Monday, September 29, 2008

A Few Excellent Suggestions For Nonprofits To Survive These Uncertain Economic Times

In my post on Friday, "All Of Us Are Wondering How The Economic Downturn Effects Nonprofits and Philanthropy", I empathized with you, your colleagues, and others who work on behalf of nonprofit organizations across the United States.

Since the House did not pass the bail out bill proposed by the President's administration, today; and the stock market closed very down, I am listing what nonprofits can do in this tough economy.

In the most recent issue, or The Chronicle Of Philanthropy's September 18, 2008 issue, a special report reviewed what various American nonprofits are doing to deal with the economic uncertainties.

On page 7 of the issue Brennen Jensen lists five "Survival Strategies", in his article, which include: "Focus on providing services that meet a critical community need. Build a board comprised solely of members willing to commit both time and money to the cause. Develop an image and culture emphasizing hard work and frugality, to build trust with donors. Show donors where and how money is being spent, and where it is still needed. Seek donations outside of a struggling community; build relationships with wealthy or prominent townspeople who have moved away."

On page 16, Jensen quotes the executive director of the Boys & Girls Club of Greater Flint, Jamie Gaskin, to clarify why this kind of nonprofit accounting, operations transparency, and communication with donors will help raise funds. ""Donors are more protective than they were 20 or 30 years ago, when organization just kept getting checks," Mr. Gaskin says. "Now they want to see something tangible. We bring donors in here to let them see it is clean and well supervised."" Gaskin and other leaders in their organization learned the value of developing relationships. Even in Flint, Michigan where the economy was hard hit before the rest of the nation, and continues to struggle; Gaskin and other leaders decided to reach out to the wealthy community members asking them to invest in ""the future of Flint"". The campaign is working and they are raising some of the largest donations that they ever have, yet, in this economy.

On page 17 of the same issue of The Chronicle Eric Frazier shares three "Survival Strategies", via his story, on page 17. They are: "Plan aggressively for the long term, to position the charity favorably for bad times. Prod all board members, not just the development committee, to help with fundraising. Don't just ask for money; look for mutually beneficial relationships with donors." Frazier's point is well made. Board members' roles vary, organization to organization, as all nonprofits run under their own bylaws and articles of incorporation. Nonetheless, all board members of official nonprofits (per the IRS), must oversee their organizations according to the letter of the law, are responsible for the organization's bookkeeping and reporting, and have taken on a role of leadership. As such, they are in the best position to raise support of all kinds for the nonprofit, including donations (including dollar donations, their own financial contributions, and in kind donations (or donations of items or goods)).

Cassie J. Moore shares her own piece's "Survival Strategies" on page 10, "Save money, and let donors know about it. Raise funds from a variety of sources; don't rely on that one big grant or foundation. Capitalize on timely topics by reaching out to new sources of revenue for support or "hot" issues. Tell stories [sic. in your fundraising and outreach] about the people you help, and avoid jargon when speaking to donors. Find ways to reduce staff turnover, to reduce time and money spent on hiring new employees."

Alison Stein Wellner, in her article, shares three "Survival Strategies" on page 12: "Seek a fiscal sponsor - an established nonprofit group that can accept tax-deductible gifts on a fledgling organization's behalf. Ask for noncash support, and be prepared to maintain a close relationship with the donors who give it. Collaborate with other organizations, and make the most of existing local resources to meet clients' needs."

Finally, in Lee Burnett's piece two social services organizations merge to solve their financial concerns. "Survival Strategies - "Consider a merger to improve service or efficiency when an organization is in good health. Begin planning before financial conditions reach the crisis stage. Go slow, and build trust with potential collaborators before deciding on a full merger. Continue to mesh organization cultures after the merger."

Please share with Seeking Grant Money Today's readers any tested and true methods that your organization is using to maintain operations in this tough economy; and post your success stories as a "Comment" below. Thank you!

2 comments: said...

Thanks for the info! Every time I see more economic strife on the news my mid goes to what the long term effect of these times will be on our nonprofit sector.

Anonymous said...

The effects of the economic downturn can be felt everywhere. Millions of Americans are loosing their jobs and thousands of nonprofits are struggling to survive - many being forced to reduce services or close their doors due to the failing economy. These are the same landmark nonprofits that your readers support, serve as board members for, or even earn their living with.

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