How Do We Do More with Less?
Consider the Equity Ethic
Last week, Clara Miller wrote a piece in the Financial Times, More from non-profits now means less in future. In her article, she cautions against the urge to do “more with less”:
Board members, donors and managers in the social sector will need to summon their courage and embrace an “equity ethic” to ensure that they and the organisations they support will be able to stay the course for the people who need them. To do so, they will need to tame one of their strongest impulses: to do more.
Asking how we can do more with less is a familiar refrain. The Chronicle of Philanthropy recently hosted a live discussion on this topic.
I think that we need to challenge the basic question. Is it realistic to expect that nonprofits will be able to “do more with less”? I think that many nonprofits need to ask how to effectively “do less with less.” A strategic question is what programs to keep, and to do them as efficiently and effectively as possible, and what programs to exit, close, or transfer to someone else.
Nonprofits are in a difficult position. Demands are rising, and organizations are struggling to keep pace. In this climate, how can we have an honest conversation about capacity?
Perhaps, that is also the wrong question. What are the consequences if we over promise and under deliver?
Where does that leave us?
For some ideas on how to make tough choices, consider that “If you have to trim, always trim back to your mission.” Here are some additional sugggestions from Clara Miller’s article:
- Keep an eye on reimbursement rates as the workload increases. The government pays non-profits less than a dollar for each dollar of services provided (such as foster care, health education, financial counselling), and as some non-profits increase their workload, they dig themselves deeper into a financial hole. Non-profit contractors often accept these “underwater” prices because they cannot bear to turn away those in need.
- Raise capital to fund change. If you need to grow, downsize, merge or simply become more efficient, capital is needed in addition to revenue.
- Difficult times inspire creativity. We have seen non-profits invest in technology that streamlines fund-raising, work “virtually” to reduce office space and/or travel expenses, and merge services or operations with like-minded organisations.
NFF also has a resource article, Navigating the Financial Crisis: A Nonprofit FAQ. It includes information on what constitutes a recession, how the economy might impact the nonprofit sector, and tips for managing your organization during this time.