Monday, November 17, 2008

Tough Decision Made In The Best Interest Of Constituents May Be A Good Solution In This Economy

Keeping with the difficult economy that nonprofits are facing we are taking a temporary break from discussing grant writing, specifically, in Seeking Grant Money Today, to provide nonprofits with what we're calling "free consultations" right now.

This week - we want to list for nonprofits who are in tight spots some options and alternatives to operating as normal.

Any nonprofit always faces doing the following, so this list of remedies is not just posted for nonprofits that are sliding in this tough economy. In operating any nonprofit well, its leadership holds themselves accountable and keeps the organization's mission first and foremost always. So, sometimes extremely tough decisions are necessary and in the best interest of serving an organization's mission statement (and the benefiting constituency) at any time; during a rough economy, or not.

It is always OK to consider all options and discuss them, freely with colleagues.

Each of the following address either increasing income, saving more money, or cutting back costs. These three strategies are the key to any organization's survival in any economy. Decisions do not have to be about the economy. The best decisions are about constiuents and the beneficiaries of our organizations' mission statements.

Some options are:

__ Retooling the organization's budget and different programs' budgets: cutting back, spending freezes, increasing income, finding savings by ordering bulk or working with new cheaper vendors, etc.

__ Getting your entire nonprofit absorbed by another (similar and successful) nonprofit thereby making your nonprofit a new program (or an extension of an existing program) under the other organization.

__ Cutting back all paid employees' hours/pay by hypothetically five or ten hours a week, across the board, thereby reducing spending but not laying anyone off.

__ Temporarily closing shop for a specific and limited amount of time to cut spending for some time but not close the operation.

__ Collaborating with another similar organization (another nonprofit, a school, corporation, research facility, government, Tribe, etc.) to provide your organization's services, products, research, etc. yet share costs (and successes).

__ Increasing donations and expanding the number of revenue streams - if you currently only hold three fundraisers a year - consider holding six this year (e.g. finding new sponsors to sponsor more of your organization's work, implementing annual appeal letters, raising more and new major individual donors, a new special event, etc.)

__ Folding and closing shop permanently which can be devastating yet it can be for the best. If your organization's constituency (whatever or whomever it serves) would be better off if another similar nonprofit were the only game in town (for a myriad of possible reasons: everything from fundraising consolidation to clarifying where to go for information and referrals, etc.) then it is worth considering this option for their sake (and their sake is key, when considering a nonprofit's future, not your own).

__ Implementing sliding scale fees for services and products which may or may not be required of all clients or customers.

__ Reorganizing your agency and through restructuring its operations, staff, procedures, and all aspects of business to cut the "fat" resulting in a leaner, more efficient, 'heads up', productive, and effective organization.

__ Downsizing/Lay Offs which is another dreaded option for those nonprofits who hire staff. Perhaps staff could be hired back when the organization recovers. Always let staff go with the most advance notice, possible; and with the very best severance package that the organization can afford.

__ Freeze all management raises, bonuses, and incentive pay and ask for their patience and understanding. This may be where the organization learns who is a team player and who is focused on the best for the organization's mission statement; and who is not.

Always weigh which option is best for the nonprofit by keeping its mission statement first and foremost; forecasting the organization's abilities, budget, and income; monitoring how well needs are being met in your community and weigh these findings against the organization's expected outcomes; note how well similar organizations working in the same field or on the same cause are doing; network and be open - talk with colleagues doing similar work elsewhere and listen to them; share your organization's situation with your regional community foundation and listen to what they suggest; talk with your local municipalities and let representatives know where your organization is, what it's considering to solve its situation, and listen to their ideas or suggestions; let your donors know what is going on and ask them for 'extra' if they can offer it (either as volunteers, by giving needed items, or by increasing their donations for the year); keep clients and volunteers up to date on what is happening; stay a team - do not get divided by difficulties and stress; listen to one another; research options; learn what can be done; and plan.

Sadly, there will be many organization who read this because they are facing the most difficult times and therefore the most difficult decisions that your organization has ever had to do. Work together, within your organization; use your community's assets, right now; learn and educate yourselves and your organization's leadership; see where your organization is right now, do a needs assessment, and recommend solutions; plan; and roll up your sleeves. I know that they were already rolled up, but hang in there. Also, take good care of yourselves, right now, as best as you can. We're in this together.

I would appreciate hearing what your organization is doing to solve any one of its difficulties during this tough economy. Please share them by commenting, below, here. We all need each other and any effective ingenuity right now. Thank you in advance.


Durham said...

I'm in the process of starting up a nonprofit mentoring organization for female youth. I would like to know are there any grants or agencies I can go to to get start up money to pay for the 501c3 application to be processed?

Arlene M. Spencer said...

Hello, thanks for reading, and here's some help. Read the following for help getting educated in best practices, nonprofit professionalism, standards, etc. see:

Places, Resources, And Ways To Learn Everything From Fundraising to Other Nonprofit Operations (Some Are Free) at:

Some Free Resources at:


We Need Money For Our 501(c)(3) What Is the Grant Seeking Process? at:

Good luck! Arlene