Challenging the status quo in NDIS service provision
A remarkable situation has emerged in the disability sector in Australia over the past few years - commercial enterprises are challenging traditional not-for-profit organisations by providing disability support services creating a more open and competitive market in the once underfunded welfare sector.
Historically, not-for-profit organisations and government agencies have been the providers of services in the disability sector and often as a last resort for people with high support needs.This began to change in the early 2000s when private and commercial entities increasingly entered the market following the introduction of individualised funding making the provision of support more attractive to commercial enterprises. Changes in government procurement in the human services sectors meant that commercial enterprises became increasingly successful in gaining contracts.
This new development in the industry was mostly frowned upon by both the government as funders and the individuals, families and carers receiving the services.
The sentiment changed in 2013 with the introduction of the National Disability Insurance Scheme (NDIS). The NDIS was the catalyst that led to the industry’s acceptance of a diversity of service providers and not just an acceptance but a big embrace and celebration of a more open market. The Scheme has injected an unprecedented growth in the size of the disability market sector from $0.89b in services during FY2017-18 to a projected $1.89b in FY2022-23.
Not-for-profits that have historically dominated the sector are being pushed by the increase in competition and opportunity and have had to assess their organisational purpose and service models. Small commercial enterprises have seen unprecedented growth in both numbers and turnover. The new environment has been so plentiful that some businesses have grown to turnover several million dollars of revenue from a starting point of zero within a few short years.
After evaluating, auditing, and mentoring more than 100 not-for-profit and small and medium enterprises (SMEs) that offer disability support services as their primary product over the past five years, I have noticed some common industry trends.
Both NFPs and SMEs tend to lack at least three of the following essential characteristics:
clarity of purpose
strategic insight
appropriate governance
evidenced based decision making
monitoring of internal and external environmental trends
proportionate systems to support operational management
effective leadership
defined risk tolerance
diverse income streams
These trends are all related to lacking a robust business strategy.
The purpose of my work has been to turn the tide on these trends and help transform these organisational risk characteristics into opportunities for providers so that they can build robust and mature businesses.
Get in touch if you want to find out how I can help your organisation be robust throughout its NDIS journey.