Adjusting When Things Get Tight

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By Chris Gandy 

Certainly there has been a fair degree of budget tightening flowing through the majority of our sector and the immediate outlook is to expect more of the same. From my perspective I have noticed this has increased the amount of hand wringing and blaming external factors but, alarmingly, not a lot of on the ground action to re-shape organisations to weather deteriorating financial conditions.

OK things are tough and every organisation faces slightly different circumstances but here are some measures, totally within your control, you can consider putting in place help your organisation thrive, not just survive, in the future:

  • Carefully review your manning – Clearly now is not the time to continue to tolerate poor performers. Those who aren’t pulling their weight need to be motivated to contribute or moved on. But as painful and possibly disruptive this may be, it is a “low hanging fruit” option which is reasonably small in dollar impact. Accepting that not for profits are great ones for holding onto traditions when it comes to human resource matters, a top to toe objective structural review needs to be conducted. And this is not just a numbers exercise but an examination of how all internal functions are delivered. Is outsourcing an option? Do we engage specialists in a particular function on a contract basis? Do we contract out some excess capacity we have to other organisations? These and other related options should be seriously looked at as, in all probability, it is your largest cost area.
  • Get real with finances – I recently attended a board meeting of a mid-sized not for profit when, during a discussion on a serious finance issue, a board member was asked for his view and replied: “Don’t know, I don’t do numbers”. Frightening stuff – but what was more disturbing than the comment itself was that none of his fellow board members raised an eyebrow and challenged him on this. Quite simply organisations today and in the future cannot hope to survive without the most robust reality-based accounting systems, controls and management. If your organisation does not have a sophisticated budget development process, cash-flow projections, and budget monitoring systems in place, it is time to start doing so. Along with a leadership commitment to make whatever budget corrections or management adjustments the numbers indicate are necessary.
  • Learn how to successfully drive change – How often have you heard a not for profit leader offer an excuse for not implementing a change by saying something like: “They won’t like it”. So what they are saying is that staff are likely to object so let’s can that idea. Remember the thing about the issue of change is that HOW changes are made is often as significant as WHAT changes are made. The change process must ease people along, have lots of communication, dialog, explanation, and opportunities for comments. And enable you to tie back each element of change to positive mission impact. THEY (the entire staff) don’t have to be thrilled, but a critical mass needs to buy in. Expect some inevitable objections and displeasure. If your organisation tries to wait for unanimous support before making changes, it’s liable to wait forever. Problem is, unless these pressing issues are dealt with swiftly the organisation won’t be around forever.

Chris is the founder and a director of Cause and Effective – an organisation dedicated to assisting cause-based organisations maximise their social impact through permanent and contingent resourcing

 

 

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B-Cause is published by Cause and Effective. Our goal is to inspire, inform and encourage people doing good to do even better.

Thats our take on things. Over to you, please add to the discussion.

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