Nonprofit Infrastructure

[Image description: A panda, resting their head on some tree branches.Image by shangshaistonemen on Pixabay] Hi everyone, this will be the last blog post until August 8th, as I’ll be on my annual ……

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READ THE TRANSCRIPT This episode features Rodney Christopher from BDO FMA, and is the first installment of our special series, Smashing the Overhead Myth – Once and For All!With 30 years of consulting and grantmaking experience in the nonprofit and philanthropic community, Rodney was instrumental…

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This article originally appeared in The Chronicle of Philanthropy on May 23, 2023. Click here to view the original article.Anyone who shops for groceries, worries about recent bank failures, or wonders how to save for things like car repairs or college tuition understands economic uncertainty. When nonprofits experience that same uncertainty, their leaders must not only deal with the financial implications but also continue to advance their missions, hire staff, and foster community wealth and well-being.While foundations and government agencies have a responsibility to bolster grantees that rely on their support, nonprofit leaders can also take actions to better navigate economic uncertainty. Here are six things nonprofits can do now. Assess strengths, risks, and challengesIt can be daunting to analyze organizational risks and opportunities, especially for nonprofits that operate with a thin margin.Assess strengths such as community trust and relationships, staff expertise, and community impact. These are often unrepresented on a balance sheet because they are difficult to measure. Try to quantify these assets.Consider whether challenges are temporary — in which case something like a bridge loan or line of credit could provide short-term stability — or fundamental, which could require a new business model or new forms of support.Anticipate, to the degree possible, how current economic conditions may affect demand for programs and services.Develop different budget scenarios, accounting for continued inflation, late government payments, and declining philanthropic support or earned income.Sometimes foundations will fund a nonprofit’s efforts to engage in financial analysis and planning; nonprofits can also access resources from membership organizations and free tools provided by the Nonprofit Finance Fund and others. Be open about your financial situationKeep grant makers informed of the economy’s impact on service delivery. While power dynamics can complicate these conversations, we consistently hear from grant makers that early communication — updates rather than direct asks — helps foundations better support grantees in uncertain economic times. Not all foundations will entertain such requests, but, as relationships permit, consider sharing:Ways your nonprofit supports the community, especially at a time when people may be struggling to put food on the table.Your role as an employer and driver of economic health and what that requires (the need to offer staff living wages and good benefits, for example).What you need, whether that is funding to cover true costs, more flexibility with applications and reporting, or additional funds to adjust for inflation. Coordinate and collaborate with peersCoordination takes time, but it can bolster efforts to secure support to cover the full costs of programs and to compensate staff members fairly. For example, several FamilySource Centers recently came together to petition the City of Los Angeles for increases in the amount the city compensates them for their social, educational, work, and family support services. These nonprofits explained that while rates have been the same for many years, costs have gone up. Some changes — like an increase to the minimum wage — were good for nonprofit staffers but weren’t accounted for in existing contracts. The budgeting process is still underway, but the city has proposed an increase that aligns with their request.Some organizations have extended collaborations born from the response to Covid. In Massachusetts, the Coalition for an Equitable Economy began as a means to help organizations, led by and serving people of color, secure Covid emergency funding. After many of these organizations were shut out from first-found Paycheck Protection Program funding, the coalition helped them secure millions in second-round PPP relief. It is now a permanent advocacy group for entrepreneurs of color. Advance equityCommunities of color are disproportionately affected by economic downturns. Plus, many BIPOC-led and -serving nonprofits have not had equal access to resources, as detailed in NFF’s 2022 State of the Sector Survey. Amid ongoing uncertainty, everyone in the nonprofit world, including nonprofit leaders, can help organizations led by and serving people of color secure the resources they need. For example, the Seattle Human Services Coalition recently reported that when Covid first hit, several well-resourced organizations declined unsolicited emergency grants and suggested the money be given to smaller BIPOC-led nonprofits. Well-resourced nonprofits can help in a few ways:Acknowledge and amplify that work that BIPOC-led organizations do in their communities and to advocate for more equitable systems.Open up networks and make introductions between well-established foundations and community-centered BIPOC-led nonprofits that offer complementary services.Advocate for better government reimbursements, timely payments, inclusive government planning and contracting processes, and other practices that help everyone and support racial equity. Reject the assumption that bigger is always betterNonprofits and businesses are often encouraged to grow. But investing in things that make you more stable without growing — staff retention, systems, financial reserves — is also a valid option, especially in times of uncertainty.Ask and evaluate: Is growth a reasonable and useful goal at the moment?Identify other goals that will help meet current community needs.Communicate with your board about the investments needed for stability and long-term service to the community — which are exciting and important, though not as “flashy” as physically opening a new building, for example.When appropriate, make the case to grant makers for stability for staff and deeper work with existing clients instead of “scale.” Reassure staff, if you are in a position to do soStaff members are a nonprofit’s most important assets. A new survey by Forvis found 50 percent of nonprofits are having difficulty delivering programs and services due to staffing shortages, and 78 percent are trying to fill staff vacancies. You can calm nerves by:Sharing measures of certainty and stability, if possible. For example, if you know salaries are funded through 2023, let staff members know. This can reduce stress and aid retention.Consider other ways to care for staff, such as additional time off and other benefits that boost morale but don’t (or only minimally) increase costs, such as flexible work hours, staff meals, outings, and speakers. Protect against using sweat equity to compensate for insufficient funding. Too often this leads to personal hardship for staff members. It isn’t a fair or viable strategy.By analyzing an organization’s financial position, taking a collaborative and equity-centered approach to challenges, and communicating clearly and frequently with grant makers, staff members, and other stakeholders, nonprofit leaders can steady their course through choppy economic waters.Looking for more actions your nonprofit can take when the economy is challenging? Visit the webpage “Managing through Economic Uncertainty” on nff.org.

Why nonprofits, particularly those supporting marginalized communities, must become active players in the landscape of advocacy.

Sophia Johnson, Feedback Labs | May 23, 2023 Located in the Kensington neighborhood of Philadelphia, Congreso de Latinos Unidos (Congreso) is a nonprofit organization with a mission to enable individuals and families in predominantly Latino neighborhoods to achieve economic self-sufficiency and wellbeing. The agency has 40+ programs operating over 5 programmatic divisions namely Education, Employment and Training, Health and Safety, Housing, and Family & Parenting. As Congreso offers a wide range of services and programs, it is crucial to establish communication channels both internally (staff orientated) and externally (first time Congreso clients). Consequently, Congreso has been developing the Referral App through which staff and clients will ideally be able to refer to the needed programs. Congreso divided the exploration and build out of the app into two phases: internal consisting of staff members and external that includes the first time Congreso clients or community members. In the LabStorm, Congreso presented to the audience to explore features needed for the external side of the app. With the goal that clients would be able to see the list of Congreso programs and their description, self-refer to programs as they see fit, and receive status updates on the referral itself, Congreso aims to incorporate the client’s voice and needs into the app before moving forward. As it is critical to involve clients in building a client-facing portal, the LabStorm participants brainstormed strategies to reach out to the clients to elicit their feedback. Reaching out to the community. Attendees brainstormed ideas on getting the word out so that the community is aware of what Congreso is looking to do. Getting people to give feedback into the design or presenting a prototype to the clients can elevate the interaction with the app and change the response rate from the community. Congreso was recommended on setting a deadline to exhaust all the strategies, and complete the app so that development does not get prolonged due to outreach challenges. Furthermore, partnering with existing emergency services, leaving flyers and brochures at reentry centers or food pantry centers where there is an overlap of people who are connected to Congreso could expand the outreach pool. Leaving informational materials with social workers can be crucial as they are meeting people at crisis points and they can refer resources at Congreso after addressing the immediate needs. Having a bunch of free swag to drop off at the offices would also encourage people to get the survey link filled out. Equity design in feedback. Attendees stressed the importance for embedding equity and paying people for their time for the feedback processes. Consequently, Congreso could focus more on quality feedback than the number of people giving the feedback. Having an iterative process of a handful of people at a time would help ensure quality feedback while carrying an equitable approach. Furthermore, it could be the case that people lack the time to test the app and hence engaging them in specific problems that Congreso is trying to solve with the app could be more effective. Attendees reminded that communicating the work is half the battle and that the process should be leveraged for the challenges that people are facing in general and positing the app to address those. Building trust in the community. The discussion in the LabStorm reminded everyone that feedback can be fun and engaging, and they can be a trust building exercise. Planning how Congreso would close the loop and share the feedback they got from the community can underline the importance of feedback to the community. Moreover, celebrating the value that Congreso got from the feedback exercise would help convey the importance of community voice to Congreso and contribute to a trust based relationship. Participants also stressed that once Congreso is out in the community and has made people aware of what they do, even if people don’t give feedback, they will know that they can make use of Congreso’s programs and it would be a win-win situation either way. As the engaging LabStorm came to an end, attendees concluded by transferring the success of the staff feedback to the client feedback process. Highlighting feedback success from the patterns found from the staff feedback would have a significant leverage for Congreso to gather feedback from the clients as they aim to have a more community-driven input in their app development. Learn More About LabStorms LabStorms are collaborative problem-solving sessions designed to help organizations tackle feedback-related challenges or share what’s working well in their practice. Presenters leave the experience with honest, actionable feedback and suggestions to improve their feedback processes and tools. To learn more about participating in a virtual LabStorm, please visit feedbacklabs.org/labstorms.