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Room for Improvement: 3 Essential Areas Nonprofits Should Focus On
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Room for Improvement: 3 Essential Areas Nonprofits Should Focus On


No matter how successful your nonprofit is, there is always room for improvement. Nonprofits are businesses, and as such, are expected to operate as efficiently as their private sector counterparts despite having less resources, staff and funds to get the job done. This quest for efficiency often leads to cutbacks in essential areas, which, more often than not, ends up hurting an organization in the long run. But which areas should more nonprofits be paying attention to?

1. Board Development

Board development is crucial to the success of a nonprofit, yet many organizations push their board toward the bottom of their priority list. Board members are an essential part of your organization, and as such, you must focus on maintaining your board and encouraging members to remain engaged and accountable.

Remember, each of your board members serves as a vital resource to your nonprofit, often helping to:

  • Spread the word about your organization and its mission
  • Hold your organization accountable by overseeing the work you’re doing
  • Raise funds by donating as a prerequisite of their membership or soliciting new donors

No two nonprofit boards are the same, meaning you must take your individual organization and its mission and vision into account when making decisions about your board, its size, the committees you have, etc. Nonprofits often make mistakes with board composition, such as basing their board on another similar organization, which causes issues like:

  • Having too few board members to foster a healthy debate
  • Creating an overwhelming burden on paid staff by having too many members
  • Failing to have the space or logistical funds to accommodate all members

 2. Financial Management

Nonprofits must be accountable for the numbers in their books. While your bottom line may go right back into supporting your organization’s mission, your goal should be more than just breaking even. Good financial management leads to a more certain future for your organization, and the more stable your finances, the more attractive your nonprofit will be to potential donors.

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To stay on track with your finances, your organization should work with a qualified advisor to ensure your nonprofit is taking advantage of every available financial opportunity. While your nonprofit may not be required to have an annual audit or review (check out Maryland’s assurance thresholds here), the assurance provided by an auditor on your organization’s financial statements can serve as a beacon for donors (and especially grantors) that your organization has its financial ducks in a row.

3. Fundraising

Even though your nonprofit may not place the same emphasis on money that a private business does, ultimately, it is money – typically raised through fundraising – that pays for the staff, building and technology you rely on every day. The majority of nonprofits are hyperaware of their need to secure a consistent source of donations, but many organizations struggle to find their feet when it comes to what it takes to actually be successful in their fundraising efforts.

Nonprofits should always be cautious that the majority of their fundraising dollars don’t come from one kind of source, whether that be individuals, corporations, grants, etc. Diversity in your donation sources better prepares your organization for economic speed bumps – like a downturn in the economy, a cutback in government spending or the dissolution of a big-time corporate donor. As a result, the more diverse your fundraising income, the less of a financial risk your organization becomes and the more attractive your organization becomes to donors.

Where Do I Go From Here?

Even the best nonprofit executives, board members and staff must commit to staying up-to-date on today’s best practices. To get new articles emailed to your inbox as they are published, subscribe to our free nonprofit blog. You can also watch our webinar, Secrets of Successful Nonprofit Fundraising.

Need Help?

Contact our Nonprofit Group online or call 800.899.4623.

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Published on April 25, 2017