This guest post is by Jean Butzen, president & founder of Mission + Strategy Consulting.
After a decade of facilitating nonprofit mergers, I am certain that the most common question I receive from my clients is not “What is the legal definition of a merger?”, or “What are the steps to a merger?” (both very good questions). Rather, it’s “How do I begin a conversation with a prospective merger partner?”
It can be very awkward to call up a colleague who you have known for years and suddenly ask, “Would you like to merge?” How does one even begin a conversation on merging? Despite the seriousness of the question, I tell my clients that they should think of it as simple as calling someone up to have a cup of coffee. Relax, and follow these steps:
1. Have this conversation with a trusted colleague.
It’s best to merge with an organization that you have a history of partnering with on more than one occasion, so you each know other’s organization’s culture, philosophy, and management team well. If you don’t know the CEO at all, then stop and do your due diligence on the organization first to be sure there is an alignment.
2. Prepare for the phone call.
Relax and think of how this as opportunity – for you both. Think about the history you have shared together, the ways you are aligned, the commonalities you share. Think about the reasons why it is time to move beyond a simple partnership and to consider a “deeper relationship.” Write down some of these points.
3. Call the person and ask them to have coffee with you.
After you’ve had your introductory chit-chat, get down to business. Here’s one possible script:
“I have been very impressed with how strong your organization is in these areas (name the specific skill sets) and how much we have benefited from our partnership with you. (Here, briefly review the history of the two organizations over the years and the various partnerships or collaborations you have had together.) I’d like to talk to you about ways that we might deepen the relationship between our two organizations and go further. Would you be interested in having coffee with me to explore ways that we might expand the impact we are having together?”
If the person asks for more information on the phone, tell them you’d rather do this in person when you meet for coffee.
4. Move the Conversation Beyond the Normal.
When you meet for coffee, thank the person for agreeing to meet to discuss deepening the relationship between the two organizations. Tell the other person how much you have admired their work and the work of their organization over the years. That is why you decided to have this conversation. Deepening the relationship could look a lot of different ways, including a merger.
Ask the person:
"Have you ever thought of merging your organization with another nonprofit before? (Give the person an opportunity to respond and see what they have to say and respond accordingly.) Yes, I am thinking of a merger strategy for my organization, but only with the RIGHT organization. I have heard about other organizations successfully merging, and frankly, I find it intriguing."
Discuss the possible barriers or benefits to a merger of your two organizations such as the name of the reaction of each board of directors, the potential impact on your constituencies, the shared efficiencies, as well as any possible downsides. Before parting, summarize the conversation and decide on your next steps.
Listen to how the other person reacts: is he or she responding positively to the concept? If so, ask why a merger is so clear to them. If the person is opposed to a merger but might be open to an administrative partnership, then that might be worth exploring, too. You both want to move slowly before locking yourselves into one strategy or another.
After talking to the person, you may decide this isn’t a good idea after all, so don’t tie your hands too quickly. Asking someone to discuss a merger is not a sign of weakness, it’s a sign of courage and creativity. And it shouldn’t be any harder than asking someone to have a cup of coffee!
Find case studies of different ways nonprofits have merged in the Collaboration Hub.
JEAN BUTZEN is the president and founder of Mission + Strategy Consulting, a national consulting firm serving nonprofits based in Chicago. Jean is a noted expert on nonprofit mergers, and leads the firm’s nonprofit strategic restructuring practice: mergers, partnerships and strategic collaborations. In addition to her facilitation work, Jean teaches and writes about nonprofit mergers and collaborations.