What Does Nonprofit Sustainability Look Like?
I often hear community leaders and elected officials pontificating about the importance of a “strong, sustainable nonprofit sector” as a way to enhance overall community health. They talk about the business and municipal communities partnering with the nonprofit sector to better address problems and bring a more holistic approach to the collective work. Unfortunately, I have rarely, if ever, heard any of these people exhibiting any true understanding of what a strong, sustainable nonprofit organization actually looks like, or the resources that are needed to accomplish this. So, what does a sustainable nonprofit organization even look like? And, how can we work actively to help the sector be as sustainable as we say we want them to be? In the environmental sphere, sustainability means ensuring that we are using our natural resources wisely and in ways that don’t totally deplete them. The same is true in the business sector – sustainability means ensuring that a company has sufficient resources to survive, maintain, and grow over time. For the nonprofit sector, sustainability can seem more precarious simply because of the nature of their structures and funding sources. But at the end of the day, a nonprofit is a business first, and the same fundamental principles of sustainability apply whether we’re talking about a for-profit or a nonprofit business. So, what are the primary components of nonprofit sustainability that its leaders must be attentive to? And, how can the community leaders, who verbalize their commitments in the most well-meaning of fashions, ensure that these organizations can continue their important roles in our communities for many years to come? Component #1 for Nonprofit Sustainability: The Strategic Plan A strategic plan is the road map for any business’s success. Without a plan that looks ahead 3 to 5 years, a nonprofit is at risk of stagnation, mission creep, and all sorts of other preventable issues. Strategic planning should be a top priority for any nonprofit leader and board member, as it sets the vision and charts a measurable path to accomplish organizational goals. Not only this, a good strategic plan puts accountability in place with clear, measurable objectives and outcomes that can be revisited at the end of each year to determine progress and impact. As a former nonprofit executive director and current, active board member for several organizations, I understand deeply the value of a strategic plan and the importance of keeping it at the forefront of the work. Anyone who gets involved with a nonprofit should read and become familiar with the organization’s strategic plan…and advocate for the creation of a plan if there isn’t one. Also, it’s always best practice to revisit the plan each year to check in on its implementation and make any tweaks that may be needed along the way. Component #2 for Nonprofit Sustainability: Adaptability The most successful and sustainable nonprofits are highly adaptable and attentive to fluctuations and changes in their broader ecosystems. These are the organizations that understood how to “pivot” long before the COVID-19 pandemic popularized the word and forced us all to figure it out (or go bust). Sustainable nonprofits tend to be headed up by fearless, information-driven leaders, people who pay attention to trends and resist the urge to maintain programs or activities strictly due to tradition. Some of these dynamic leaders seem to operate by instinct, but the most thoughtful of this group actually do a lot of homework behind the scenes. Analyzing data, having conversations with peers, staying informed about current or upcoming issues that could impact their organizations. For those who serve on the boards for these nonprofits, it’s imperative to not leave all the adapting to the executive director while board governance stagnates. True partnership between a board and its leadership team requires strong communication. This is the only way to be sure that shifts and pivots are well thought out, that consensus is built, and that implementation occurs organization-wide instead of in silos. Let’s be open to change and adaptation, and deliberate and thoughtful about its implementation! Component #3 for Nonprofit Sustainability: Planned Succession Most nonprofit leaders I know are pretty good at succession planning for their boards of directors. If their bylaws require board turnover via term limits, succession planning gets baked into how the organization functions. However, succession planning for staff and leadership is also super important for building a sustainable nonprofit. Not only should the leader be thinking about the skills and/or representation needed to maintain a healthy board, he/she should also be planning for their own eventual departure from the organization. For every nonprofit I have been involved with, whether as a board member, a staff member, or an executive director, I have operated under the philosophy of “leaving it better than I found it”. In my experience, this means taking the board development and succession planning process seriously, and it also means taking deliberate steps to improve the organization’s structure, operations, programs and staff to prepare for the day when I will no longer be involved. This type of succession planning may seem difficult, especially when there is so much to do on a day-to-day basis. But it’s so important to any nonprofit’s long-term health. We must always operate with a long-range vision for our organizations – whether we are board members or paid staff – and take incremental steps that move our organizations towards greater sustainability while we are involved. Component #4 for Nonprofit Sustainability: Diversified Funding The fourth and final component I’ll share related to nonprofit sustainability is also the most difficult to achieve: a diverse funding model. Building a funding model of any sort in the nonprofit sector is difficult enough but establishing funding diversity is extremely tough…and also extremely important for long-term organizational sustainability. Financial sustainability requires sufficient resources to pay for overhead, staff, and programming. It also requires a build-up of reserves for unforeseen challenges. This should be enough to cover at least 3 months of the operating budget. Lastly, financial sustainability requires
Read moreFive New Year’s Resolutions for the Nonprofit Leader
Happy 2023, friends in the nonprofit sector! If you’re anything like me…and pretty much everyone else on the planet…you’re working hard to step into the new year with intention. Whether you’ve resolved to lose a few pounds, or train for a marathon, or finally get your household budget together, please know that we’ve all got something we want to get handled in the new year. Personal goals and resolutions are a great way to start a new year, and it is also true that the personal tends to cross over into the professional for many of us. So, I’m here to offer a gentle reminder that our professional intentions are just as important as those personal resolutions. How we as nonprofit leaders show up at the start of the year can really make or break the type of year our organizations have. I’m talking about how well we care for ourselves, our teams, and our boards. Remember, friends: we can’t fulfill our missions and serve our clients unless the house is in order! Here’s five quick tips to make sure you’re starting the new year with intention: 1. Find (and Protect) Your Balance – of course this is the first thing on every professional’s to-do list, right?! Prioritizing work-life balance is of utmost importance, especially for those who work in the nonprofit sector where there are never enough resources or hours in the day to accomplish all that needs to be done. Just remember, friends, you can’t take care of anyone else unless you are taking care of yourself. One thing I’ve learned in my long nonprofit career is that almost everything can wait until I have had a good night’s sleep. Another thing is that there is no organizational priority that should cost me my health. Period. So, start now: find some boundaries and set them. Say no when no is what needs to be said. Go home at a reasonable hour. Let a few of those emails and to-do lists wait until you’ve had some sleep (and exercise). Just do it. You’ll be better off for it, and so will your productivity. 2. Ask for What You Need – leading a nonprofit organization is a calling. The people who answer this call are among the hardest working, kindest, and most generous people I’ve ever met. They are also the folks who will work themselves to the bone, taking responsibility for everything from managing organizational finances to running programs to scrubbing floors if that’s what needs to be done. But, the fact is that most nonprofit leaders do have resources that can be used – human resources, financial resources, technology resources – we just have to remember how to identify what we need and ask for it. Start the new year resisting the pull of the hero complex, friends! “Doing more with less”, while noble, is also the quickest way to burn out. Figure out where your time is best spent and where you need additional hands and/or expertise. Then, have a conversation with your board and ask for what you need. It sounds simple because, well, it is. 3. Support Your Team – setting your nonprofit up for a successful year should always include investing in your team’s professional development. Speak to your team members about their professional goals and what you can do to support them in the immediate term. Listen to their words and do your part to give them what they are asking for. Do you have a team member with significant growth potential? Maybe they’re ready to take on a new responsibility for the organization. Do you have someone who want to learn a new skill that will help them do their job better? Send them to a conference or hook them up with a mentor who can help them grow. Nobody wants to be stagnant, friends…not you, and certainly not your team. Invest in their growth and you will definitely see results! 4. Nurture Your Board – a new year is an excellent time to revitalize your relationships with your board members. After all, the board of directors is the most important group of volunteers any nonprofit organization has. So, it behooves the nonprofit leader to nurture these relationships to ensure that board members remain engaged and committed to the mission and their important work. Try offering an annual refresher course in board governance. Extend a board meeting by 30 minutes to allow a bit of camaraderie. Connect with each board member personally over coffee or lunch. Ask board members how they’re feeling about their service. Solicit their feedback and ideas. And, always thank them for all they do to support you and the organization. 5. Create (and Follow) Your Plan – in a perfect world, every nonprofit has a robust strategic plan that they follow to a tee. In the real world, most nonprofits are lucky if they have a simple annual roadmap to help focus their work for the year. Whatever form your plan takes, just make sure you have something that will help keep you focused for the whole year. A good annual plan will include at least one organizational and programmatic goal. It will also include a financial goal to help drive fundraising efforts to help accomplish the organizational and programmatic goals. And no plan is complete without the ability to evaluate success, so be sure yours includes responsible parties and measurable outcomes. It’s going to be another fantastic year of nonprofit excellence, friends! Hope these tips are helpful, and please be sure to share your tips in the comments for starting the new year with intention!
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