Take These Steps to Confront an Ever-more-challenging Environment

Seven Keys to a Successful Nonprofit

By Christopher D. Marini, MSA, MOS

With an increased regulatory environment and constant pressures to maximize revenues, operating a fiscally successful nonprofit organization can be more challenging now than ever before. There are many actions, both big and small, that can be taken to ensure an organization is operating as effectively as possible.

I’ve selected seven keys to discuss that can help your organization in the years to come.

An Investment in People

In an industry that’s so intently focused on varied sources and levels of funding, it’s good to remember that an important asset of any organization is its staff. Here are some points to consider:

• Having a solid management team is particularly important because their attitudes permeate through all levels of the organization. To aid them, look for trainings or webinars that can help management develop their leadership abilities. With motivated, inspiring, and knowledgeable leaders at the helm, staff are more likely to be inspired to work with passion.

• Any time is a good time to perform an analysis on your hiring process. Is your new-hire training standardized, and does it help introduce staff to the culture of the organization in addition to position-specific training?

• Keep an eye out for that shining star of an employee that shows aptitude for future growth and leadership. If you can provide him or her with an opportunity to develop their skills, you will develop a pipeline for strong leadership. This form of succession planning can help the future continuity of the organization.

• Keeping employees and staff engaged and motivated is always a challenge. Are your organization’s raises and promotions based on measurable merit, whereby those employees who best meet the desired criteria of success are rewarded for their efforts? Doing so will keep your best and brightest engaged and set an example for other employees.  A consistent method of evaluating the success and performance of your employees is a great foundation.

Having an Involved Board

Having a diverse and knowledgeable board of directors is a tremendous advantage. Be sure to tap into their unique skill sets and contact networks to maximize their value. Be open-minded about ideas they have, and assist them in organizing periodic meetings to discuss big-picture items such as programs, investments, budgets, legal issues, and other high-level or important items that may require attention.

Public Image

Public image and recognition are crucial to obtaining donations, funding, and support from your local community. Consider evaluating your current marketing efforts critically to determine whether your approach is earning you the recognition needed to support your program. You likely have a wide range of tactics available to you — press releases, networking, speaking opportunities, social media, and a website.

However, simply having these things in place does not breed efficacy in and of itself, and, unfortunately, marketing is often the last thing on the minds of busy and inundated nonprofit leaders.

First, it’s important to clearly define your intended audience. All too often, organizations take a very broad approach without first considering the profile of their audience. It’s imperative to know who your audience is before engaging in public relations.

Next, consider whether your outreach initiatives are using resources effectively. Here’s an example: your organization is engaging in speaking events to garner support and find new volunteers for summer-camp programs your organization runs for area youths. However, your current speaking engagements at local Rotary clubs and chambers of commerce aren’t yielding the number of volunteers you’d hoped for. In this case, you might consider alternative audiences like church community-service groups, student organizations on college campuses, or other community-based groups whose mission better matches the profile of your ideal volunteer. The idea here is to think critically on every mode by which you communicate to determine if alternate approaches might be more efficient or effective.

Utilizing Volunteers

An excellent method of keeping costs down, while still getting work done, is utilizing volunteers. In order to attract and retain volunteers, it is important that the community is aware of the existence of your organization and cares about its mission, as noted above. If either of these criteria is not met, obtaining volunteers will prove to be a challenge.

Once volunteers are on board, it is imperative to use their time well.  When they arrive, ensure clear expectations are set, while at the same time making the process fun and convenient. If a volunteer has a good first experience, they are more likely to come back and even bring a friend.

Always show appreciation for their time and energy. Some organizations will even buy small gifts or hold an annual reception for volunteers.

Diversify Funding Sources

Most people have heard the adage “don’t put all your eggs in one basket.” When nonprofits rely too heavily on one type of grant or donor, they create a concentration that could potentially be detrimental if they lost this key revenue source. Most nonprofits already have a good handle on garnering cash donations from individuals and businesses, but here are some other sources that may not have been considered yet:

• One way of giving that is becoming more popular is making a charitable donation from a retirement account. Amounts attributable as qualified charitable distributions will not be included as taxable income to the individual.

• Non-cash gifts or trade can also be helpful for certain organizations.

• Charitable gift annuities are a good way to gain immediate revenue while offering tax advantages to the donor.

• Encourage people to name your nonprofit as a beneficiary in their wills or through tax-beneficial methods such as charitable remainder trusts. A good public image and mission will make this easier.

• Special events are a great way to generate additional revenue in a fun setting.  It is also an excellent way to have direct face time with donors.  Examples of popular special events include golf tournaments and annual galas.

Know the Rules

Nonprofits are highly regulated, and the rules are constantly changing. There are many annual filing requirements, and audits are a requirement for organizations with certain amounts or types of government funding. Regular communication with your accountants and attorneys is always a good place to start.

Additionally, consider sending certain staff to external trainings or seminars to help them stay on top of what they need to know to successfully perform their job.  Further nonprofit information can be obtained at www.mbkcpa.com/category/non-profit.

Mergers

While it is a word that some organizations dread, mergers can sometimes be a useful tool. Oftentimes, a region may have too much direct competition for resources, or a key executive director will retire or accept a position elsewhere. In instances where continuity seems troublesome, mergers can be an effective way for organizations of similar missions to come together for a common good.

Mergers can help centralize and combine resources, leading to a better financial position and the ability to spread the organization’s mission to a larger population.

In Conclusion

Running a fiscally successful nonprofit organization ultimately comes down to the quality of the people involved and the programs it operates. With knowledgeable employees, involved board members, and motivated volunteers, your nonprofit will be able to keep a positive public image and be in a good position to maintain the proper funding and regulatory compliance necessary to ensure future continuity and fiscal success. u

Chris Marini is a senior associate with the Holyoke-based public accounting firm Meyers Brothers Kalicka, P.C.; (413) 322-3549; [email protected]