Clicky

Articles: The NDIS readiness challenge – adopting commercial practices without losing your reason for being

30 June 2016

Chris Skelton , Consultant, Not-For-Profit |

The introduction of the National Disability Insurance Scheme (NDIS) is one of the single biggest issues facing Australia’s not-for-profit sector today. Disability service providers are being confronted with a dramatic shift in their operating environments, both in relation to their participants’ interaction with them and their internal activities.

As someone who is closely involved with the not-for-profit sector, I strongly believe that the ultimate outcome from the NDIS, regardless of its impact, must be that people with a disability have their needs met into the future.

BDO shares this view and is working hard with its clients to help ensure the strength of Australia’s not-for-profit sector is maintained.

To gauge the readiness of Queensland’s disability providers and provide a meaningful and useful roadmap for their path to full NDIS implementation, BDO conducted the NDIS Readiness Survey in the first quarter of 2016.
The results of the survey are now available and they put a spotlight on six prominent challenges facing providers:

  1. The need to ‘set’ or ‘re-set’ strategy for the new market
  2. Cash flow and working capital management
  3. Transactions for growth
  4. Marketing and engagement
  5. Technology
  6. Human Capital.

These results were strongly reinforced as the key areas of focus during the panel discussion at our NDIS Readiness Survey result presentation event at BDO in Brisbane yesterday. Our panel of experts all agreed that these are the areas disability service providers need to focus on to ensure long term success and organisational sustainability. If you missed our session, you can view our Facebook Live broadcast here.

Snapshot of the key findings

Strategy

The changes to funding processes implemented under the NDIS have the potential to completely shift the long term strategic environment in which participating organisations will offer services, and could derail those service providers who have not revisited their organisational strategy to adequately address these changes.

Financial management

Transitioning from block or grant funding to the NDIS service provision and invoice structure has the potential to put significant pressure on the cash flow and day to day financial resources of disability service providers. To ensure financial sustainability, providers must define their exact cost of service delivery and understand what financial resources will be required to manage the change and operate in the new environment.

Mergers, acquisitions and collaboration

As the disability funding model changes, so too will the competitive landscape, with both not-for-profit and private sector enterprises seeking to carve out market share. Some organisations will require short term geographic or service line expansion to ensure their survival, and others will be well positioned to seize transactional growth or partnership opportunities.  Ultimately, some providers may decide to divest some or all of their disability services.

Marketing & engagement

The shift toward user choice in service delivery will create a new contestable marketplace where organisations must be able to track, understand and act on the engagement between NDIS participants, employees and services. In this new environment, organisations need to create, manage and utilise their brand in the market to secure new relationships.

Technology

The new funding model changes a number of major aspects in how organisations process payments, communicate with staff and participants, secure their data and utilise systems.

Human capital

The NDIS, user choice, and a contestable market will alter the face of how service providers attract, manage and retain talent. Employer brand, selecting people leaders, improving HR processes and developing an approach to the full human capital lifecycle will be essential to long term organisational sustainability.

Get the full report

For a detailed analysis of the survey results, including observations from BDO specialists working in the not-for-profit sector, download the full

NDIS Readiness Report

Collaboration in a business sense will be absolutely fundamental to success in the new NDIS world. Achieving this relies on the sector embracing a shift away from the ‘not-for-profit’ label and continuing to move towards the ideal of a ‘for service and not-for-loss’ mindset.

For a more detailed discussion about how your organisation can ensure long term viability in a competitive marketplace, please contact a BDO not-for-profit specialist.