Maintaining the status quo is a commitment to mediocrity, declining relevance, and reduced sustainability.
Back in the day all people wanted from a nonprofit was financial strength, consistent service, dependability, and predictability. If an executive could maintain the status quo, he or she was thought to be an excellent manager.
In a society where everything is evolving, status quo becomes an anchor to the past and an obstacle to progress. However, consistency, stability, and dependability are what every manager and employee wants. Therefore, there is an internal drive to create and maintain the status quo while there is practical reason to avoid it.
Operational efficiency depends on providing the same services to every client. It reduces cost and time. It makes it easier to train new employees. It makes it easier to standardize services and measure employee performance. However, it also assumes that the clients served this year will be identical to last year’s clients.
Operational effectiveness depends on consistent results. Every client wants the same or better results from your services as the other clients are receiving. The donors want the same results for each client. The other organizations providing alternative or similar services to yours are striving to provide their clients with better services. Each time better results are achieved for one client there is a new standard. Producing the best possible results for each client means you must abandon any desire to maintain the status quo.
At the same time, the clients are changing along with their needs. It is rare for a nonprofit leader to say, “We serve the same clients year after year.” There is a need to ensure that the service content and delivery method frequently change. When the only consistency in the clients is how different they are from each other, maintaining the status quo impedes successfully serving the clients.
Historically, one of the common measures for determining operational efficiency was the constant or declining cost of serving each client. When there is a high variability in the clients served, the needs of the clients, and the standards used to measure success (client results), it is unrealistic to think that the cost of serving a client will be constant or declining.
It is now time to develop an operational definition of efficiency rather than a financial definition. Of course, any operational definition can be reduced to a financial result. However, that translation process lengthens the feedback process to the service provider (staff member), which lengthens the time it takes to respond to the need for change. The lack of timely feedback makes the measurement process less efficient, which defeats the purpose of measuring efficiency in a rapidly changing environment. In addition, the financial measure is far less meaningful to the service provider than an operational measure. This also implies that the efficiency measure is most effective when it is customized for each service provider.
Next Step:
Educate your board and donors about the need to change how operational efficiency is measured
Change the culture of your nonprofit to be change seeking rather than change adverse (status quo)
Evaluate everyone’s willingness to adapt during the annual review (staff, volunteers, and board)
The survival of every organization depends on changing to meet the evolving needs of those it serves. When change is gradual, it is an incremental cost of doing business and is built into the annual budget. When change is deferred until it becomes a survival necessity, it is expensive and sometimes impossible to afford.
Consistency, stability, and dependability are incompatible with rapid change. However, rapid change is necessary for sustainability in a rapidly changing society.
Leaders (individuals and organizations) are the first to change. Your clients want to be served by a leading nonprofit. Your donors want to give to a leading nonprofit.
Take It Further:
Think about how the need to be adaptive will affect your staff, volunteer, and board member recruiting.
What other standards, besides adaptability, are needed to create the flexible culture your nonprofit needs to remain relevant?
