PhilanTopic

5 Ways to Engage Finance Professionals in Pro Bono Service

(The following post by Aaron Hurst, president of the Taproot Foundation, was adapted from Powered by Pro Bono: The Nonprofits Step-by-Step Guide to Scoping, Securing, Managing, and Scaling Pro Bono Resources. In his previous post, Hurst weighed in on the value of "pre-mortems.")

Nonprofit economics differ pretty significantly from the for-profit kind. For one thing, tools like a balance sheet or a profit-and-loss statement don't carry nearly as much weight in a not-for-profit setting as they do in the business world. Nonprofit organizations also have to follow specific rules and regulations related to their tax-exempt status. Despite these differences, nonprofits are learning how to boost their capacity and effectiveness by engaging accounting and finance professionals in their work. The fact that there are some 1.8 million accounting and finance professionals in the U.S., and that many of them are looking for ways to make an impact in their communities, is a huge plus for the sector.

With that in mind, here are five things finance and accounting professionals often are willing to do for nonprofits on a pro-bono basis:

1. Program-cost analysis. A program-cost-analysis project identifies the cost initiatives a nonprofit must define in order to answer a pressing strategic question. The first phase of any such project involves an in-depth examination of an organization's current finances to tease out cost factors relevant to those initiatives. After that, a comprehensive report which clearly lays out the full costs of taking on a particular initiative is prepared.

2. Internal financial controls assessment. Rigorous assessment of an organization's financial controls ensures that it is consistently recording financial transactions in an accurate fashion. These controls also help to minimize risk, including employee theft. The first step in developing an effective internal controls system is to identify areas where abuses or errors are likely to occur. Many accountants can provide you with a checklist of these areas, as well as questions to consider when you are planning your system.

3. Budgeting. A well-designed budget process can help an organization and its management zero in on key financial issues and potential problems before they have major consequences, enabling the organization to move from reactive to proactive resource management. The end result of such a process should be a budget that allows key stakeholders to track the status of the organization's finances in real-time; enables managers to track actual performance against plan; and allows for quick adjustments to meet changing economic conditions.

4. Pricing strategy. Pricing strategy projects look at the value of a specific product or service. Since price directly affects revenues (price x quantity sold = revenue) and, therefore, profitability (total revenue - total costs = profit), a good place to start when developing a pricing strategy is to determine unit costs. While nonprofits rarely are driven by the bottom line, net income is crucial to organizational sustainability. Therefore, any pricing strategy project should incorporate a method to calculate the real costs associated with the product or service delivered so as to ensure a sufficient level of net income.

5. Supply chain audit. The planning, purchasing, manufacturing, marketing, and distribution functions embedded in a supply chain often operate independently of one another and have their own objectives. With an eye to identifying opportunities for increasing efficiencies and better integrating these different functions, a supply chain audit looks at every step in the chain, from the procurement of the materials needed to create a product, to the process by which those materials are turned into a finished product, to the distribution of the product to customers/beneficiaries. The result, quite often, is better performance and lower costs for the nonprofit.

The nonprofit executive often has to act as CEO, CFO, COO, talent manager, and marketing director at the same time. Juggling these roles is tricky at best, but when the organization reaches a certain scale or ambition, taking a closer look at its financial health becomes critical. Identifying key financial needs is the first step to scoping projects and developing specific "asks." Accounting and finance professionals do these things everyday, and many are looking for ways to make an impact. The most effective leaders will do what they can to take advantage of this pro bono resource.  

-- Aaron Hurst

Conducting a Pre-Mortem

(The following post by Taproot Foundation president Aaron Hurst was adapted from Taproot's new book, Powered by Pro Bono: a Nonprofit's Step-by-Step Guide to Scoping, Securing, Managing and Scaling Pro Bono Resources, published by Jossey-Bass. In his last post, Aaron shared three tips to help prepare your team to be a great client for a pro bono engagement.)

A post-mortem is done by doctors after a patient dies to uncover the cause of the patient's demise. It's also a great way for doctors to learn and hold themselves accountable (although it doesn't do much good for the recently deceased on the table).

A pre-mortem, a process that increasingly is being adopted by project teams, takes the idea of the post-mortem and tries to apply it before a patient has died -- in other words, before it's too late to help. But of course in this case I'm not talking about an actual patient, but rather any project (internal or external) that involves a significant commitment of resources (monetary and/or human).

The pre-mortem process can be as simple as asking your team a few questions at the start of the project. For example: Assume that, six months down the road, everything that could go wrong on this project has gone wrong. What went wrong? And why?

Focus on the three to five most likely reasons that the project could fail or go off the rails. Then map back how you could have prevented these meltdowns. Finally, incorporate those changes into your project plan before you actually get to work. Might the patient still show up DOA? Sure. But the chances of that happening are much less likely than if you skip the pre-mortem altogether.

-- Aaron Hurst

Prepare Your Team for Pro Bono

(Aaron Hurst is president of the Taproot Foundation. The following post was adapted from Powered by Pro Bono: The Nonprofits Step-by-Step Guide to Scoping, Securing, Managing, and Scaling Pro Bono Resources, to be published later this month by Jossey-Bass. To read the previous post in Aaron's series, click here.)

You just returned from a meeting with one of your largest corporate partners. In the meeting, you explored the possibility of your corporate partner doing a critical pro bono project for you in a few months. They seemed like they were pretty into it. Heading back to the office, you're fired up but want to make sure your staff is ready.

Here are three tips to prepare your team to be a great client for the pro bono engagement:

1. Clearly define the connection of the project to your strategic plan and goals. Make sure you can make the case that it's a critical project for your organization.
2. Identify who will be on your internal team and tasked with working with your corporate partner. Clearly define team members' roles and think about how you will recognize their work on the project, including the skills it will help them develop.
3. Have your internal team meet and do a pre-mortem before the project kicks off.  Pre-mortems are a great way to expose team members' hopes and fears.

Much of the success of a pro bono project lies in how you prepare staff for the engagement. As with most things in life, what you get out of it is directly correlated to what you put into it.

Of course, companies also play an important role in getting their nonprofit partners ready for a pro bono engagement. If you’re a company looking for ways to get involved, check out our upcoming webinar on Nonprofit Readiness.

-- Aaron Hurst

Six Common Pro Bono Models

(The following post by the Taproot Foundation's Aaron Hurst was adapted from the book Powered by Pro Bono: The Nonprofits Step-by-Step Guide to Scoping, Securing, Managing, and Scaling Pro Bono Resources, to be published in September by Jossey-Bass. To read the previous post in Aaron's series, click here.)

When we think about pro bono services, we typically picture teams of business professionals doing projects for a nonprofit -- building a new Web site, helping to create a strategic plan for an organization, and so on. In reality, there's an incredibly diverse array of models through which nonprofits can receive pro bono resources. Here are the six most common to help you think about how you can best leverage pro bono to boost your mission.

Loaned employee. An individual employee drops some of his or other duties to pursue a pro bono project. For companies and professional services firms, this typically requires a sanctioned and compensated leave of absence. Pfizer, for example, provides employees with three- to six-month sabbaticals so they can donate their services to nonprofits.

Functional coaching and mentoring. This model pairs a subject-matter expert with an employee at a nonprofit organization who can benefit from his/her functional expertise. Gap Inc. has their corporate HR executives mentor senior HR staff at their nonprofit grantees.

Team-driven projects. Individuals come together on teams to deliver a product based on the needs of the nonprofit partner, with each individual having specific roles and responsibilities. This type of pro bono engagement typically requires a dedicated project manager on the team as well as several specialists. An example: Bain & Company, provides $40 million a year in pro bono consulting advice to nonprofits.

Open-ended outsourcing. An organization makes its services available to a specific number of nonprofit organizations on an ongoing, as-needed basis. For example, a professional marketing association might serve as the general marketing outsourcer for a nonprofit agency. This is also a common approach in law firms that provide ongoing pro bono support to nonprofit organizations.

Signature issue. An organization combines formal pro bono work with other corporate assets to leverage significant internal resources toward solving a specific social issue. Typically, a signature-issue campaign represents a significant and longstanding partnership between an organization and a nonprofit client or clients. Deloitte, for example, adopted College Summit as a signature-issue partner and has provided the education organization with everything from a seat on its board to hundreds of thousands of dollars in pro bono services over the years.

Individual help. Help donated by a single employee is probably the most common form of pro bono service. It could be a photographer who donates a shoot or a facilitator willing to help out with an organization's board retreat. LinkedIn is a great resource for finding this kind of pro bono support.

There is no shortage of highly skilled people able and willing to help nonprofit organizations on a pro bono basis, and the ways they are able do that are limited only by our imaginations. Check back next week for more tips and techniques for scoping projects and securing pro bono services for your organization, and be sure to visit the Taproot Web site for more information about the growing pro bono marketplace.

-- Aaron Hurst

Raising Pro Bono

(Aaron Hurst is the president and founder of the Taproot Foundation, a national nonprofit organization that makes business talent available to organizations working to improve society.)

Every year, professionals donate over $15 billion in pro bono services, from marketing and legal help to strategic planning support. That’s four times the amount donated by corporate foundations every year. And it’s a resource that every nonprofit needs to tap if it wants to realize its full potential.

This post is part of a new series designed to help your organization learn how to get its piece of the pro bono pie. Every month, my Taproot colleagues and I will share tips and insights into how to scope, secure, and manage pro bono resources that can help your organization get the support it needs to thrive.

Over the last ten years, the Taproot Foundation has not only provided pro bono services directly to nearly two thousand nonprofits, we’ve been hired to design pro bono programs for a range of leading companies, from Deloitte to Capital One. In the posts that follow this one, we will draw on that experience to provide insider information that helps position your organization to strategically leverage these resources.

We are also working hard to get more companies to create pro bono programs that provide donations of high-quality professional services to nonprofits like yours. Inspired by President John Kennedy's historic call to members of the legal community to use their professional skills in the battle for civil rights in the 1960s, I lobbied President George Bush in 2008 to create a parallel challenge to the business community, asking them to use their skills to help the nation in a time of critical need.

The result was the Billion + Change campaign, which was launched by Jean Case, co-founder and CEO of the Case Foundation and chair of the President's Council on Service and Civic Participation. Billion + Change has already secured pledges of $1.8 billion in formal pro bono resources for nonprofits from more than two hundred companies, and it aims to reach five hundred companies over the next eighteen months.

In my next post, I’ll focus on the most common forms of pro bono service offered today by companies looking to support the nonprofit sector and make a difference. In the meantime, be sure to visit our Web site for more information on how to donate your skills pro bono, find pro bono resources for your organization, or to learn more about the growing pro bono marketplace.

-- Aaron Hurst