names and employed a marketing company to help with our thinking. All our stakeholders were involved and out of a selection of 6 possible new names one was chosen at a Trustee meeting. A key element was that we wanted to keep the 'Trust' part of the title because it's also about us being an organisation that people can -trust- in.'

So the Immune Development Trust became the Complementary Health Trust. 'We got a new logo and a website - but again modernising what we had rather than starting from scratch'.

This rebranding was enabled by a funding award from the Peter Moores Foundation.

Asked what the impact has been of the rebranding, Hannah suggests, 'it has definitely opened us out a lot to new areas- people phoning are now clearer about who we are and it's certainly clearer for NHS doctors and nurses. No one thinks we just do research anymore'.

So with a refocused organisation and a successful rebranding operation the future looked rosy for CHT - but that wasn't quite the end of the story-

The value of supportive trustees

Shortly after CHT's organisational review and rebranding the Executive Director who'd worked with Hannah to make all this happen decided to move on. Although a new Director was recruited, this appointment proved unsuccessful and suddenly CHT was left without a much-needed leader to drive the changes forward and ensure the organisation remained buoyant.

'Some other people also left at this time and those who were left felt insecure and so I had to work with staff to reassure and motivate them, to ensure we retained their commitment'.

Nevertheless, as acting Director, Hannah also needed support. Working as Deputy Director with previous the Director, Hannah says they'd had 'an excellent working relationship, 'He had the ideas and I was the practical one, but together we had many -eureka moments-'. But when it suddenly came to taking the reins herself, Hannah was less than certain that it was the right move for her. 'I was reluctant to take on the role of Director'.

This is where CHT's close relationship with its Trustees reaped dividends. 'I was honest with the Trustees about my weaknesses and training needs and they were really supportive'. Following discussion, Hannah agreed to continue acting up as Director in order to test the water. 'It was a steep learning curve, but it meant I could grow into the role and feel really confident about finally officially accepting the post'.

As it turned out, the supportiveness of the Trustee Board reaped benefits for CHT as well as for Hannah. As Hannah explains, 'I used this time as an opportunity to try new things and see if I could bring in new contracts'. As a result, Hannah developed new avenues for CHT's work and this is leading to substantial growth for the organisation - 'we undertook a new pilot study on MS and following a meeting with Holloway Prison we're now working together to organise provision of complementary therapies to women inmates. The next step is to expand this service into other prisons.'

The power of relationship building

CHT's focus on its people and clients has seen it through a substantial period of change and this emphasis remains central to CHT's way of working, both internally and with outside stakeholders.

CHT's focus on client need remains central to the organisation's ongoing self-evaluation. This was crucial during the organisation's period of reassessment but has subsequently also led the Trust to expand its services where it feels it can best meet local need.

'It's all about making the services available to people locally' Hannah explains. 'For example, we're currently working with the South London Partnership - 11 PCTs working together in South London to whom CHT is contracted to provide services. This is leading to expansion of our service venues across south London, so that there is much easier access for all clients across the 11 boroughs'.

Part of the mechanics ensuring CHT reaches its client base is Hannah's commitment to effective partnership working. She sees great value in building and maintaining relationships with potential purchasers in order to promote the Trust's work: 'I work hard at networking - it's important to build links with hospices and it enables us to work with NHS partners more closely. Recently we have been successful in expanding our Brent PCT contract, as previously the Afro-Caribbean community were under-represented. So now we have some new services in Brent particularly for this client group, and in the process of doing this, we have built up excellent new relationships with the commissioners and clinical nurse specialists too'.

As a consequence, CHT has excellent working relationships with PCTs, NHS commissioners and other potential purchasers, to the extent that commissioners are often involved in recruitment interview panels, or in CHT staff training days. As part of part of CHT's future plans Hannah is currently talking to Help the Aged about the possibility of CHT delivering its services to older people, either in their own homes or via the current clinic set-up.

Building up strong relationships means CHT are in a good position to develop new work. This includes expanding current contracts that are going well and developing new services with purchasers who have heard from others about the great work CHT does. Hannah stresses, 'it's not just about new contracts, but also about developing the ones you've got'.

Quality systems and outcomes

Unsurprisingly for an organisation so committed to its people, clients, and stakeholders, CHT has also invested the time and energy needed to implement a quality system. What is surprising - and a further testament to CHT's forward thinking - is that they went straight in at the deep end by choosing Investors in People rather than something tailored for smaller organisations. CHT achieved Investors In People status in 1998 and have maintained it since then. Implementing IIP was a particular challenge because not many charities, and certainly not many small to medium sized organisations, had IIP in '98. This meant there were no role models to seek advice from. Instead, it was CHT's commitment to its staff and people and dedication to ensuring everyone understood and supported the work that helped them through: 'we've always been a people organisation and we wanted to do the best for our staff and clients. We discussed it beforehand with everyone and decided it suited us so we went ahead'.

As Hannah describes it, stretching your organisation in new areas can be beneficial; 'there was a lot of work to do, and it stretched us, but that was good - it sharpened our focus on what we were doing: supporting staff and clients'.

People drive change

CHT's story illustrates the importance of focusing on your organisation's core mission and taking your people with you, particularly in times of crisis, review or development. The Trust's example also highlights how sustainability comes not only from a sound funding base, but also from sound organisational planning and working.

Despite the challenges, Hannah remains upbeat about CHT's period of change back in 2002 - 'I've always had a positive attitude and in the long run a clear out can be good - it's an opportunity to rethink'.

What emerges from listening to Hannah is the great personal commitment that has been made to making CHT a sustainable entity - from supporting the staff team through to working closely with the Trustee board.

What happens next?

The market is currently very buoyant for CHT and other charities are looking to the Trust for advice on improving their own working; 'others look to us, they say -you're the best- and ask how we've done it'. Organisations are keen to find out how CHT work with practitioners and purchasers because CHT is well established and increasingly highly regarded amongst health professionals. But as Hannah reiterates, 'it's all about building links and developing what you've got'.

Looking to the future

CHT is now building on its success with contract income. The Trust is looking at the contracts it already has and thinking about how these can be expanded or introduced in new areas; 'where can we be used? Where are our services needed?'

In strategic terms, the CHT team think of their development as the 'hub and spoke model' - they're developing new spokes in the CHT wheel. Each new service, or 'spoke' makes the organisational wheel grow bigger.

There are longer term plans to go nationwide - working with other voluntary organisations may be one way of facilitating this. 'If we can develop work with a national organisation in London then this could enable our entrance to other branches around the country'. This again highlights the importance of building good working relationships in terms of knock-on effect.

But at the heart of all CHT's work is their core mission to deliver complementary therapies to people with severe health issues.

'It's important to be focused on what you're doing. Every so often you need to stand back and think about who you are, what are you doing? It's good to take a rain check and to try and build work at a steady pace - otherwise, what does that say about you?' 'Be focused'.

But substantial organisational change doesn't mean Hannah's abandoned her practicality. 'The important thing is that it has to be manageable, something that can be done. We're building-up steadily'.