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Explore the big issues affecting funders of digital resources, such as budget cuts, decreasing endowment investments, and the need for long-term preservation. Learn about the steps project leaders and funders can take to ensure sustainability.
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The Big Issues Kevin Guthrie, ITHAKA Morning Session Talk and Discussion (Outline) 7 May 2010
Plenty of ‘big’ issues • Fragile and hostile economy • Government instability in the UK • UK university budgets to be cut £449 million in 2010-11, with £215 million cuts for teaching and research funding flat • Uncertainty about what further cuts a new government might bring • Government budgets are under duress in the US • At least 39 US states have reduced funds allocated to higher education • Endowment investments in decline • American university endowments registered their worst average returns since 1974 • Philanthropic foundations making smaller grants • Median annual grant-making for large U.S. foundations dropped $2.1 million in 2009 • What are the consequences for innovation in higher education, cultural heritage, and related sectors?
The big issues are affecting funders • For grantors, pain points at every stage in the life cycle of a funded project: • Previously funded projects returning to ask for more funding at the end of their initial grant cycle • Once the project’s initial grant ends, less funding available for on-going support from universities, museums, and other host institutions • More innovative projects are at the door seeking start-up funding • Long-term risk that projects are not being digitally preserved
Doesn’t Change the Fundamentals: “Now We Mean It!” • Ithaka S+R conducted research on online resources in the academic and cultural heritage sectors in 2008-09 • In a series of twelve case studies, profiled the projects’ histories, costs and revenues, and sustainability plans • Identified five key steps for sustaining a digital resource • This underlined the challenges of trying to make each funded project sustainable. Is there capacity to respond to a more challenging environment?
And not just for those who think they invest in digital resources… • Not all granting agencies and foundations describe themselves as funders of digital resources, yet their grantees are creating a wealth of digital projects • The museum that receives funding to mount an on-site exhibit and builds a vast interactive website with hundreds of images • The television production team that posts online production stills and transcripts, and launches a discussion board • The medical research teams who deposit datasets and papers in a national repository
Sustaining Digital Resources:An On-the-Ground View of Projects Today (2009) Sustainability is the ability to generate or gain access to the resources—financial or otherwise—needed to protect and increase the value of the content or service for those who use it
What role for funders? • Our 2009 study addressed sustainability from the project leaders’ point of view • What are the steps they took to balance costs and revenues, plan for future investments in and updates to the resources, build a robust community of users • The study did not address the roles funders play • What does project sustainability look like from the funders’ side? • What are the steps they can take in this process? • What are the obstacles? How do funders interact with the steps we identified? Where do they help the process, and where might they hinder it?
Five Steps to Sustainability Empower leadership to define the mission and take action Create a strong value proposition Creatively manage costs Cultivate diverse sources of revenue Establish realistic goals and a system of accountability
Empower leadership • Found that successful projects have leaders who: • are strongly dedicated to the projects • pursue new opportunities and risks • hire talented staff • What can funders do to help? • How much control do funders have over project leadership? • How can funders build capacity for entrepreneurship and innovation in their grantee project leaders?
Create a strong value proposition • Project leaders: • Create a resource that offers unique value, and understand that value • Deeply understand to whom the resource offers value, and why • Continue to add value to the resource based on an understanding of users’ needs • What can funders do to help? • How can funders help ensure that value proposition is clearly articulated? • Do funders discuss impact? • How can funders help strengthen the value proposition of the projects they support? • Do funding guidelines give resource leaders the freedom to enrich and invest in the resource post-grant?
Creatively manage costs • Project leaders: • Minimise direct costs • Secure contributions from the host institutions • Outsource to vendors • Recruit volunteers • Need accurate and full accounting of operating costs • What can funders do to help? • Our research pointed out that host institutions may be less able to provide the in-kind support that was possible in a stronger economy. • Is the model of transitioning a funded digital project to a willing host institution still viable? • How can funders provide scaled solutions to lower costs for all the digital resources they fund?
Cultivate diverse sources of revenue • Project leaders: • Cultivate sources of revenue to cover both direct costs and ongoing upgrades • Experiment with different revenue models • Clearly identify the value of the resource to the target audiences • Consider diverse sources of revenue • What can funders do to help? • Do foundations and granting agencies value the development of long-term revenue sources? • How do funder policies regarding IP constrain revenue options for projects? • How is progress toward revenue generation evaluated throughout the grant? • Do funders require revenue projections?
Establish realistic goals and accountability • Project leaders: • Establish goals and targets with their host institutions • Determine balance between financial and mission goals • Assess progress • Connect their broad mission to quantifiable targets • What can funders do to help? • Do funders require the development of measurable goals and objectives? • How are fundees required to report impact to funders? • Do fundee impact reports affect the future funding practices of grantors? If so, how?
What questions can funders ask themselves? • Which types of projects require sustainability? • How do funders articulate their exit strategies to projects? • And just what does sustainability mean? • Covering just direct costs? • Covering all operational costs? • Generating enough to continue resource development?
Longer-term issues rising to the top • Blue Ribbon Task Force on Sustainable Digital Preservation and Access final report pointed to continued need for attention to digital preservation • Highlighted key recommendations for stakeholder groups, including funders and sponsors of data creation • Create preservation mandates when possible • Invest in building capacity for preservation • Provide leadership in training and education for digital preservation • Fund the modeling and testing of domain-specific preservation strategies • Suggests the importance of a more expansive role for funders over the lifecycle of a digital project • Is this a sustainable situation for funders?
For funders, new big issues In a harsher economic environment for universities, libraries, museums, and others, difficult questions to answer: • Which projects need to be “sustained”? • How can funders and fundees better define what “sustainability” will require and understand the steps needed to accomplish this? • How can funders’ policies and practices improve the chances for success of the projects they fund? • How can a funder have impact in the Five Key Areas, to help digital resources survive and thrive?
