Coming full circle

January 19, 2015 was the 152nd anniversary of the birth of Edgar Helms, the founder of Goodwill. At the beginning of the 20th Century, he came up with an idea that included asking people to donate clothing and household items they no longer wanted. Helms wasn’t the first person to do that. But instead of just giving those goods to poor people, he put unemployed people to work collecting and repairing some of the goods, selling them to the public, and using the money to pay wages to the workers. He created jobs – a way for unemployed people to earn money, and the collection and sale of used goods was the means to that end. That basic idea still works over 100 years later and represents the financial backbone of our entire organization as well as a source of a lot of jobs – over 2,000 in central Indiana alone – for people who in many cases don’t have a lot of options.
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Helms believed that every human being has value, and he believed in giving people opportunities – a chance rather than charity – a hand up rather than a hand out. And those basic values are still just as important in Goodwill as they were over a hundred years ago.

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We do things differently today, to be sure. Over the course of our history, we’ve continued to learn and to adapt to the incredible changes that have taken place in the economy, demographics, technology, laws and regulations, competition, and American culture. I believe Helms would be amazed at how large Goodwill has become across this country. And I believe he would be particularly pleased to see how Goodwill in central Indiana has evolved – especially over the past decade – because of the way we are emphasizing whole person, often whole family approaches. Such approaches haven’t been all that common among Goodwills over the past half century. But that’s the approach Helms took in the early decades of Goodwill’s history. That first Goodwill, located in Boston, included a day nursery, a kindergarten, a fresh air camp and farm for city kids, a music school, and a night school that taught trades. Of course, they also offered employment services and jobs.

The other early Goodwills followed that lead and included a similar emphasis on helping families. For example, in the late 1930s, the small Goodwill organization in Indianapolis, working with other organizations in the community, offered a kindergarten, a prenatal clinic, a dental clinic for school children, a home-based health care program, a variety of classes for female heads of households, and a library with books mothers could borrow to read to their children.

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From my reading of the organization’s history, that approach began to change in the early 1940s as providing jobs became the primary or exclusive focus. For the next forty years, our principle role in the community could be paraphrased as helping people with various employment barriers prepare for, find, and keep jobs.

During the last decade, though, in response to some significant changes in our society and the inability of other approaches to solve a number of major social problems, we’re now moving back toward a much more whole person, often whole family approach much like that exhibited by Goodwills in the early part of the 20th Century. In a sense, we’re coming full circle.

Today, though, with current information and technology, along with other resources, we have the potential for much greater scale and lasting impact in the lives of people and the larger community.

From a personal standpoint, what we’re engaged in today is the most significant and exciting work in my 45-year career with Goodwill.

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The Seasons

A snowy winter

As I am writing this, it’s snowing – again. But it’s March – finally. And if it’s March, surely spring can’t be far off – can it?

As we approach (I think) the end of the most relentless winter – not to mention one of the snowiest and coldest – I’ve ever experienced, we’ve been reminded – with frustrating frequency – of how badly elements over which we have absolutely no control can affect our organization. Harsh winter weather adversely affects the volume of donated goods we receive and has a negative, sometimes devastating effect on our retail sales. Yet, while revenues drop, expenses rise – for snow removal, salt, higher heating bills, and the costs of higher absenteeism.

While we have no control over the weather, we do have to respond to it. We have to adapt. This year we have had to postpone or eliminate some of what we had planned to do in 2014. Some vacant positions will go unfilled, some capital expenditures will be deferred, and cost controls we’ve imposed will probably remain in place for the rest of the year. But that’s not necessarily bad. It’s a good time to do examine a lot of what we do, do some selective pruning, and become even better stewards of our resources.

It’s also worth noting that weather effects are short term, and despite the early year financial challenges, our mission is not threatened and we will continue to be a strong organization. If nothing else, this winter has reminded us that one of the reasons it’s important to have a strong balance sheet is so we can weather (pun intended) the periodic downturns and occasional external shocks that all organizations invariably experience from time to time.

Even with the constraints we’ve had to impose, we will still accomplish a lot this year. We have nine retail store projects we expect to complete in 2014 and a tenth that will be underway by the end of the year. This will mean more jobs – especially for people whose options are limited by disability or other barrier. More stores also mean more convenient places for donors to drop off goods and for bargain hunters who love to shop at Goodwill.

Our nine Excel Centers remain at capacity, and we will graduate nearly 500 students this year. Most will also earn a post-secondary credential that increases their employability.

Nurse-Family Partnership will continue to grow, as will the extent to which we are able to realize synergies across our various operations and services. For example, more of our NFP moms and Goodwill employees are enrolled in Excel Centers or are receiving job preparation and placement services from TalentSource.

There’s always been a seasonal pattern to Goodwill’s donated goods/retail operations. In the Midwest, donations of goods tend to be highest from spring through early fall, with a spike the last week of the year. Retail sales tend to be strongest when winter turns to spring and when fall weather arrives, with a spike just before Halloween (a relatively recent phenomenon).

But there is no season to the work we do to increase positive impact in the lives of people and the communities in which we operate. Employment of people with limited options is year-round, as are the Excel Centers, Nurse-Family Partnership, and other services Goodwill offers. And our emphasis on continuous improvement means exactly that – continuous.

So – despite the challenges of a winter we’ll never forget, there’s plenty of reason to be optimistic and glad to be part of the work Goodwill does. And if we get a bit crazy when spring weather finally does arrive, at least we know everyone in this part of the country will understand – and probably join in.

Why Doesn’t Everyone Like Us?

Those of us who are part of Goodwill know that we have a good organization that is made up of good people. And we know we have a mission that is appealing to just about everyone. We also know that well over 90% of the population is not only aware of Goodwill, but also has a favorable opinion of the organization. But there are still some people who don’t like us. Why? And what can we do about it?

I believe the people who don’t like our organization fall into four categories:

1. The uninformed or misinformed. Some people don’t like us because they don’t know enough about us. This category includes those who have erroneous assumptions that logically lead to incorrect conclusions about our operations and services (and sometimes about our competence and integrity).

To reduce the number of people in this group, we must seize every opportunity to provide facts that counter erroneous assumptions and constantly do as much as possible to increase public understanding of what we do and why we do it.

2. The aggrieved. These are people who have had a bad experience with Goodwill. I subdivide this group into two categories:

a. The pouters. These are people who don’t like a decision we made or an action we took, even though we acted responsibly and were fully justified in our actions. There’s not a lot we can do about those in this category other than ensure that the decisions we make and the way we operate are consistent with our values and based on sound criteria and sound processes. We also need to respond as well as we can to these kinds of concerns when they are addressed directly to us.
b. The justifiably aggrieved. These are people we have not treated well or with whom we have made a mistake. Obviously, we can reduce the number of people in this category by constantly improving our performance. And when we do become aware of a mistake we’ve made, we should correct it as quickly and fully as possible, do our best to make amends, and remember to say, “I’m sorry.”

3. The philosophically opposed. Goodwill has not historically encountered much opposition on philosophical or ideological grounds. However, in our efforts to provide opportunities to certain populations or address a particular social problem, we do occasionally encounter people who simply do not agree with our position or direction. While we might never win the support of some of those individuals, we can at least do our best to explain the rationale behind our positions and directions.

4. The jealous. The larger and more successful we become, the more we are likely to encounter individuals who are jealous or resentful of our success. There will always be some people in this category, and we can’t control that. But we can guard against adding to their number by treating everyone with respect, by not acting or appearing arrogant, and by not bragging.

Altogether, I suspect the total number of people in all of these categories is a very small percentage of the population. However, it is in the best interests of our organization to constantly strive to reduce the number of such people. This, in turn, will tend to increase the number of strong supporters we have and will minimize the amount of time and energy we must spend responding to complaints, criticisms, and accusations. While we should realize that, regardless of what we do, not everyone will like us, it is important for us to do all we can to avoid unintentionally giving anyone a reason not to think highly of our organization and its work.

On Getting More Bang for the Buck

As I have highlighted in previous posts of this blog, there’s a lot of data showing a deterioration in a number of major social indicators over the last forty years, despite massive increases in public spending and a huge proliferation of not-for-profit organizations. Overall, the dominant approaches that have been taken during the past several decades have not reduced a lot of our social problems. One could even argue that some of those approaches have actually made matters worse.

Fortunately, there are some steps being taken that might eventually result in more effective use of public and philanthropic dollars to alleviate social problems. According to the Coalition for Evidence-based Policy,” the Office of Management and Budget (OMB) has launched a major new push for the development and use of rigorous evidence in budget, management and policy decisions across the federal government…”

The kind of rigorous evidence to which OMB is referring is the kind that Nurse-Family Partnership (NFP) has been able to demonstrate over a long period of time. NFP is, to use language of the Coalition for Evidence-based Policy, an intervention “shown in well-conducted randomized controlled trials… to produce sizeable, sustained benefits to participants and/or society.”

NFP is a nurse-led home visitation program for first-time moms in low income households who voluntarily enroll no later than the 28th week of pregnancy. A registered nurse makes frequent home visits to help improve pregnancy outcomes, help parents learn how to provide responsible and competent care for their children, and help improve the economic self-sufficiency of the family. Regular visits by the nurse continue until the children are two years old.

Goodwill worked for three years to bring NFP to Indiana, and we have begun implementing the program in Indianapolis. At capacity, our registered nurses will be working with 600 moms at a time.

Thirty years of randomized controlled trials have produced evidence of the incredible long term benefits of NFP. For example:

    48% reduction in child abuse and neglect through child age 15
    56% fewer doctor and hospital visits due to childhood injuries through child age 2
    67% fewer behavioral and intellectual problems in children at age 6
    69% fewer convictions of nurse-visited children at age 15
    72% fewer convictions of mothers when children are at age 15
    83% increase in workforce participation by low-income, unmarried mothers by the time their child is four years old

The Rand Corporation calculated that every dollar invested in NFP results in a $5.70 return to society.

Some people don’t want to invest public dollars in programs such as these because, they emphasize, parents are responsible for giving their child a strong, healthy start. I agree that it’s the parent’s responsibility. However, when a parent is unable–for whatever reason–to exercise that responsibility well, the rest of us have a choice. We can invest up front to help prevent problems and develop human potential – or we can do as we’re now doing and continue to pay much more downstream for public assistance, remedial education, rehabilitation, incarceration, and in all the insidious ways we all pay when we have a poorly educated, under-skilled workforce.

It’s also important to remember that no child has any choice about the circumstances into which he or she is born.

If we really want more bang for our buck, we will begin shifting support from programs with marginal return to those that can demonstrate high, long-term benefits. Doing so will upset some people, but will result in a wiser, more effective use of the dollars that are available. The potential long-term benefits are enormous.

Adapting to Technological Changes

The fastest growing part of our organization is our ecommerce unit. By enabling us to sell many items for substantially more than they would sell for in a Goodwill store, our ecommerce operations enable us to be better stewards of the goods people give us. The growth of our ecommerce operations has also created a lot of jobs, as we currently have nearly 100 employees at clickgoodwill.com – over twice as many as we had at the beginning of this year.

Down through the years, technological changes have eliminated some jobs and created new ones. At Goodwill, for example, when I started my career we repaired radios and television sets. Doing so wasn't too difficult in those days. The sets used vacuum tubes (younger readers, look it up on Wikipedia), and we had a tube tester. Check the tubes, replace the bad ones, and many of the sets would work just fine. Vacuum tubes were eventually replaced by solid state electronics, and this effectively put an end to our repairing radios and TVs.

During those same years, we also repaired toasters and other small appliances. Over time, though, technological improvements in the manufacturing processes and increased sophistication of the products, coupled with rising labor costs, made many new small appliances less expensive than the cost of repairing broken ones. Fortunately, in more recent years, technological improvements have also helped create recycling and secondary markets for many products that can no longer be repaired economically.

Another example: From 1974 till 1992, we manufactured high quality oak file boxes for 3×5 and 5×8 cards for the federal government. For quite a few years we had 18 employees – most of them people with disabilities – who produced an average of 50,000 boxes a year. But over time, as the use of personal computers rose, the use of file cards fell and, consequently, the government didn’t need as many of the boxes. Eventually, the volume declined to the point where we exited that business.

Our involvement in online retailing began very slowly about twelve years ago after Goodwill in Orange County, CA created shopgoodwill.com. The Orange County Goodwill continues to maintain that 7-day auction site, which is designed to enable any Goodwill organization to post items on it. About five years ago, we began to increase our use of shopgoodwill.com, and we also began posting some books on several book-selling Web sites. We subsequently added CDs, DVDs, video games, and jewelry to the array of items we could effectively sell online. Better software and packaging equipment have improved our efficiencies to a remarkable degree, and we believe there is enormous additional growth potential in that part of our organization.

Of course, as is the case at most relatively large organizations, new technologies have created other entirely new departments at Goodwill. Known in many companies as IT (Information Technology), in our organization it’s TS (Technology Solutions). Composed of bright, talented people, TS keeps us connected, helps develop and optimize uses of technology to improve our effectiveness, and helps us be good stewards of our resources. As the organization continues to evolve, so too do the services of the Technology Solutions department.

While we’ve come a long way, we can be sure that technological changes will continue to create new challenges and opportunities for us. We can also be sure that if we do not adapt well enough to those changes, we will be left behind – less effective, perhaps irrelevant, and in a worst-case scenario maybe even extinct.