​Sustainable nonprofit organizations stay strong by paying attention to five key areas – vision, mission and strategy, leadership, communicating value, revenue generation, and engaging stakeholders.  
 
Organizations that fail often are tripped up by trouble in one or more of these areas. They allow mission-creep. They fail to generate sufficient unrestricted income to support the on going operation of the organization as well as new initiatives. They fail to tell a compelling story of the work they are doing and the impact it is having. Their leadership becomes insular and stops engaging with stakeholders, often assuming they already have a good sense of their needs and wants.

​A compelling vision of how the world will be different because of your work is not enough if you do not couple it with specific strategies to achieve that vision. Organizations are stronger when they invest the time and energy into periodic strategic planning – taking a step back to assess their current state and set a limited set of goals for a three or five year period. But this is also not sufficient. Those larger goals then need to be translated into the organization’s annual work plan. Both volunteer and staff work needs to be tied to achieving those larger goals. Those work plan goals are ideally “SMART” – specific, measurable, assignable, relevant and time bound.

​The organization’s long-term health is best served when there is shared leadership between the staff leadership and board. An organizational leadership who discusses strategic issues, has clear goals that they are aiming for and makes sure that they have access to good information and data when making decisions positions the organization for success. A key role of leadership is also to ensure that staff has access to the tools and resources they need to effectively do their jobs. 

​Becoming internally focused is a mistake that is very easy for organizations to slip into when confronted by the rush of the urgent. There is a creative tension between your leadership holding your vision and setting strategic direction and ensuring that you are also engaging with the constituents you serve. Taking the time to see the world from their vantage point and understanding their needs and their pain points. Without this, the organization may waste time and resources creating programs and services that are not relevant to the constituents they aim to serve.

​A truism in the nonprofit sector is “no money, no mission.” This saying reminds organizations that they will not be able to pursue their mission for long with no resources. While a nonprofit does not pay dividends to share holders, it can have programs that are profitable. It can – and should -- be profitable – or have net assets in nonprofit accounting language at the end of the year. An organization with a break-even will constantly struggle to remain financially viable. Leadership needs to understand the organization’s business model, including its revenue engine. What is the mix of revenue sources – both traditional fundraising and earned income that build the organization’s capacity over time? Relying solely on grants endangers organizations because most often those funds are restricted to a specific purpose. They support (and create) work but do not necessarily support the organization overall.

To raise funds from individuals and from organizations, organizational leaders need to be able to effectively communicate the value that the organization produces. What are the compelling stories that demonstrate your impact? Have you defined how you achieve your impact, including the outcomes of your work? Are you measuring that impact so that you can demonstrate the change you are affecting?
 
Use this Organizational Sustainability Assessment tool to see where your organization is strong and what needs attention.
 
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This is the third part of a series of posts on the mistakes organizations make in strategic planning. The first reviewed how plans lacking buy in from key stakeholders usually end up gathering dust on the shelf as well as how to avoid that outcome. The second explored how some planning processes do not ground themselves in real data, relying instead on anecdotes. I also discussed how visioning can sometimes go too far, creating plans that lack connection to the organization’s actual capacity.  In this third post, I will discuss two additional mistakes that get in the way of an organization having a successful planning process.

Getting overly complicated can show up a few different ways. Sometimes it’s the process itself. Organizations trip themselves us when they try to tackle too many strategic issues through one planning process. The process gets bogged down. People forget why they started the process in the first place. At the end of an overly complicated process, people are often so tired that they have little energy to implement the wonderful plan they have just created. Keep your focus on 2-3 major strategic issues and keep the process moving for success.

The plan itself can also be overly complicated. A strategic plan that ends up too long and too detailed often tries to nail down all the actions steps in advance.  The big ideas get lost in the pages and pages of graphs and Gantt charts.  Keep the strategic plan itself simple – a few pages with 3-5 big goals that will orient the work of the organization. The details should go in an implementation plan, focusing on the first year’s work plan.

​Failing to operationalize the plan is one of the most frequently mentioned challenges by consultants working with organizations on strategic planning. When your strategic plan is not connected to your regular management practices, you set yourself up for failure. Staff and volunteer work plans need to be driven by the large strategic goals with details on what action steps will move the organization closer to those goals. I worked at one organization at which a lot of effort was expended to connect volunteer groups actions to the strategic plan. Yet the strategic plan had no impact on staff work plans. This practice missed a key element to increase the likelihood of the plan’s success.

Budgeting is a second key area for operationalizing the plan. Remembering that a budget is nothing more than a plan in numbers, when the budget does not support the strategic goals then progress is unlikely. Are new initiatives being adequately supported with investment?

Be sure to create a process for monitoring progress and making tweaks to the plan as needed.  Staff and volunteers should be reviewing it regularly, acknowledging and celebrating where progress has been made and adjusting as appropriate.

So keep it simple – both in your planning process and in writing the plan itself. Think about how you will operationalize the plan and integrate it into the your regular management practices at the beginning of the process.
 
Want to talk about how you might apply this at your organization? Book a coaching session.

I help the helpers. When a major disaster happens or tragedy in the news, a video from Mr. Rogers often makes the rounds on social media. His mom told him to look for the helpers. I will be way further off to the side than what he describes--not even on camera. Instead I will be in conference and project rooms of
nonprofits and associations that either serve the helpers or directly serve marginalized people.  I will be working with those helpers to make their organizations healthier, to be more strategic, and innovative.

I have worked in the nonprofit sector almost my entire career. Over time I learned that while the mission always motivated me, I was more interested in how people did what they did – how they worked together. And what got in their way. They were all trying to have a positive impact in the world. Why did it seem like such a struggle much of the time? I read lots of books and ultimately went back to graduate school to try and get some insight into that question. I learned about how groups and teams work, how to design organizations, how to create strategy, how to cultivate innovation and the importance of organizational culture. And much more.

​I believe nonprofits are more likely to have a greater mission impact if their ‘inside’ matches their outside --when the values they espouse for the change they want to see in the world match how they treat each other and go about their work. I believe that these organizations can be great places to work AND have a great impact. They don’t have to choose between those two. 

​By being internally healthy, the organization turns down the static in their system. If the people investing their life to achieve these important missions are freed up from expending energy on internal inefficiency or supporting a poorly performing team, they are then able to apply that critical energy on achieving their goals.

​One way to turn down the static is to get clear on the organization’s strategy. Being clear and focused on where you want to go, what you want to achieve and how you will achieve it taps into the brilliance and energy of the group. The challenges these organizations are facing require innovation. Yesterday’s solutions are not sufficient. And for innovation to work the organization’s culture needs to be open to it and create space for creativity, experimentation and even failure. 

This type of work plays on my strengths. I am good at seeing connections and simplifying a lot of detail into a few big goals. I love working with people to help them figure out new and better ways of doing things. To offer people structures and processes to make manageable what otherwise might feel very overwhelming and impossible to tackle. I love helping groups imagine new futures and then helping people realize those. 

By investing in women and children, communities improve. Families' health improve. Women invest in those around them and they contribute to a virtuous circle. By serving those who work to support thriving families, communities and a sustainable economy, I can also contribute to this virtuous circle.

I am here to be a catalyst, like a river current that propels people along in their good work so that they can do it with more ease. People want to be happy and engaged at work and do work that matters. Yet not lose themselves in the pursuit of that work – no more martyrs to the cause. I want to help that come alive in the world.

​Assessing the sustainability of your organization’s business model has two key aspects for associations and nonprofits. The first is assessing how much each of your programs and services are moving your organization’s mission forward.  The second is how the program or initiative is contributing to your organization’s bottom line. Is the program profitable? Break-even? Burning through considerable resources? Mission-driven organizations often fall into the trap of considering one or the other of these two key factors rather than looking at how they intersect.

​Let’s dig into the first of these. How are your programs and initiatives contributing to your organization’s mission? This moves beyond an impact program evaluation.  A program evaluation looks at an individual program and tries to establish whether and how it is achieving its desired impact.  The impact assessment as part of an organizational sustainability assessment looks at all your programs and evaluates them with common criteria.  Thus you are able to get a comparative look across initiatives for how they are contributing to your organization’s mission.

​Deciding on the criteria you will use is key.  This is a useful step to widen the circle and involve key stakeholders to define what criteria you will apply.  According Jeanne Bell, Jan Masaoka and Steve Zimmerman in the book Nonprofit Sustainability: Making Strategic Decision for Financial Viability, there are seven benchmarks that are useful to consider in this process:

1. Alignment with Core Mission – This is the most basic and fundamental standard. How well is the program or initiative aligned with your organization’s core mission?
2. Excellence in Execution – How well does the program or initiative do? Is it a core competency of your organization? Is the program past its prime? Are there other organizations in your space that do this type of program better?
3. Scale/Volume – How many people are impacted by the program? How many participants do you have? Are the numbers growing or declining?
4. Depth – How deeply are people impacted? Does it engage an important or influential market?  Many programs that are more intimate have more depth but do not involve high numbers.
5. Filling an important gap – Think about whether this is filling a gap in the market place – not just any gap – but a gap important to your mission.
6. Community Building – Does the program or initiative create connection? Build engagement? Does it provide a compelling experience?
7. Leverage – Does the program build connection for future engagement? Does it have a marquee value for organizational branding? Does the initiative create tools that can be repurposed or used in other programs?

You will likely have other criteria that are important in your context. This list gives you a starting point for thinking about how to assess the mission impact of your programs and initiatives.

Download Four Things to Consider before an Organizational Sustainability Audit.
Learn more by listening to my webinar on Organizational Sustainability.

Want to talk about how you might apply this at your organization? Book a coaching session.