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A to Z Survival Guide for Uncertain Times

December 16, 2011

(Michael Seltzer is a regular contributor to PhilanTopic. This post originally appeared on this blog in October 2008, shortly after the collapse of Lehman Brothers. Plus ça change, plus c'est la même chose. Michael's last post was a Q&A with David Jones, president of the Community Service Society of New York.)

AbcsEach time the American economy has suffered a downturn or government has cut back on funding for social programs, the media has focused on how those of us on "Nonprofit Street" are being affected. Those of us running nonprofit organizations don't need newspapers to tell us how things are going or how our constituents are faring. Instead, we want to know what our colleagues are doing to address the financial challenges we each face.

The "A to Z Nonprofit Survival Guide for Uncertain Times" is compiled from my past writings and strategy recommendations I learned from grantees, clients, and fellow consultants. To all of you, I am grateful for your generosity and wisdom.


Accentuate the positive
There's enough doom and gloom in the media and on Wall Street. The public doesn't want to hear how poorly nonprofits are doing; they want to know that nonprofit organizations will continue to be there for them.

Be bold
The pressure to scale back programs and to promise less is real. But it's important, when possible, to find new ways to provide value to clients, funders, and supporters.

In normal times, many nonprofit leaders view collaboration as the most unnatural of acts. These are not normal times. There is much to be gained, including cost savings and enhanced impact, by working more closely with others.

Deepen relationships (with elected officials, in particular)
Unfortunately, local, state, and federal governments will be forced to make cuts in their budgets as tax revenues decline. Be sure to make the case with your elected officials and their key staff for continued government funding of your organization.

Look for opportunities to experiment and/or pilot small-scale initiatives. Such opportunities are likely to be a less expensive investment in change than grand, large-scale progams or initiatives.

Fundraise selectively
Good advice anytime, but especially in the current economic climate. Focus on strong, solid prospects rather than second-tier long shots. With corporate donors, be prepared to discuss non-cash ways the company can support your operations, including loaned executives, volunteer programs, the short-term loan of facilities, and other in-kind contributions.

Get rid of dead (board) wood
Tough times demand that all stakeholders roll up their sleeves and give generously of their "time, talent, and treasure." Board members who are unable and/or unwilling to pull their weight and contribute what they can to strengthen the organizations must (gently) be shown the door.

Help other organizations less well positioned than your own
It doesn't have to be with money; technical assistance, fundraising advice, even something as simple as words of encouragement can go a long way in a tough economic environment. At the end of the day, we're all in this together.

Invest in the future
Though you're likely to find that cost-cutting measures are unavoidable, it's equally important that you identify ways to create or expand your reserve funds. No one can predict the future, so the best advice is probably the old Scouts motto: "Be prepared."

Join your local or state association of nonprofits
Networking is not only helpful in times like these, it's essential. Local nonprofit associations provide a great meeting ground to exchange information and lessons learned with peers and colleagues in other organizations.

Keep informed of developments in your field
That means staying on top of your issues and looking for even better ways to do what you do. This is not the time to cut back on professional journals and magazine subscriptions.

Look to the future, not the past
Another way of saying, "Don't rest on your laurels." And if your organization is struggling, take comfort from the fact that, with creativity, hard work, and an optimistic outlook, things are likely to get better.

Mind the sweet spot
Don't just chase dollars. Identify your organization's "sweet spot" -- the intersection of its vision, mission, assets, and other strengths with the giving "impulses" of your supporters and stakeholders -- and make sure everything you do connects to it.

Never reinvent the wheel
No explanation necessary.

Open yourself and your organization to new ideas
If something has stopped working for you, it's probably time to change it. Open your mind to new ideas and new ways of doing things, and seek out the opinions of experts in your field.

Plan for uncertainty
To be a good steward of the resources that have been entrusted to you, you simply must forecast several different financial scenarios for your upcoming fiscal year. Be conservative in your revenue projections.

Quickly communicate bad news to your key supporters
Make sure your key internal and external stakeholders feel they are being kept apprised of major changes and developments affecting your organization. And whatever you do, do not let them learn bad news about your organization from the media.

Respect your stakeholders
You can expect to get a lot of tough questions from concerned stakeholders. The fact they are concerned is a positive for your organization. Don't squander it by giving false or misleading answers.

Cost-saving measures such as sharing office space or pooling back-office functions must be considered in tough economic times. Many funders will be cutting back on administrative costs and will appreciate grantees' efforts to do the same.

Tell your story
Across the country, in practically every community, low-income families and individuals are the ones who will be most affected by the economic downturn. They are likely to turn, in growing numbers, to local nonprofit organizations for food assistance, child care, credit counseling, job retraining, legal assistance, and other services. Nonprofit leaders would be well-advised to collect the stories of the individuals and families they serve and share them with donors, supporters, and local media.

Upgrade your staff perks
Many nonprofits will be pressured to reduce headcount and/or to contract out some of their services. Such measures can hurt morale and reduce organizational effectiveness. It's important, therefore, for nonprofit leaders to find both material and non-material ways to express their appreciation for and solidarity with staff. Listen to their ideas and validate their concerns. They'll appreciate it and your organization will benefit.

Vision, vision, vision
In tough times, people tend to rally around organizations and leaders that project an air of confidence and optimisim. Franlkin D. Roosevelt warned about fearing "fear itself" in the depths of the Great Depression, and in the 1960s Lyndon Johnson rallied a shocked and racially polarized country around the notion of a "Great Society." For both men, language was a critical tool in helping to paint and convey a picture of better times to come. Nonprofits would be well-served to take a page out of their respective books.

Wear your values on your sleeve
In our sector, the most important assets are our values and the public's trust. Whether we express our values through our Web sites, marketing materials, or on a T-shirt, we should display and wear them proudly. And in no circumstance should we compromise our ethics or the integrity of our organizations or the sector.

Remember: Most of us still have a lot to be grateful for.

Yield no ground as an authority in your field
In order to assert that authority, however, you have to stay informed (see K) and must communicate clearly.

Zero in on your core competencies
Identify what your organization does best and strive to be a leader and innovator in that area or space.

-- Michael Seltzer

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Quote of the Week

  • "[L]et me assert my firm belief that the only thing we have to fear is...fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance...."

    — Franklin D. Roosevelt, 32nd president of the United States

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