The Facts of Life About Nonprofit Resources
March, 2010Do you need more resources for your nonprofit organization? Nonprofit leader always answer "yes" to this question. As a consultant, who has worked with nonprofits for the last 16 years (March is our anniversary month,) we've develop a list resource facts we often cite. This newsletter shares a dozen of them and suggests actions that will help you to obtain more resources for your mission.
1. Permanent Duty
No matter how large you become you will always be able to use more resources to meet your mission. Good or bad, resource development needs will always be with you. Action: Learn more about how to grow resources for your organization. Help your leaders to understand the permanence of this effort.
2. The Right Fit
As you grow larger, rather than just getting resources, obtaining the right resources will become your focus. You will need unrestricted gifts for your largest expense. This is often staffing or a hard to fund component of your program, i.e., the single-male former drug addicts. Action: If you are new or expanding, identify how you will obtain resources for your key needs. If you are established, develop new long-term strategies to meet this budget need.
3. Know Thy Sources
Individual contributions are fabulous because of their flexibility, but the majority of nonprofit income year-to-year is earned income. Action: Know the sources of your organization's income and how they compare to nonprofits in general (see Where Do Nonprofits Derive Funding? and Where Do Nonprofits, Except Healthcare, Derive Funding?) This knowledge will
help you to make faster and more effective decisions about resource development.
4. Prefer Deep Wells With Return Options
Favor income sources that you can return to frequently over one-time wonders. Action: When you must chose between two potential donations; consider the odds of a fourth or fifth gift, not just what is available now.
5. Right Size
Resource timing is important. Too many resources can be almost as injurious to an organization as too little. Resources must be balanced with capacity. Too much, too easy, too early endangers your success, just as too little, too hard, too late. Action: When someone offers a large gift, seek to structure it so that you receive it over a number of years to allow you to also grow your capacity alongside it.
6. Steady Wins
Some organizations, at some phases of their development, do not need growth. Instead, they need to stabilize their base and increase their capacity for future growth. Action: Consider if this is a phase you are in or, one you are approaching. What must be stabilized? What capacity will you increase? In terms of management, what is your next step forward?
7. Nurture Passion
Resources build stable organizations when they are linked to people's passions about your mission. At the last hole, you don't want your golfers, asking, "Who does this tournament support anyway?" Action: Offer your participants knowledge to grow their passion for your cause. Share why your cause matters to the whole community-even if you have told everyone multiple times already.
8. It Will Cost You
You may hate to spend money to make money, but you must. Action: When you are unsure about expending money look at fundraising cost charts. James Greenfield, in his book, Fund-Raising: Evaluating and Managing the Fund Development Process shares that overall big picture. The national average cost to raise one dollar is twenty cents. Furthermore, depending on the type of fundraising, the cost range is from five cents to over one dollar for every dollar raised. Every board and staff member needs to be cognizant of this reality.
9. Rinse and Repeat
To maximize your organization's resources, maximize your learning in places where you can re-use information. Use a designer to help you create a newsletter, but also learn from him some fundamentals about layout for other publications. Use a grant writer to draft the first grant you will request from a source, if you plan to return to it regularly. (Then, use the first request as a template for later requests.) Prefer the strategic planner who helps you to increase your strategic thinking year-round to a one-event specialist.
Action: Invest when you can re-use what you learn multiple times.
10. Easy Money
Along the way, you will obtain some easy money. Easy money is an exception to the rule -that proves the rule. After you win at the easy money cash machine, avoid lingering around it for another hit. Too many organizations waste resources trying to get easy money sources to produce again. True opportunities follow consistent and proven preparations.
Action: Undertake consistent actions to increase your income from
sources that consistently provide nonprofit income.
11. Learn the No, No Song
Organizations that survive and thrive specify what they need to achieve their mission and frequently share it in compelling ways with the community AND never quit. Action: There is a song, "No, no, no, no, no, no, no, no, no, yes." Hum this ditty to yourself when you encounter a string of nos.
12. Know Your Strategy and Destination
If you do not know what kind of organization you want to be next, you cannot successfully obtain resources for it. This is more than just having a vision. You need to know your next destination on the road to your vision. For instance, your vision points to expanding your services. Does this mean
you will offer more services to your current customers? Or, does it mean expanding geographically to reach new ones in the next state? Or, will you penetrate your current markets better? Resources follow vision and not the other way around. Action: Determine specific next vision destination before action plans.
Pick out one fact of life to act on today. When you are ready for
other resources to help your organization grow, check out www.kedconsult.com to find dozens of other articles and helpful tools.
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