Every nonprofit experiences trouble from time-to-time. Knowing how to recover prevents the problem from growing, becoming persistent, or threatening survival.
The recovery steps are:
Be Proactive – Being proactive enables the leader to take the other four steps mentioned here. Sitting on the sidelines and letting the storm pass leaves the nonprofit weaker and less able to respond to the next challenge.
Change Your Cultural – If the issue is significant enough to be called a problem it suggests that the culture of the nonprofit needs to change. At a minimum, it indicates that communication of early trouble indicators needs to be stronger.
Improve Quality – Most problems are perceived by others as an indication that quality has declined. Using the problem as an opportunity to improve quality (whether a quality improvement is needed or not) builds confidence within the stakeholder community.
Take Risk – Problems sap resources. Recovering from a problem requires the leader to act boldly and take risks. It takes courage to step forward, acknowledge the problem, and deploy scarce resources.
Refresh Your Vision – The leader must have a vision of what the nonprofit will look like in the future (5 or more years), how to use the current problem to strengthen the mission, and facilitate the vision. The problem, whatever it is, is an opportunity to inspire the nonprofit to reach higher. Even if you already have a vision, use this opportunity to refresh the vision making it wider, deeper, or stretch it further into the future.
Be intentional about taking the preceding five steps when trouble arises
Use the recovery process to build strength
Make the recovery plan and execution of the five steps a group effort
When the recovery team is large and consists of a cross section of stakeholders it builds strength in a variety of ways. The large group reduces the burden on you and your nonprofit and makes recovery quicker and easier. It demonstrates to everyone the strength of your support system. It encourages volunteers, donors, referral sources, and advocates to continue to support your nonprofit and its mission. It gives the clients confidence that your nonprofit will continue to serve them.
You care deeply about your mission, nonprofit, and clients. Taking the five steps when problems arise will help ensure that what you care about continually becomes stronger and more sustainable even during difficult times.
If never making a big mistake is the definition of success, using best practices is a great insurance policy. Best practices are the actions that have been time tested to be safe. However, in a rapidly changing society, best practices are always going to lag and innovation is the best way to increase sustainability.
How can a nonprofit keep up with the rapidly changing community’s needs by using best practices?
How can a nonprofit increase its service to its clients and the community if it waits for best practices to lead the way?
Some of the best practices hurt nonprofits focus on efficiency, controlling costs, and treating everyone the same. The government agencies have been doing that for years and rarely are they seen as the model for effectiveness. Their clients who receive those efficient, cost controlled, and uniform services still have a hard time finding jobs, feeding their families, and taking their rightful place in society.
Your programming probably already has a higher success rate than similar government agencies. What are the best practices that are holding back your mission from producing even better outcomes?
If your nonprofit uses best practices (the proven method that every other nonprofit uses), how will that help your nonprofit better compete for a donor’s attention?
Your nonprofit was formed to provide your clients with a better life.
What are the durable (long-term) indicators that your mission is fulfilling its purpose?
How do you measure your success in a meaningful way?
What is your current success rate and what success rate will you provide your donors and client in 5 years?
What are the unique characteristics of your service delivery model that create a compelling difference in the outcomes of your clients?
What best practices should you abandon to change your response to the preceding four questions?
Without abandoning some of your current best practices, are your answers to the preceding questions sufficient to increase the sustainability of your mission over the next 5 years?
Determine what your nonprofit must do to move from best practices to best results
Start talking with clients, prospective clients, your community, and donors about the outcomes they want and expect in 5 years
Develop a more intentional, measurable, and reportable process (ensure your programming has credibility as well as results)
Focusing on and talking about the outcomes no longer makes your nonprofit unique yet it is still possible for your nonprofit to be a leader. Lead by showing everyone what the best practices of the future will be and how much they will improve outcomes, client success, and mission sustainability.
Being one of the leading nonprofits in your area will help increase your ability and opportunity to attract donors and better serve your clients and community.
In a highly competitive environment that is changing rapidly, focusing on core competencies usually results in a slow decline rather than long-term success.
Your core competency is something you understand well. If you give it more attention, you and your nonprofit will increase your proficiency and efficiency.
Think about foundation grants for a moment. Those grants are something you compete for along with every other nonprofit in your area. Which of the following do you think the grant reviewers will find more compelling?
Our nonprofit has focused this past year on our core competencies and as a result, we can serve more clients in less time and at a lower cost per client.
Our nonprofit has expanded our programming adding Innovation X; as a result, our outcome success rate has risen from 75% to 80%.
In the second case, the grant reviewer will see that 5% more of the population being served achieved success. That has a meaningful impact on the community and the clients. It has a meaningful impact on solving society’s problems.
Since Innovation X is an innovation, we know that the nonprofit is building a new area of competence. They never would have developed that competency in the new area by focusing on their core competencies.
Every grant lost is one more step on the long slow path to decline. Every client and donor lost is another step. Clients go where they have the best chance of receiving the help they need. Donors go where their money will have the greatest impact on society and people’s lives.
Every successful innovation is one more step toward making your mission more attractive to supporters, clients, and your community (increased sustainability).
Convince your board to allocate at least 3% of the annual budget to enabling innovation
Create a list of innovations that have the potential to increase the success of your clients
Select the 2 most promising ideas to try in the next year
Most innovations never achieve the desired level of success. However, the failure to innovate lowers the potential of an organization to thrive. The value of the successes outweighs the disappointments.
Remember that high value donors expect and support innovation. Most of your high value donors acquired their funds from innovations. They will help you fund a well thought out innovation especially if the initial (trial) process is small enough to minimize risk and large enough to validate success.
Now is the time to abandon your core competencies and channel the creative and competitive spirit of your staff for the benefit of your clients. Innovate!
Creating a culture of generosity is important to every nonprofit. It is difficult to cultivate the generosity of donors and volunteers without cultivators who are the model of generosity.
What is your definition of generosity and how do you measure it?
Even though generosity is an inward condition, you know it when you see it. What do you want to see (outward conditions) to be able to say that someone is generous?
Most of us think of generosity as giving of one’s self (time, abilities, and things). Obvious outward indicators are volunteering and donating. Other indicators are mentoring, giving credit for contributions to a joint project, and spontaneously offering help and compliments. What other indicators would you like to add to the list? Which indicators are important to the success of your mission and service to your clients?
As a leader, you have the opportunity to create or enhance your nonprofit’s culture of generosity by simply recognizing acts of generosity. Every time you comment on something that happens, you send a message to those around you that the act is important. Since we all want to please our leaders, your comments encourage others to change their actions. It is a simple, subtle process, which encourages change and makes change comfortable for everyone. It is a slow process but embedding it into the life of your nonprofit will make it durable and authentic.
Every nonprofit asks its donors to be generous. When the nonprofit has a strong culture of generosity, it models the behavior it expects from its donors and volunteers. As your nonprofit’s culture of generosity increases, you will notice an increase in donor and volunteer generosity.
Determine which outward indicators of generosity are most important to your mission and client services
Measure the frequency with which each indicator occurs in the next week (baseline)
Observe and comment on the important indicators after you have your baseline established
Take a week to measure the frequency with which each indicator occurs about 90 days after you begin commenting on the indicators (establish a new baseline)
Review the important indicators once a year to ensure you are encouraging the most valuable ones
After 3 – 6 months of cultivating generosity, you will notice an increase in board engagement. You will also notice that board member generosity will increase. Those indicators plus your improving baseline of generosity will be tangible indicators that your mission’s sustainability is improving.
Even the most generous individual has the potential to be more generous and every nonprofit would benefit from being surrounded by more generous individuals. Enhancing your culture of generosity is an ongoing and rewarding activity.
Two examples of best practices that often hurt nonprofits are: relying too much on policies and procedures, ensuring that certain groups of individuals are represented on the board.
Policies and procedures are one of the best practices that every organization is encouraged to have. They are designed to protect the organization from legal action, criticism, and other problems. We have all had an experience where we wanted to accomplish a simple task but an administrative procedure unnecessarily complicated and delayed completion.
Which of your nonprofit’s policies and procedures are hurting your clients or donors? Which do nothing to improve outcomes, help the staff be more productive, or strengthen your relationship with donors? Do any of your nonprofit’s policies and procedures strengthen your mission?
One of the commonly accepted best practices is to ensure there is a client on the board. This often results in having individuals on the board who have been recruited solely based upon their willingness to serve.
Willingness is one of many important attributes you want in your board members. When the willing are unprepared to think strategically, understand the financial challenges a nonprofit faces, help with fundraising, and enable the nonprofit to succeed, the problems your nonprofit faces are harder to solve. In addition, it is difficult to keep the other board members engaged because of the time needed to educated the willing rather than transact the business of the board.
It is important to have the clients’ point of view represented on the board. The solution is to recruit the client to serve on a committee until their skills and knowledge qualify him or her for board service. Now it is a best practice that helps the mission.
Review all of your best practices and determine which ones are unnecessary or reduce your nonprofit’s ability to provide great service
Look for ways to comply with the necessary best practices through an automated process so that your staff has time to give everyone outstanding service
Focus on effectiveness (serving clients and donors better) rather than complying with a procedural mandate
Of course, there are historic reasons for each of the best practices. However, each of the best practices was developed in the past. Some of the reasons for the practices have been eliminated over time.
Another way to look at best practices is to refer to them as the same practices everyone else has. Does that sound like it enhances your nonprofit or its reputation? Do those practices make it easier or harder for your nonprofit to demonstrate how much it cares about the unique needs of clients and donors? Do those practices frustrate your staff and make it harder for them to serve the clients? Do those practices make your mission stronger or do they reduce your mission’s sustainability?
What best practices can you eliminate immediately that will make it easier to serve clients this spring?
Being Efficient = Best Practices = Doing Things Right
Being Effective = Doing What Is Best for Clients and Donors = Doing the Right Things
Word-of-mouth is the best advertising when you train your clients to say the right thing about your nonprofit.
The clients who provide word-of-mouth advertising for your nonprofit are the ones who love your nonprofit. They think prospective clients should use your nonprofit. Their enthusiasm and love enables them to speak out. Their enthusiasm and love also makes them sound sincere.
They love your nonprofit because of what it is doing for them or their family. You are partnering with the client to help them achieve their aspirations. However, it is unlikely that is what they are saying about your nonprofit.
Because they love your nonprofit and want to support it, they are probably telling others what you say are your nonprofit’s strengths (highly trained staff, caring staff, good stewardship of donor funds, financial strength, and current technology). While all of that is true, it is insufficient to justify using your services. However, helping your client achieve his or her aspirations is a compelling reason to use your services.
Each client needs a unique set of attributes (such as resilience, discipline, proactive, and strong work ethic) to actualize his or her aspirations. It is the positive change in your client’s attributes, which tells your client, prospective clients, and donors your nonprofit is doing a great job. It demonstrates that your nonprofit is uniquely able to help your clients develop the necessary attributes. It is the help with attribute development, which defines your value to your clients.
The clients know your nonprofit is doing a great job because they experience the change. However, if the client only talks about what you say is important no one else will think your services are better than the alternatives.
Survey your clients and determine which attributes are important to them and which attributes your nonprofit is enhancing
Use your newsletters to talk about the attributes valued by your clients (now you and the clients will be using talking points that are valued by prospective clients)
Use your clients’ attributes (vocabulary) when speaking with prospective clients (talking about attributes makes your nonprofit sound like a place where lives are changed rather than services delivered)
Tell your board and staff which attributes are valued so they will know what to emphasize and what vocabulary to use when speaking with prospective clients
Tell your donors what the clients value about your nonprofit
Most nonprofits talk about their services and strengths (you can too if the prospective clients ask). Talking about attributes will demonstrate the uniqueness of your nonprofit. Attributes are what clients want for themselves and what will provide your clients with a lifetime of value.
Helping clients develop the important attributes makes your nonprofit a partner in the formation of the client’s life and his or her future. It is easy for clients to switch nonprofits. It is hard to walk away from a place that is important to the formation of your life. Retaining clients adds to your nonprofits sustainability.
Helping to make a durable change someone else’s life is the primary motivator for many donors. Do your donors know how extensively and durably your nonprofit changes lives?
If you do the attribute survey this month, you can change the conversation and increase the number of clients you serve and increase the generosity of your donors by fall.
Think for a moment about the challenges a large organization like The Salvation Army faces. It has operations in most countries. It must allow the local leaders to determine how to interact with the local population. Dictating the interaction from world headquarters would diminish the effectiveness of its mission, acceptance by the local population, and its ability to attract support. In short, the local leaders are responsible for local relevance.
It is tempting to have a single standard for doing everything. A universal standard creates a high level of efficiency. It also alienates everyone who is different from the standard.
The Salvation Army is a good model because they ensure their mission is never compromised and their services are always relevant.
Why is this important to a nonprofit in your community?
Our communities are becoming more diverse and the trend is likely to continue. The internet has taught all of us that we can expect a customizable experience from any organization who serves us. Yet, we each define ‘customizable experience’ to be ‘relevant to me’.
Your staff needs to be able to function like the local leaders of The Salvation Army. Your staff must be able to freely translate your services into relevant experiences for each family and client.
Empower your staff to treat standards as guidelines so that the diverse and individual needs of your clients will be effectively met
Review your standards to ensure they are broad enough to encompass the needs of the diverse population that surrounds your nonprofit
Review your standards with community representatives to ensure the standards are relevant to the needs of their constituents
The sustainability of your nonprofit depends on growing your capacity to serve an increasingly diverse client population, which requires an ability to keep your mission relevant to your constantly evolving community.
Is your standard for serving clients flexible enough to accommodate everyone in your community who wants what your mission promises? If you were more flexible without sacrificing your mission, would demand for your services increase?
Your path to greatness is different from any path the other nonprofits are using. Why is it important to step off the common path?
Our country has achieved greatness because enough individuals have strived for greatness to set the entire country apart from all others. Our country has the potential to be even greater if each of us would strive a little harder to be great.
Colin Powel, Bill Gates, Steve Jobs, Martin Luther King, Jr., and many others have achieved greatness in a variety of fields. No one who follows them will be able to achieve greatness without stepping off the great person’s path and heading in a new direction. Greatness is always on the path no one else is taking. Some new paths never lead to greatness and that is a risk.
Will the clients of your nonprofit discover their greatness in life? It will be easier for them to discover their path to greatness if your nonprofit models the discovery process.
If your nonprofit chooses an fruitless path, it will still be a great model for the clients. Your nonprofit can easily step back onto the path everyone else is following. Challenging the status quo teaches staff and clients to challenge themselves. It also provides donors with something exciting to support and share in.
When you find greatness, your nonprofit will be rewarded with more clients, greater client success, higher client retention, increased donor generosity, more referrals, and a larger group of advocates.
Find a viable new path to explore by talking to your staff, board, clients, and donors and discovering what excites everyone
Design a limited exploration (trial) of the potential new path
Try the path
Evaluate your potential for success based upon the trial results and decide if there is sufficient evidence of success to justify a larger or continuing investment
Great organizations are highly sustainable. You are the kind of leader who can lead others to greatness, model greatness for your clients, and significantly increase the sustainability of your mission.
Announcing the bold new step will excite your donors and increase donor support.
What bold new step will you announce?
Every nonprofit should have the same answer to, “What do your clients need?”
Ideally the answer is, “Nothing. We already provide everything they need.” Many nonprofits are able to provide that answer. Most of them are regularly asking the question in the hopes of keeping their programs fresh, relevant, and effective.
Asking the introductory question periodically keeps a nonprofit in tune with the evolving needs of its community. Asking a different questions places the nonprofit in a leadership position in the community.
Nokia was the number one cellphone company in the world. Today, they are scrambling to catch up to the leaders (Samsung and Apple). Today’s leaders are the leaders because they asked themselves, “What will our clients need?” The answer to that question has allowed them to surpass Nokia. In addition, all of us have the potential to benefit because of the new tools and services we have available to us.
Naturally, the new leaders had to provide what Nokia was providing (“what the customers need”) as well as the something we were going to need (“What will the customers need?”). The leaders become the leaders and will sustain their leadership by being able to answer both questions.
It takes a few years from the time the leader recognizes the need before the solution is available. It only takes a few days for everyone else to recognize the need after the leader delivers the solution to the market.
Money follows success. Your donors will be more generous when they see your nonprofit as a leader. Donors are as concerned about your future clients having what they need as the donors are about ensuring your current clients receive what they need. In addition, leading nonprofits have the strength (sustainability) to weather the storms.
Remember it is more important to focus on the future of your clients than their present needs
Ask what your clients will need in the future at least once every 6 months
Develop a plan to meet the future needs of your clients and incorporate everything they currently need in the plan
Engage your donors in support of the future needs of your clients
Leaders demonstrate their expertise and understanding of their clients by having solutions before the clients have problems.
You have a choice. You can define the future or let someone else define what your future will be. Asking the question, “What will our clients need?” allows you to control your mission’s future.