As most nonprofit founders and CEOs are executing strategic plans to keep their teams safe, it is also important to simultaneously develop plans to keep our organisations alive, so that when the dust begins to settle, and the world begins its path to recovery, people will have jobs to return to, and the programmes we run will continue to create impact on the ground.
We can expect funding to potentially take a downturn, either due to a reduction in the overall funds available, or as a result of funds being redirected towards more imminent causes—COVID-19 relief and rehabilitation work, livelihoods, and healthcare.
An effective way to prepare organisations financially is to run a scenario planning exercise, and prepare for the worst- and best-case scenarios. This is a critical first step as it will determine the course of action going forward, and shape financial and programme models for the next 12 months, starting April 2020.
Three things to consider when financial planning for your organisation
- Reduce fixed costs: Take a hard look at fixed costs (such as office rent) to see what can be cut or reduced over a period of time.
- Rethink programme cost: Rethink the design of programme delivery—can scope or certain aspects of a programme change?
- Re-examine people costs: While appraisals could continue as usual, the financial aspect linked to appraisals could be deferred by a quarter. In a worst-case scenario, if employees have to be laid-off or furloughed, keep in mind that team members at highest risk—those that are employed at a lower salary—should be impacted least by these policies.
Read the full article about re-evaluating nonprofit finances to survive COVID-19 by Mahamaya Navlakha and Satyam Vyas at India Development Review.
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