State of the Sector and What to Do

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Are nonprofits and communities in need being left behind by the US economic recovery? Leaders from more than 5,000 nonprofits in the US indicated they think so, according the Nonprofit Finance Fund’s 2014 State of the Nonprofit Sector Survey, where you can filter data along varied criteria, including geography, audiences served, and more. While 80% of respondents reporting an increase in demand for services for the 6th year of this survey, the highest percentage ever–56% of survey participants–stated they were again unable to meet demand in 2013.

“The NFF survey results illustrate the ongoing risks of a frayed social safety net dealing with increasing demand,” said Hilary Pennington, vice president of the program for Education, Creativity and Free Expression for the Ford Foundation, a longtime survey sponsor along the Bank of America Charitable Foundation. “If we continue to expect nonprofits and their dedicated staff to meet society’s most critical needs at the most crucial times– we need to recommit as a society to strengthen the necessary supports to do just that.”

Since 2013 is the row any easier to how for American nonprofits? Only 11% of those surveyed expected 2014 to be easier for those they serve. So what’s a nonprofit to do? Many are considering new models of funding, say the leaders surveyed. And many shared that they are experiencing “daunting financial situations, and said they are looking at new ways to secure the future of their organizations for the benefit of the people they serve,” says the NFF survey summary. Is your organizational following some 2014 advice from The Chronicle of Philanthropy?

Regardless of the timing of your fiscal year, some of this expert advice may be just the ticket for your mid-year reset. Moreover, the advise is about what not to do. In more positive terms, do the following:

1. Pay attention to donors who give mid-size gifts. Analyze the ranges in which your donors give and be sure staff, board members, consultants–whomever is active in your donor cultivation–is connecting with donors at various levels. This supports better cultivation of prospects for increased gifts and donations that connect donors’ wishes for your organizations.

2. Be discriminate in how you use social media. Pay attention to the demographics indicated by your analytics. Who’s interacting on Facebook versus Twitter? Are donors more reachable via e-mail and/or postal mail?

3. Use information instead of hoarding it. Don’t wait until the end of the year to tell your donors who great they are. Thank them and cultivate them all year–and frequently provide details about the difference their gifts make. Your donors will appreciate seeing your progress and outcomes.

4. Be specific. Avoid “fuzzy” language. You don’t have to rewrite your mission statement, but you can illuminate it with action-oriented descriptions of what you do. Be descriptive and tell stories about your work and the people you serve.

5. Embrace mobile technology. Is there an echo in here?

6. Be intrepid about risks. Encourage innovation in your organization but remember that some experiments may fail–and that’s OK. If the NFF survey is accurate, nearly half of nonprofit organizations have experienced a 50% decline in support over the the past five years. And, by the end of the year, your organization may be among the:

  • 31% changing the main ways in which they raise and spend money.
  • 26% pursuing an earned income venture.
  • 20% seeking funding other than grants & contracts, such as loans or other investments.

The challenges may not be short-term, but opportunity beckons. As never before, nonprofits can combine new technological resources and the reach they provide with imaginative and relationship-based solutions. In 2013, some positive actions of 49% of organizations in the NFF survey include collaboration with another organization to improve or increase services and as many invested money or time in staff professional development. Capacity upgrades took priority with 40% making hardware or software improvement to support efficiency. And 39% conducted long-term strategic or financial planning. “Today, it’s clear that government funding and traditional philanthropy alone can’t cover the critical work of nonprofits addressing pressing challenges in our communities,” said Kerry Sullivan, president of the Bank of America Charitable Foundation. There’s more to know about the state of American nonprofits. Take time to review the full survey results, along with an interactive survey analyzer and a look at trends over the past six years, at: www.nff.org/survey.

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Yvonne Hudson

Yvonne Hudson, principal of New Place Collaborations in Pittsburgh, loves creating mission-driven solutions for clients. Her extensive experience as a marketer in higher education, arts, and business informs strategies for TopNonprofits, The Bayer Center for Nonprofit Management of Robert Morris University, Pittsburgh Festival Opera, and other businesses and nonprofits. As a nonprofit staff member, board member, and volunteer, she has participated in aspects of capacity-building including programming, fundraising, and audience development for organizations in New York, Washington, DC, and Pittsburgh. A speaker, singer, and mentor, she enjoys presenting and acting, including her long-running solo show Mrs Shakespeare and is a board member of Pittsburgh Shakespeare in the Parks and a past vice president of New York Women in Communications.