Commonization

Marketplace on American Pubic Media produced a story about the Toyota design theory of commonization.  A single vehicle part is designed and used on multiple models.  It costs less, requires less in research and development and is more efficient to stock.  The practice is wonderful until something goes wrong and then every model is effected.  Toyota now has a billion dollar problem to fix and has been forced to shutdown production of new cars to fix the current fleet.

I wonder if you have seen the same thing in the nonprofit sector?  I frequently hear groups discuss the need to get more grants from foundations.  If every group acted on this strategy it would overwhelm the foundations.  Giving USA provides the following data.  Foundations account for 13% ($14 billion) of the total philanthropic giving in 2008.  About 75% ($230 billion) comes from individuals.  Which piece of the pie looks more attainable to your organization?  Diversification is one model but commonization as a tactic just because another organization is having success is not strategic but rather reactionary.

Commonization has been used very successfully in a community wide efforts.  Charitable events that support multiple agencies are amazingly well received.  Old Bill’s Fun Run in Jackson Hole, Wyoming is administered by the Community Foundation of Jackson.  It provides a way for the citizens of the community to support all the nonprofits with “one broad stroke.”  It is the umbrella fundraising event for the community.  Commonization has been well received and worked extremely well in this application.

Are your initiatives thoughtfully designed and linked to your strategic plan?  Are you reacting to the success or failure of the enterprise down the street?  If you take on a strategy of commonization can you sustain yourself if the “brakes fail” as in Toyota’s case?  If you are serving for the public trust, what is in the public’s best interest?  What are the benefits of commonization for your community?

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