Monday, December 1, 2014

How to Get your Nonprofit through the Recession: A Checklist for Managers

By Steven M. Worth, President at Plexus Consulting Group, LLC

Sometimes when in a storm it is useful to have a checklist at hand that serves as a reminder not to forget certain fundamentals. With information overload and all your senses screaming at you, it is easy to lose track of things that in normal circumstances would be “no-brainers” for veteran managers. So to that end I have this handy check list that is divided between “strategic” and “operational” things that a manager needs to keep in mind in the midst of this “Great Recession.”

Re-check your bearings—focus--The world in 2008 when the Great Recession first hit. Maybe you saw it coming, but if so you were pretty much on your own. Few saw the greatest economic crisis since the Great Depression coming before it hit. And then, like a tsunami, it just kept hitting. Every quarter that has gone by has brought more bad news…..

So, why is it so many organizations are using strategic business plans from before all this happened? This is like using a map of Washington, DC to find your way around the streets of Paris! Alright, maybe not quite that bad, but still. If you have not done strategic planning in the past year then it is high time to do so. Assess the changes in your strategic environment and adapt your organization’s course accordingly. The direction you were headed in may not be where you should be headed now. Or, at the very least, the ways in which you will get there will have changed. 

Wouldn’t it be nice for you and your stakeholders all to know what that is before you bump into something? Are you operating effectively? Are you hitting your benchmarks—or has your market changed so fundamentally that you need to rethink your approaches? Think of it as aiming at moving targets. Check and recheck and ask yourself fundamental questions—are we doing what we need to do in the most effective way possible? Are we aiming at where the target will be or are we aiming at where it used to be?

Are you operating efficiently? Resources are scarce in the best of times. Waste is always a luxury that no one can afford, but this is particularly true now. Test out your operations, where can you squeeze out more efficiency? Be prepared to see things in a different way—maybe there is a whole new way of doing things that you have never before tried. If so, try it. Now is the time. Too many managers assume a death grip on the steering wheel…staying the course, afraid to try anything new. Try it.

Internal and external communications. Probably the single most important operational function in times of a crisis is communications. Are you communicating effectively with all those shareholders and stakeholders who are critical to you? This includes prospective members and members as well as your board. And it especially includes your staff and any consultants and partners you may have. Don’t assume that just because you are sending them a newsletter that they are receiving the message that you think they are. Communications is a two way street—it takes listeners at both ends, not just one person talking, to achieve it. Communications can be turned into intelligence, and this is always a good thing to have in a crisis.

Reducing expenses
The two biggest items in your budget are salaries and rent. Which activities can be outsourced and which must be handled by staff? Outsourcing almost always reduces expenses while accessing greater expertise. It also provides greater flexibility if you think you may need to change course later. Office rent is a particularly grievous problem now that commercial real estate has actually declined in value this past year. So if you are stuck with a costly pre-recessionary lease—work with a reputable realtor to find ways to reduce this cost.

Are you spending your marketing dollars in the best way possible? Have you trained your staff in the things they could be doing to help market through their own personal and professional networking? DO NOT consider marketing to be an expendable overhead item. It is your organization’s oxygen. Cut that off and you slowly suffocate!

Are there items on your checklist that you think should be included here?

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