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HarvardBusinessSchool9-496-001December21,1995ResearchAssociateNicoleSackleypreparedthiscaseunderthesupervisionofProfessorJeffreyL.Bradachasthebasisforclassdiscussionratherthantoillustrateeithereffectiveorineffectivehandlingofanadministrativesituation.Copyright©1995bythePresidentandFellowsofHarvardCollege.Toordercopiesorrequestpermissiontoreproducematerials,call1-800-545-7685orwriteHarvardBusinessSchoolPublishing,Boston,MA02163.Nopartofthispublicationmaybereproduced,storedinaretrievalsystem,usedinaspreadsheet,ortransmittedinanyformorbyanymeans—electronic,mechanical,photocopying,recording,orotherwise—withoutthepermissionofHarvardBusinessSchool.1CityYear:NationalExpansionStrategy(A)“People,peoplehaveyouheard?CityYearistheword!,”called200voicesfromBoston’sCityHallPlaza.Itwas8a.m.onawet,Februarymorningin1993.Asthecommutersrushedby,theyoungpeopleofCityYear,uniformedinbrightredjackets,completedtheirdailyphysicaltraining.Soon,theywouldbreakintoteamsandmoveoutintoBoston’sneighborhoodstoserveincommunitycenters,shelters,andschools.MichaelBrownandAlanKhazei,CityYear’sfoundersandexecutivedirectors,couldnotsee“P.T.”fromCityYearheadquarters,anoldwarehousealongthewharf.Buttheyknewitwashappeningandweretremendouslyproudoftheyouthcorps’commitmentandaccomplishments.Initsfourthyearasademonstrationprogramfornationalyouthservice,CityYearhadsurpassednearlyeveryone’sexpectations.Parents,teachers,communityleaders,themedia,CEOsoflargecorporations,eventhePresidentoftheUnitedStates,hadpraisedtheprogram’sabilitytobringtogetheryouthfromdiversebackgrounds,tocontributesubstantivelytotheBostoncommunity,andtostartupandsustainoperationsthroughlargelyprivatesectorinvestment.Thismorning,however,KhazeiandBrownwerefocusedonthefuture.Pressurehadbeenbuildingsince1991togrowCityYearbeyondBoston.ByJanuary1993,hundredsofpoliticians,businesspeople,andcitizenshadaskedtostart“aCityYear”intheirtown.Youthservicewasonthepresidentialagenda.And,KhazeiandBrown’svisionhadalwaysbeennationalservice.ThequestionsfacingBrownandKhazeiwerewhen,where,andhowtoexpand.Chicago;Providence,RhodeIsland;andColumbia,SouthCarolinawerepossiblechoicesforthenextacademicyear,noweightmonthsaway.Othercitieswereunderconsiderationforopeningin1995,whenbothfoundershopedtohave8to10sitesinoperation.Alloptions,however,wouldrequiresubstantialresourcesandorganizationalcommitmentinthecomingmonths.ToopenthefirstexpansionsiteinSeptember,BrownandKhazeiknewtheyhadtoactnow.BackgroundofNationalServiceTheideathatU.S.citizensshouldperformnonmilitaryserviceforthenationhadexistedsincephilosopherWilliamJamescalledfor“amoralequivalentofwar”in1910.1DuringtheGreatDepression,thefederalgovernmentexperimentedwithnationalservicebycreatingtheCivilian1James,William.TheMoralEquivalentofWar.NewYork:AmericanAssociationforInternationalConciliation,1910.496-001CityYear:NationalExpansionStrategy(A)2ConservationCorps(CCC),aprogramtoputjoblessAmericanstoworkbuildinginfrastructureandimprovingnationalparks.In1964,PresidentJohnsoninauguratedVolunteersinServicetoAmerica(VISTA),adomesticPeaceCorpsforcollegegraduatestoserveinruralAmerica.Overtheyears,however,VISTAreceivedlimitedfunding;otherproposalsfornationalserviceduringthe1970sand1980sfailedtoattractwide-scalesupport.Federalprogramsfocusedinsteadonjobtrainingandemploymentforlow-incomeandunemployedyouth.Intheabsenceoffederalinitiative,advocatesofnationalservicebeganinthe1970stoamasspoliticalsupportforyouthservicecorpsatthelocalandstatelevel.By1984,27unaffiliatedprogramshadbeenestablishedasgovernmentagenciesorgovernment-fundednon-profits.Thenewprogramshadtwogoals:theywereseenasawaytoaccomplishmeaningfulserviceandasananswertorisingyouthunemployment,crime,anddropoutrates.Themajoritywere100-to1,000-memberconservationcorps,patternedaftertheCCCofthe1930s.Youthworkedfull-timefortheminimumwageinsupervisedteamsof8to12people.Participantsweretypically,male,highschooldropouts,andfromlow-incomehouseholds.Dependingontheregion,corpswereeitherpredominantlyCaucasian,Hispanic,orAfrican-American.Mostcorpsperformedphysicalservicesuchasbuildingrepair,trailclearing,andenvironmentalcleanupinurbanandwildernessareas.In1984,NewYorkCitybudgeted$10millionforanewyouthcorps,designedtoinnovatetheestablishedmodelofyouthservice.First,incontrasttopastefforts,theCityVolunteerCorps(CVC)wouldengageitsvolunteersinhumanservicesuchastutoringchildrenandworkingwithelderly.Second,itplannedtoattractadiversecorps,bothraciallyandsocio-economically.Theprogramachieveditsfirstinnovation,butnotitsdiversitygoal.Accordingtoanindependentevaluationconductedin1987byPublic/PrivateVentures(P/PV)andtheFordFoundation:“CVCmembershavesuccessfullyaccomplishedimportanthumanserviceworkinthecommunity....Likemostyouthcorps,participantsarehighschooldropoutsfromlowsocioeconomicbackgrounds.”2A1987P/PVassessmentofallU.S.youthcorpsconcluded:Youthcorpsarechallengingprogramstooperate,requiringsubstantialcommitmentsofpoliticalleadershipandfunding....Mostproducealargevolumeofworkofgoodqualityandconsiderablevalue....Manycorpsmembers,[however],require