For several years now, we have seen the demands for nonprofit services increase rapidly, oftentimes exceeding capacity. Nonprofit organizations are focused on meeting the needs of their constituency while increasing impact. Some of the challenges get raised when organizations are planning to effectively scale for growth and impact. With the ever changing and growing needs, how are nonprofits adapting?
We’re seeing more mergers between nonprofits as well as new partnerships and collaborations. Some of these partnerships are with social enterprise organizations, some with other nonprofits, and others with community entities. With increased competition for funding and donors, nonprofits are learning to partner, narrow the focus of their mission, and adopt critical tools to ensure mission success and growth.
While growing to broaden the scope of your mission is a very good thing, it also brings new challenges. You have multiple funding streams, demand for deeper visibility, more grantor requirements, and increased compliance and reporting requirements. You may add new locations, programs or initiatives. It’s vital to plan for your growth and your expansion beyond the startup mode. Most nonprofit organizations start out utilizing small business tools to manage the organization. Once growth and expansion starts to kicks in, nonprofit orgs begin to experience the pains and limitations of ‘startup’ tools and resources.
In our last two posts, we shared information with you related to outcome measures and funding diversity. These two areas are critical as you plan and prepare for growth. Once you start tracking and measuring outcomes and increasing the diversity of your funding – you will quickly see the need for a best in class financial management solution – that will allow you to leverage modern technology to strengthen your visibility, transparency, automation, efficiency – and of course – your stewardship.
As your organization starts to thrive and grow, don’t think it will just happen on its own. Plan and build your strategy to accommodate the growth in a sustainable way. Nonprofits need the leverage and benefits that modern, best in class fund accounting affords. Whether through automation and visibility, or transparency and reporting – make sure that you equip your nonprofit with the tools that will allow it to thrive, grow, and maximize impact.
Questions or comments regarding scaling for impact and growth? Please reach out to us. You can also follow us on Twitter (@BeckCPAs). Check back next week for the final post in our series, where we will focus on automating your processes.
At Beck & Company we specialize in not-for-profit accounting and auditing. We understand the unique challenge of balancing the needs of your various stakeholders – contributors, members and your board, too. We have experience serving not-for-profit organizations such as unions, homeowner’s associations, religious organizations, charities, and social service organizations. If you have any questions regarding the filing of your form 990 we are here to help. Contact us today for more information.