Achieve Australia Building Extraordinary Lives The inside story behind the merger of The Crowle Foundation & Achieve Foundation
“There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things.� Machiavelli
Achieve Australia: A snapshot
Who we are •
Achieve Australia is one of the leading disability service providers in New South Wales Australia.
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Operating across metropolitan Sydney, Achieve Australia is a company limited by guarantee, governed by a voluntary Board of Directors.
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We support over 550 people with disability or who experience disadvantage across accommodation, employment and day services with plans to introduce a respite service.
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We have 450 employees & 110 supported employees in funded positions.
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Achieve Australia is supported by New South Wales Government Family & Community Services, Ageing, Disability & Home Care; the Australian Government Department of Education, Employment and Workplace Relations and Department of Families, Housing, Community Services and Indigenous Affairs.
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Income 2011 $24 million
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Achieve Australia is a registered Housing Provider.
Our Vision Achieving Social Inclusion
Our Mission Delivering on the right of people with disability to achieve a meaningful and valued life
Disability Services: The Australian Scene • • •
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20% of Australians have a disability - in excess of 3.9 million people Individuals, carers and service providers receive funding through State and/or Federal governments If introduced, the proposed National Disability Insurance Scheme will bring about the most significant change in decades for Australians with disability www.everyaustraliancounts.com.au 53% of people with disabilities participated in the labour force, compared to 80% of those without a disability in 2003 Since the 1990s, the labour force participation rate of people with disability has fallen, while the rate for people without disability has risen A lower labour force participation rate, when combined with higher unemployment rate, is that people with disability are less likely to be employed than others.
The Merger Partners Achieve Foundation (formerly Hornsby Challenge) • Formed in 1964, it served over 170 people in the Hornsby, Ryde & Parramatta areas • 200 full & part-time staff & volunteers • A community-based organisation. Provided accommodation, training, employment & community access services to adults with an intellectual disability
The Crowle Foundation • Formed in 1952, it provided services and facilities to 250 people across Hornsby, Ryde & Parramatta • 200 full & part-time staff & volunteers • Provided accommodation services & community-based accommodation for up to 75 people
Crowle Home
Why Merge? Crowle and Achieve had independently identified four crucial strategic issues for their survival:
Viability Diversification Growth and Alternative income sources
Were there alternatives to merging? Achieve could have continued on an organic growth path but the long-term viability of some of its programs was questionable.
Crowle was planning to sell a parcel of land to help its finances but ultimately may have seen its services broken up.
A Merger of Equals The deal to merge the two Foundations was based on the concept of ‘a merger of equals’.
The merger was unlikely to have proceeded if Crowle’s strong membership base believed it was not an equal partner in the merger.
The Merger Mechanics Coming Together The seeds of the merger were planted at CEO networking functions. Formalising the Merger Discussions On 2 July 2008, the Crowle and Achieve Foundations’ publicly announced that they had entered into a Memorandum of Understanding (MOU) to explore a ‘merger of equals’, including due diligence. Merger Implementation Group A series of ‘four by four’ meetings – the two Chairs and two other Directors from each organisation and the two CEOs – began to thrash out the merger process. Membership Rationalisation In order to execute ‘a merger of equals’ and ensure good corporate governance, it was necessary to rationalise the membership of the new organisation.
Selling the merger – the communication challenge The leadership of both organisations sensed the need for clear & consistent communication if the merger had any chance of succeeding.
A tailored approach was taken to the various stakeholder groups & experts brought in to assist.
The Role of Governments Through the merge, both organisations aimed to enhance financial viability & win ‘preferred provider’ status from governments.
The Role of Advisors The leadership of both organisations drew heavily on colleagues, mentors & others from within and outside of the disability services sector to help guide them through the merger process.
Crunch Time At no time before the votes to merge Achieve and Crowle did the respective leadership teams consider the merger a done deal. Ballots were cast by members of both organisations in November 2008. The result had to be ratified by the Federal Court of Australia.
Post-Merger The post-merger implementation phase has been far more problematic than anticipated. Two years on, the future shape & vision of Achieve Australia continues to be forged.
Post-Merger What’s been happening over the past two years? •
Devolution of Crowle Home
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Purchase of Araluen – heritage facility & new location for Day Services and a new self-funded Respite program
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Great network of volunteers
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Fully re-branded, including marketing collateral, Achieve newsletter and new interactive website
POST MERGER Outcomes achieve employment • Prior to merger in 2009 – 47 people accessing our disability employment service • March 2010 – 81 people • April 2011 – 170 • 65% of those now employed no longer receive a disability support pension • Relocated operations to new modern offices in April 2011
The Ongoing Cultural Challenges
While Achieve and Crowle shared some common history as former branches of the New South Wales Challenge Foundation, their operating models were starkly different.
What impact has the Merger had on Key Stakeholders? •
People we Support
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Volunteers
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The Board
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Senior Management & Staff
Key Lessons from the Pre & PostMerger Periods Smaller organisations, which often lack the financial or technical ability to grow, will increasingly be forced to search for partners.
It is not enough to rely on a ‘desktop’ due diligence process.
Gain as much ‘behind the scenes’ insight into the potential merger partner as possible.
Key Lessons from the Pre & PostMerger Periods cont. The hard work is often in the post-merger phase, rather than the pre-merger period. A professional communications plan is essential. It is important to have realistic pre-merger and post-merger budgets in place. Discipline among board members and senior management was a critical ingredient throughout the process.
Key Lessons from the Pre & PostMerger Periods cont. The merger process soaks up an enormous amount of time for those involved.
Due diligence stands out as an area that could have been better handled during the merger process.
Crafting a Strategy Amid Chaos Board & senior management consumed by post-merger issues for the first 12 months.
Expert assistant brought in to fashion a bold strategic plan to take Achieve Australia into the future
Conclusion Would we do it again?
It’s been tough but worthwhile.
Ultimately, this merger has resulted in better outcomes for people with disability which is the key measure its success, or otherwise, should be judged on.
Session Evaluation Information
SESSION TITLE: Strategies2 SESSION CODE: CRP-T300