The Unanticipated (and Sometimes Unfair) Consequences of Strategic Alliances

October 25, 2012; Source: Silicon Valley Business Journal

We often hear people discussing organizational partnerships in terms that assume that a larger organization tends to be stronger and more stable and resource-rich than a smaller one, but this is a vast oversimplification, according to this story of a small organization that has been destabilized by its partnership with a larger group. Strategic partnerships exist along a continuum of more to less autonomy. The relationship between the two groups described below is fairly autonomous on paper, perhaps, but one still has the capacity to deeply impact the operations of the other.

Located in Silicon Valley, Loaves & Fishes is 33-years-old and its purpose is to feed the hungry [Full disclosure: the article we are citing is by a board member of Loaves & Fishes]. On October 19, it was notified that it would not be allowed to serve food out of one of its three locations at the Innvision Montgomery Street Inn. The hunger program had invested $70,000 in building a kitchen at the Innvision location and paid $2,100 rent each month but because Innvision decided, in a larger strategic planning process, that it had to cut back on its daytime services, the program was given a month’s notice to cease operations in that location.

The author of the article surmises that the eviction is the result of InnVision’s July merger with the San Mateo-based Shelter Network, which yielded the InnVision Shelter Network. The executive director of Loaves & Fishes says she believes that InnVision Shelter Network is trying to manage costs after its merger and in the face of declining federal contracts, but she does not understand why this should affect their operation, which she says operates fairly self-sufficiently.

InnVision Shelter Network has an annual budget of $16 million. The annual budget for Loaves & Fishes is a meager $661,000 and it has always, according to this article, operated in the black. –Ruth McCambridge