Organizational check-up: 7 answers your nonprofit needs to knowSir Jose Bright
Many nonprofits find themselves responding to the changing world reactively. Faced with rapidly increasing demands for their services and insufficient resources to respond, they also see new initiatives and other organizations as a threat. Board and management teams may be overwhelmed with the task of growing their brand and capacity while maintaining quality services for their clients. At the same time, donors are questioning nonprofits that appear too bureaucratic, less innovative, or unable to demonstrate measurable and sustainable impact.
In order to overcome these challenges and remain the long-term partner of choice for your stakeholders, it is imperative to address these seven questions:
- Does your organization have an innovative and relevant strategy?
- Do your board, management team, staff, and volunteers have the knowledge, skills, and attributes required to execute the strategy?
- Can you mobilize and manage resources effectively?
- Are your internal operations effective and efficient?
- Are you using relevant, cost-effective, 21st-century technology?
- Are you harnessing and growing your social capital?
- Are you building the right brand for your nonprofit?
While the above questions are not exhaustive in terms of achieving success, they’re the key questions asked by potential board members, donors, volunteers, and clients when deciding whether to engage with your nonprofit.
And for good reason—fundamentally, ignoring these questions could lead your nonprofit to:
- provide outdated or irrelevant services;
- lose credibility within the sector or community;
- have trouble retaining key board members, staff, volunteers, donors, clients, and partners;
- chase after funding without a clear direction; and
- lose opportunities for growing—or even sustaining—the organization.
To assess the effectiveness of the organization, board members and top management team members must answer those seven questions by focusing on the following areas.
1. Strategic Planning
The strategic plan is a guiding documental for all decision-making: A living, 3-to-5-year roadmap charting a path to the future the organization wants to create. When a nonprofit has a solid, innovative, and relevant strategic plan, it will be easier for all internal and external stakeholders to determine their role, and how they can add value. Having a strategic plan minimizes conflict, improves communication, and increases efficient, effective use of organizational resources. Moreover, it builds a credible brand and assists efforts to mobilize existing and potential donors, sponsors, and partners.
Organizations that don’t have a strategic plan are more likely to waste limited resources or fail outright. Without a relevant strategy, organizations may be pulled in conflicting directions by stakeholders, and lose credibility in the process. Today, those who are serious about engaging with a nonprofit often request to see the strategic plan—not just to establish an organization’s credibility, but to determine where their resources can be best deployed.
2. Strategic Leadership
A nonprofit’s greatest asset is its people. Without skilled, experienced, committed people with the right set of attributes, a nonprofit will have difficulty implementing its strategic plan. As a founding leadership team adds staff, board members, volunteers, and partners, they will need to ensure that they’re able to weather growing pains and innovate to remain the partner of choice for clients and other stakeholders. The right set of human capital builds a healthy organizational culture that can achieve the mission, build a positive brand, and solidify its position within the community.
3. Resource Mobilization and Management
The strategy cannot be achieved without mobilizing and maintaining your resources—including people, funds, in-kind donations, collaborative partnerships, and more. Nonprofit leaders must seek long-term financial sustainability, and avoid becoming dependent on a single donor or government funding source, as well as develop a forward-looking plan for resource deployment. Once resources come into the nonprofit, leadership will have to develop strong relationships with funders, volunteers, collaborative partners, and donors through proper reporting and communication.
4. Effective and Efficient Internal Operations
Leadership will have to develop tools to regulate activities, and set measurable objectives toward meeting strategic goals. If internal operations lack control mechanisms, it will be difficult for the nonprofit to detect irregularities, identify opportunities, handle complex situations, and even delegate authority within the organization. Control mechanisms should focus on all levels within the organization, including belief systems, boundary systems, performance management systems, and interactive monitoring systems. In order to provide quality services and build a credible brand, nonprofit leadership develop internal operations with the organization’s structure, systems, policies, processes, technology, and people in mind.
5. Harnessing 21st-Century Technology
Today’s technology—including tablets, smart phones, apps, online tools, and more—is making it easier for nonprofits to access information, identify opportunities, problem-solve, innovate, and reach out to more people. Investment in technology can also reduce the nonprofit’s costs, expedite processes, improve communication, deliver virtual services, and improve branding. Many nonprofits now have a website and a presence on social media, and some are mobilizing support through crowdfunding, e-recruitment sites, e-newsletters, and online letters of appeal. In addition, partners, donors, and even clients are increasingly insistent that nonprofits put technology to good use.
6. Utilization of Social Capital
No nonprofit can afford to be an island. Because we are currently challenged like never before, today’s nonprofits must build healthy and reciprocal networks with people and institutions in order to better share information, opportunities, and resources, as well as overcome larger challenges within the sector or community. Maintaining healthy social capital leads to greater outcomes and impact.
7. Marketing Your Brand
Many nonprofit leaders don’t see the relevance of marketing their programs and services or focusing on customer service, a consistent image, or understanding the “markets” you’re targeting in terms of clients and funders. Without those priorities in place, however, you can’t develop appropriate strategies to attract those clients and funders. Two common results: trying to be everything to everyone, and failing to achieve substantial results. Nonprofits require a structured marketing strategy, informed by research and budgeting, to produce quality results, maintain them over time, and make a meaningful impact.
Think on the seven questions, and try asking colleagues for their thoughts on some of the issues raised: The first step for improving any of the areas above is to start a conversation.
Sir Jose Bright is a senior consultant with GCN’s Nonprofit Consulting Group.