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Developing Business Cases for New Services in Research Libraries

Recommendations: Part I, Organizational Readiness

1 Leave a comment on paragraph 1 0 Determining organizational climate and capacity is an important first step in successful planning for new ventures, and, by careful application of aspects of Brinckerhoff’s (2000) social entrepreneurship model, research libraries can effectively assess their and their parent institutions’ readiness for the creation of a business case.

2 Leave a comment on paragraph 2 0 Step 1: What is the library’s mission? It is necessary to review the mission statement and determine how proposed new services will apply to it. Are services under consideration consistent with this mission?

3 Leave a comment on paragraph 3 0 Every library should periodically review its mission and goals as part of a regular strategic planning cycle, and to ensure that staff and stakeholders, including the board or governing bodies, and any applicable external stakeholders, are in alignment regarding organizational purpose and new service outcomes. Brinckerhoff (2000) recommends putting together a planning group able to review the mission and serve as the core participants in venture development. But whether a library creates a planning group or uses an already existing leadership committee, staff from all levels of the library should be represented, along with “skilled outsiders”—possessing financial, business development, marketing and other needed experience— who not only can contribute to planning and implementation but have the status and credibility to promote the library’s initiative to the campus community at large. This will usually mean, at minimum, also including representatives from the faculty, students, alumni and administration, together with business or public service leaders who may provide access to alternative funding as well as business expertise. The group’s composition will necessarily differ depending on local circumstances, but it can frame its initial discussions around such general questions as, Do preliminary ideas regarding new library service ventures fit into its overall mission? Do proposed new services fit within the overall culture both of the library and university at large? Will they be in line with any consortial or other cooperative agreements already in place? Will new ventures be politically feasible in applicable statewide or regional contexts?

4 Leave a comment on paragraph 4 0 In conducting a mission review, the following components should be considered:
The library’s mission should be up-to-date and accurately convey the services the library is currently performing. Does the library still serve the same constituencies? Has the service area expanded to include new branches, for example, or has the library cut programs due to budgetary constraints? Given the effects of the current economic climate on higher education, this may be a good opportunity to consider if all priorities are still valid, or if some should be dropped in preparation for taking on new, more viable services or ventures. Does the mission reflect the university’s most recent strategic plan? Or has a new leadership changed the university-wide priorities with which the library’s mission should align? If the institution is adding more graduate programs, has the library’s mission been updated to reflect these new teaching and research areas? Has the institution’s research agenda shifted from a basic to more applied focus in order to capture funding dollars? What are the institution’s major grant initiatives, and is the library appropriately involved in providing support?

5 Leave a comment on paragraph 5 0 Brinckerhoff (2000) suggests that a mission statement should be scrutinized to allow for new, more expansive language in order to incorporate new services or outreach to new constituencies. On the other hand, a balance should be preserved by creating more inclusive language that at the same time does not sacrifice the library’s unique service niche or dilute its brand identity. Additionally, as the discussion of proposed business services evolves, it is critical that, if the library expects to generate profits from such ventures, all key players agree on how the profits will be used to support the library’s and institution’s overall missions. Will these profits be used to maintain or expand current services, folded back into ventures, or will they benefit some other part of the institution? If the library is considering partnering with another entity to jointly provide new services (such as e-publishing with a history department, campus publications office, or campus information technology services), is its mission inclusive enough to validate such partnerships and alliances, and, if so, how will the profits be divided?
Update the library mission as needed, ensuring that a consensus has been reached among all stakeholders on the wording as well as meaning and service implications of the revised mission.
The mission review process may require a considerable investment of time, depending on the institutional context, but provides an excellent public relations opportunity for the library as it solicits buy-in and engagement from its various constituencies. However, libraries involved in regular strategic planning may already be undertaking the bulk of this work, and need only incorporate selected additional components into an already existing process.

6 Leave a comment on paragraph 6 0 Step 2: What is the library’s and university’s overall risk tolerance for new business ventures?

7 Leave a comment on paragraph 7 0 After conducting a mission review, library leadership should consider how comfortable it is with assuming the risks inherent in new business development, as well as the tolerance for such entrepreneurial activity in the university, or university system, environment. Further considerations include whether the university has set limits on investment in new services, especially if they will entail medium or long-term sunk costs. Do university leaders view such resource allocations as investments rather than expenditures (and thus opportunity costs—involving risks but also rewards—rather than mere operating costs). Fundamentally, does the organizational culture reward risk-taking, or is it difficult to implement and sustain new ideas? Academic libraries often seek investment through grant opportunities, but is there a reasonable expectation that permanent funding will be secured at the end of the grant period or that, once established, a new service will be self-funded and revenue generating? Does the university administration understand that, in a nonprofit context, outcomes for business ventures should be a “mix of mission return and financial return” (Brinckerhoff 2000)? And how will the library measure and demonstrate a venture’s “soft” mission-oriented rewards additional to its financial return? (Note that we will address risk calculation and risk mitigation in the context of analyzing service options in Step 5 of Part II, below.)

8 Leave a comment on paragraph 8 0 Step 3: What will be any new venture’s overall mission outcomes?

9 Leave a comment on paragraph 9 0 The library, as a social enterprise distinguished by its “dual value creation properties—economic value and social value” (Alter 2003), should consider the need to develop services having both “high mission impact” and “high viability,” with viability equating with profitability (Allison and Kaye 2005). This will help prepare planners to later identify impact and revenue strategies for sustainability within the case-development phase. In ensuring that mission return and financial return are discussed early in the planning process—before idea generation and creating a case for specific new services—library leaders will encourage an understanding that any subsequently developed project goals should explicitly refer back to mission, a precaution against a common mistake among nonprofits of developing lucrative services that can’t be justified within the context of their correspondingly neglected social mission.

10 Leave a comment on paragraph 10 0 Step 4: Are the right resources in place to consider new services at this time?

11 Leave a comment on paragraph 11 0 A basic environmental scan should be undertaken to determine if the library and university have sufficient physical, human, and financial resources available to consider embarking on new initiatives at the present time. In particular, the planning group will need to be able to justify the critical question of opportunity: why is the moment opportune for the proposed service?
Brinckerhoff’s (2000) “readiness checklist” divides resources into the categories of systems, skills, space, and finance, forming an outline for an institutional environment scan, with academic library–related questions included as additional considerations:

12 Leave a comment on paragraph 12 0 Systems (Does the library, university, university system, etc. have in place adequate applicable policies and procedures, as well as the information, administrative, and accounting systems needed to support, monitor and assess new services?)

  • 13 Leave a comment on paragraph 13 0
  • Do new services relate to other initiatives on campus, statewide, regionally, nationally, etc.
  • Does the library have in place appropriate personnel and finance policies for developing a new service?
  • Is the information technology infrastructure sufficient to support any needed additional capacity?
  • Should the library absorb and repackage as new services initiatives originating in other units (digital publishing, custom databases, etc.)?

14 Leave a comment on paragraph 14 0 Skills (Do existing personnel possess the requisite expertise and experience to deliver the new services, or will additional personnel be required?)

  • 15 Leave a comment on paragraph 15 0
  • What training/repurposing of personnel will be needed, and at what cost?
  • What existing duties will personnel cease to perform in order to assume new responsibilities? What reward system will be in place to compensate staff who transition successfully?

16 Leave a comment on paragraph 16 0 Space (Is there appropriate space available [physically or virtually] to support new services?)

  • 17 Leave a comment on paragraph 17 0
  • Does the library have adequate storage, equipment and other infrastructure to accommodate new services?
  • Will the library gain space, equipment and other infrastructure through reducing or discontinuing existing services of less value?
  • Are there appropriate emergency safeguards/security measures in place, if applicable?
  • Is there an institutional commitment to sustaining necessary arrangements?

18 Leave a comment on paragraph 18 0 Financial readiness

  • 19 Leave a comment on paragraph 19 0
  • Is the university willing to invest in new services at this time?
  • If funds aren’t plentiful for new start-ups, will the library consider dropping some services in order to develop others?
  • What are the financial options the university is willing to entertain (possibly including loans, bonding or credit) to begin a new service?
  • Can the library obtain grant or other soft funding? What are the consequences for long-term sustainability if services are funded with soft money? Will funders penalize the library if such a service generates income?
  • Can the library undertake partnerships with business, or accept private funding?
  • Are there restrictions on the use of consortial funding, if applicable?

20 Leave a comment on paragraph 20 0 These steps in gauging organizational readiness—starting with mission review and ending with a brief assessment of infrastructure—help prepare libraries to evaluate their culture and capacity and serve as an introduction to determining new services in the light of mission, cautioning libraries to look seriously at initiatives stakeholders see as core and therefore more likely candidates for sustainability and growth. Ideally, undergoing such a step-by-step evaluation exercise at the beginning of service planning can build a positive institutional climate of support for new ventures a library determines to pursue through the stages of case development described below. For those libraries that are ready, it’s time for the actual business case.

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Source: http://mcpress.media-commons.org/businesscases/recommendations/