Is Your Nonprofit a Survivor?

I am not a financial expert nor am I a Chicken Little, but if I pay attention to the financial chatter there is good reason to believe that we are on the verge of, if not in the beginning throes of, a recession. So, perhaps the sky is beginning to chip—or fall—depending upon who you are and what you’ve done since the last time we were at this precipice.

This isn’t the first recession we in the nonprofit sector will face, nor will it be the last. So, have we learned from the past?
Have we better prepared and insulated ourselves for this economic downturn? Have we diversified our revenue streams, and diversified within those streams? According to 2003 numbers from Bridgespan,  60% of the annual income produced by the nonprofit sector was earned dollars—the actual exchange of payment for services provided by a nonprofit. While I would love to assume that percentage has increased in the ensuing four years, I’ll settle for that 60-40 ratio. But do nonprofits have diversity within their earned revenue streams, so that if the recession means the backing off from some things, you can continue to count on income generated from others?

Have boards gotten the message that they need to be active players in the fundraising efforts of their organizations? And not equating fundraising solely with the writing of grants and going after corporate sponsorships dollars—all things that boards perceive as best done by staff, if they are lucky enough to have that development staff? Or, have boards been resting on the assumption that the government has always funded us or Foundation X has always funded us? Have we been cultivating an individual donor following?

Have we remembered that we always need to protect and nurture our core competencies, even as we chase dollars? Because when the times get tough, as we know they always will, the mantra that gets chanted is, “Remember your mission! Play to your strengths!” In other words, don’t ever betray your core competencies as you always, need them.

Have we done a good job of developing, nurturing and rewarding the dedicated and hard working staff members who will, when times get tough, be the ones on whom we will need to depend to stay loyal—to our organization, our customers and our donors—so that we can deliver on our mission promise? After all, it is during tough times that many of the nonprofit sector’s services are needed more than ever. So, we are, as we all know, working harder with less for more clients. We don’t need to be trying to recruit, hire and train new staff when we are working on delivering our mission at warp speed. We need to have our skilled and accomplished, loyal and well rewarded staff committed to staying on.

So, have we learned and are we ready to face this impending period of tough times with the capacity to survive and come out the other end ready to flourish?