Tanoto Foundation

The more you give, the more you have. We believe that doing good to others enriches all our lives. Philanthropy is not just about giving money, but also about creating positive change and building long-term relationships with communities.

Mr Sukanto Tanoto, Founder, Tanoto Foundation
 
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About the Tanoto Foundation

The Tanoto Foundation is an independent philanthropic organisation founded in Indonesia by Sukanto Tanoto and Tinah Bingei Tanoto in 1981. It began when the founders established a kindergarten and elementary school in Besitang, North Sumatra, and now works across Indonesia, Singapore and China. Tanoto Foundation’s core belief is that every person should have the opportunity to realise his or her full potential and that quality education accelerates equal opportunity. The Foundation harnesses the transformative power of education to realise people’s full potential and to improve lives.

What was the challenge?

Since 1981, the Foundation has successfully implemented impactful, life-improving programs; yet, these were primarily limited to particular local areas. After several years of pilots and trials – building experience, confidence and data collection – the Tanoto family expanded their work to have a greater impact on more communities nationwide and regionally and fostered deeper collaborations with a broader range of stakeholders.

To achieve this ambition, the Foundation underwent a transformation in 2017. Recognising the challenges and opportunities in the education sector, they realised that a sharper thematic focus would enable them to seek larger-scale implementations and longer-term partnerships to create meaningful impact. Mr and Mrs Tanoto established a sizable endowment fund to drive the transformation. To benchmark their work and gain insights into best practices, the Foundation visited leading philanthropic organisations in the United States and participated in a study with the Asia Philanthropy Circle and McKinsey to identify market gaps in Indonesia’s education sector. Through their visits, they learned the importance of clarity and focus on their strategy and goals.

What followed was a journey of organisational growth and institutionalisation. Over a four-year period, the Foundation grew over three times in size, reaching 173 employees by 2020, including expansion of the organisation’s managerial and subject-matter expertise. The leadership recognised that this scaling-up would require a more institutionalised organisational culture, as cross-divisional coordination and information flows were now much more complex. The main challenge, however, was to ensure that this was done whilst still staying true to the Foundation’s original mission, values and spirit of agility and continuous improvement.

What was the response?

From the outset, the founders saw their Foundation not only as a platform for giving back, but also as a way to share their family values of gratitude, diligence, frugality, harmony, and filial piety. The younger generation of Tanotos are also fully committed to their parents’ legacy, as they increasingly take on leadership and governance roles within the Foundation. 

Under the guidance of the Tanoto family, in 2017 the Foundation’s newly hired Global CEO Dr. J. Satrijo Tanudjojo began the transition towards a more strategic operating model. This required a robust organisational structure, high-performance culture, effective programme portfolio, and a strategic approach to developing partnerships and embedding the Foundation’s mission and values across all levels of the new organisation. The Foundation worked with the Bridgespan Group to identify critical elements needed for expansion, including a laser focus on education, partnerships, and leveraging the power of data, all of which formed their strategy refresh. A central priority was harnessing the passion and potential of the Foundation, without losing sight of their core values. 

Through all of this, the Tanoto family’s values needed to remain central to the Foundation and its work. To ensure that this was the case, the family and senior stakeholders asked themselves several key questions: 

• How could they minimise the risk of internal strife and damage to morale during such a large-scale transition of the Foundation’s organisational structure?
• Looking ahead, what best practices should the Foundation promote and embody across the staff to ensure that the Family’s core values remain an entrenched part of the organisational culture during a 300% personnel increase?
• Which types of expertise are needed within the new organisational structure, and does new talent need to be hired into the Foundation to ensure that the Foundation’s values and culture are embedded across teams? 

The insights they gained from considering these questions at the senior management and Board level were then used to create a range of practices:

1. Rooting the strategic transformation in a Theory of Change (ToC), developed through deep engagement with the Tanoto family and leadership, embedding their core values. This fostered an understanding of the underlying social challenges the Foundation was working to address, the external circumstances, and potential solutions. Close alignment with the UN Sustainable Development Goals (SDGs) also helped ensure the calibration of the Foundation’s work with broader national and global development agendas.
   
2. Internal transformation: creating harmony and change management to support transformation. Growth brought in leadership changes and new working styles, moving rapidly from a relatively small-team dynamic with less formalised, project-based ways of working into a large organisation with a programmatic approach and more formalised responsibilities and accountability. With this came internal changes that at times challenged organisational cohesion, and new team members faced a learning curve as they adapted to the changes. To address this issue, the One TF Campaign internal program was developed to ensure alignment and engagement across the Foundation. This campaign focused on communication and training, including regular leadership meetings and town hall meetings, creating communications collateral such as vision postcards, and standardisation of terminologies and operating procedures across the organisation.
   
3. Internalising values across all aspects of practice. In addition to being a programmatic focus, the values of education, continuous learning and cross-collaboration are deeply embedded within the Tanoto Foundation’s practices across all levels through organisational structures, processes, communications and culture. Dual reporting lines break down silos between divisions to foster collaboration. Weekly meetings are held with front-line employees to collect feedback and deploy new tasks, while senior management meets monthly to make collective decisions, report progress, and coordinate strategies. At the individual level, the Foundation emphasises offering a compelling employee value proposition rooted in a culture of engagement and empowerment. This includes personal development plans and supporting front-line decision-making.
   
4. Measure the effectiveness of change initiatives to drive continuous improvement. For the Tanoto Foundation, this includes a self-assessment system that staff discuss with their supervisors, based on a code of conduct that guides staff by translating core values into expected behaviour. The Foundation also conducts annual employee surveys to gather feedback on areas that need further improvement. 

What have they learned?

1. Transformation is a collective effort. Develop strategies and theories of change collectively to promote joint understanding and ownership. Maintain constant and open communication between leadership and the whole organisation to ensure transformation becomes a collective journey.
2. Strong leadership is critical to translate values into actions in the organisation. Institutionalise values, culture, and codes of conduct that translate values into expected behaviour and actions.
3. Balance institutionalisation by retaining flexible space for transparent discussions, frank dialogues, finding common ground, and multi-party collaboration. Healthy tension can be generative for innovation and learning.
4. Transformation is a journey of learning. Foster ownership and continuous improvement through a shared learning journey, encouraging the team to embrace change and push beyond their comfort zones for innovation.
5. Assign a change manager role to manage and track the transformation programme. For smaller organisations, this does not have to be a dedicated position, but it is still critical for a focal person to be responsible for coordinating the change initiative and engaging with various teams.

Key outcomes and impact indicators