What Works in Work-First Welfare: Designing and Managing Employment Programs in New York City

8. Different Practices among Program Types

89 8 Different Practices among Program Types Another useful way of exploring the main differences between today’s work-first employment programs is to look across organizational types. For example, in what ways do nonprofit and for-profit programs differ in their service strategies? Do programs that are compensated solely based on performance—that is, by their success at helping people get and keep jobs—have different practices than programs that are compensated only partly based on performance? And how do program practices differ between large and small programs, or between faith-based and secular ones? The 26 welfare-to-work programs in New York City provide preliminary insights into these issues. NONPROFIT VERSUS FOR-PROFIT The views of program leaders illustrate the blurred nature of the categories “nonprofit” and “for-profit.” For example, several nonprofits said that they try to run like for-profits. William Forrester, Executive Vice President of Goodwill Industries of Greater New York and Northern New Jersey, explained how his nonprofit organization (which runs three of the 26 sites) draws on for-profit management techniques: It’s a business. My philosophy is that a nonprofit business is the same as a for-profit business except that our shareholders are the clients we serve everyday . . . We try to model ourselves after a for-profit in the sense that we have a vision, a strategic plan, we do marketing, we hold people to account . . . You have pressures to produce. Then you have the pressures that you want to treat a person with dignity. How long can we spend engaged in counseling and case management? . . . [Spend too much time on that] and your production is down. 90 Feldman Likewise, Karen Smith, Senior Vice President of the nonprofit Wildcat Industries noted, “Nonprofit agencies call themselves nonprofit, but they’re really in it for the profit. They just call it something else.” Other staff members at nonprofit programs emphasize that covering costs is a challenge but is necessary to stay in business. “You have to have a for-profit mentality because otherwise you won’t survive,” one staff member said. But leaders at other nonprofit programs express very different sentiments . Covering costs is not their primary concern, and they are willing to fundraise to address budget shortfalls so they can provide the level of service they believe is appropriate. For example, the director of a small faith-based program recalled the message she received from the nuns who founded the organization: Sister Mary Paul and Sister Geraldine were the founders of the program and their model was “You do the work, we’ll find the money.” I remember Sister Geraldine when we lost a contract and we had no money. [I asked,] “Are we going to close the program?” [She said] “We’re not closing the program. We will find the money.” And they always did. They had the pressure but they didn’t put the pressure on me or on the staff. Interestingly, the person overseeing a for-profit program, New York Job Partners, discussed how their program philosophy essentially matches that of a nonprofit. New York Job Partners is part of a national company (Affiliated Computer Services) that was new to the social service field and trying to gain a reputation for providing quality services. Charlotte Curan, Operations Manager of their contracts in New York explained, “I’ve been told to do a super quality program and make it grow. I’ve gotten the support from [the regional manager]: ‘If you need another job developer, hire them’ . . . Maybe someone else will make millions of dollars for the company, but right now this line of business has to show the quality services that we can produce.”1 Staff members at other for-profits, however, emphasize their programs ’ distinctiveness from their nonprofit counterparts. For example, Pete Cove of America Works said one advantage of for-profits is their greater flexibility in terms of employee compensation, including the use of performance pay. Another advantage, he said, is resource flexibility, meaning being able to adjust program operations quickly in response Different Practices among Program Types 91 to changing conditions. And Susan Melocarro of Career and Education Consultants said that pressure to cover costs distinguishes for-profits from nonprofits: I’ll tell you the difference with the nonprofits. If they are not generating enough revenue from the contract, they do fundraising or they have foundation funds or funds from other sources that...