During the pandemic, we organized a regular Zoom gathering of nonprofit CEOs who came together to talk about fundraising challenges, staff burnout, social justice and returning to the office.
It can be lonely at the top, and I hate to bring down the mood, but sometimes it’s helpful for nonprofit leaders to know they are not alone when it comes to the challenges and obstacles they face. When this group of CEOs got together, there was a sense of collective relief as each leader recognized their organization was having similar experiences to others in the sector, and they came to rely on one another for idea sharing and advice. Thankfully that time has passed, and the group decided they would reach out to one another on an as-needed basis.
Even still, until every mission is met, there will be challenges and obstacles. So what is keeping nonprofit leaders up at night these days?
Financial stability and the economic climate
This wouldn’t be a post about what keeps nonprofit leaders up at night if it didn’t address concerns about overall financial health and stability. This is a worry in even the best of times, but it’s hard at the moment not to feel like something bigger might be looming. The Fed has raised interest 10 consecutive times since last year, and despite what continues to be a healthy job market, consumer confidence is waning, and several mid-sized banks have collapsed.
The good news is that historical data shows even if there is a recession on the horizon, nonprofit organizations tend to fair okay even despite them. In a December 2021 study of 37 Washington-based nonprofits, researchers found for many, financial losses as a result of the pandemic were not as severe as expected, due to emergency relief funds.
Additionally, Nonprofit Quarterly conducted an extensive study of nonprofit finances during the Great Recession and found that most parts of the nonprofit sector saw no reduction in overall financial resources and actually grew during this period.
Even still, if you’re a nonprofit leader, it’s important to consider what the financial implications of a recession could be on your organization. Most financial experts in the nonprofit space advise having at least three months of cash on hand to support the organization, should you hit a rough patch.
Some things you can do now:
- Revisit your nonprofit’s long-term goals
- Conduct scenario planning and focus on what you can control
- Prepare for your 2023 annual appeal, and don’t let up on your fundraising goals
- Reflect on what worked during COVID versus what didn’t, and determine if there’s anything you can do now that led to results then
Retention and culture
Nonprofit leaders rely on a talented and committed staff to achieve their mission. However, recruiting and retaining top talent can be a challenge for nonprofits that may offer lower salaries and fewer benefits than for-profit businesses.
With the employment market remaining strong, many nonprofit leaders worry about how to attract and retain top talent, and how to provide staff with the resources they need to be successful in their roles. Additionally, hybrid and remote work styles are making it more difficult to fill roles that require individuals to be in-person, such as case workers, program staff, medical providers, etc.
Some things you can do now:
- Revisit your organization’s core values. If you don’t have them, developing them together serves as a great team building exercise
- Conduct a compensation study to determine how your pay and benefits compare to other similar organizations. If they are far lower, develop plans for increasing them over time
- Create a vision for who you want your organization to be as an employer. Think beyond salaries to brainstorm the benefits you may want to provide to achieve that vision (for example mental health resources, quarterly staff lunches, or how about Monday Motivations, like Cara Collective?)
- Develop a staff professional development plan
Engaging diverse stakeholders
From the constituencies nonprofits exist to serve, to board members, staff, community partners, legislators and funders, there are many diverse voices that need to be involved in nonprofit decision making at different points and in different ways. Many nonprofit leaders stay up at night thinking about how to engage each of these audiences and wondering how they will balance competing priorities.
Some things you can do now:
- Conduct a stakeholder mapping exercise to understand all of the groups and individuals who need to be involved in your nonprofit decision making (use this worksheet for help)
- Get clear on who needs to have a voice and who needs to have a vote (models like DARCI can help)
- Read Prosper Strategies’ Shared Power StrategyTM Rule Book
Engage your beneficiaries, even if it’s hard (learn about the challenges and best practices)
Mission impact
Nonprofit leaders are driven by the ability to impact change, and they are often evaluated based on their ability to achieve measurable results. This can create a great deal of pressure for nonprofit leaders who worry about whether their programs and services are truly making a difference, especially when have limited ability to effectively measure outcomes (because they haven’t been defined, they are difficult to track or they don’t have the resources to track them).
Some things you can do now:
- If you don’t have a strategic plan, create one and make sure it’s measurable. This is a great opportunity to align everyone within your organization as well as your stakeholders around what you are trying to achieve
- Start somewhere. Many nonprofit leaders get overwhelmed about the amount of data they could collect to demonstrate impact. Start by focusing on the highest level metrics
- Supplement data with storytelling, to bring context to your impact
While I’m sure there are many other things keeping nonprofit leaders up at night right now (I alway say, what makes you breaks you), I hope you can find some comfort in knowing that you’re not alone when it comes to the things I’ve shared in today’s post. What else would you add?
