Resource Independence Theory

Paper Summary:

Judith Saidel, executive director of the Center for Women in Government, has conducted much research in recent years related to non-profit management, policy, government sector relationships and the relationship between the two. This paper examines Saidel's Resource Independence Theory which claims that appointing certain individuals to advisory groups is a method that organizations can use to build strategic relationships between the organization and key stakeholder groups in the community.

From the Paper:

"Judith Saidel is the executive director of the Center for Women in Government located in SUNY-Albany (Rockefeller,2003). Saidel has conducted much research in recent years related to nonprofit management, policy, government sector relationships and the relationship between the two. In a recent study conducted by Saidel, 101 New York State nonprofits that received funding via government grants were examined. Saidel's primary intent was to uncover the role of advisory bodies in organizations.

Saidel's research has focused on interdependence issues between public agencies and organizations as well as the role contracting may have for non-profit governance, policy education and leadership development (Rockefeller, 2003). Saidel's recent New York State research study entitled "Advisory Groups and Governance," specifically outlines the important function advisory bodies have in nonprofit and public management. The primary purpose of her study was to examine the interdependent role nonprofit agencies have in relation with governing advisory councils.

Ms. Saidel developed the "Resource Independence Theory" related to the role of advisory boards and governance. She claims that throughout history, advisory boards have primarily been viewed as "passive bodies" with no real governing or influential impact on the organizations which they represent. "Resource Independence Theory" claims that appointing certain individuals to advisory groups is a method that organizations can use to build strategic relationships between the organization and key stakeholder groups in the community (Saidel, 1991). Advisory boards, according to Saidel, link nonprofit organizations with key members of the community at large and the pubic.

Advisory boards also help organizations find representation with businesses, corporate entities, professional group, foundations, community members and government agencies. To survive, nonprofit groups need such support, and need to be highly visible within the communities they represent. Advisory boards serve the purpose of enabling an organization a higher level of visibility in the community and world at large (Saidel, 1991). In the past, nonprofits were often seen as simply a group that resided within a community. This change in thinking however, offered by Saidel, can help nonprofits become more contributing and important members of the community.

Saidel's research supports the idea that volunteer advisory groups are crucial bodies of governance in many nonprofit organizations funded by government grants. Her theory explains how advisory boards act as independent entities in nonprofits, separate from the board of directors. The board of directors in a nonprofit organization is often comprised of the CEO and government policy makers. These individuals often have a desire to find an advisory group that will draw on the community, thus creating greater diversity within the organization (Aspen, 1999). Advisory board insight and influence assure that objective decision making remains possible within a nonprofit, in essence allowing a system of checks and balances between the board of directors and organization as a whole. The board of directors in turn, has the unique ability to also evaluate and criticize the decisions offered by the advisory board. The advisory board in turn, helps to fulfill organizational goals and train new board members, as well as maintain the affiliation of retiring board members (Aspen, 1999).

By remaining independent, advisory board decisions are often considered based on merit and not subjective decision making. Advisory board functions within nonprofits include performing organizational activities such as fundraising, grant allocation and agency assessment (Saidel, 1991). Additionally, advising bodies act as ambassadors and advocates for nonprofits in grassroots communities (Aspen, 1999).

Saidel claims that advisory boards hold three primary functions in nonprofit organizations, including: (1) Acting as the "bridge" between the nonprofit group and community members, (2) Complimenting and strengthening the governance functions of the board of directors by providing independent thought, and (3) Assisting executive staff members with nonprofit organizational activities such as fundraising (Aspen,1999). These functions have been outlined above. Perhaps another appropriate term for advisory boards would be "ambassadors," as these boards truly are comprised of officials that act as representative members of the nonprofit cause.

"Resource Independence Theory" provides a framework for how advisory groups should act out in nonprofit organizations. Saidel supports the idea that these groups can help nonprofit organizations achieve "a balance of community representation in it's governing bodies" (Aspen, 1999). Advisory boards also, according to Saidel's theory, play a key role in helping the governing body of nonprofits raise funds for their programs and offer key training to personnel and board members. Their organization contributions, from a practical standpoint, are critical to the survival of nonprofits. Advisory boards may be considered the glue that holds the organization together, assisting with key initiatives and program development.

Additionally, advisory boards help nonprofit organizations reach key people in the community, thereby increasing visibility and support (Aspen, 1999). Program development, continuity of process and policy making and objective judgment are all contributions to nonprofits made by advisory boards. According to Saidel, "As the boundaries between government, business, and the voluntary sector blur, connections across sectors are increasingly becoming blurred" (Aspen, 1999). Advisory board's also bring credibility to nonprofits, and their support of the organization spreads a message among community members and politicians that they are on an important mission with an important organization, one that will impact the community in many significant ways (Aspen, 1999).

Advisory boards function well by establishing a clear mission and goal. They focus the efforts of the nonprofit and help decision makers understand the role an organization has in the community. Saidel's research and theory regarding Resource Independence has re-established the importance of the connection of nonprofit organizations to the community at large. Her methods clearly establish the importance of recognizing the contribution that advisory boards have to the success of nonprofit management. Through proper use of advisory board council, influence and training, Saidel demonstrates how the creation of boards can once again establish the link between nonprofit organizations and the community."

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