The Nonprofit Impact Manifesto
The world has never needed an effective nonprofit sector more than it does today, yet it has never been more difficult to run an effective nonprofit.
The challenges facing our planet, our communities, and our families are significant. Our world has lost half its wildlife in the last 50 years. Ten percent of the world’s population still lives in extreme poverty. Hunger has been on the rise globally since 2015. Here in America, Black and Latinx students continue to see fewer opportunities for educational advancement. Economic inequality continues to grow. More than 1.6 million people are diagnosed with cancer each year. Death from gun violence has reached its highest rate in over two decades. And many of the problems and inequities that already existed in our communities are only growing due to fallout from the COVID-19 crisis.
Every day, nonprofits are taking meaningful action to combat these problems, but they face obstacles that hold them back from doing all they could to truly make an impact. In fact, most nonprofit CEOs report that producing results continues to get more and more challenging.
This is because:
Demand is Growing
As global and domestic challenges accelerate and funding cuts for government programs that support people in need continue, 86% of nonprofits say demand for their programs and services keeps rising, and over half say they can’t meet that growing demand. All of this will continue to be exacerbated by the fallout from COVID-19.
Resources are Shrinking
The number of U.S. households that give to charity has been on a slow and steady decline since the turn of the century, and as older donors are replaced by Millennial and Gen-Z donors with less net worth and more unpredictable giving habits, many predict this decline will intensify. Additionally, many nonprofits that have long relied on government grants and foundation funding are seeing contributions decline, disappear or become less predictable. In March of 2020, when COVID-19 was declared a national pandemic, hundreds of nonprofits were forced to cancel their largest fundraising events of the year and quickly develop alternatives. Still more saw individual donations and grants decline as people became more timid about giving in an uncertain economic climate. As funding wanes, most nonprofits are finding themselves financially unprepared, and about half do not have operating reserves to sustain themselves for a single month.
Competition is Fierce
The number of nonprofits in the US has grown nearly 50% since the 1990s and thousands of new organizations launched in the last year alone. Many of these organizations do similar work and should collaborate or merge, but instead they find themselves competing for the same resources. Nonprofits aren’t just competing with one another, either. They also compete with the exploding social enterprise sector and businesses with strong social and environmental initiatives. Organizations are challenged by increasing competition for talent as well. In 2019, the number of nonprofit employees who voluntarily left their jobs hit its highest point since 2001, and in that sort of environment, keeping top talent is harder than ever.
“Nonprofits feel pressure to conform to funders’ unrealistic expectations…and respond in two ways: they ‘spend too little on overhead, and they underreport their expenditures on tax forms and in fundraising materials. This underspending and underreporting in turn perpetuates funders’ unrealistic expectations. Over time, funders expect grantees to do more and more with less and less—a cycle that slowly starves nonprofits.” – Stanford Social Innovation Review
Trust is Broken
In 2017, the number of Americans who say they trust the nonprofit sector to “do the right thing” dropped below the 50% mark, and in 2019, more people said they have more trust in business than in nonprofits for the first time in history.
The Starvation Cycle is Accelerating
As the organizations behind the Overhead Myth movement point out, many funders and donors have a long-held and ultimately false misconception that the most effective nonprofits are those that spend the least on their non-program expenses, also known as their “overhead.” While this might sound smart on the surface, in the nonprofit sector, overhead is a term that gets applied to everything from leadership and fundraising staff to technology and measurement — in other words the very things required to make a nonprofit effective and sustainable.
These problems are substantial, but we are not powerless against them, nor do we need to rely on government alone to solve them.
Those of us who work in and with the nonprofit sector know that nonprofits aren’t giving up in the face of these barriers to impact. On the contrary. Most are doubling down on their efforts to drive change. Every day, nonprofit organizations are taking meaningful action to combat climate change, end poverty, fight hunger, improve education, advance equity, improve health outcomes, serve on the frontlines of the COVID-19 crisis, make communities safer, and so much more.
With more than 10 million nonprofits and non-governmental organizations worldwide, and approximately 1.56 million of those based in the United States, we have the bench strength and the will to drive meaningful change, but no reliable way to optimize effectiveness and scale impact.
Introducing...The Nonprofit Impact System.
We have brought disparate research and best practices together into a simple system that has the power to make every nonprofit more effective. It is called the Nonprofit Impact System™, and it is transforming the way nonprofits operate. At the same time, it is transforming the way nonprofit supporters understand impact, and it is helping them direct their resources to the organizations best positioned to drive change.
The Nonprofit Impact System™ includes four dimensions of nonprofit effectiveness: Focus, Strategy, People, and Progress. Within each of those four dimensions, the system includes several critical components and proven practices nonprofits must develop to maximize their effectiveness.
The introduction of The Nonprofit Impact System™ represents the first time that nonprofits have had a complete, research-backed system for optimizing their effectiveness, and the first time their supporters have been able to look to that same system for understanding it.
Implementing The Nonprofit Impact System™ takes time, but you can begin today by making the 10 commitments outlined here, and asking your supporters to make 10 commitments of their own (funder Manifesto coming soon).
These commitments are the first step toward building a more effective nonprofit sector, and a more effective nonprofit sector can build a better world.
We will exist not because we can, but because we must.
We will foster focus internally through a clear vision, mission and core values.
We will communicate our focus externally through a strong brand.
We will establish what success looks like.
We will center our efforts around an agile strategic plan.
Each key function of our organization will have its own strategy and sufficient budget.
We will co-create change.
We will prioritize our people.
We will hold everyone on our team accountable to our goals and put processes in place for making continual progress on our missions.
We will measure our impact, report on it, and optimize our efforts based on what we learn.
The world is ready and waiting for a more effective nonprofit sector. Will you answer the call?
If you’re aligned with the ideas in this Manifesto, the time to take action is now. Making these commitments is only the beginning. You can start using The Nonprofit Impact System™ at your nonprofit by visiting nonprofitimpactsystem.com and accessing the library of free tools and resources you’ll find there. We’re also here to support you with workshops, coaching and consulting services that will help you unlock the full power of The Nonprofit Impact System™ for your organization.
Your nonprofit has a hard road ahead. That’s undeniable. The problems you’re aiming to solve are massive in scale, and there are so many barriers holding you back from making the impact you know is needed. But with The Nonprofit Impact System™, you finally have the tools to knock down those barriers and drive the change you have always known your organization was capable of.
Thank you for committing to building a better nonprofit sector, and in turn, a better world.
Download a PDF (Printable) Version of the Manifesto
About Prosper Strategies
The Nonprofit Impact Manifesto is brought to you by Prosper Strategies. It was written by Prosper Strategies’ co-founders Alyssa Conrardy and Lindsay Mullen.
Prosper Strategies is a nonprofit consulting firm on a mission to build a more effective and impactful social sector. Every day, we use our Nonprofit Impact System™ to help nonprofits like yours:
- Find their Focus
- Build their brands
- Develop (and actually use) their strategic plans
- Improve their approach to marketing and fundraising
- Optimize their teams and boards
- Make rapid progress on their goals
- Measure the results of their work
- …and change the world
Learn more at prosper-strategies.com