A recent report from the AP shows that nonprofit giving has declined for only the fourth time in 40 years. With the very real probability of a looming recession and our prediction of an increase in nonprofit CRM costs, it’s time to take a holistic view of where your nonprofit financial stability comes from. We can think of this like three legs of a stool. All three are crucial for a stable financial base.
Fundraising
Increasing fundraising revenue is a top priority for nonprofits and with good reason. Nonprofit financial stability depends on money consistently coming in. But just trying to boost fundraising without a clear understanding of trends and patterns can lead to a lot of wasted effort. Analyzing your giving data can help ensure that you don’t leave money on the table.
Diversifying
Nonprofit financial stability also requires protecting yourself from sudden changes of fortune. Nonprofits can often be devastated when a major source of funding goes away, such as when an expected grant doesn’t get renewed, a major donor gets disgruntled, or a corporate sponsor changes their strategic goals. Good data management practices can help to ensure that you are keeping current donors happy and make you aware of opportunities to further diversify your revenue streams.
Efficiency
Nonprofit financial stability also requires not wasting your work effort. You pay your staff to get work done, and if inefficiency keeps that from happening, then you are wasting money. Think of it like heating your home. You pay for power to keep your home warm, but if it’s poorly insulated, you pay more than you need to. Likewise, you pay your staff to power your operations. Inefficiencies reduce your staffing ROI and increase burnout and turnover, which adds to your costs.
***
Don’t underestimate the importance that quality data technologies play in the financial stability of your organization. The right tools can increase efficiency, help keep your current donors happy, and give leaders better information to make smarter strategic decisions.
Do you want more financial stability for your nonprofit?
Schedule a free, no pressure consultation to discuss your concerns with a data expert.
David J. Dunn
David is the founder of Undaunted Consulting. He specializes in data management system optimization and rapid app development for social service, social justice, and environmental justice nonprofits.