Shaping the System Development Organization

Coordinating Resources and Structuring Accountability

Topics: Philanthropy Strategy and Planning, Philanthropy, Business Development, Strategy

This is a preview of restricted content.

Full access to this content is reserved for Philanthropy Leadership Council members. Log in now or learn more about Philanthropy Leadership Council.

After a period of rapid hospital consolidation, health systems have benefited from economies of scale by centralizing many administrative tasks. However, consolidation of fundraising initiatives across hospitals is still lagging.

Members who read this study will:

  • Understand the benefits of creating one central development office to oversee all fundraising goals
  • Gain advice on determining the best way to allocate resources, data, and donor contacts across hospitals
  • Learn to effectively utilize data tracking and reporting to create accountability
  • Consider systemization concepts that forward-thinking health systems are now undertaking

Executive Summary

Systemness the new (hospital) norm

Today, the majority of U.S. hospitals exist within larger, multi-hospital health system organizations—a stark change from the preceding decade in which provider institutions more often operated autonomously. Industry experts expect mergers of independent, community hospitals and acquisitions by health systems to continue to alter the health care landscape in the near future and with greater frequency. Increased difficulty accessing capital, greater need for cost control, and potential loss of tax-exempt status comprise just a few of the considerations behind the trend.

This shift has led to recent changes in management structure and organization at systems across the country, reflecting an expanded ambition for the role “systemness” can play in ensuring greater value for dollars spent.

Systemization of development lagging

Despite the many factors pushing system development executives to consider the benefits of sharing resources and accountability among affiliate foundations—and widespread agreement on the merits of leveraging system size—health care philanthropy finds itself lagging behind the systemization trend compared to other health system business functions. Many development organizations face challenges with regard to structural optimization efforts due to the complexity of reorganization, internal politics, and misconceptions about the purview of a central office.

As is often the case, the hesitancy of leadership to modify long-standing practices and cede the degree of autonomy needed to realize the benefits of intra-system partnership has lengthened the adoption curve. The result is wide variation in organizational structure from institution to institution and little industry standard regarding best practice for system collaboration.

Charting the course for system development structure

Two primary factors differentiate system development organizational structures from one another: resource centralization and authority structure systemization. The first concerns the degree to which system executives distribute resources and process ownership across affiliates and the central office; the second, mechanisms for accountability.

The Road to Systemization