7
Collaborating with government

Local, state, and federal governments all have much to gain from the success of your business. When your vision includes collaboration with government agencies, partnerships are possible that benefit both your business and your community.

Governmental bureaucracies, regulations, and other hurdles may have scared you away from developing successful business-government partnerships. You may think you don’t have the necessary time or patience. But times are changing, and business-government collaboration has become an important concept for the twenty-first century. If building your business and growing local value is your goal, then looking for ways to work with government agencies should be on your agenda.

Your business can choose from a wide variety of methods for constructing bridges with government agencies to build a stronger community. The list below offers basic categories of government-business partnerships.

• Public school partnerships. As federal, state, and local budgets have tightened, funding of public schools has suffered. This has opened up opportunities for businesses and schools to collaborate.140
• Municipal government efforts to support local independent businesses. The dominance of chains and big-box stores has resulted in local retail stores going out of business and leaving many downtown areas deserted and boarded-up. In response, networks of locally owned businesses have organized Local First campaigns in communities all over North America. Several municipalities and local government officials have recognized the importance of independent businesses to sustainable economic development and have partnered with and helped fund these campaigns.
• Municipal, state, and federal initiatives to create a sustainable community. Mayors from cities and towns of all sizes are developing “sustainable” or “green” initiatives to create more sustainable communities. These include recycling programs, green building projects, inner-city development, and energy conservation. Values-based business leaders are playing a pivotal role in several of these initiatives.
• Services for government agencies. Many businesses have government agencies as their primary customers. Although privatization (moving government services into the private sector) has obvious limitations, governments at all levels have needs that are best met by a commercial enterprise. When the public and private sectors build bridges in order to work together, the community usually wins.
• Business expansions. A common source of conflict between business and government emerges when a business moves to expand its physical plant. Dealing with government officials, neighbors, and government regulations can sorely test an entrepreneur’s patience. However, values-driven entrepreneurs respect the legitimate rights of the community and proactively look for solutions that meet everyone’s needs.

(Abuses of public-private partnerships obviously occur when politics and lobbying play a role in determining which company wins a contract.)

The American Reading Company understands the potential of partnering with government agencies. The company’s business model relies on working with local school systems and on gaining government funding for the development of its programs. Jane Hileman has created a terrific example of how a business can build bridges with government agencies and create a more culturally and economically just world.

Partnering with Government Agencies: The American Reading Company, Philadelphia, Pennsylvania

Jane Hileman began teaching school in 1973. While working at an urban middle school in North Philadelphia, she created programs to help her students do well on standardized tests. After she had worked with them for two years, all of her students scored in the 90th percentile on the California Achievement Test (at that time the standard reading test in most states). This success wasn’t at all surprising to Jane, but it did give her concrete evidence of what she intuitively knew—there is no excuse for the achievement gap that exists between students in rich communities and those in poor communities. She felt that it was imperative that educators like her figure out how to help all children succeed.

She knew that successful people pass on their penchant for achievement to their children through teaching the use of language and living the “lifestyle of reading.” She also knew that integrating reading into a family’s daily rituals makes reading as natural as breathing. Jane’s mission was to give poor children access to the same literary life that wealthy children get. This meant being read to every day and eventually reading on their own every day.

By 1995 Jane’s work had evolved to become a practical and simple system that she felt could change the world. Now she needed to get it into schools so it could be used. But how best to do this? At first she tried to market her reading system from her position as a teacher within the school structure. She succeeded in persuading several schools and individual teachers in Philadelphia to embrace the program, but she had to fund much of this work out of her own pocket. At that point no school systems would adopt her program. They tend to be slow to accept change, and innovation from within is rarely tolerated.

Not to be deterred, Jane began working through the nonprofit world, eventually starting her own tax-exempt nonprofit organization. This didn’t work either, and she became frustrated with the ineffectiveness of her nonprofit strategy. She realized that if she was going to take her idea to market she would have to go directly to the customer. She had become an entrepreneur with a social mission, and she wanted to get moving. Filled with a sense of urgency, she joined the ranks of entrepreneurs, and in 1998 Jane started the American Reading Company (ARC).

After eight years the American Reading Company has 105 employees, with revenues of almost $15 million, and has averaged 70 percent growth since its founding. Its profits are plowed back into the company to facilitate its objective of rapid expansion. Although ARC has outside investors, Jane has maintained the controlling interest in her company, which she feels has enabled ARC to remain true to its mission, even when money got tight. As of early 2006, ARC is providing successful reading programs to 250,000 children in 29 states and 1,050 schools.

The core ARC program is the 100 Book Challenge. It is a state-of-the-art, standards-based reading program that teaches students to read, parents to create a literacy-rich home environment, and teachers how to teach reading using trade books. Twenty thousand children’s book titles are organized into plastic bins, based on reading levels, and brought into schools to form classroom libraries that circulate weekly. Brightly colored skills cards outline what readers need to be able to do to read at each level using state standards, so they know where they stand and what they need to do to improve. Students are required to read for a minimum of thirty minutes a day from books they can read and want to read. Teachers use a Readers’ Workshop model to teach students not only how to read but why they should read.

ARC’s Research Labs and its new product, Curriculum Integration Project, both provide libraries and curricula in social studies and science so every student can access grade-level content standards while reading at their individual success level.

Getting ARC off the ground was tough. Despite Jane’s view that she was offering a stellar product that would make a big difference in the lives of children, during weeks of making pitches she received one no after another. Of course, getting turned down day after day is not a new experience for a budding entrepreneur. And, as Jane points out, this new venture gave her innumerable opportunities to test herself in what she calls the three Rs of successful entrepreneurship—resourcefulness, resilience, and relentlessness.

The years spent putting the program into Philadelphia schools on a nonprofit basis finally paid off. Shortly before Thanksgiving 1997, an article appeared in the Philadelphia Inquirer with the headline “Reading Program Gets Rave Reviews.”¹³ This inspired the ABELL Foundation (which is dedicated to enhancing the quality of life in Baltimore and Maryland) to call and invite her to Baltimore to present the program. Shortly after her presentation, the foundation cut a $140,000 check to ARC for providing a summer reading program in Baltimore. This was the beginning of a long, successful relationship that opened the doors for ARC into other cities.

For example, the Akron school system began the 100 Book Challenge as a summer school program in 1998, and the program has since spread to over twenty schools in Akron. In 2005 Akron added the ARC Research Labs to its summer school program as a companion to the 100 Book Challenge. Another great example is the Jersey City school system, which includes the 100 Book Challenge in all of its grade 1–5 schools. It has also adopted the ARC Research Labs for its middle schools as part of its language arts curriculum district-wide.

AMETEK, a $3 billion international aeronautics instrument company headquartered in Paoli, Pennsylvania, has been a big supporter of the ARC program. The 100 Book Challenge is one of the literacy programs sponsored by the AMETEK Foundation. The foundation placed the program into thirty classrooms in two schools in Binghamton, New York, in 2002 and has since instituted it in Rochester, New Jersey; Panther Valley, Pennsylvania; and West Chicago, Illinois. It not only provides the program but continues to support it in each of these locations for three to five years. The school systems in these cities continue to use the 100 Book Challenge with varying degrees of support from AMETEK, and they have decided to implement the program at their own expense when AMETEK’s support is no longer available.

The more ARC becomes involved in school systems throughout the United States, the more glaring the need for effective reading programs becomes. As Jane says, “The bottom line is that children who are below grade level in reading need to move two to fours years in reading levels in one year. That’s a big job—and one we’re up to. We preach the idea that if you are not a reader, you can become one and here’s a way for you to do it. It works, and the rewards last a lifetime.”

ARC utilizes a project-based learning model, and the children become invested in the project of their own choice in which they read and write and talk and listen in a group of peers. The teachers become coaches of the students, explaining what they are expected to learn by the end of the unit and working with them to achieve the objectives. Jane has found that if you make the standards clear at the beginning and map out a pathway to success, the children learn to read.

What’s remarkable about the work of ARC is that as much as the program effectively teaches children to read, it’s not solely about the reading. It’s as much about agency and creating a fertile environment that allows young people to flourish. Reading becomes simply the entry point for children to grow and thrive. Jane views this as an entrepreneurial model because each child creates what could be viewed as a business plan. The child sets objectives and plots a strategy, and the educators and ARC provide the support to help all the children achieve their goals. Jane has found that the skills the children acquire in learning to read today can be directly transferred to learning how to get what they want in the future.

And ARC is crystal clear that involving parents in the process is indispensable to its success and encourages their participation from the get-go. When parents understand what ARC is asking them to do, they feel more in control and more relaxed. The process of learning to read becomes a partnership and a family affair with its attendant direct and indirect benefits.

As ARC has grown, it has greatly increased the number of staff members, all of whom are highly competent and fully committed to the mission of the company. Hiring and training staff is always a challenge. As a way of attracting and keeping talented people, Jane has created an emotionally and spiritually rewarding work environment. This supportive culture enables ARC’s staff to sustain the saint-like patience needed to partner with hundreds of different schools all over the country.

Partner with Those Who Have the Most at Stake

Partnering with school systems and government bureaucracies is daunting, so much so that many entrepreneurs won’t even attempt it. And these fears do have their basis in fact. ARC knows how difficult a task it is to build partnerships with school systems. The company uses every possible opportunity to spread the word through media features, innumerable speaking engagements at conferences and meetings, and most important, word of mouth. As the ARC program grew and established a track record, the marketing materials shared the results and possibilities, and much less persuasion was needed.

Jane continues to present her case whenever and wherever possible. Occasionally, a school board or government leader will sign on, but she has learned the hard way that her primary strategy should be to work locally with teachers and school administrators in order to gain their buy-in. These educators see the need for ARC’s program every day, and they know the ins and outs of the various bureaucracies. Once they become excited about the program, they usually find creative ways to obtain the necessary funding.

Balancing Passion with Patience

Jane and her staff are passionate about teaching children to read. They want to improve reading programs, and they want to do it now. Billions of dollars of federal funding are available for education. One would think that the process of obtaining official governmental approval for funding might take time, but eventually a program like ARC would be an approved program. This has not been the case, and it’s been so frustrating for Jane and her team.

ARC prides itself in its ability to work through the morass of government regulations. Jane and her staff make painstaking efforts to get access to decision makers and other key people in positions of influence in order to make their case effectively. Jane was appointed to the National Association for Educational Progress steering committee, which tracks reading progress around the nation, and she has spoken at over 150 conferences. Several large-scale studies were done by Temple University and others, demonstrating the effectiveness of the program. Even with all the documented results and her active networking, the state of Pennsylvania has not approved the program for purchase by schools using money for Reading First, a federal reading program.

Jane’s frustration with obtaining funding for her program has gone beyond Pennsylvania. President Bush’s No Child Left Behind program has set aside billions of dollars to improve the education of all children, and schools across the country have been told by their states that they can purchase programs from two short lists of approved programs. In spite of an excellent reputation backed up by strong empirical data, ARC has not yet been able to get on either of these lists. For the first two years of No Child Left Behind, the American Reading Company was told it must have scientifically proven results from a randomized child study that can cost up to a million dollars. This requirement favors large corporations and effectively prevents small companies with new and innovative ideas from participating in this important federal program. Jane hopes that as the program continues to grow, even this formidable wall will come down.

Best Practices in Partnering with Government Agencies

Jane and ARC partner with school systems to improve reading skills by offering an effective and proven reading program. Powell’s Books, one of the nation’s outstanding independent bookstores, is also partnering with local school systems to promote reading, but it is doing this by putting books in the hands of thousands of schoolchildren.

Encouraging Children to Read More: Powell’s Books, Portland, Oregon

Powell’s Books opened in 1971 on a derelict corner in northwest Portland, Oregon. Powell’s now has six locations throughout the city, a successful Web site, and annual revenues over $20 million. Despite the business’s tremendous growth and success, what locals love about Powell’s is its continued commitment to being a neighborhood bookstore, with a staff that cares deeply about books and the community.

For the last nine years, the center of Powell’s community giving program has been the It’s for Kids campaign. President Michael Powell began the campaign as a way to partner with local public schools to encourage young people to read and hopefully to boost holiday sales. If a customer mentioned It’s for Kids at the check stand, Powell’s gave a credit of 10 percent of the purchase to the public schools to be used by school librarians for book purchases. The program reinforced the company’s image as community oriented and heightened public awareness of the needs of public schools. Although Powell’s found that the program did not make a difference in the sales for the holiday season, Powell’s continued the program, donating over 40,000 books to local public schools between 1995 and 2004.

Powell’s always received a great deal of positive feedback from grateful parents, teachers, and school librarians. And over the years, as funding for Oregon schools was gradually cut, school librarians began to depend on Powell’s program. Recognizing this increasing need, in 2005 Michael Powell decided it was time for a change. As implemented, the program provided librarians with credits to purchase books from Powell’s at retail prices. Michael thought there must be a way to expand this partnership and to leverage his staff’s book-buying expertise to significantly increase the flow of books into local schools while not increasing the expense to Powell’s.

The redesigned program, School Book Challenge, would encourage customers to contribute the equivalent of one book, valued at $5.95. In turn, Powell’s would match each pledge with ten additional books. The difference? Instead of giving librarians a cash credit, Powell’s staff would choose the books, using their expertise to select an appropriate assortment that could be acquired more cheaply by buying in bulk and partnering with vendors interested in helping a good cause.

Librarians’ initial responses to this new idea were not overwhelmingly positive. They continued to be gracious but expressed disinclination for any change to the program that was often their sole source of new books. In response, Powell’s staff convened meetings with groups of librarians, listened to their concerns, and tried to reassure them that the new program would be more successful than It’s for Kids had ever been. In the end, despite the schools’ hesitations, Powell’s went ahead with the innovative idea.

In August 2005, 275 teachers and librarians from ninety public schools were invited to the Powell’s warehouse for book selection. To their surprise, they found over 57,000 books— more than had been donated in the entire history of the It’s for Kids program! The librarians were overwhelmed by the selection and number of books. Through this innovative business and government partnership, schools received between 400 and 800 books each, meaning an average tenfold increase over the 60 or so books they had received in years past.

What ARC and Powell’s Books are doing to support reading programs in local school systems is impressive. New Seasons Market intentionally partnered with residents and the local government to grow its business in an environmentally friendly manner. And the good news is that the collaboration was successful, offering an excellent example for how your company can build bridges to help grow local value.

Constructing an Environmentally Friendly Building: New Seasons Market, Portland, Oregon

Brian Rohter is the CEO of New Seasons Market, a locally owned and operated group of grocery stores in Portland, Oregon. He was well into the development of the company’s fifth store when a representative from the local neighborhood association approached him with an environmental concern—storm-water runoff.

Besides polluting rivers and streams, runoff after rain causes flooding and erosion, destroying habitats and contributing to sewer overflows. Plans for the latest New Seasons Market included adding 15,000 square feet of nonpermeable surfaces (surfaces covered by buildings or pavement) to the existing site, which would mean another one million gallons of storm water flowing out to the Willamette River.

Brian learned that Portland’s Bureau of Environmental Services had grant money available for businesses interested in implementing storm-water controls. By creating “bioswales,” marshy wetlands that absorb and filter runoff, around the new store, Brian could reduce the impact his building would have on the environment.

However, the project was already well underway and to make modifications would most likely mean increased costs and a delay in opening. Not only would Brian have to ask the architects for new drawings and apply for a grant to help cover the cost of building the bioswales, but he would have to obtain new permits from the city. Brian’s experiences with the city so far had not always been smooth. The process of getting the original permits had been long, slow, and frustrating, and he was sure that the redesign would significantly postpone the store’s opening.

But this was an opportunity that could not be missed; New Seasons wanted to be an environmental leader in the community and an inspiration to other businesses. With little deliberation, Brian decided to stop the building process, asked his architect for a redesign, and braced himself for yet another round of negotiations with the city.

His willingness to be flexible for the good of the community paid off. A local environmental organization volunteered to help New Seasons convene a working group, which included representatives from the neighborhood association, the Portland Bureau of Environmental Services, and the Portland Bureau of Development Services. Everyone was impressed with New Seasons’ readiness to navigate the potential roadblocks associated with changing the building plans. With all of the entities at the table focused on issues of water quality, the group easily reached agreement on the need to amend the building plans in order to incorporate bioswales.

Much to Brian’s surprise, once this common ground was established, things began happening quickly. New plans were drawn up and submitted, the city agreed to grant $50,000 for the bioswales, and the permit applications were hand-carried by city employees between departments to speed up the process. A few months later, the new store opened—on time.

The market’s bioswales absorb over one million gallons of storm water annually, preventing water from becoming tainted and flowing into the Willamette River. New Seasons intends to include bioswales in the planning for future stores. The company is sharing its experience with other businesses and hopes many will follow its lead. By aligning its goal of being an environmental and community leader with an ecological need identified by the city, New Seasons developed an effective partnership with the local government. By finding common ground with the Bureau of Development Services, New Seasons produced a winning result for the company, the city, and the community and opened doors for other collaborative opportunities in the future.

Partnering with government agencies in one particular area or program can lead to other collaborations that benefit the community. The list of possible business-government collaborations is boundless, and once you begin the process, the waters feel a bit more friendly and you will begin to broaden your horizons. Cascade Engineering has spent years working with government agencies to train and hire people who were receiving government financial support and to move them off the welfare roll and onto the Cascade Engineering payroll.

Moving People off Welfare and into Jobs That Pay a Living Wage: Cascade Engineering, Grand Rapids, Michigan

Cascade Engineering, based in Grand Rapids, Michigan, is in the plastic injection molding business. It manufactures parts for the automotive and solid waste markets. Founded by Fred Keller in 1973, the Cascade Engineering Family of Companies has sales of over $280 million and employs 1,200 people (about half of whom are people of color).

Cascade is serious about its support for the community and issues an annual triple bottom line report that measures the company’s financial, environmental, and social impact. In 1992 Fred and his manager of community partnerships and workforce diversity, Ron Jimmerson, created a program to transition people on welfare into full-time employment at Cascade. The Welfare to Work program began with twenty participants and high hopes. Although their intentions were good, Fred and Ron didn’t have the necessary experience in this type of program. When all of the participants dropped out, they realized they needed to start over again with something different.

The next effort was the Work to Work program. Cascade would hire employees who had worked for six months or more at a group of local Burger King restaurants. This program failed because few people worked at a Burger King for as long as six months because they couldn’t live on the wages the restaurant chain paid its employees.

Not to be deterred, Fred and Ron started from scratch once again. This time they used a much different approach, and the third effort was a success. First of all, they decided to call the program Welfare to Career. This name change was important because it reflected a change in the content of the program and, equally important, it affected how the participants felt. It opened up opportunities for them and gave them hope.

Second, they sought the assistance of outside agencies so each organization could do what it did best. For example, they contracted with the Four C’s Child Care to assist the participants in caring for their children, and the state Department of Human Services covered 80 percent of the cost. They also worked with Angel Wings, a Christian-based company staffed by highly trained drivers, to transport employees to work. For those with children, Cascade worked with the municipal transit system to pick up the parents and children together, drop off the children at day care, and then take the parents to Cascade. These and other partnerships made a huge impact on the participants and on their job attendance.

The third big difference in the Welfare to Career program was bringing in Ruby Payne, PhD, and her consulting firm. Her book, A Framework for Understanding Poverty, and training provided a major breakthrough for Cascade by providing a structure for the program. She taught Fred and Ron that every culture has different rules and norms of behavior and that moving people from welfare to financial independence requires a complete overhaul of their personal support system. In order for this program to succeed, it had to give participants what they needed to become a part of middle-class society, something Fred and Ron previously hadn’t understood.

They now know that teaching new employees job skills isn’t enough. These work-related competencies don’t by themselves give employees the knowledge of how to manage money, hold down a job, and create a consistent and fulfilling life. As part of the program, Cascade began offering on-site personal and career development classes on topics such as money management.

Cascade partnered with the Inner City Christian Federation (ICCF) to prepare new employees for purchasing a home. ICCF specializes in building homes for low-income people in the inner city. It counsels these people in purchasing a home and learning how to manage their finances and maintain and care for their new home. In many cases Cascade’s employees were paying more in rent than they would be paying for a home mortgage. Cascade also worked with Habitat for Humanity to connect participants with this nonprofit dedicated to increasing home ownership. To date, eight graduates of the Welfare to Career program have moved into Habitat for Humanity homes, and seven others have purchased homes with the help of other programs.

Cascade also helps guide the employees to other government agencies that can be of help. For example, a state of Michigan program helps qualified people purchase automobiles. So far, over sixty employees have bought cars through this program.

Each Welfare to Career participant begins work in a production capacity at a living wage of $9 per hour. Some have advanced to the point where they are earning $14.50 per hour. After a ninety-day probation period, staff members receive 100 percent of their health insurance benefits. They are also eligible for the company educational reimbursement of up to $2,000 per year for higher education classes that would help the company.

The Welfare to Career program has grown to include a high of forty participants, and at one point over a hundred graduates of the Welfare to Career program were working at Cascade. Of the forty that went through the program in 2004-2005, thirty-eight no longer receive cash assistance from the government. By any measure this is a big success and a wonderful example of a program that includes not just one but multiple partnerships with government and nonprofit agencies for the extensive benefit of the community.

Building bridges with government agencies as a strategy for growing local value has been proven to work. Besides doing good for the community, these partnerships can give you a competitive advantage, enabling you to expand your business and increase your profitability.

Lessons Learned: Partnering with Government Agencies

Following are some of the lessons you may have gleaned from the examples given in this chapter:

• Don’t fight City Hall. Don’t rule out a government agency as a strategic partner for your business. Agencies may have relatively large budgets and substantial human resources, and they touch thousands of people’s lives. Federal, state, and local governments often look to the private sector to partner on projects and programs for which they need expertise or a quick turnaround. 156
• Learn the lingo and remember that patience is a virtue. When choosing to work with government agencies, walk in with your eyes wide open about the challenges involved. Study the system and talk with others who have had direct experience in order to identify “hot buttons” that the agency cares about. When you work with a government bureaucracy, every step generally takes longer—factor this into your business plan.
• Be known as a bridge builder. Networking and community involvement are essential for gaining traction in the public domain. Being known as a consensus-building community leader in your field can be a real asset when partnering with government agencies.
• Work with government programs to meet hiring and training needs. Many businesses are finding it difficult to find qualified employees, and in fact some are on a constant search to fill job vacancies. Effective government programs are available that can help you identify (and offer ongoing training and support to) unemployed or underemployed local residents who could become excellent staff members. Ultimately, business-government partnerships like these will play a critical role in ending poverty.
• Go back to school. Business and school partnerships have proven to be highly effective ways of improving local public education systems. Developing an ongoing business project that contributes to your local schools creates a strong connection to the community and is greatly appreciated by all your employees, especially those with school-age children.