The typical narrative about the nonprofit employee is that they so deeply believe in the mission that they are willing to sacrifice their own financial stability in order to help facilitate meaningful change in the world. No doubt more than once, they’ve probably received the most unhelpful feedback: “You’re not going to get rich working for a nonprofit!”

Yet, there’s no reason why nonprofit employees can’t be saving the world while meaningfully saving for their own future. If you start early and are consistent with your savings, nearly anyone can become a 401(k) millionaire. And it’s even easier if you have some support from your employer.

 

Providing life-changing benefits to your deserving employees

Let’s imagine a 25-year-old nonprofit employee who earns $58,000 a year. If she invests 6% of her salary a year, her employer matches 3.5%, and her investments see an 8% annual rate of return, she’ll have more than $1 million saved by retirement. If she’s able to save 10%, her retirement nest egg grows to over $2 million.

It should go without saying that nonprofit employees should be able to retire comfortably after years of dedicating themselves to helping others. But frequently, these hardworking, dedicated employees aren’t receiving the same quality benefits that their corporate counterparts enjoy.

Sure, nonprofit leaders have a lot of competing responsibilities. And managing a nonprofit budget requires leadership to make sure that donor dollars are used efficiently to help the cause. It’s not entirely surprising that employee benefits might be one of the last things a nonprofit leadership team wants to worry about. But that could ultimately hurt the mission.

Caring for your employees should be a top priority. Offering a 401(k) with matching should be standard in the industry. When every dollar of a nonprofit’s budget matters, it’s more important than ever to make sure you’re taking care of your employees in an effort to retain the best team for your organization.

Choosing the right retirement plan for your nonprofit employee

There are a number of retirement plan options for nonprofits to choose from. Most have heard of the 403(b), which is the traditional nonprofit retirement plan. In many ways, a 403(b) plan is similar to the widely used 401(k) plan. A 403(b) plan allows employees to set aside some of their salaries each pay period in individual retirement accounts, and the money is allowed to grow tax-free until it’s withdrawn.

The investment options available through 403(b) retirement accounts are typically more limited than the options associated with some other retirement savings plans. Generally, 403(b) account investments are limited to annuities and mutual funds, and these plans typically do not offer an employer match.

But one of the biggest drawbacks to a 403(b) plan are the fees. A 2022 study from the U.S. Government Accountability Office found that the expense ratios for the annuities and mutual funds range from about 0.01% to 2.37%. That amounts to investments costing up to 237 times more than other lower-cost retirement plans. Additionally, there may often be surrender fees, or fees for selling or withdrawing money from an investment within a set period of time, charged when investing in annuities in a 403(b) account. Surrender fees can be as much as 10%.

These fees can have a huge impact on a nonprofit employee’s long-term savings goals. When you only have a small amount to invest in the first place, you want to make sure you’re not paying more in fees than you’re earning on your investments.

Let’s go back to our young nonprofit employee. If she’s paying 2% AUM fees each year, she’ll forfeit more than $600,000 over the course of 40 years. Even an AUM fee of 0.5% will cost her $200,000+ over the course of 40 years.

While 403(b) retirement plans have been a nonprofit standard for years, there’s no reason why your organization can’t use a more cost-effective plan that ensures your employees can enjoy the full benefits of the years they spent working and saving.

The benefits of a Safe Harbor 401(k)

The most widely offered retirement plan option, 401(k) accounts allow employees to make pre-tax payroll contributions from their paychecks each pay period in the same manner as 403(b) plans. And like 403(b) plans, the money is allowed to grow tax-free until it’s withdrawn during retirement.

A 401(k) plan typically offers employees a wider range of investment options including stocks, bonds, and mutual funds. Equally importantly, when offering a 401(k) retirement plan, employers, including nonprofits, can make contributions to employee accounts, thus helping employees to be more adequately prepared for retirement. Fees tend to be lower as well. The best 401(k) plans offer AUM fees that are less than one percent. Unfortunately, many of the big financial institutions charge their customers upwards of 2%, which again, can take a big chunk out of an employee’s long-term savings.

While the investment diversity is indeed a benefit, as is the ability to make matching contributions, traditional 401(k) plans also come with more significant reporting and administrative requirements. Specifically, traditional 401(k) plans must adhere to non-discrimination rules established by the federal government. And to ensure that plans meet these requirements, employers must conduct annual tests known as the Actual Deferral Percentage and Actual Contribution Percentage tests. As the IRS explains, these tests are designed to verify that deferred wages and matching contributions from employers do not favor employees who are more highly compensated.

But don’t let these administrative requirements trip you up. With the right 401(k) provider, you won’t have to worry about these steps. One of the best solutions is a Safe Harbor 401(k). A Safe Harbor 401(k) is a type of retirement savings plan that allows employers to avoid most annual compliance testing that traditional 401(k) plans must undergo. If a company meets the requirements for Safe Harbor matching contributions, it is deemed to be in compliance with certain nondiscrimination tests.

By offering employees a Safe Harbor 401(k), nonprofit leaders can avoid losing time on all the administrative headaches that used to be involved with offering an employer-sponsored retirement plan. All they have to do is set up the plan, automatically enroll their employees, and start matching their contributions.

Employer-sponsored retirement plan benefits everyone

Offering a 401(k) plan and a match can make a meaningful difference in an employee’s life. But it can also have a huge impact on a nonprofit. A 2023 Morgan Stanley study found that 92% of employees view retirement planning assistance as a priority when choosing where to work.

Keeping a good employee will not only save nonprofits money potentially lost to recruiting costs, but also help them earn more in the long run. 

Time is also of the essence, as there’s never been a more affordable time to set up a new 401(k) plan. Small business employers, including nonprofits, with up to 50 employees, are eligible to receive a tax credit covering 100% of administrative expenses (up to $5,000) for the first three years of a new plan.

Offering a cost-effective 401(k) plan to your nonprofit employees is a win for everyone. You can help them achieve financial security while they help you achieve your goals for saving the world.

Harnessing the Past to Propel Your Nonprofit Forward

Learning from the Past: The Foundation of Growth

Nicholas Sparks aptly noted, “Everyone has a past, but that’s just it–it’s in the past. You can learn from it, but you can’t change it.” This holds profound implications for nonprofit organizations. As entities, we often allow past experiences to overly influence our current operations. However, these past experiences do not define us, they form a part of us and our mission. Our organization is so much more than a collection of past events.

In the nonprofit world, we frequently grapple with a sense of lack, thinking we don’t have enough funding, our mission is not being fully realized, or our relationships with donors or volunteers aren’t as fruitful as we’d like. Many of these challenges can be traced back to past experiences that we have yet to fully learn from.

Nevertheless, overcoming past challenges is similar to recovering from personal loss. It entails accepting the reality, understanding the circumstances, and acknowledging that not all questions have definitive answers. This mindset shift is crucial for addressing the limiting beliefs holding our organization back.

Adopting a New Perspective: The Key to Nonprofit Success

Transitioning from this understanding, it’s vital for nonprofits to adopt a fresh perspective. It’s about realizing that we cannot control every variable, but we can control our response. Consider this – if a funding proposal was rejected years ago, should that one instance impact our future attempts? That rejection doesn’t warrant another moment of our energy.

Creating a Vibrant Future: The Nonprofit’s Potential

This positive energy ultimately shapes a better environment for our nonprofit. Clear vision allows us to better evaluate our relationships, mission, and strategy. Operating in a state of fear or distrust only serves to limit our organization’s potential for growth.

Moreover, increasing the positive ‘vibrations’ within your organization can dramatically transform the way it functions. This involves being more present in the moment, being clear about what the organization wants, and being open to receiving that desire.

As we focus on the present moment, new opportunities arise. By opening our organization to new partners and continually evaluating whether our environment truly serves our mission, we prepare for a vibrant future workforce.

Lastly, our decisions in a nonprofit should come from the heart as much as the head. Our intuition, our connection with our mission, can guide us. The rational mind is crucial, but it can also be susceptible to manipulation or trickery.

Remember, your nonprofit is worthy of love and support from the community. Once you open your heart, embrace life and everything it has to offer, your organization will be unstoppable.

Be a rebel. Rise up! Break the cycle of limiting beliefs and propel your nonprofit forward. Like a phoenix from the ashes, your organization may face defeat, burnout, criticism, injury, and abandonment. But they will not, shall not, and cannot destroy your mission. For you, like Rome, were built on ashes, and you, like a phoenix, know how to resurrect.

6 Lessons I’ve Learned as a Nonprofit Intern

Internships are some of the most valuable experiences you can have as a young professional. Not only do they boost your resume but they also provide you with real-world experience, great networking opportunities, access to more resources, and the possibility to be a part of projects that you can add to your portfolio. 

As a recent graduate, I can confidently say that my time as an intern has benefited me greatly and I would not be where I am professionally today without it. Throughout my time as an intern, I learned new skills, built projects, and held great responsibilities that have impacted me greatly. I can boil this experience down to 6 main lessons I’ve learned as a nonprofit intern.

1. Always be open to trying new things!

It is important as an intern to keep an open mind to any projects you may come across. Take chances and be open to any new experience your nonprofit may offer you. Your time as an intern provides you with so many opportunities to try new things, so take advantage of it! 

Whether you enjoy the project or not, you learn something new from it! And, you have a better understanding of it which may come up in interviews with future employers. Sometimes it can be common for interns to feel as if they are doing busy work. But guess what! Your work at your nonprofit matters! Whether it is a tedious task or project, you’re still helping the organization succeed and making a positive impact along the way. Give yourself some credit! Everything you do will add value to your nonprofit organization!

 

2. Ask questions!

Never be afraid to ask questions! As a nonprofit intern, your team realizes you’re young and new to the professional world. They will always be more than happy to answer your questions because it shows you care. As an intern, it can be overwhelming at times but make sure you take full advantage of the time you have with your fellow nonprofit professionals! They have excellent experiences and ideas that will help you succeed. 

One thing I started doing as an intern was writing down more questions throughout my time working. Your team may not have time to answer questions right then and there – the nonprofit world is very busy! But if you write down your questions when you have them, you can ask them once you have the opportunity to talk with your team. I generally enjoyed asking professional development questions during my weekly meeting with my supervisor as it provided time to have an open discussion where I can learn and grow as a nonprofit professional.

 

3. Your team wants you to succeed!

As mentioned above, it is so crucial to take advantage of the professionals you work with! They have great experiences in the nonprofit sector and would love to share them with you! If you show you’re interested in something, many nonprofit leaders would love to take the time to explain it further or set you up with available resources.

Additionally, as an intern, embrace being a part of the team! Your nonprofit team wants to see you succeed! Oftentimes if they are aware of outside resources such as webinars or networking opportunities, they are happy to connect them with you. Show your love for your position and appreciation for all their time and you’ll be surprised how much they help you progress as a professional.

4. Making and fixing mistakes

Just like anything else in life, you’re bound to make mistakes. If/when you make a mistake as a nonprofit intern, remember a few things. First, own up to your mistake. Taking responsibility for your actions is essential. It shows ownership, accountability, self-awareness, and professionalism which are all crucial things to have in your life and throughout your career. Second, talk with your team to see how you can resolve the mistake yourself. How you handle making mistakes is huge, it impacts how your team perceives you and your morals which becomes increasingly important as you end your time with them and look towards full-time opportunities. Third, try to establish guides for yourself that help you prevent the same mistake from happening in the future. For example, if you mess up the details of a social post, write out a thorough checklist to use before uploading the post to ensure accuracy and quality.  

Remember, we are all human! Your fellow nonprofit professionals make mistakes too. Tomorrow is another day for you to show how passionate you are about this position and how well you can handle yourself professionally.

 

5. Project Management

Project management is so crucial throughout your career and almost every employer will ask how well you handle it. Internships provide a welcoming environment where you can learn your strengths and weaknesses regarding project management. After knowing more about your preferences, you’ll be able to handle multiple projects simultaneously with ease. 

There are plenty of tools available to manage multiple projects. Your nonprofit organization may utilize tools that help you manage your projects and assignments. But, it is important to learn how to take responsibility and learn the best methods of project management for you! One tip is to import important due dates into a calendar and look at what takes the most priority for your upcoming week. 

 

6. Establishing routines

Whether you’re interning remotely or in person, one of the best ways to keep yourself on track and engaged is to establish routines regarding assignments and communication times. This idea goes alongside project management. If you establish a routine of completing tasks that you do weekly or daily, such as interacting on social accounts, it will be easy to remember and hold yourself accountable. 

Additionally, establishing routines of meeting with your supervisor or other team members helps you maintain effective communication, engagement, and accountability. Nonprofits are extremely busy, as I’m sure you realize. Because of this, it is important to establish regular times to meet with other people a part of your nonprofit team in advance to ensure you’re on track, discuss new opportunities, receive feedback, and ask those thoughtful questions. Each of these things forms expectations of you and your other team members. Establishing routines and sticking to them shows professionalism and that you care about doing well in your position. 

Summary

Nonprofit internships are so valuable to gain experience, learning new skills, and networking with fellow nonprofit professionals. Your internship could lead you to places you never imagined! As you get started, keep these 6 lessons in mind! They’ll help you be the most effective and successful nonprofit intern you can be!

Do your staff have the skills they need to move your mission forward and achieve your North Star? McKinsey Global found that nearly 9 in 10 executives and managers recognize their staff have skill gaps or will have gaps in the next 5 years. The nonprofit workforce isn’t exempt from the challenges of skill gaps. Without the right skills, your staff will struggle and your organization will feel the effects of that. So how do we prepare our workforce for the future of work? 

• Identify the skills your staff need to be successful.
• Develop training or other solutions to develop those skills.
• Provide ongoing support to staff. 

 

Identify Skills

To develop staff for the future of work, you first have to be clear on what skills are needed. A competency model is a great way to paint a clear picture of the expectations you have of your staff. To create a competency model that will prepare staff for the future of work, you will need to determine which competencies are right for you. 

How do you do that?

You need to do some external research to see what trends and changes will impact your organization. You will also need to review your own internal documents, such as your strategic plan, job descriptions, organizational values, and DEI commitment. You can then identify themes across this internal and external research to identify some of the skills that will be needed for success. 

In addition, you can also gather staff input to identify what skills they are using on a regular basis and what challenges they face in their work (possible skill gaps). This can be done through focus groups, interviews, or surveys. 

Once you have collected this information, you can synthesize all the data to identify the skills that are most important and/or most urgent for your nonprofit’s work. 

This gives you a framework to develop your staff as a whole, but you may also want to personalize the learning experience.

How do you personalize it? 

To do personalize skill development, you will need to offer a way for individual staff to identify the skills they need in their roles. This can be done with self-reflection tools, supervisor feedback, formal assessments, or 360 feedback tools.

Staff can use these tools to identify opportunities to upskill or reskill so they can be more effective in their roles. And, it allows the nonprofit to meet their staff’s unique gaps. 

 

Develop Training

In the McKinsey Global study, one-third of all respondents placed closing skill gaps as one of their top three priorities. While identifying the skills people need to be successful is an important first step, it isn’t enough to simply communicate those expectations. Nonprofits need to develop the skills they want to see. Two-third of respondents noted they were addressing the skill gaps by hiring new staff, but this isn’t always an option. That’s why 56% also said they planned to develop staff. 

What is staff development?

Staff development is anything you do – with intentionality – to ensure your staff are learning, growing, and performing. 

Developing your staff is most often done through training. This can include in-person training, virtual instructor-led training, self-paced eLearning courses, or even email training. This can also be done through other experiences, such as coaching and mentoring.  

The important thing is that the solutions are tailored to your nonprofit’s needs. While you can certainly use “off-the-shelf” solutions, they will not take into account the uniqueness of your nonprofit or the specific needs of your staff. 

How do you create custom experiences? 

One approach is to select one skill and create learning experiences for staff to develop that skill. The whole organization can focus on the same skill and learn and grow together.

Another approach might be to allow staff to self-select the skills they want to develop. You can offer a variety of skill development opportunities, and everyone is able to have a personalized learning experience. 

What is the result?

McKinsey Global found that the reskilling efforts have paid off. 73% of respondents who had engaged in reskilling efforts saw improved employee satisfaction and 50% saw improved employee retention. 

 

Provide Ongoing Support

An important thing to note about skill development is that it takes time. Attending a training isn’t necessarily going to produce behavior change. Training combined with ongoing support is more likely to be successful. 

What does ongoing support look like? 

Ongoing support can be coaching or mentoring. It can be supervisor feedback. It can include providing resources. It can include removing barriers. It could even include extrinsic motivators like reward systems. 

You may decide to build the expectations into performance reviews for accountability, but it’s also important to remember the importance of day-to-day coaching. 

How do we successfully make this change?

Consider using the Prosci ADKAR model to ensure staff have everything they need to adopt the new behavior. Ask yourself a few key questions:

• Are they aware they need to change?
• Do they want to change?
• Do they know how to change?
• Do they have the skills to change?
• Can they sustain the change?

If the answer to any of these questions is “no,” determine how you can make it a “yes.” Do you need a communications strategy in addition to the skill development strategy? Do you need a way to track, incentivize, and celebrate change? The answer is probably yes. 

Setting up these wrap-around strategies is a great way to prompt individual change, and your nonprofit will reap the benefits of that.

 

Conclusion

Nonprofit leaders have the challenging privilege of developing their staff. It can be difficult to know where to start, but identifying the skills your staff need doesn’t have to be complicated. Once you’ve identified the skills, you can create the right learning experiences to develop those skills and provide the support needed to sustain the changes. With time and intentionality, we can prepare our staff for the future of work so we can continue retain our staff and drive our mission forward. 

Why Effectively Tracking Outcomes at Your Nonprofit is Important

Outcomes is a nonprofit industry term used to describe the qualitative and quantitative conclusions you can draw from your organization’s outputs. Outcomes frequently describe measurements of change within your organization or your programs.

Identifying the change affected by your organization and the opportunities for change help make your nonprofit even more effective. And being able to demonstrate that difference is critical in securing funding.

Let’s dive into how to track outcomes better, how they can play a role, and how one nonprofit has been able to track outcomes more effectively using Apricot 360.

Evaluating nonprofit outcomes management

While the process of measuring the outcomes of a program scales well, there are some specific steps you should keep in mind when evaluating particular programs.

 

1. Defining objectives: Of course, everyone wants to know how to measure the outcomes of a program. But, before you can look at the outcomes, you must first analyze your
   goals and objectives. This helps ensure that your organization will ask the right questions when setting up your reporting. Your organization needs to ensure that its
   programs’ missions are clearly defined and that you know how you will measure its success for each program. Some of these program objectives can be qualitative, but
   funders will also want to see quantitative measures, so be sure to focus on these as well.
2. Data collection: Once you know what questions you are trying to answer, you can focus on what data you will need to answer them. Making sure you have the right system set up for collecting this data and ensuring that any caseworkers or other staff members who will be inputting data understand the larger picture is also an important step in this process.
3. Data analysis: After you know what data you need; you have to figure out what to do with it. Here, applies the information you collect in step two to the objectives you set in
   step one. This is where a good software solution can come in handy.
4. Data evaluation: Lastly, evaluate your outcomes management systems regularly—we recommend annually—to ensure they are still serving the needs of the organization and any funders on the program or project. When evaluating systems, ensure they will scale as your services and needs grow.

 

Counting Outputs and Tracking Outcomes

You’ll frequently see outcomes in the form of percentages. For example, a housing organization may see an 80% reduction in recidivism, or a healthcare nonprofit may record a 45% increase in preventive healthcare screenings.

These figures come directly from the data you collect and the outputs you’re counting at your organization. Outputs are the quantifiable metrics and data points in your organization. For a youth organization, for example, outputs could be the number of students who attended an after-school program or how many school supplies were given to a school system.

Even if your staffers don’t call the process “counting outputs,” your organization probably already does this regularly. It’s cumbersome and tasking for nonprofits to track those outputs without case management software. Case management software like Apricot 360 allows your caseworkers to consistently and quickly input outputs into one centralized location. This will enable staffers on their teams and across departments to view that data, pull reports, and develop insights on the outcomes of the organization’s programs.

Tracking Outcomes Effectively at A Place Called Home

Without software like Apricot, it’s not easy for nonprofits to identify their outcomes in a unified way. Laura Mills, senior director of data & systems operations at A Place Called Home in Los Angeles, California, joined Social Solutions and the Nonprofit Times for a webinar on what funders want to see from nonprofits. She said tracking outcomes at APCH has “been a thorny question for us; I’ll be honest.”

“It’s not something we have all the answers to right now or that we have historically. APCH is coming up on our 30th anniversary, which is very exciting,” she said. “But we started like a lot of nonprofits as a small community-based organization in the basement of a church, and the programs grew in response to community needs, which is my long way of saying we didn’t always build in outcome management as part of that program growth. And we’re focused on, ‘What do our members need? What do their families need?’ And that’s not always going to be filling out a survey, although we recognize the extreme importance of doing that.”

Since adopting Apricot 360 and building up capacity at the nonprofit, Laura said that her organization had created a system of tracking outcomes by creating an organization logic model and theory of change, which APCH didn’t have at the outset of its programming.

“So, we’ve brought in external consultants helping us build our capacity. Plug for Social Solutions—a big part of getting that capacity ready was switching over to being Apricot 360 users over the last couple of years,” she said.

In addition to building capacity, adopting Apricot 360 has allowed APCH to ditch spreadsheets and track data in a centralized place. APCH’s previous method for tracking was arduous, time-consuming, and vulnerable to errors and data loss.

Even with excellent case management software, tracking outcomes can be difficult for nonprofits like APCH because it takes many years to harvest the fruits of the organization’s mission and purpose.

“For a lot of youth and community development organizations, our ultimate goal is long-term, lasting change where people have sustainable careers and they can contribute as active members of their community, etc.,” Laura said. “So, we know even if we’re with a young person for 10 years they’re going to continue with that growth over the course of their lifetime and be different at age 30, 40, etc.”

Laura advises the many organizations also facing this predicament to get creative in capturing and sharing the insights of their work. At APCH, Laura’s team looks at research, indicators, and the long-term outcomes of similar organizations that have been around longer.

You can ensure the longevity of your nonprofit when you can demonstrate your outcomes—your impact—to current and potential funders.

Start Tracking Outcomes at Your Nonprofit with Apricot

Tracking outcomes at your organization doesn’t need to be a daunting and time-consuming task. Evolve your reporting to appeal to more funders and how easy-to-use case management software can help you maximize your limited resources to create those reports. Read Create Reports Funders Want to See today.

 

This spotlighted blog post is courtesy of Bonterra.

Are you currently working on creating a budget for your nonprofit organization?​ Effective budgeting for non profit organizations is essential to achieving goals. Creating budgets for your nonprofit programs in addition to an overall budget for your organization can seem like overwhelming tasks. Budgeting requires careful record-keeping, evaluation of the past, consideration of the future, and a thorough understanding of your organization’s current context. 

And here’s the punch-line: you won’t get it right!

The thing is, the purpose of a budget isn’t for it to be right. The purpose of budgeting for nonprofit organizations is for it to reflect your realistic financial goals and plans for the upcoming year. The purpose of a nonprofit budget is to provide your organization with a roadmap that will help you plan, make decisions, and adjust the plan when things don’t go exactly as expected so that you can stay on track as the year unfolds. 

Why Budgeting for Non profit Organizations So Essential to Nonprofit Accounting and Operations?

Budgeting for non profit organizations is, perhaps, the most important financial document for your organization because it is a financial management and strategic tool.

As a financial management tool, the budget outlines how your organization plans to use its money, breaking down your anticipated revenue along with forecasted direct and indirect expenses. The budget includes everything: programs, events, fundraisers, employee costs, rent, utilities, and more.

When used as a tool for strategic planning, a budget enables you to do the following:

• Coordinate operations around both short and long-term goals
• Fine-tune your operational strategy
• Make informed decisions
• Conduct more productive board meetings
• Provide better direction to your nonprofit finance committee
• Improve fundraising efforts with better-informed donors
• Easily monitor the use of mixed-purpose funds
• Make the best use of your funds overall
• Stay on track financially

Types of Budgets for Nonprofits: Which Is Best for Your Organization?

Before you start a budget for your nonprofit, you must first understand that there are different types of budgets. Furthermore, it’s important to remember how each type serves a slightly different purpose. Knowing which type of budget you adopt will help you ask yourself the right questions and gather the right information for creating the most accurate budget.

The Incremental Budget

An incremental budget is based on your organization’s financial history. To create this budget, you start with the previous year’s budget and build on it, adjusting figures and adding or removing line items as necessary. With this type of budget, unspent funds are either deleted or reallocated.

An incremental budget requires the least amount of work. However, it can have a tendency to perpetuate financial problems, unproductive programs, and money waste in an organization. This is because it doesn’t require you to really comb through and evaluate each program and expense individually.

The Zero-Based Budget

A zero-based budget starts from scratch with a blank slate every year. While you can (and should) use the previous year’s numbers to estimate upcoming expenses and income, you should carefully evaluate each one. Assess whether the expense is worthwhile, whether the program is generating an acceptable ROI, and whether you can expect to receive similar donations from your existing donors.

With zero-based budgeting, expenses are more carefully evaluated. To earn their place in the budget for another year, costs typically need to be tied to real results.

Additional Types of Nonprofit Budgets

The incremental budget and zero-based budget are the two most commonly used budget types in nonprofit organizations. There are, however, a few other types of budgets that are worth mentioning:

• Surplus Budget—Some nonprofits build a surplus into their budget in order to set aside rainy-day funds, pay off debt, or cover an expected upcoming decrease in funds.
• Deficit Budget—A deficit budget is one in which an organization plans for its expenses to exceed income. Typically, it is not advisable to operate with a deficit budget. There are a few exceptions, such as if the deficit has a time limit and represents a real investment in the organization like an expansion project.
• Break-Even Budget—A break-even budget is one that reflects an upcoming deficit or shortfall in funds. Rather than cutting line items, the nonprofit leaders focus on fundraising to increase funding and address the deficit.
• “Known Risk” or “What If?” Budgets—It can be advisable to create a “known risk” or “what if?” budget for the purpose of evaluating potential risks or unexpected costs that could result in a cash flow shortage. Look at the conditions your organization is currently facing and create a budget for a worst-case scenario so that your nonprofit will always be prepared to weather financial storms.

12 Nonprofit Budget Best Practices for Better Financial Management

1. Your Budget Must Be Flexible

It’s important to restate that your budget won’t be exactly right. No one can see the future. So, while creating your budget, remember that the numbers you choose to put down represent your best guess and nothing that you put in the budget is set in stone. Pro tip: stay on track by having a helpful Nonprofit Budget Guide handy.

2. Start Early and Follow a Set Process

Although it’s never too late to make a budget, the process should ideally start two or three months before the beginning of your next fiscal year. This allows you enough time to gather all the information you need and to present the budget to your nonprofit board for approval.

3. Work Together

No nonprofit executive director is an island, and this is especially true when it comes to making a budget. Delegate as much of the process as you can to your development employees, program directors, and finance committee members. Having your program directors carefully create budgets for each of their programs will knock out a big portion of the data you need to produce an overall nonprofit budget. You can then focus on the rest of the organization’s expenses and funds.

Making it a team effort will help you create a more accurate budget. 

4. Context Is Key

When it comes to budgeting, context is essential when considering every item. Think about where your organization is right now, the current donor climate, and your current expense climate. Do you suspect that your building’s AC unit is about to go out? Or perhaps you have other unusual expenses, fund shortages, or fundraising windfalls that you need to make special plans for.

5. Use Your Numbers

When making a budget, rely on your numbers—not your gut. Historic data is the most reliable information you can use for creating a budget. Just be sure that you’re using timely and accurate historic numbers when forecasting future expenses and revenue.

6. Make Your Budget Realistic

Dreaming is for writing mission statements. When making a budget, it’s okay to be optimistic. But it’s essential that you be realistic, especially when it comes to estimating the upcoming year’s revenue.

7. Sort Your Expenses

Keep your expenses sorted into categories (fixed and variable), and maintain a budget for capital expenditures that is separate from your operational budget.

8. Include Non-Monetary Contributions

Remember to include, record, and track non-monetary contributions with you budget. This might include volunteer hours or non-monetary contributions such as vehicles or other equipment. These are also known as in-kind donations.  List them so that the value zeroes out while still being accounted for.

9. Focus on Cash Flow

When budgeting, keep an eye on your cash flow forecasting. For example, if you know that you have a big expense coming in the spring but do not receive the majority of your funds until year-end fundraising, it’s important to realize that you could experience a cash shortage that you will need to plan for accordingly.

10. Take Note of Your Budget Assumptions

If you make any assumptions (and you probably will) while creating your budget, be sure to make note of those assumptions. As a result, you can keep a careful eye on your guesswork. Perhaps some guesses will be little less educated than the other numbers on your budget, so adjust your numbers if needed.

11. Shoestring Budgets Are Risky

Operating with a shoestring budget is risky. For this reason, it’s best to budget with a 3-5% surplus written in. This gives you a bit of wiggle room if your cost estimates came in low or your revenue estimates turned out to be too optimistic.

12. Revisit Your Budget Every Month

Creating and making the most of a nonprofit budget isn’t a one-and-done job. You should revisit your budget every month and compare it to your actual numbers. This allows you to keep a close eye on your strategic plan for the year and where how your nonprofit is actually performing.

Compare Budget Vs. Actual to Stay on Top of Variances

As you go along, don’t be afraid to make changes and adjustments to your budget to better fit the year’s actual numbers. By making continuous adjustments, you can keep your nonprofit on track to successfully complete another year.

Streamline Budget Creation and Budget vs. Actuals Evaluation With an Affordable, Automated Back Office

Many nonprofit leaders assume they can’t afford the type of back-office that’s required for effective nonprofit budgeting and comparing budgets vs. actuals. This, however, is not the case. Like small for-profit businesses with limited resources, nonprofits can also take advantage of the many benefits of outsourced accounting service providers—like GrowthForce—that are highly experienced in and specialize in accounting for nonprofits.

Nonprofits have intricate needs and face unique challenges that most accounting services don’t have experience in. That’s why I created GrowthForce: to help and serve this overlooked group of nonprofits. With over 35 years of nonprofit financial management experience, I’ve single-handedly seen the difference it made when organizations used accounting as a fundraising tool.

For a fraction of the cost of an in-house bookkeeping and accounting department, outsourced providers give your organization access to the tools, technology, and experienced teams of accounting professionals who can show you how to leverage your back office and your annual budgeting to take your mission to the next level.

 

*This spotlighted blog post is courtesy of GrowthForce

 

About the Author

From tech founder to nonprofit CFO and fundraiser, Stephen King brings a unique combination of vision, foresight, and experience to help nonprofits maximize their cash flow and operational efficiency. He’s been a dedicated board member of many nonprofit organizations – including seven years working for Amnesty International USA – where he was the Director of Development and Chief Financial Officer. His time at Amnesty reinforced Steve’s life-long commitment to giving back to the community through charitable causes. Regarded as one of the accounting industry’s top thought leaders, he’s currently serving as President & CEO of GrowthForce, a heart-centered company with specialized teams providing accounting for nonprofits. Learn more about GrowthForce by connecting on LinkedIn.

Positive EOY staff morale + Strong organization leadership = New Year Success

Let’s face it, the last few months of 2022 are a vital time for organizations! You’re trying to reach new goals, set new initiatives, and plan for the incoming year. During this planning, your staff can feel burned out. Consider your staff’s workload, scrambling to make year-end goals, and let’s not forget: their personal lives going into the holiday season.

Don’t fret; we’ll be going through some initiatives to take to stay productive and refocus for a New Year.

How to Stay Productive

Throw a Holiday Party

It doesn’t have to be fancy. It doesn’t have to be expensive. It just needs to be fun. Throw a party that your staff will look forward to. Long work days are a little more bearable when a party is on the horizon. You can host a luncheon during office hours or have your party at a restaurant on a Friday night so your employees can bring their spouses. Either way, make it special. Decide on a couple of games or maybe even a white elephant gift exchange. Whatever you do, make it worth the hard work they put in all year.

Plan Out Holiday Social Media Campaigns

Social media can be fun for your target audience as well as your employees. Have them brainstorm a special giveaway or a fundraising campaign. Be sure to make it holiday-themed to keep your staff and audience interested. If you struggle to keep your social media channels active, scheduling out your posts in advance can help you stay on track.

Maybe you can partner up with a local coffee shop or restaurant and give away a coupon or gift card to anyone who comments on a photo or likes a post on Facebook. You could also have your donors match the number of likes a certain post gets by the time New Year’s Day comes. Have your employees run with the idea and let them have a good time with it. It’s something that’s a little different and special during the holiday season, but it still maintains productivity.

Show appreciation

Your staff works hard all year, so be sure to recognize them. Hand-write thank you notes with a gift card inside or offer a Christmas bonus. If you can’t afford to be financially generous, that’s okay. Just let them know they are appreciated. It will keep them motivated to do their best when they’re feeling burnt out. Expressing gratitude for your support network is a priority, bump it to the top of your list. If you know this is a priority but seems like a daunting task, get creative. Gratitude can be displayed in several ways and there are plenty of tools that can help including automations and integrations that build deeper, more personal relationships with your donors, staff, and support network.

Set goals

Set some end-of-the-year goals for yourself, your organization, and your staff. Having one common goal to work toward will keep you and your staff productive as the year draws to a close. Make the goal visible in your office so everyone can see it and be reminded of why they do what they do.

Give them a reason to be productive

Make sure your organization is having some small successes along the way. Try partnering up with a for-profit organization. Maybe for every $20 made, a for-profit company will donate a percentage to your organization, or something similar. Don’t worry about burdening the company. They have the resources to carry out orders and produce merchandise, even though this is their busy time of year, too. 20 percent of annual retail sales occur between November and December, so your organization might benefit from that.

When your staff sees that your organization is doing well and making a difference, they will be on board and ready to work until the holiday comes.

Work with them

It’s difficult to come to a balance between working your employees hard until the holidays come and letting the lack of motivation get the better of them. Stay somewhere in the middle, though. Be sure to allow the time off they need, but ensure you are staffed enough to continue their work. Understand their busy schedules and stressful lives, and they will appreciate you more.

Most of all, make sure you get the rest you need this holiday season, too, while preparing for the busy year to come.

Refocus for a New Year

Don’t Drop the Ball

Let’s fast forward, congratulations on your successful end-of-year fundraising campaign! After all the hard work put into the final fundraising push of the year, you deserve the extra plate at Christmas dinner and the extra drink (or drinks) on New Year’s Eve—cheers. But now that the year is over and the ball has dropped, it’s time to make sure you’re not dropping the ball. Here are a few things you can focus on in the first few months of the new year to ensure success for your nonprofit.

Follow up

Just because your holiday giving campaign ended doesn’t mean its success has to be stuck in the past too. Use the leftover momentum to start the year off on the right foot.

Start by following up with new donors who showed interest during your campaign. Obviously, thank-yous are a must—your donors will love ’em and your mom will be proud—but consider some other ways to follow up too. For example, you could send a short survey to donors. Ask them why they donated and what other causes they support, and don’t be afraid to ask a question to get some more specific information that will help you improve your future fundraising efforts. If you rely on volunteers, ask these new donors if they want to get a little more hands-on and take things to the next level by joining your team of volunteers.

Wrap it Up

Have some fun in documenting the memories, performance, and achievements from the previous year. An annual report is a common publication of nonprofit organizations, an annual report should be a distinct piece of your communications and marketing assets. Since annual reports are big projects, it’s okay to expect more of this signature piece. This signature piece should provide clarity and accountability, inspire conversation, honor supporters, give readers something easy to remember and hard to forget, and showcases your nonprofit in all it’s glory. So get out there and show off a bit. Wrap up your previous year in a beautiful annual report.

Don’t get overwhelmed. An annual report is a complex beast of a project…or is it? A lot of meetings, stress, and far too many words are often put into these temporary snapshots of a nonprofit’s work. This guide breaks down these reports into an easy-to-follow outline while using the “5 W’s”: Who, What, When, Where, and Why.

Plan for next year

I’m sure the last thing you want to do in January is a plan for November and December. But the sooner you get in the film room and review the game tape, so to speak, the fresher it will be in your mind once the game day arrives. Take some time to identify your nonprofit’s successes and shortcomings you noticed during the holiday giving season and put pen to paper.

Don’t overthink it. Start with some open-ended ideas on what went well and what can be improved and thank yourself later because these notes will be helpful when the time comes to start planning. Be sure to get the final donor numbers down in writing and compare them to your expectations and previous years’ efforts.

Fight the post-holiday slowdown

The way to combat this is to do a great job of telling your story and pushing your brand to its constituents. Use social media to tell people what you’re up to. Put together some numbers that illustrate your successes during the last calendar year and make them available to your stakeholders and the community – show people where their donations went and how they helped. Use any interview requests or press opportunities to further your organization’s narrative. If journalists aren’t knocking down your door, go to them by pitching your story ideas to the media and posting unique and relevant blog posts. As always, the more you’re in front of your constituents and your community, the better. Putting even more focus on fundraising now will go a long way in preventing a slowdown in contributions later.

When a sports team ends its season, they get an off-season; time to recover, and a chance to reflect on the past year before starting again. But do you think those athletes are propped up on a beach with a cold one in hand the entire time? They’re using that time to hone their craft and improve themselves, they’re in the gym and the film room, doing whatever it takes to be better than the competition. And don’t kid yourself, you have several worthy competitors of your own in your community for a donor or volunteer to consider working with. There’s no offseason for nonprofit professionals. We have to reflect on past efforts and plan for the future while continually putting our best foot forward each and every day. 

About the Authors: Kayla Matthews and Randy Hawthorne. As the former Executive Director and Editor for Nonprofit Hub and a Professional Certified Marketer, Randy shares his passions of marketing and education with nonprofits to help them implement marketing and organizational leadership principles so they can grow their organizations. Randy lends his marketing and organizational leadership expertise to a number of nonprofits in his community. Outside the office, Randy works with high school and college students and mentors young professionals to develop their leadership and entrepreneurial skills.

Originally published 12.28.15—Updated 11.17.22

Try to Please All and You Will Please None: How Segmenting Your List Can Increase Engagement and Charitable Giving

Have you ever used these communication strategies with your nonprofit community members? How Segmenting Your List Can Increase Engagement? 

• Emailed the same message to everyone on your list every time.
• Rarely communicated so as not to “bother” anyone. 
• Relied on just one or two channels to get your message out. 

If so, you are not alone! 

Most organizations we’ve worked with have struggled with at least one, if not more, of these communication challenges. 

And that’s because trying to please everyone using the same methods and strategies is impossible.  

That’s right, your donors, staff, board members, leadership, volunteers, and program participants all have different needs, interests, and behaviors: 

• Some people want to hear from you more. 
• Others want to know less. 
• Some donors read their emails several times daily, while others don’t even have an email address. 

This means sending the same letter to everyone could be wasting resources and potentially hurting your relationships with them at worst. 

So how can a nonprofit like yours “please everyone”? 

Unfortunately, you can’t! 

Here’s what we do know after working with hundreds of nonprofits over the years: 

There are better ways to communicate with your supporters than throwing spaghetti at a wall and seeing what sticks. 

Or worse, ghost your audience until it’s time to ask for a gift. 

If finding that sweet spot of communicating with your donors is difficult, let’s talk about one way you might relieve some of the stress in the system: Segmentation. 

What is segmentation?

Segmenting means dividing your supporters into groups with similar characteristics. 

For example, a school might segment its database into current parents, alums, and parents of alums. Each of those groups could be further segmented into decades or by individual class year. 

By speaking to a smaller group of people within your community, you can send a message that says directly to them and connects over a shared experience or common interest. 

Segmenting has enormous benefits. It has been shown to increase click-thru rates on email campaigns by 15%, according to MailChimp! Hands down, it’s the best way to ensure constituent groups get what they need at the right time. 

So how do you segment a group of supporters?

That’s the million-dollar question! Truthfully, it will vary from organization to organization, and the possibilities are endless. 

Here are some basics to consider:

• Giving history
• Event attendance
• Relationship to organization 
• Demographic info
• Behavior
• Preferred communication method
• Interests

Let’s take a closer look at these categories.

Giving History 

Giving history, including gift date and amount, is the single marker for which every organization, regardless of size, should be segmenting. 

Why? Because you most likely wouldn’t send the same “thank you for your gift” response to a person who just gave $50 as the person who has $5,000, at least not with a separate follow-up and stewardship plan. 

Their levels of investment are very different, and they’d expect different levels of engagement from your organization in return.

Event Attendance

Consider tracking attendees and no-shows when you hold an auction, gala, race, meeting, or another event. After the event, you can quickly sort and customize the message from “thanks for attending” to “sorry we missed you.” It also becomes much easier to invite past attendees in the future. 

Relationship to Your Organization

Who volunteers for you? Who serves on your board of directors? Who participates in your programs? Knowing who does what is key to personalizing your communications. 

It might be a single line of text that differs from one group to another, or you might have an entirely different communication strategy. Whatever the case may be, put yourself in your supporters’ shoes and think, “How do I feel when I read this?”

Reading a “Dear Friend, thank you for your support” letter is much different than the one that says, “Hi Debbie, thank you for volunteering at the Linky Din 5K!” 

Delight your people with personalization, and they will return the favor. 

Demographic Info

Should you track age, gender, geographic location, income level, marriage status, and the like? Sure! If you can. 

Generationally, we can see trends in giving and philanthropic interests, although we’d also caution that making assumptions based solely on any of these characteristics could flop. 

That said, you might have a case where you’re appealing specifically to women and want to highlight a shared experience. Or perhaps your national organization is serving a unique need in a particular city or province, so segmenting by location could be very helpful. 

However, you decide to segment based on demographic information and your plan.

Behavior

Segmenting by behavior is a terrific way to target a particular audience. Some CRMs and email platforms will do it automatically for you. 

For example, what if you saw a whole bunch of people open your last email but didn’t click through? Perhaps you could send a follow-up note to those who showed interest and entice them with a personalized message. 

This is a powerful way to send targeted communications through email, and it might be worth looking into.

Preferred Communication Method

One version of the golden rule is to communicate with supporters the way they communicate with you: 

• Do they text you after you leave a voicemail? Text that person back. 
• Are they quick with email? Great, make sure they’re on your email list. 
• Don’t have an email but respond to your direct mail appeals? Keep sending those letters – it’s working! 

To get this information, consider sending out a survey with the communication options that you can accommodate. Providing a list of 6 or 7 methods you can’t honor doesn’t do any good. 

Interests

Your nonprofit might have a single focus, or you could have several arms that work together to solve a problem. If you’re able to speak to people who are interested in one particular area of your organization, by all means, try to segment them out. 

For example, a large medical nonprofit might send a research-focused newsletter to its science lovers. Another segment might be focused on education initiatives, patient success stories, or tales from the front-line workers. 

No matter the size of your organization, segmenting by interest can keep engagement up and help reduce the number of unsubscribes to your email list. 

Steps to segmenting your list:

If it seems like segmenting is a no-brainer, you’re right. However, it’s not always easy to execute in practice. 

1. Start small – choose one or two areas to focus on and test them out. You can always revisit and adjust your segments as you learn more about your audience. 
2.  
3. Determine your messaging strategy for each segment. Will you write a unique message for each segment, or change a small part (a line, a paragraph, the offer, the ask)? 
4.  
5. Develop key message themes you’d like to send out regularly (appeals, receipts, thank you’s; newsletters, emails, surveys)
6.  
7. Decide how often (weekly, monthly, quarterly) and through which media channels (social, email, direct mail) you’ll communicate with each segment.
8.  
9. Track as much data as you can from each segment and use that data to make adjustments in your subsequent communications. 

Overcoming hurdles

In an ideal world, communication between an organization and its supporters should be ongoing, relevant to their lives, and done through the channel(s) that they (the supporters) prefer. 

The most difficult challenge to overcome is bad data. Wrong, missing, outdated, or duplicate information can lead to some folks being left out and others getting double-asked. 

If your organization uses a spreadsheet for your constituent information, it might be challenging to track critical segmentation data. It’s also hard to sort by multiple characteristics in a spreadsheet and not end up with mistakes or duplicate emails being sent to the same person.  

How can you segment efficiently? 

With a good system. 

Investing in a CRM with excellent reporting capabilities, such as fundraising manager by Salesforce, might be a logical next step. Are you looking for your LYBUNTs? Your volunteers? Your donors over $5,000? A master database with all your donor and constituent information allows you to pull segmented lists with just a few clicks. 

Ultimately, personalization matters significantly to your organization’s bottom line, and it doesn’t have to be complicated. So if you’re not yet segmenting your lists, I hope this article gave you some food for thought and a little inspiration to try segmentation.  

>> Co-written by Amanda Cowart of Red Rock Communications.

“Amanda Cowart is a content writer specializing in nonprofit fundraising, email campaigns, and website copy. She is a regular contributor to cloudStack Services, a Salesforce implementation partner for nonprofits.”

 

Cut costs just in time for budgeting season.

1. Pay less for processing credit card donations or don’t pay at all

How would you like to increase your annual donations by up to 4% without adding any new donors? It sounds too good to be true, but it is. Studies show that 50% of donors will pay the processing fee for their donations if given a choice. See, I told you that you might not pay at all. Now you get more and pay less. Plus, you haven’t added any new donors.  Instead, you empowered and maximized your donor base. How cool is that? Imagine what you can do with that much more money! 

Cash discounting is the industry term for when a donor opts to pay the fee. You need a way to implement it for sure. Well, let’s get that done. At your donation checkout page, if you have the right payment processing company, you can add a box for the donor to choose whether or not to pick up the tab. Now that the donor has paid the fee, you’re getting that much more for your charity. 

Tidal Commerce offers solutions for nonprofit payment processing for nonprofits or for those looking to start a new nonprofit that helps your donors give more. It keeps their data 100% secure and grows your mission. Their program gets members an approximate effective rate of 2.15%, which crushes the competition. Some organizations are paying up to nearly 6% to process a credit or debit card donation, with an average range of 3-4%. Let them do the math to demonstrate the difference between our effective rate of 2.15 and your current rate. They will discover the tremendous impact on your organization’s bottom line.

Tidal Commerce, a Nonprofit Hub Business Member, offers a free rate analysis and approximately two business days turnaround time. Simply provide them with your last two statements. They crunch the numbers and return a no-obligation quote. During that discovery phase, it sometimes uncovers that a company offers you that shiny low rate, but by adding higher per-transaction fees, they make up for it on the back end.  For example, instead of paying $.10-15 per transaction, they charge you $.30 per transaction. That takes the luster off that sparkling rate because you now learn what effective rate you actually pay. Very sneaky on their part. 

The Hard Truth:

Not every payment processor can do cash discounting. Sometimes your software company doesn’t like it when you inquire if it’s possible or if you can switch processing companies. That’s because some have a revenue-sharing partnership with whomever they signed you up with when you bought their software. And sometimes, that processor has a high rate and offers nonprofits no rate considerations. In that scenario, the only one who loses is your wonderful organization. It’s not transparent or even nice, to say the least.

Outcome:

Being the genius that you are, you did your homework by contacting your software company. Or perhaps you managed it some other way and asked your website hosting company, “hey, how can we do this?” At your next company meeting, you presented your fabulous new idea to implement cash discounting and got a resounding YES! You might even get a round of applause. Because you made this happen, the next budget meeting makes it possible to add a new program or new employee, or new equipment or food or clothing, or shelter. Whatever your charity does, it now does that much more because of you. Bravo! Pat yourself on the back, you shrewd and savvy person.

2. Seek out the deals and discounts that companies love to give to nonprofits:

Some businesses want to support your excellent work through less expensive plans and nonprofit discounts.

• You can usually save money by paying for subscriptions annually instead of monthly. If the company offers no discount of this kind, there’s no harm in asking for a nonprofit deal. Once you put it out there, you might be pleasantly surprised by the response.
• TechSoup is a website that exists as a resource for finding discounts on software,  technology, and services for nonprofits. They list names such as Microsoft, Adobe, and Intuit.  Now those heavy hitters put out products that help any organization. 
• Use your Nonprofit Hub advantages to your advantage. The Nonprofit Hub’s Good Referral Directory is a database of nonprofit solutions providers, several of which offer nonprofit discounts. Find the ones that suit your needs and unlock the savings to help improve your organization.

3. Strengthen your volunteer program

Volunteers are part of the lifeblood of your organization. Many people want to help and get involved but don’t know how. Sometimes they do not know about a nonprofit operating in their area and if they discovered it. Perhaps they become a volunteer. Deploying technology and recognizing the volunteers’ needs requires flexibility. It’s vital to educate volunteers before they dive in. These elements are crucial to growing, energizing, and maximizing the efficiency of volunteers. After all, you should strive to make their experience a positive one.

Wow, that sounds like a lot to digest.  Have no fear; it’s easier than some might think.  

Technology is your friend!

On average, people spend 147 minutes on social media a day.  You have many avenues to energize your volunteers and tap into new ones. You can use Facebook, Instagram, LinkedIn, Twitter, Tik Tik, or other platforms. You don’t know who’s waiting in the wings to answer the call to action.

Some tips for pulling in, obtaining, retaining, and effectively utilizing volunteers include:

• This is the big one. Utilize or create social media accounts with the name of your organization. It’s a no-brainer, but nothing else happens without that being in place. On LinkedIn, I have seen charities of all causes and sizes. Not only the organization profile but the profiles of members. Some have had as few as two members, but those members have followers, and those followers have followers.
• Once you have created your organization’s profile page, see who amongst your employees or volunteers has a profile on any social media platform. Ask them if they are willing to provide information about your charity. Strength is in numbers. The larger the potential audience, the more potential to get new volunteers. You’ve planted seeds all over the place, and now see what kind of harvest you get.
• Now that you have strengthened your social media presence, it’s time to put some more hustle behind that muscle!  Put up posts about previous volunteer events. Post photos and feature volunteers on social media. Many people love to see themselves in action! Describe the impact of the event. For example, “thanks to all of you, we raised more than $5,000 to help cloth.” Or, “feed or provide medical care.” Maybe you even have a specific story of one person and what it meant to them. You’ve made it look fun and rewarding. Now you’re cooking.
• At the bottom of these posts, have your contact person’s information and ask for volunteers for future assignments.
• Ask for volunteers online for every event. I suggest doing this multiple times before the event. You should clearly state what openings you still have or need. Some people become more motivated when they see how near or far you are to your goal.
• Now you have to reel in those volunteers by offering them flexible assignments with specific requests. You should mention you provide training and support. Remember how you felt when you started your job? That’s how these people likely feel, excited but in need of instruction. One bad experience might sour your organization. During one of my volunteering experiences at a charity run, they led us to a place where we were at a “watering station”.  We ran out of water!  We could cheer on the runners and walkers at that point, but that’s it. It wasn’t awful, but it shows how some planning might have helped us help those people on a warm summer’s day.
• A good experience equals good word of mouth. On average, a person with a negative experience tells at least ten people. Conversely, those with good experience only tell one or two people. Get those positive vibes flowing!

There you have it! You now have three ways to bolster the income, decrease expenses, and attract new volunteers. In addition, you have another outlet for those in need to discover your organization. Thank you for reading and considering my suggestions.  Most importantly, though, thank you dearly for what each and every one of you do to help make this world a better place.

Smoothing Turnover Transitions: Overview and Process

Employee turnover is an inevitable part of running a business. People move on for a variety of reasons. Still, no matter the situation, these events can significantly impact every organization and the remaining employees who shoulder this burden. Without a transition strategy, a teammate’s exit can leave a hole in your organization. This can cause overworked, stressed employees and a loss of critical institutional knowledge.

 

With proper planning, such occurrences do not have to disrupt your workplace significantly. This guide will discuss the importance of transition planning and detail the steps to establish such initiatives.

Employee Turnover Is Part of the Business Lifecycle

In any business, the fluidity of its workforce is constant. Some transitions occur due to promotions and reorganizations. You can manage these changes. When the turnover results from an individual separating unexpectedly – either involuntarily or by their own choice – having a plan to maintain productivity and day-to-day operations is vital. 

 

No organization can eliminate unexpected turnover. But, how you anticipate and plan for such events directly affects the engagement and productivity of the remaining team members. Terminating an employment relationship can also negatively impact the organization’s ability to reach long-term goals. 

 

If the departing individual is a central figure, certain aspects of your business could grind to a halt. For example, financing may be at risk if the departing person is integral to your fundraising efforts and has special relationships with supporters. 

 

With upfront planning, you will be prepared to weather these unavoidable workforce changes and prevent serious disruption to fulfilling your mission. 

Why Organizations Need Transition Plans

When you have forewarning that an employee is moving on, you have the luxury of time. It allows you to create a strategy for filling the position and getting a new person up to speed. When the news comes as a surprise, it can leave managers flat-footed and coworkers overwhelmed.

 

Transition plans are essential to guide managers through these rough spots with actionable steps, not just theoretical suggestions. By identifying concrete tasks to complete, filling the position and acclimating the new colleague will be as seamless as possible. Checklists and other tools in your plan will alert managers to critical details. It ensures that key responsibilities and information sharing do not fall through the cracks.

Be Proactive – Have Your Plan Ready to Go

Waiting to put your plan together until you have an immediate need places you in a compromised position. Suppose the employee announces their intention to leave the organization with little notice or termination is effective immediately. In that case, you may not have sufficient time to implement a thoughtful transition strategy. You will play catch up, which only complicates an already stressful situation.

 

Once you have created your overall transition strategy, share it with your staff, especially managers and supervisors. If your team knows that the organization has prepared for these events, they may feel less apprehensive when they learn of a colleague’s plans and experience less burnout during the transition phase. 

 

Additionally, your plan should communicate organizational expectations regarding resignation and company obligations when an employee quits. An informed workforce will feel more confident that management has control of the situation. This allows associates to focus on their primary responsibilities – serving your constituents. 

 Establishing Your Plan

Typically, leadership and Human Resources lead in developing a plan’s framework. Many nonprofits do not have the scale to support a full-time HR function, so others, such as line managers, team leads, or office managers, may step into this space. Alternatively, you may consider hiring an outside consultant to assist you. 

 

Once identified, the team should scope out overarching principles, objectives, and guidelines applicable to any transitional situation. To be effective, the finer details of the transition roadmap should incorporate input from relevant stakeholders. In some cases, the development of these points may need to wait for an actual need to arise. In larger organizations, department-specific plans may be useful. 

 

One of the first activities to tackle when preparing a reliable transition plan is reviewing or drafting job descriptions. Up-to-date job descriptions serve two purposes. The first is to identify each position’s responsibilities. This will help management to grasp which tasks will need immediate attention when an employee vacates a particular role. Job descriptions are also the perfect starting point for writing job postings when you are ready to search for a replacement. 

 

Nonprofits are often nimble, with individuals wearing many hats, and their responsibilities frequently shift as the organization grows and focuses on new priorities. Regularly checking in with employees about their workload and deliverables can help keep your job descriptions current and your organization prepared to take action to fill an open position quickly. 

 

This is an appropriate time for organizations of sufficient size to review or consider establishing succession plans for key positions. 

Put in Place Standardized Practices 

Consistency in company-wide policies and procedures focusing on employee separations will make everyone’s job more manageable. These resources will also instill confidence in leadership’s ability to guide the organization through what is often a stressful time.

 

Specifically, policies and procedures related to promotions, separations, and terminations should be reviewed and updated to reflect current practices and address any gaps. As part of this process, give special attention to how the organization administers final pay, benefits termination, and exit interviews. 

 

Preservation of knowledge and data is also a key consideration. Employees should understand how to back up work, record tasks, and share know-how. Cross-training team members is a good practice because it broadens institutional knowledge and reduces the risk of hampering workflow. Also, it allows for coverage in a colleague’s absence for a short period (e.g., vacation or illness) or when an individual permanently separates from the organization.  

 

Handle communication about an employee’s departure carefully. Establish guidelines on sharing information about the separation. Keep in mind that it is crucial to identify who should be informed and to protect the privacy of all parties involved. 

 

If you are unsure if your policies are up-to-date and legally compliant, you should consider conducting an HR audit to identify deficiencies and areas needing improvement. 

What to Include

Organizations must design a transition plan that aligns with their business plan, culture, organizational structure, size, and work distribution. Strategies for small nonprofits may look very different from those implemented at larger organizations. However, all effective transition strategies include some standard features and action steps.  

 

Scheduling a transition or turnover meeting is a good starting point. This meeting should include HR, the relevant manager or supervisor, key coworkers, and, if possible, the departing employee. This may require more than one meeting.  

 

Topics addressed should focus on:

• Daily responsibilities
• Open or ongoing projects
• Key contacts and stakeholders
• Location of files (hardcopy and digital)
• Passwords
• Measurable objectives

 

Additional plan components include: 

• Checklists that spell out key tasks and timelines
• A talent search roadmap 
• Introductions to stakeholders, contacts, clients, and accounts
• Methods for preserving and transferring knowledge and skills 
  • Documentation 
  • Shadowing the outgoing employee or other team members
  • Training sessions
• Feedback and exit interviews
• Appropriate forums for wishing the departing employee farewell, so they leave with a positive impression of the organization

 

Things can move rapidly once an employee makes their intention to leave known. Maintaining an organizer (hardcopy or digital) housing all the relevant policies, templates, and checklists may help things run smoothly during this busy time. 

 

However detailed you decide to make your plan, with it in place, you will prepare to take immediate action upon learning of an employee’s pending separation from the organization. 

 Implementing Your Plan When a Departure is Imminent

Once you know a specific employee’s service is ending, it is time to customize your transition plan. You are now in the position to develop a concrete approach to the departure of a particular employee and fill that position. Where appropriate, involve the outgoing employee and seek their input to the extent possible.

 

The turnover meeting should be a priority, making an effort to schedule this meeting so the person currently on the job can attend. They know their role the best, and the information they share may make the days ahead less hectic. Before their departure, ask this individual to create an exit document outlining their daily tasks and overall responsibilities, highlighting unfinished business, and identifying files, data, systems, and other information that would be helpful to the incoming team member.

 

Ideally, the current employee and the new hire will overlap, even for a short timeframe. When this is possible, the veteran employee can provide critical on-the-job training. The new team member can shadow them and benefit from introductions to workflow, stakeholders, and organizational systems.  

 

For a variety of reasons, this observational period is often not possible. In these instances, managers and other team members will need to take on these orientation tasks, and it will be helpful for those on point to sit with the employee before their last day to gain as much insight into the function as possible. Depending on the circumstances, it may also be advisable to ask the employee’s opinion regarding whom on the team might be best suited to take on their duties while the company selects a replacement.

Careful Work Upfront Can Ease Future Stress 

As we know, preparation puts you in a better position to handle difficult situations when they arise. While you cannot plan for every contingency, employee departures are a known part of any organization’s life cycle, making it the perfect opportunity for pre-planning. Transition planning requires leadership commitment and the diligence of those developing the strategy. Still, all that hard work will pay off in the long run as you adeptly navigate future employee departures.