Mario Morino, Venture Philanthropy Partners Chairman, recommends that nonprofit boards answer six critical questions to insure that their nonprofit is prepared for changes that might lie ahead.
- “What conditions could change precipitously, endangering our mission and those we serve?” If a lot of your funding comes from a few sources (governments, foundations, major donors), how would you survive a major cutback from some of those sources?
- “What can we do to improve the outcomes of our programs?” Too many nonprofits put a lot of effort in improving their processes, and never actualize big, non-incremental improvements that can save lives, enable more youths to graduate, or help more unemployed workers get jobs.
- “What is our organizations ‘baseline’ budget for providing the minimum acceptable level of service to clients?” You need a contingency plan for what is the smart thing to do if you have a major revenue loss. A zero based budgeting approach prepares you to always be able to keep delivering your core services with acceptable quality.
- “Who could we turn to if we were at risk of having to fold our tent?” For-profit businesses typically know who they would go to if they had to sell their business for whatever reason. Identifying and developing those relationships now will enable you respond effectively if you are suddenly facing a crisis.
- “How can we change our prospects by building on what we already know?” It is important to explore new opportunities that are directly tied to your mission and are not more than one step away from your core competency. Incentivize your staff and board to search for ideas to grow your nonprofit based on this “one-step away” principle.
- “What can we do to strengthen our revenue base?” First, expect everyone to play a role, not just the fundraising committee and team. Don’t just focus on your current base, but consider new sources based on the “one-step away” concept. But proceed with new sources cautiously. They can lead to a loss of mission focus and a dilution of scarce internal resources.
You can read Mr. Marino’s complete five page article on “Saving the Ship by Rocking the Boat” at: http://www.vppartners.org/learning/chairmans-corner/saving-ship-rocking-boat
Author: Bob Cryer, Executive Coaches of Orange County, www.ECofOC.org