Bridgespan Outlines Eight Steps To Help Nonprofits through Tough Times

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Summary

New article shares tips for navigating troubled waters and urges leaders to keep focus on diversity, equity, and inclusion

BOSTON, September 12, 2019 — The Bridgespan Group published a new article, “Eight Steps for Managing through Tough Times,” aimed at helping nonprofit organizations navigate challenges triggered by economic recession, the loss of a major funder’s support, or other disruptive forces. Building on previous work and advice from other nonprofit leaders and experts, they offer eight actions that organizations can undertake. The article is part of a newly updated “Managing through Tough Times” special collection on Bridgespan.org, which also includes case studies and a curated list of external resources. 

According to Maria Orozco, a lead contributor to the collection and principal at Bridgespan, “It is critical to take each of these steps with an eye toward how decisions could differently affect people of color—both inside and outside of your organization.  Building the better world that we are all working towards requires that social sector actors deliberately embed racial equity considerations into their decisions, and tough times are not an excuse to let that focus slip”.

The eight steps include:

  • Act quickly, but not reflexively, and plan contingencies: Always plan for the worst and have plans B, C, and D in place. For example, many organizations start by asking themselves what they would do if they had to cut their budgets by 10, 20, and 30 percent.
  • Protect the core: Consider not only which programs are highest impact but also where discretionary dollars are going. Programs that are not covering their costs deserve extra scrutiny.
  • Identify the people who matter most and keep that group strong: Odds are not all of them are your direct reports. These decisions should be viewed through a DEI lens to ensure that a variety of identities and viewpoints infuse your organization’s vision and work.
  • Stay very close to your key funders: The individual donors and organizations that know you the best are the ones that are most likely to help you navigate a downturn. Make sure you know their priorities and how your nonprofit fits in.
  • Shape up your organization: Tough times can be a catalyst for taking advantage of low or no cost opportunities to improve internal operations. If a recession is sparking the tough times, paradoxically it may be the moment to add to the leadership team—taking advantage of a less competitive market for talent.
  • Collaborate to reduce costs and expand impact: This is the time to take some classic advice to heart: don’t do it alone. Sometimes the most innovative solutions come from unexpected partnerships.
  • Involve your board: Now more than ever, your board needs to be well informed about the organization’s financial health and actively engaged in planning and fundraising. Board members may also be able to provide focused operational support to complement staff efforts or fill gaps left by staff lay-offs.
  • Communicate openly and often: People need to know that leadership has a handle on the situation and a plan to address it. Develop concise talking points for staff and your board.

The article also cites the critical role funders have to play. Citing research showing that bias-related barriers to capital make nonprofits led by leaders of color the most financially vulnerable, one of Orozco’s co-contributors to the article, Cora Daniels, said funders “have a special obligation to these grantees during tough times. They should double down on support—both their own, and by aggressively tapping their networks to help them navigate financially tough times.”

Lauren Rourke, who also worked with Orozco and Daniels, added, “Steps taken to navigate through tough times are important because, right or wrong, they endure. The road to financial stability for nonprofits is a marathon, not a sprint. How we run it will make all the difference to whether and in what shape our organizations are able to cross the finish line.”

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About The Bridgespan Group
The Bridgespan Group (www.bridgespan.org) is a global nonprofit organization that collaborates with mission-driven organizations, philanthropists and investors to break cycles of poverty and dramatically improve the quality of life for those in need. With offices in Boston, Mumbai, New York, and San Francisco, Bridgespan’s services include strategy consulting, leadership development, philanthropy and nonprofit advising, and developing and sharing practical insights.

Bridgespan’s “Managing Through Tough Times” special collection was updated in 2019, with Maria Orozco, Cora Daniels, and Lauren Rourke as lead contributors.

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