The following is a conversation between Brian Gallagher, President & CEO of United Way Worldwide, and Denver Frederick, Host of The Business of Giving on AM 970 The Answer in New York City.
Denver: Like me, my next guest’s first job out of college was with the United Way. I now host a little radio show in New York, and for him, he has only gone on to become the leader of perhaps the most important and influential nonprofit organization in the world. He’s Brian Gallagher, the President and CEO of United Way Worldwide. Good evening, Brian and welcome to The Business of Giving.
Brian: Thanks Denver, it’s great to be here.
Denver: Share with us some of the history of the United Way and how it’s evolved over the past 131 years. One thing I do remember… It was founded in Denver.
Brian: It was founded in Denver. Very good. It actually starts like a bad joke. It was founded by a rabbi, a minister, and a priest who stepped into a bar. What’s interesting about it is United Way, like a lot of major nonprofits and the public high school, were products of industrialization. One of the social impacts around industrialization of the country was that millions of people moved from rural areas into cities for jobs, and there was no social safety net.
There was no public welfare system. That didn’t exist; so the private sector, faith leaders, businesses, early organized labor started organizing into associations. They were essentially planning organizations. What are we going to do about these health issues and housing issues and so forth? That was the forerunner of United Way. First, in Denver. When it started to modernize, it became Community Chest. So, this idea of raising money together for a group of nonprofits…honestly, before that, it was the War Chest. The World War I relief effort kind of took this community planning model that was evolving, started in Denver, put a fundraising and in-kind contribution, civil defense, civil society piece to it. After World War I flipped it into Community Chest, and that became United Fund, and that became United Way.
Denver: Today, how many United Ways are there across the country and the world?
Brian: There are 1,800 local United Ways in 41 countries. There are 1,100 United Ways in the US. Collectively, we generate about $3.7 billion in revenue in the United States… and growing pretty quickly outside the US… and now over $1.1 billion in revenue outside the US.
We’ve gotten big by acting small.
Denver: What’s the nature of the relationship that the United Way Worldwide has with these 1,800 local United Ways?
Brian: The best way to describe it is we’re a franchise nonprofit. United Way World– we own the name and the brand mark, United Way– and we license it to local volunteer groups to operate, do business as United Way in Greater New York, in Miami, in Mumbai, in London. They have to follow certain rules around governance, financial management, ethics, legal issues, and so forth. But they’re independent nonprofit organizations incorporated in that city, in that state, in that country. So, we’ve gotten big by acting small. You get really focused on: what do you want to try to manage centrally– finance governance, ethics, some talent managing corporate relationships, and other government relationships. But you want to stay local as well. One community at a time. New York’s a different place than Miami. So, that’s how we’re organized.
It’s a civil society organization, and citizens generally are going to have a greater role to play in terms of global relationships. Humans want to connect, no matter where they are.
Denver: I think some listeners might be a little surprised to know that you are in over 40 countries. Where is that presence most visible? And do you link any of these countries back to communities here in the United States?
Brian: It’s a really interesting questions. Our biggest presence outside the United States is in East Asia– Japan, Korea, China now. We’re growing quickly in South Asia, in India. We have a really good network in South America and Latin America. After the Berlin Wall fell, we went quickly into Central and Eastern Europe and started United Ways in Hungary and Romania and so forth.
Now, our biggest hole has been in Western Europe because of the role of government– socialism and so forth. But that’s starting to grow now, and we have a presence in London, in Paris, in Madrid. We’ll start in Germany this year sometime. You can trace it all the way back to two things. Especially in East Asia after World War II, Community Chest, the forerunner of United Way, was introduced into Japan as part of the rebuilding effort, along with Rotary and other things. Our brand in East Asia is the Community Chest. So, it’s the Community Chest of Japan, and they generate more than $200 million a year today. Community Chest of Korea is our second largest affiliate in the world with over $600 million.
In South America, it’s either United Way or it’s Fondo Unido, United Fund. Same idea. People like to say, “Oh Americans are so different in terms of giving.” We’re different, but we’re not as unique as people like to think we are. There’s this human instinct to give back. Now, formal philanthropy is different. This idea of incorporating in Mexico City makes sense as long as you say: Do it the way you would do it in Mexico City; just follow these rules. What we do, to your second question, there are more people today living outside their country of birth than any time in the history of the world. If you go, not even in big cities anymore; all-sized cities are people from different countries.
We started something many years ago… but we resurrected five or six years ago…. called One Heart Two Loves. I’ll give you an example. The idea, I live in one place, but I have a love for the place where I live and a place where I came from. The largest concentration of Korean Americans in the United States is in Los Angeles. So, we brokered a conversation between the United Way of Los Angeles and the Community Chest of Korea. The Community Chest of Korea has this thing called the Honor Society, which is leadership donors in Korea. The United Way in Los Angeles wanted to break into the diaspora, the Korean community. They signed a Memorandum of Understanding. The Community Chest of Korea hired a staff person to work at United Way in LA, and they were raising money back and forth, and now doing programming back and forth. It’s a civil society organization, and citizens generally are going to have a greater role to play in terms of global relationships. Humans want to connect, no matter where they are.
Denver: That’s a splendid example.
Your mission is advancing the common good, focusing on three areas: Health, education, and financial stability. Very ambitious, indeed. How do you go about doing that work?
Brian: The thing about that agenda is if you look at a successful human being, a successful family, a successful community, neighborhood, country; those are the building blocks. Always have been. Always will be. Am I healthy? Do I have access to healthcare? Am I educated and trained well enough to get the job that allows me to be financially stable? It’s not that hard.
It’s hard when you come up against government systems and healthcare systems, and United Way systems. So, the way we go about it is: essentially, say we exist to help a community define its most important issues and how to work on it together. Let’s say that a community says our biggest issue is: We’ve got a lot of new immigrants, and their children aren’t graduating from high school in a way that allows them to be successful and not a challenge in our communities. What you say is, education. It sounds daunting when you say education and community health. But when you say education, but what does it mean in this community? What it means in this community fundamentally is: we need a Latino strategy to make sure that young Latinos whose families moved here and are getting integrated into the schools but struggling; how do we have a strategy that helps those young people graduate in a way that helps the school be successful, they be successful, their neighborhoods be successful?
You break it down, make it smaller. Then you say to corporate employers and to government and to family, and to faith-based organizations; we all need to agree that there’s a goal that supersedes all of us. I’m back on my alma mater’s board of trustees primarily because they didn’t check my probation record apparently. Apparently, those records didn’t go back that far, and I said to the other trustees: we don’t have an enrollment plan unless we have a diversity plan. Our communities are getting more diverse. If we want to keep enrollment going and be a successful university, then we have to invite communities of color for instance. Education sounds big. High school graduation sounds big. But if you’re saying, all kids have to succeed, then you break it down; then you divide it up; then it gets more manageable. Again, we don’t try to do it at such a macro level that it becomes daunting. It’s a series of small things that add up to big things. In the US, we have a historically high high-school graduation rate, and it’s because of government leaders, local leaders, United Ways, Boys and Girls Clubs, City Year, and we started to lock arms and say, “We’ve got to graduate our kids.”
I have seen more knock-down, drag-out fights between early childhood development providers over how to measure the success of a three-year-old than you should ever see in a lifetime. Agree on what success looks like so you have a common language…then have an infrastructure backbone organization that cares about the collaboration.
Denver: It’s interesting because you’re really saying there too: It’s a single playbook with a single set of metrics, and United Way plays that indispensable role of really bringing the government and the nonprofits and the private sector and the corporations and the wealthy individuals together, all taking a piece of it. I guess they refer to that as collective impact.
Brian: It’s interesting because when Stanford and others came out with this collective impact model, and some folks in United Way got all up in arms saying, “We’ve been doing that for 20 years.” I said: “Well, then say it.” They coined what we did. You should be happy. What I learned is exactly what you just said is that, essentially collective impact is this: agree to what are most challenges or opportunities or issues as a community. Agree on the goal. Really, important, agree on a goal. Agree on the strategy, and what strategy means is: What role is everybody going to play? I’ve been around so many collaborative tables where the cities are there, the counties are there, the chambers are there, the businesses are there, faith leaders are there; we have this big conversation about what we’re going to do, and then we all go back and run our organizations.
It’s like, “Oh well that’s very interesting. But it’s not adding up.” So you have strategies and assigned roles, metrics; agreeing to how we’re going to measure success is essentially saying we’re going to adopt the same language. I have seen more knock-down, drag-out fights between early childhood development providers over how to measure the success of a three-year-old than you should ever see in a lifetime. Agree on what success looks like so you have a common language, and then our role quite often is then have an infrastructure backbone organization that cares about the collaboration. Not just an institution within the collaboration. It’s sometimes an invisible role.
Denver: It can be thankless. It really can. Backbone organizations are so critical and so vital, but they can be underappreciated. Because they don’t have that emotional component. Everybody wants them, but nobody wants to pay for them.
Brian: That’s right. I went to undergraduate school to be a social worker. I came into the United Way realizing this was a fundraising organization. So, what I learned was collective impact to me was; okay, that’s great. That’s what we should be doing. But that doesn’t mean that that’s – you still have to go sell yourself. You still have to go market yourself. You have to tell personal stories. Nobody wants to hear about your committees, but they’d like to hear about the result of the collective impact work. You wouldn’t be reducing the number of homeless veterans in America today in city after city if there wasn’t a collective impact model in these cities brought together by United Way. So, don’t sell the collaboration. Sell the fact that there are fewer veterans on the streets. Sell the results, and sell the aspiration. People buy aspiration.
If you don’t make your goals aspirational, that forces everybody to change, including yourself; then you will negotiate down these common denominator goals to a point where it doesn’t matter.
Denver: That’s interesting what you said because I think you’ve maintained that social impact goal setting…. It has to be aspirational because if you make it too much like business-goal setting, you get into those language fights that you just talked about with early childhood development. You have to really keep it at that high plane.
Brian: The other thing Denver that happens is in my experience, and I’ve had a lot of really smart leaders reinforce this with me. If you don’t make your goals aspirational, that forces everybody to change, including yourself; then you will negotiate down these common denominator goals to a point where it doesn’t matter. Now, you’re fighting over stuff that doesn’t matter. If you want to take on high-school graduation, then set a goal like the one we’ve just set now for ourselves in the US, to get to 95% of all young people graduate. Or the thing that I thought was crazy, when the coalitions and homelessness in the US came about 10 years ago, or 12 years ago, their goal then and today is to eliminate homelessness. They came to interview me, and I said,”You guys are out of your mind. You’re never going to eliminate homelessness. Did you not read the Bible?” They were right, and I was wrong. It was because, it forces you to go,” God Almighty! How are we going to eliminate homelessness?”
Denver: Isn’t there a line that goes, “If you have a rock, and you’re trying to roll it up a hill and you’re having trouble, go find yourself a bigger rock.”
Brian: Exactly right, and you’ll probably find help.
Denver: You find help and get people excited, and you find new tools to get the big rock up.
Brian: Exactly. That’s been our experience when we focus on helping a community succeed, our institution succeeds. When we focus on our institution, we’re not as successful. When the community is sick, we’re sick. And when the community is well, we’re well.
Denver: Let’s turn to another thing that United Way is well-known for, and that is workplace giving. When I was at the United Way back in the day, it was a different world. People would go to work for ATT or Union Carbide, and they were pretty likely to retire from those places, so that employer-employee relationship is not like that at all anymore. You have a different set of challenges, different set of circumstances, how do you approach it?
Brian: Instead of just starting at the workplace, there are four big drivers of change in the world today. One is globalization of the economy. No matter what anybody says, the economy is globalizing and will stay that way. The migration of people, mentioned earlier. The number of people living outside their country of birth, the changing demographics in the US and around the world; my generation of boomers are leaving; the millennials are coming. Fourth is digital technology. Blows up business models, and speeds everything up. So, the workplace is just now – subject to all those changes.
If you look at pre- and post-Great Recession in the United States, the two things that are post versus pre is structural employment changed. There is this big question, remember during the recession, I wonder if those jobs will ever come back? The answer is no, they didn’t come back. And they’ve come back as part-time, as at home. Robotics and machine learning and so forth. The other is a commitment to digital commerce. That’s what’s changed the workplace, and the millennials are more multiracial, more; hands-on is too pejorative; they’re more experiential. They’re more holistic. They know fundamentally that this idea that we’re always going to do better… they don’t buy that. It doesn’t exist for them.
So, what that means for us is that we’ve had to move from a business-to-business model, forever our relationship was with the company, the employer. We didn’t know the people who were donating to us. The information came to us in big batches of information and checks and payroll deduction. Now, everything has to be about the men and women as individuals who work for those companies, and the relationship with the company is a channel relationship.
What’s interesting about it ,Denver is, the companies are struggling with the same thing. They’re struggling with getting and keeping great people because that lifelong deal was a two-way street. The millennials have figured out: I don’t think you’re committed to it. Therefore, I’m not committed to it. So, this mobility of employment is a challenge for some. What we say is, “Look, we can help you create a relationship with your employees that helps them achieve things that they want to achieve in the world. But you can’t tell them what to do.” Not anymore. We used to tell them what to do. This is how to do it. This is why you should do it. Now you create an opportunity to do it, and don’t tell them what to do.
Denver: They want companies that are socially engaged, but don’t tell me what to do. It’s funny when you talk about the loyalty. I sometimes even look at that in sports…with free agency, and I never really drew that connection for a while. It all began when you sign a three-year contract and then a Yankee becomes a Red Sox. The world just reflects that.
Brian: One of the changes – I won’t do a complete spoiler – but Robert Putnam, the social scientist from Harvard who wrote Bowling Alone – a great book; and a bunch of other things. Maybe the most pre-eminent social scientist alive in the country today. He’s writing a new book, and he’s done a lot of research and essentially this change… It started with the workplace, but it’s really a cultural societal change; we switched from a We-culture to an I-culture. My generation, the boomer generation, became the me generation, and he actually talks about our divide in the country in the US politically and culturally now and economically, really started as early as 1970.
We like to think that the 60’s was this renaissance decade. His view might be that it was really the warning decade. That this we-culture of the gilded age and Teddy Roosevelt, and we’re all in this together that led to the greatest generation, and so forth… is that we drifted to an I- generation. And that you can’t put it back together as it was 100 years ago. But what we’re searching for, I think, is a We. How is it that we collectively respond to our greatest needs and opportunities and believe that I individually will succeed if everyone succeeds?
Denver: Harder and harder to find that common good. That common ground.
One of the most exciting developments in workplace giving is this new app called Philanthropy Cloud which you’re doing in partnership with Salesforce.org; this could really change how philanthropy works. Tell us what this new tool can do.
Brian: I’m really confident that it will. I say that because I’ve been doing this for a long time, and I’ve broken my pick on a lot of ideas or been disappointed by a lot of ideas. I just think that this one’s it. Because it captures what we were just talking about.
Salesforce is voted as one of the most innovative technology companies in the world. The best place to work according to Fortune. It was founded by a guy named Marc Benioff. Marc is an unbelievable philanthropist. He’s 50 years old. Maybe just north of that. His name’s on Children’s Hospital in San Francisco. He didn’t adopt the school in San Francisco or Oakland. He adopted the school system literally.
So, we were working with them. We were trying to create this app for employees in corporations to better manage, get access to us, give, volunteer, so forth. It’s very interesting, but it wasn’t compelling to me. I was like, Fine… whatever. But I kept saying, “What we need is a solution today for this idea of common-good, or collective impact. I met Marc at the World Economic Forum in Davos. We chatted about it. He’s pushed me, and I pushed him. So, we got this little project going. I finally get to him last– not this last January, but a year ago, last January. I said, “Marc, I need to draw you two circles. One circle I showed 60 thousand companies, 50 million employees, 2& ½ million volunteers. You’re building an app for us to try to do better with these folks in these companies.
But you’re missing an entire whole circle. 50 thousand NGOs funded, 1,800 communities. Mayors, county commissioners, faith leaders. Everybody in community. It’s the connection between the two things that will change the world. The technology already exists to transact anything in the world. You can give to anything. Somebody just made a $27 million dollar gift to DonorsChoose to take every request off the board. Fantastic transaction. What does it do for education? Content with market, and he looks up and says: “That’s a big idea.” I said, “Then let’s build it.”
So, Salesforce is building that technology for us that will allow individuals in… first companies and then beyond… to manage their giving, manage their volunteering, connect to content like… you want sustainable development goals and locally United Way housing and education content. You want a volunteer. You want to advocate. You want to talk to a member of Congress. We’re going to help you do that. You want to connect with other people inside the company in real time to organize to ask them to be involved. We’re going to help you do that, all powered by not just the functionality they get built by Salesforce, but by the artificial intelligence that is Einstein. United Way is the content partner. They’re the technology partner. We can’t do what they do. They can’t do what we do. We’re going to put the two things together. And we’re right now out there in pilots within corporations across the US.
Denver: it’s going to roll out this summer, hopefully.
Brian: As they say in the technology world, would be GA on June 29th. It’ll be generally available June 29th.
Denver: It sounds a little bit like Amazon or Facebook in the sense that when I go there, it knows about me. it gives me the news feeds that I want. It tells me, based on my purchases, what I might be interested in. You’re doing all that for this whole sector which has never been done.
Brian: We’re doing it for the whole sector. You know what’s interesting is that when we first thought of it, we thought we were doing it for us, United Way. And then we said, Why do we even exist? What we’ve realized is, we’re doing it for the whole sector. When I got back from the conference where this was announced, the Salesforce conference called Dreamforce, my colleague running Girl Scouts USA called me up: “How do I get on the platform?” And I thought, Oh yeah, that’s right. This is about her. This is not about me. It’s about all of us. By the way, one of the things that this will allow people to do is to create their own profile. You leave a company, you take it with you. And you go to the next company, you take it with you.
Brian Gallagher and Denver Frederick inside the studio
Denver: People learn from one another. You got some great bells and whistles. You got volunteer hours counter; you can hook it up to QuickBooks and TurboTax. It really begins to integrate in so many different things to make your life better.
Brian: It will connect to your social media feeds, at some point as soon as we do that – one of the things we like about Salesforce is they release new versions every three months. So, the roadmap and the learning that we’ll get from the marketplace will be in real time. The big idea here is Marc and I looking at each other and say,”Let’s go do that. Let’s go do that because nobody’s done it yet.” You can drill a well anywhere in rural India with a contribution made through a website, and the farmer will wave at you as the well is being drilled. But what does it do about water? What does it do about women who are exploited in the farming industry in rural India? How do you deal with the content? It’s incredibly exciting, and we have already… even beyond where we thought. We are going to immediately take this ecosystem out beyond United Way and make it available to help build the capacity of other nonprofits.
Denver: Very exciting.
Sticking with philanthropy for a minute, I want you to tell us what you think about philanthropy in this country in 2018. It’s been around 2% of GDP for forever and a day, but the way we’re getting to that 2% is really changing. Speak to that a little bit… and maybe some of the concerns you have over it.
Brian: I’m going to say it this way. Even though I struggle with how I’m saying it, but I don’t know any other way to make this point. The concentration of wealth in the United States is being followed by the concentration of philanthropy. It’s good that more people are giving to charity. Is it good that increasingly that’s being driven by high net-worth people creating their own foundations or their own donor-advised funds to direct what they think is important…. and less a community and if you give $200 a year, your voice isn’t the same because the concentration is different? That’s what I’m concerned about.
On my way over, I was beforehand with a major donor, and we were talking about this. Big donor from a prominent name who said philanthropy is really like philosophy. You’re really exercising your philosophy. So, my concern is, we have charitable giving is growing in the United States, but the number of people giving to charity is decreasing. The number of people volunteering is decreasing. What built this country, what made this country great was that everybody’s voice mattered. Not just United Way. We have to find a way to get more voices back in our communities in order to choose a topic for our governments to listen to us. We’re so divided in the country… the income is so divided, the gap between wealth and poverty is not sustainable in the US. It’s happening in Canada now as well. So, what’s happened is we carved out the economic middle. Globalization did that. We then carved out the political middle. You can’t find a moderate Republican in Washington. Now, we’re carving out the cultural middle, and we just passed a tax bill that concentrated wealth even more and increased the deficit. We all knew that that was going to happen. Anybody who says that they think it was going to pay for itself is disingenuous. The fact is we have to focus on building our middle back. Philanthropy can be a part of that, but what we need is policy and tax law that incentivizes people of all means to get back involved in the communities.
Denver: It’s interesting what you said about philanthropy in that we scrutinize our political donations. But our philanthropic donations can have political overtones as well, but people don’t pay much attention to them. They can really direct energies, and they can direct the whole sector about how we tackle a problem based on the size of those gifts.
Brian: No doubt.
Denver: Speaking about building back up, let’s talk about social mobility in America. So many studies, and you look at them all the time, will tell you, more and more and more it becomes predictive. Where we begin is where we’re going to end up. If you compare it to how we fare against other countries in the developed world– Germany, Norway, Canada– we’re not doing so well as far as social mobility. What do we need to do to recapture this sense of the American Dream and of possibility?
Brian: In short, we need education and upscaling state-level and a national plan which we do not have. The economy globalized, and in a global market, you have to get clear on what’s your competitive advantage, where you want to compete, and that goes right down to how do we educate young people and re-skill people whose jobs are being eliminated in order to get to the jobs that are being created. And there is no plan. What we see is it is local communities, community colleges, businesses creating their own because there is no national plan. I hate to be this negative, but this is exactly what’s happening.
The fact is that there is an opportunity for us… if we will get real about where we are as a country. Why do we have to be so freaked out if we can’t say as Americans, we’re so exceptional? So what? The fact is that every civilization rises and falls. The smart ones are a human or a family or community have some level of self-awareness in order to pull yourself out. If you look at Germany and look at the German education and job training system, how is it that they’ve maintained their manufacturing system? How is it? Because they realized that if they were going to make the shift to precision manufacturing, they were going to have to train their people differently, and it wasn’t just four-year engineers, but it was people in that value chain that would allow precision engineering, machining, and so forth, computerized. We have to do the same thing.
…why don’t we focus on mobility as an overarching objective for the country, because it will build back the middle, which will force us to change our job training, education systems, move money, change policy, build back the middle again.
Denver: We have a hard time though getting a generational plan. I think part of it is our political system. You have people come in. They’ve got an idea for four years. Somebody else comes in, completely undoes that plan, and comes up with a new one instead of saying, “Hey, this is a generational problem, and we have to look at 20 years and get a playbook.
Brian: The politics goes with it. My dad was a Reagan Democrat. He emigrated from Ireland with an eighth-grade education, union plumber his whole life, member of union his whole life, voted for Ronald Reagan. I said,” Dad, What the hell are you doing? Why are you voting for Ronald Reagan?” And he said, “I just like the way he talks.” And I thought, That’s interesting!
Denver: Informed decision.
Brian: He just liked it. In other words, he liked how he looked on television. I’m the fourth of six kids. I’m in Northwest Indiana; Gary, Indiana. I’m the first one to go to college. Others then went, but the two after me went. But I watched. When I left Northwest Indiana to go to Muncie, Indiana to go to school, there were 30 thousand people working at US Steel in Gary. Today, there’s less than 2,000. I watched guys that I graduated high school with go work in the mill, and when I came back for the summer, they had new cars. They had boats, and now, some of those same guys – not all, but some of those same guys are driving trucks or forklifts, and they’re making $15 an hour. Thirty years ago, they were making $25 an hour, and they’re pissed. These are today’s Reagan Democrats, and that goes to mobility.
Today, what people are concerned about is, how do I get ahead? They don’t sit at home talking about systems and governments. They are concerned about: I wonder if I can get a better job. I wonder if… Well, let’s focus on them. What we do is, the Trump phenomenon finds it through there and quite honestly, exploits it. The Democrats didn’t even know it was there. Why don’t we focus on mobility as an overarching objective for the country, because it will build back the middle, which will force us to change our job training, education systems, move money, change policy, build back the middle again. That’ll get us moving again.
Denver: Let’s talk about what you’re doing on that because I know this issue probably gets you as excited as much as any other, and that’s the skills gap. There are companies that can’t find the workers they need, and there are people who desperately want those jobs but just don’t have the technical skills. What does United Way do, and I know you’re doing a lot, to try to close that gap?
Brian: We go local. You go to Cincinnati, as an example. But it could be Denver, it could be LA, it could. You bring together employers, city government, job training providers, nonprofits, and you decide together: what are the jobs that we are going to need in the next 5, 10 years? Those employers say it’s going to be healthcare. It’s going to be precision manufacturing in this area, and it’s going to be technology related to essentially the entry, the pipe into artificial intelligence. Indianapolis is doing the same thing.
All right, if we’re going to need 10,000 jobs, where’s our labor force? Well, they’re either coming out of prison; they are in a retail job right now, or they’re underemployed in a certain area. Our nonprofit agencies or our public systems know who they are, but we don’t tie them to this. Cincinnati, like Indianapolis, like other… creates their own economic development plan. We’re going to get 10,000 people into these jobs. The companies are going to help subsidize it. United Way is going to raise money and provide family support, transportation, daycare. And in a matter of five years, they’ve put now almost 9,000 of those 10,000 people in jobs that allow them to sustain themselves. Livable wage. We’re doing that city, by city, by city.
Denver: It’s the middle of the country that really is important. We have so much attention on the coasts. But really, if we can get some of that innovation and that energy to places like Louisville and Cincinnati, and Tulsa, and places that you’re talking about… really that’s where this country is going to come back.
Brian: No doubt. You’re exactly right. It’s the Twin Cities, it’s Iowa, it’s Detroit, it’s Kalamazoo, it’s Indianapolis. It’s Evansville. It’s down in, Texas not so much, because the economy is so robust, and there’s ups and downs. They have other assets. One of the reasons, this is collective impact. One of the reasons to do it this way, you go and talk to employers in the middle of the country. The way they talk about the opioid epidemic is, “I can’t find employees to pass the drug test.” Literally. So, you can look at that. I’ve talked face to face with employers in the middle of the country who said: “Tell us what we need to do about the drug crisis because we’ll do whatever we need because we need employees, and they can’t pass our test.” That’s why you focus on jobs and mobility.
Denver: It’s pretty sobering, isn’t it?
Brian: It’s very sobering.
The thing that’s changing fastest in the country that we’re not dealing with very aggressively is that we’re fast becoming a non-white majority country.
Denver: Is there a particular social ill, maybe that’s it, that really has you troubled… let’s say keeps you up at night, and we just have a really hard time making a dent in?
Brian: It is social-economic mobility, but I would put it in this context… this texture, that has me most concerned about the country. Probably, the thing that’s changing fastest in the country that we’re not dealing with very aggressively is that we’re fast becoming a non-white majority country. That has a lot of folks freaked out. Back in the day, in a national industrial economy, and I was a white steel worker in Gary, Indiana, and I had good job. My co-worker was black or Mexican. I didn’t care, I was good because I had a job. Now, when my job sucks, and people tell me that it’s somebody who doesn’t look like me… that’s my problem why I don’t have that job. I’m nervous about that.
I knew a lot of illegal Irish immigrants growing up. I guess we knew who they were, but weren’t trying to deport them because they were white and they spoke the language. They spoke funny but they spoke the language. I think we’ve got to come to grips with what one of the things that makes America great is our… Don’t even go down to diversity and exclusiveness. We’re better when we take – it’s like a great jazz band. It’s like, let all the talent in, man! Let all the talent in. We’ll make everybody better. This band will kick ass if we do it this way.
You got to deal with security, but what’s happening right now is … we’re using our fear. We’re losing the fact that economic and social mobility is down because we don’t have an economic plan, and we’re not training our folks and educating our folks fast enough to fill those jobs because those jobs exist. We’re becoming more diverse. We’re becoming less white, and those two things in combination are getting exploited by a lot of people, and it’s going to kill us.
I think one of the unlikely alliances that’s going to happen are white seniors and aging millennials who find themselves in the same need.
Denver: We’ve got our arms around it too because not only is it a racial divide, but it’s going to be that generational divide that is going to be along those racial lines. So, you have a pot of money, and you have the older white people who are retired looking to get it, and you have the younger people of color looking for early childhood and things of that nature, and it’s going to be a battle going.
Brian: Here’s my hope. I’ve got to finish this part with a ray of hope. I think one of the unlikely alliances that’s going to happen are white seniors and aging millennials who find themselves in the same need. They both want healthcare. They want housing that they can afford. They need transportation that will get them to where they want to go because once you get older, I don’t care how much money you have. You need healthcare, and you now need things that younger people need as well. I think the 80 million boomers as we get older, we’re going to have to get a little older, and as the millennials get further into their earning years and start having families and so forth, I think that’s going to be the alliance.
Denver: I want to pick up a little bit on what you were talking about before about your family. Because you bring to this job empathy, and part of that maybe comes from your own childhood which was pretty challenging. You relied on food stamps and public assistance, and nonprofits, and you came from a turbulent household. Give us a little window into that and how it’s shaped and influenced the way you do your job today.
Brian: I didn’t think about it growing up. You never do. I used to tell my story a lot. I don’t as much anymore, but when I did, and I’d listen to other people tell a similar story, you really don’t think about, “Wow, I’m poor. This is rough.” You may not like it, but you don’t think about it that way.
How guilt and self-esteem can be affected by certain things that happen in your life, and the brilliance of how people, strangers and/or friends can help you create a different result for yourself.
Denver: I don’t think we knew much better then too because you didn’t have all this communication coming to you on the phone either.
Brian: I think that’s right. My dad had a very severe drinking problem. He was an angry guy. It would create work patterns for him that would be on and off. My mom was from Scotland. He was from Ireland, and she wouldn’t even tell him that she was getting food stamps or getting public assistance because he was too proud, and there would have been another big fight about it and so forth. She was a very, very resourceful woman. An amazing woman. So, it affected me in retrospect when the first time I remember being in line with my mom buying groceries with food stamps. It was the first time I noticed people looking at us. I just never thought about it. I must have been 12 or 13. Somehow you just look at things like it turned from black and white to color, and I sort of looked at my mom and I looked at the clerk, and I looked around… so that was one.
The other was when… I won’t get into this too much but when my mom needed shelter and direct intervention and so forth. That hits you a certain way that when you’re a young son… one of the ways that hits you– and it creates empathy– is you feel guilty that, Why didn’t I help her? I should have helped her! That is something that has stayed with me my whole life.
Then the last thing is the number of people who weren’t getting paid to help me and helped me anyway. So my best friend in high school even today, one of my best friends is his mom and dad raised me. So, when I didn’t want to be in my house, I was in their house. I took my first college visit with them because they were talking about going to colleges. The way it’s affected me is probably how people look down on other folks when they really don’t know their circumstance. How guilt and self-esteem can be affected by certain things that happen in your life, and the brilliance of how people, strangers and/or friends can help you create a different result for yourself. I probably wasn’t going to go to college except that my friend from high school was going to college and so, Okay, I’ll go.
Then I get a construction job in the summer to pay my way through school, and then all of that in combination gave me this balance of: I’m going to show them. A big chip on my shoulder that got smaller over time. But also a toughness that even my dad was a part of. By the way, it works the other way… you don’t have to grow up that way to be a person of really high character and so forth and so on. For the longest time, part of that chip was: Who the hell are you? You grew up wealthy, everything you need, and so forth. That’s just as bad. It’s judgmental. It’s like saying: Why don’t you get to know me? Then make a decision.
Denver: Instead of jumping to that conclusion.
Well, you needed a little bit of that toughness when you took on this job. I think you assumed it about five weeks after 9/11. And pretty much out of the chute, you guys were getting criticized along with the Red Cross about: where’s the money going? And why aren’t you spending it faster? Then there were some other controversies, particularly in New York and Washington. Some financial scandals with their CEOs, but you’ve been really able to take those problems and leverage them into a way to help strengthen the organization. Explain how you did that.
Brian: 9/11 was one thing because 9/11 was… we and the Red Cross didn’t deserve the criticism we got. But that was fine. That comes from raising hundreds of millions of dollars. That was a no-win. We did the right thing, and I went against our public relations firm’s advice, and I went on The Factor with Bill O’Reilly. On that one specifically, what I realized is that, if I go on his show and admit my mistakes, and allow him to say that he saved me, then it would be all good, which is exactly what happened. It was just playing the media game. It was all a game.
The other one was of substance. There was the United Way in Washington that the CEO had embezzled money and ended up being convicted, and I came in to the job. Every six months, it seemed like a local United Way was doing something unethical or illegal or stupid. What I kept hearing was, 99% of all United Ways are doing great! But we all have the same name!
What I realized is our culture has to change. What I did, we did, was we took the 9/11 controversy, we took the Washington controversy and said,” Wow, we have to change. Look at our environment.” Went to Senator Charles Grassley who was head of the Senate Finance Committee which oversees nonprofits in the country, and we had re-written all of our membership requirements in United Way to essentially move us from a confederation of like organizations sharing a name, to much more of a federation where we had much more control of our governance, finance, ethics, and so forth. We tightened things up. This is now six months on the job.
I saw Grassley directly, I showed it to him and said, “If we do this, will you publicly endorse it?” And he said, Yes. We called a meeting of all United Ways in Phoenix, that fall; had 800 there. Put on the table a vote to rewrite all of our membership requirements, and you couldn’t vote no. More importantly is what the message it sent to our field and to our volunteer leaders to say: no tolerance on this!
What we would say, and I said to our board: there’ll be a big United Way that’s going to raise a plan and challenge this, and when they do, we’re going to take it off. Chicago, my hometown. What I learned is the suburbs and the cities still don’t like each other. We forced them to create a plan, and we supported them, and I went out to see the plan, and they essentially gave me this presentation of 150 people in a gymnasium in Hinsdale showing essentially… saying how full of crap I was. You were a local United Way. You can’t tell us what to do. Unbeknownst to them, the day before, I assumed this might happen. So, I asked the national board for a board resolution to pull every license of every United Way in Chicago.
After their presentation was over, I get up on the stage, I said: “Thank you. Appreciate it. Our board, the United Way of America Board, yesterday voted to pull every single license of every United Way in this room unless you vote to merge and follow all of the guidelines. They followed. I said, “If you don’t, we’ll pull every license, and we’ll start all over in Chicago. That said to the rest of the country and to the rest of the world: Don’t do it.
You know what you get now? Instead of every six months reading about something in the newspaper, you can’t manage all these things. Even big companies don’t know what’s going on. Jamie Diamond didn’t know about the $3 billion whale, and they’re the best. You change the culture. What we get now are calls or emails from a board member saying, “We got a concern about this. What do you think we ought to do?” What does it say against… you’re not reading about it or hearing about it in the media. You hear from volunteer leaders who now understand this is part of your job.
People who get in trouble usually make decisions below their belt, or they think they’re bigger or better than they are. Don’t do either one.
Denver: Let me ask you about that culture. I had the great pleasure to go down to your headquarters several months ago, and speak to the members of your staff about the workplace culture at United Way Worldwide. I’ll tell you, they absolutely love working there. But I wanted to ask you about how you describe that culture… How you think about it, and maybe specifically what you do; the way you model your behavior to help shape and influence it?
Brian: I find the best leaders I’ve ever seen and the most impactful organizations I’ve ever been in or observed are purpose-driven. I think of my two grown daughters now, and they want to work for purpose-driven organizations. In United Way, we’ve gotten so business-like that you can forget why you exist. Culture I think has to start with mission and purpose. One of the things that we did almost two years ago now is we hired a Chief Culture Officer who has this unbelievable background in corporate culture and nonprofit culture.
People kept saying to me: Culture starts at the top, and it’s like, but I don’t know anything about it in terms of how you actually do it. So, I know technology. I have to drive that, but we hire a Chief Technology Officer. So we went and hired a Chief Culture Officer, and she’s helped us understand how to design the jobs and the workflow and the compensation and the communication inside the organization to reflect what I want it to be. Because what was happening for the longest time is I would have a vision for our culture, but we didn’t have a plan to actually execute it because we didn’t have anybody focused on: how do people get a say in things. How do you structure jobs?
She came to me she said, I think we should close the office between Christmas and New Year. I said: Really, why? She said, people will love it. We’re not getting much done. Not everybody follows that religious calendar, but we’ll figure that out, and here’s what we’ll say. I said, Okay. It costs money. The other thing, people have said this about a lot of things, but, people just want to be in the know. They just want to know what’s happening.
It’s funny, in this interview, I’ve said more about myself… Most things that our employees don’t even know about me. What Laurie, our Chief Culture Officer said to me is, “You got to lighten up, man! You got to let people know you.” That’s what we do. Being about purpose-driven. Trying to get the structure and the jobs and compensation and the communication to reinforce that. It’s to be a human. People who get in trouble usually make decisions below their belt, or they think they’re bigger or better than they are. Don’t do either one. Just be accessible. And vulnerable sometimes.
Denver: I must say, you say a lot about the culture of the organization when you hire a Chief Cultural Officer, because you’re saying to the people: I think this is important.
Brian: I think this is important, and I don’t know how to lead it. I think it’s critically important; you’re spot on. Who you hire and who you surround yourself with says a lot about the culture of your organization and also how you will achieve certain things. You can achieve something a lot of different ways. How do you want to achieve it? Do you want to achieve it in a way that there’s broad-based success? Or is it just success? How you organize, who you hire says a lot.
Denver: Speaking about achieving, let me close with this Brian.
Not many people get to serve as a CEO of an organization, any kind of organization, for 16 years, at least not in today’s world. Although, I suspect this is still being written, what do you hope that your legacy will be to the United Way and the communities that you serve?
Brian: It goes back to your question about what’s the social ill that keeps me up at night. I’m concerned about how tribal we’ve become as a country. Increasingly how we’re divided we’re getting as a world. This may seem hyperbolic to some or Pollyanna-ish to some. I think that United Way has something to say about that. I want our legacy to be: United Way was necessary 130 years ago; it is just as necessary today because we’ve got to come back together. It doesn’t matter what you think the most important issue is. Are you willing to care about everybody else’s success as much as yours? That’s what I want the legacy to be. I learned a long time ago that if I think about community success first, and then institution success, and then mine, I’ll be successful. If I think about it, the opposite, maybe not. I come back to: I want folks to say the community got well; United Way got well because of it.
Denver: We’re all rooting for that, that’s for sure.
Brian Gallagher, the President and CEO of United Way Worldwide. I want to thank you so much for being here this evening. Tell us a little bit about your website and the information on it. But more so, give us some ideas of how people can get involved in their local United Way.
Brian: If you go to our website, unitedway.org, put in your local United Way. It’ll take you right to that United Way. Talk about what you want to do. Find a way to volunteer. You’ll be able to communicate directly to that local United Way or to us, [email protected].
Denver: Thank you, Brian. It was a real pleasure to have you on the show.
Brian: Thanks, Denver.
Denver: I’ll be back with more of the Business of Giving right after this.
Brian Gallagher and Denver Frederick
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