Every conversation comes back to it – it is unavoidable. What will we do? How do we get through this? We are feeling the new pressure of the cost of providing services.
Moreover, as times get tougher, our communities will need us more.
Despite our predicament, there will still be opportunities out there, but organizations will need to work harder with an eagle eye on the future than ever before, if they are to come out on the other side whole. Examining the options; thinking through the implications; looking for win-win ways to conduct their programs and collaborate with perfect foundations; and being fast and flexible are even more important in the bad times than in the good times.
Bad times breeds innovation
In this economic paradigm shift, we will find new solutions to live together for the long term as ethical human beings, live greener, and grow our social impact. To get a good overview of today we wrote to Rick Delano, President of SMS, LLC in Bridgehampton, New York to ask what he thought. He suggested that “readers go to www.lifecourse.com to better understand the theories of authors Bill Strauss and Neil Howe. The authors believe that each 80 years there are social moods they call “turnings” …a post-crisis “high”, an awakening, an unraveling, and a crisis. Generations (about 20 years in duration) who are born in a particular turning and enter adulthood in a following turning develop a generational personality that they carry through life. As these generations age, they influence history which then influences the circumstances around how our new young people develop.”
OK – this is an interesting insight into cycles of humanity. I suppose we will all have the opportunity to live through at least one cycle like this. So what do we do as nonprofits?
A plea for wise counsel
We decided to encourage nonprofits not to panic, but instead to slow down and think about the right steps to take to weather the storm. We thought about good communications, record keeping, crisis management, and all the millions of t hings that could pop up in your mind when fear intrudes. And we decided that in all crisis there is great opportunity if you can slow down enough to see it.
To get the best advice we could find for you, last Wednesday we sent out an email blast asking professionals and friends across the country to respond to TXNP with sage advice for nonprofits and foundations to get them through the crisis. From my classmates at my high school in Washington, DC, to my Leadership Texas sisters, to nonprofits, foundations, and for-profit professionals. We received so many responses, but we are sharing the best with you all. Enjoy and take all of this good advice to heart.
Nonprofits - Because of who we are, we will rise to this challenge even though this could become a very uncomfortable time. It may take some time, but we will get through this. We have an awesome responsibility to our country. Let us rise to the challenge.
1) Michael Bacon (CFRE) and Marion Lee and Leadership Texas - Bacon Lee & Associates – San Antonio
"In worsening economic times, nonprofits must speak loudly about the needs of the clients they serve. They have to advocate for the fact that their clients' issues only become more urgent in times like this. Whereas donors may be watching their 401K plans diminish, the poor are getting laid off, having more crisis situations and needing more from the nonprofits that provide a safety net.
Our job as nonprofits is to urgently share the needs of those we serve and how those needs are greater now than ever."
2) Anne N. Connor, CFRE - Grants & Research Manager and Leadership Texas - Methodist Healthcare Ministries – San Antonio
"Wearing my “funder’s hat,” my advice to foundations during this difficult time would be (1) be more willing to fund operating expenses and (2) increase your level of coordination and collaboration with other funders in your area so that you can have the most efficient impact possible.
Wearing my fundraiser’s hat, my advice to other nonprofits would be: (1) Read Penelope Burk’s book, “Donor Centered Fundraising,” and implement her advice as a way to reduce donor churn – it’s far more cost-effective (and easier) to keep the donors you have than to find new ones. (2) Increase your efforts to collaborate with other nonprofits to reduce expenses and increase foundations’ interest in your work. (3) Increase your focus on good record-keeping so that foundations worried about how their limited funds are spent will be reassured."
3) Terry Axelrod – Founder and CEO of Benevon – Seattle, Washington
"When asked what to do about donors who are unable tp pay off their pledges because of a tough economy Axelrod replied: Pledges are not legally binding documents, but we say that if you stay in touch with your donors and cultivate a real relationship with them, you can expect a 90% or better collection rate on your donors' pledged donations.
If your donors are impacted by the economy and decline to pay their pledge, we suggest you graciously "bless and release" them; stay in touch with them and look forward to their financial support in better days. They will remember that you treated them well in hard times."
4) Carolyn M. Appleton, CFRE – Corpus Christi
“Although many donors continue to do well with their investments, the current upheaval in the national and international financial markets has caused them to be more cautious than would normally be the case. Philanthropists are not making funding decisions as quickly as they might have in prior years. Hence, making a truly compelling case for your non-profit organization's work is essential. And, because many charities raise a significant percentage of their income during the last few months of each year, now is the time to focus, to communicate your needs thoughtfully and carefully, but not to panic.”
5) Wanda Brice – Director of the Women’s Museum and Leadership Texas - Dallas
“At this horrific point in our economic history, I cling to every sage. I agree with you totally on the non-profit position within this storm. I believe we have to speak directly with our strongest supporters, asking their advice and their continuing commitment.”
6) Karen L. Shultz - Managing General Partner - Brilliant Ideas Group and Leadership Texas- Austin
the Business of Strategic Communications
“I sit on the board of a couple of sizeable non-profits. I subscribe to the theory that everyone has something to give and the community/business volunteer and the non-profit both have the job of figuring out how to make it work. The key is to be creative and know your customer (like any business) which is your community at large. What are the pain points, what are their thresholds and how can we maximize so it is a win win for both the non-profit and the community (I use this term to encompass everyone and every organization.)
It’s the Three T’s – Time, Talent and Treasure. Everyone can do one or all of these things – give of their time, provide an expertise, knowledge, experience i.e. Talent they can share of give, and lastly give monetarily or help monetarily (treasure). Every donation counts – small and large. I also believe that if a larger community (group) gave as little as $10 or $20, the aggregate sum is much greater than one or two or three people or grant/foundations might give.
Board make –up is a critical component especially utilizing the Three T’s. If the board is unbalanced into one area, they cannot be effective in the others nor take advantage of the precious resource of each.”
7) Eva Williams - Process Specialist Enterprise Architectureand LeadershipTexas – PEPSICO - Dallas
"Here's the perspective of a potential volunteer/contributor:
My experience with non-profits (as a volunteer) is that organizations who treat volunteers with respect retain the volunteers' services. Unfortunately, too many people responsible for coordinating volunteer efforts are petty dictators and treat those volunteers like "grunts". The result of such treatment is the volunteers gradually quit. Recruiting new ones is much harder than doing what it takes to keep existing volunteers happy.
I understand how difficult it can be for an organization that relies on volunteers to have them not show up as scheduled/planned. So it's also important to communicate expectations on both sides:
• Tell the volunteers what is expected of them and the impact on the organization's services when those expectations are not met.
• Also listen to volunteers' concerns, issues they may have, suggestions for improvements, etc.
• Volunteers, in turn, need to be honest about the level of commitment they can make to the organization.
As for appeals for monetary contributions, don't do a one-size fits all approach -- nothing turns me off faster than a contribution form that puts words in my mouth (for example, "I support blah, blah, blah" with a checkbox for my "generous donation"). Frequently I agree with most (but NOT ALL) of the philosophy of the NPO, but I resent being asked to check that I agree with some phony statement. Those requests quickly hit the paper recycling bin at my house.
Just tell me what the organization does, how much of the money raised actually goes to provide the services, how much to overhead/management, and how much to "fund-raising". If the organization has a good proportion going to actual services (and a way to verify the claims are true), you'll get a contribution from me."
8) Mitchell Long – The Long Foundation – Austin
“I know that charitable organizations are going to have a very tough time in the near future. Its hard to look long term when you are trying to meet payroll and service obligations tomorrow. For private foundations, they will have to continue to look to the long term as they re-evaluate their investments and strategy. It will be interesting to see how the switch from traditional investments (stocks and bonds) to alternative investments (hedge funds, venture capital funds, etc.) affects the private foundation sector. That might be an article all by itself, though it is probably too early to evaluate. Many of the alternative investments have a large delay in reporting values and profit/loss.”
9) Palmer Moe - SA managing Director - Kronkosky Charitable Foundation – San Antonio
“It appears that the current economic climate will be with us into next year. I expect that annual support will be impacted. It would be prudent for nonprofit organizations to plan their budgets for next year accordingly. This should likely involve establishing priorities within the programs of the nonprofits and having action plans thought out in advance in the event that budgeted revenues fall short of expectations.”
10) Bruce Trachtenberg – the Communications Network – Chicago
“When times are tough, people obviously are more careful about their giving. In fact, they are probably more likely to give to organizations that can make a good case about how donations can be put to effective use. So rather than entrench or go quiet, hoping to weather the storm, smart nonprofits take extra care during tough times to make sure they do the best possible job they can communicating to current and potential donors why they are worthy of support.”
11) Marolyn W. Stubblefield, MA, MBA - Regional Vice President National Kidney Foundation Serving South & Central Texas and Leadership Texas – San Antonio
“In this environment of a faltering economy, we at the National Kidney Foundation (NKF) have held strategy sessions to maintain if not increase our income streams. Our Special Events have become a mixture of high and low ticket events, and we plan to grow our income with the lower range events. The reality of the economy right now has turned us to one of our signature events, the Kidney Walk. Our Walks are for fundraising and freindraising, healthy exercise and branding. The price of participation ranges from nothing but showing up to enjoy a walk by the San Antonio River along the Mission Trail or along the Corpus Christi downtown waterfront to individual and corporate donations. We have loyal sponsors and highly competitive teams, both of which lead to a strong bottom line for our group.
Our other signature events, the Gift of Life Gala (this year honoring living organ donors) and Kidney Golf Match will remain high-ticket. Again, we have a loyal group of sponsors who enjoy the event as well as their recognition in our materials.
In Fundraising 101 classes, the "Donor Target" encourages us to aim first at donors closest to our Mission and to widen our focus as we move away from the center of the target. This economy reminds us to treasure the donors closest to the heart of our Mission and to expand our focus carefully.”
12) Nancy Schwartz – New York Founder and President of Nancy Schwartz & Company providing marketing and communications
“This is the time to invest in strategic communications, not to hunker down and panic. The best way to put it is this: If nonprofits don't do so, they'll really be overlooked. If the budget needs to be cut, figure out how to make more of an impact, perhaps even for less. Don't just slash and burn budgets/staff.
Remember -- communications are your organizations strongest ongoing connection with the world in which you operate (and your stakeholders). Pull back, and those connections will weaken, big time.”
13) Elaine Gantz Wright - www.YouCause.com and Leadership Texas – Dallas
“My job is to coach nonprofit organizations to "think outside the box." The social web, like www.yourcause.com provides high-octane tools nonprofits can use to expand constituencies and leverage the viral power of peer-to-peer fundraising in dynamic, new ways. So, I think the answer is a "both/and solution." Nonprofits should stick to the basics -- just keep asking! And, they should not be afraid to experiment with new media!”
14) Nancy Clarke - Director of Finance and Administration with the CREATIVE ARTS TEAM at The City University of New York and National Cathedral School Classmate – New York
"One thing is "Don't Communicate Your Panic.
Leaders of NPOs (or any organization) need to be careful about what they say, even offhandedly, and also of their demeanor. If the Executive Director has a look of panic/deer in the headlights on her face, the junior receptionist is not going to know how to handle that. Office gossip is rampant. And then you never know who knows whom, and what is said at a dinner table. It's amazing what a small world this really is.
Behind closed doors, with the development director, finance director, board president, etc, yes, you should be talking strategy and figuring out "what if" scenarios.
But, in crisis times, donors will not want to give to groups that look like they won't make it - so you don't want to give that impression. Yes, you can say it's hard times, we're concerned, we're tightening our belts. But give an air of confidence that you know what you're doing.
That's what FDR did - and that's what we need to do now.”
15) Indu M. Bilimoria, Director Procurement Services at Texas Tech University and Leadership Texas – Lubbock
“Know the difference between want, need and greed. “Short cuts” invariable hurt more people than those involved in the action.”
16) Martie DiGregorio, Program Director for Special Events - Office of the President – University of Texas at Brownsville and Leadership Texas – Brownsville
“I believe the most important element in all this is exactly what you mentioned below…calm decision-making. There cannot be two crazies at the same time (think marriages!). Someone has to think and act solidly in order to avoid further spiraling.”
17) Shannon Nisbet – Director of Development Family Service Association of San Antonio, Inc.- San Antonio
“This isn’t the first or last time in our nation’s history where we have been severely impacted by a negative economy. The strength of our country and our community lies in its people. In times like this we need to work together for the betterment of all. Some of us might be lamenting a drastic dip in our 401k’s but for those with little, the soaring food, gasoline and utility costs are threatening their ability to survive, much less thrive, during these challenging times. It is a time when working cooperatively for the betterment of our community is crucial.”
Great ideas, aren't they? Thank you!