SWOT’ing Your Nonprofit

Why would you want to SWOT your nonprofit? Because it will help you understand your place in the nonprofit world.

Cloudlancer Writing Services offers writing services to for-profit as well as nonprofit businesses. For-profits absolutely understand the concept of SWOT, since they generally have to submit business plans to lenders. Nonprofits on the other hand, tend to view themselves as somehow above the normal tools used to evaluate a business. I firmly and emphatically disagree with that viewpoint.   

SWOT, or SLOT, used in the context of business planning, is defined as a Strength, Weakness (or alternatively, Liabilities), Opportunity and Threat analysis. Many nonprofits do not include one in their initial strategic plan, but every single nonprofit (and for-profit as well) should produce one on a yearly basis. You may not ever have to submit one to a funder, but at a minimum,  a properly constructed SWOT will keep your organization moving forward and prepared to succeed.

Many businesses, both for-profit and nonprofit, at least give a nod to the Strength and Opportunity components. The Weakness and Threat areas are often minimized or totally ignored in the company planning.

An honest assessment of your organization’s business health and mission success using a SWOT analysis can help you understand why you are not moving forward as quickly as you want to, why your funding requests are ALWAYS turned down, or even what to do to manage explosive growth. 

For example, perhaps your mission statement and mission execution don’t match, confusing funders trying to understand how their funds will be used.  Perhaps there are far too many nonprofits in your area addressing the same mission. Perhaps they are more established, better organized and have greater name recognition. There is only so much money available from funders, and if you don’t stand out, you may not get any of that funding.

Perhaps your nonprofit has always been the only one addressing a specific mission. Success breeds imitators. Are there suddenly several organizations all competing for the same dollars? Annual SWOT reviews should reveal that as a Threat. Did you recently lose a key employee in the fundraising department? Evaluate the impact to your organization by revising your SWOT report. Has your mission evolved out of its original focus area? It’s time to re-assess your presentation to prospective funders by revising your SWOT to deal with current reality.

Your organization may subliminally recognize that something has changed. Putting it down on paper forces you to recognize and deal with problems before they become crises, and allows you to be proactive, instead of reactive to changing circumstances.

If you have questions on preparing your SWOT analysis, give us a shout, and we’ll be happy to help.

Do You Need a Website?

Cloudlancer Writing Services usually sends a prospective client a questionnaire to assess organizational readiness to apply for grants. One of the questions asks whether they have a website, and for some reason, in the last two or three months, many organizations have answered “no” to that question, or indicated they have a simple page with their name and donation contact information only.

I absolutely recommend that your NPO have a well-designed and informative website. There are so many hosting services out there that have DIY templates, there is simply no reason not to have one. On the other hand, a really bad website is undoubtedly worse than no website.

The website should provide information as well as ask for donations. Many grantors will ask for your URL, and they may expect to be able to visit the website and receive information that may not be on your grant application. For that reason alone, you should have a website with the information they may be seeking.

The latest surveys of foundation-based grant funders indicate that approximately 20% have gone to a web-based application format.  That is an increase of 5% in two years. That is both a blessing and a curse. Aside from the Common Grant Application format, there is no standardization of these online application processes. Many of them are severely limited in space to provide your grant narrative, and they often do not have space to list your other funders. Others ask for your top five funders, sometimes with amounts, sometimes without amounts. Most of them do not allow you to send other data, such as expanded program descriptions, or documentation regarding funding. They may not ask for your board of director’s information.

A well-designed nonprofit website will answer many of the questions they may have. Smaller nonprofits with low budgets for web development should still strive to answer at least the five “W” questions; Who, What, When, Where and Why.  The website should provide donor recognition (your new donor may well expect some sort of recognition on your website) opportunities, news of events past and future, and some mention of your most outstanding accomplishments in the past year.

Your website should look and feel professional. What is acceptable on social media pages is often not acceptable in the business world. If you must take a really informal tone, provide a link to your Facebook or other social media page. Typos, poor grammar, slang, and Twitter-style writing does not belong on your website.  I actually looked at a website recently whose landing page started out with “Hey there dude, whazzup?” Somehow, I don’t think the review board of the Carnegie Foundation will be impressed. If you don’t feel that you can present just the right impression, we can help you to achieve that balance between professional and empathetic.

Your website is your organization’s online persona. It’s the first impression many people will have of your organization. Make it a good one.

ASPCA Emergency Funding for Hay Purchases

A grant for nonprofits specializing in equine rescues has just opened at ASPCA.  The website states that they will fund from $5,000 to $10,000 for emergency hay/feed relief, with preference given to organizations in drought-stricken areas.  They may also consider applications for rescues affected by Hurricane Isaac. See the full informaton at:

http://www.aspcapro.org/aspca-equine-fund-hay-bale-out.php

If you need assistance, please don't hesitate to contact Cloudlancer Writing Services at www.cloudlancerwriting.com

How do nonprofit funders assess your financial health?

Here at Cloudlancer Writing, I often counsel nonprofits on positioning themselves for maximum competitiveness when applying for grant funds. Mission is important, the ability to show results is important, program development and documentation is important, but financial accountability and sound management of funds is equally, if not more, important. When you move out into the larger philanthropic world, it increases the need to be as professional as possible. These people do not know you, and they have to have a way to assess your organization. The best prose in the world is not enough to put your organization at the top of the pile when applications are reviewed by national, regional or government agencies.  Your local philanthropist may be able to come to your office and chat with you, but larger organizations typically do not visit every nonprofit that they fund.

Many nonprofits have specific financial methodology for deciding which nonprofits should receive funding.  One example of such a tool can be found at:

 http://nonprofitfinancefund.org/files/images/initiatives/financial-scan-sample-report.pdf. 

This report format, which was developed with considerable collaboration with a major financial institution, is the epitome of the formula-based evaluation and uses the data obtained from your 990. It reads and functions like a loan evaluation form. Other foundations have their own, perhaps less rigid formulas that they have developed over years of experience with the nonprofit sector. The common denominator is that all of them seek to discover whether your nonprofit can survive and accomplish its mission.

As I have often stated, in many ways the criteria by which grant funding is awarded is no different from that used by a bank or loan company to loan funds. The only difference is that your nonprofit doesn’t repay the funds in cash. Rather, the use of the grant funds is justified from the grantor’s standpoint if it is used effectively to advance whatever cause or mission they are supporting. Since these particular dollars will never be repaid, the criteria for disbursing them can be, and often is, even more stringent than a loan application.

No funding agency, whether philanthropic or not, wants to see the dollars they provide squandered. Your nonprofit track record of getting maximum good out of the dollars you have been given is the charitable equivalent of a 900-point credit rating. No matter how great the need, no matter how committed your organization is to its mission, if you can’t prove good stewardship, your application is likely to be rejected.

I do not necessarily subscribe to the idea that all nonprofits must “solve” a problem to be considered for funding. Sometimes, the best that can be achieved is mitigation of the issue at hand. If your nonprofit supports victims of domestic violence for instance, your single organization can’t eliminate all the root causes. Poverty, substance abuse, illiteracy and a myriad of other factors enter into the equation. What funders DO want to see is that you are having a measurable and sustainable impact. Perhaps it’s a program to retrain the people to obtain a better income. Perhaps it’s substance abuse counseling. Perhaps it’s simply a way to be removed from the violent situation. If you can show that the dollars you were granted are providing solid, measurable results, and that you can support your daily operating expenses, that is usually enough to meet the grantors expectations.

To provide that proof, and keep track of your results year-over-year, you will need sound financial reporting, a program that provides for a clear description of the problem you are addressing, and clear result-based reporting. That is what funders are attempting to measure, using not just glowing accolades, but financial evidence that you have a defined mission, that you spend money wisely to gain maximum impact on the problem, and that you have a clear path to sustaining the program even without their specific funding. When applying for funding, don’t start out with a built-in roadblock. No matter how small your nonprofit is, good financial recordkeeping will help to position you for success.

If I Could Assemble the Perfect Board of Directors

Because I deal with numerous small and newer nonprofits, I see many ineffective boards. Not bad boards, in the sense that they are disinterested, or self-serving (those tend to crop up more in long-established organizations), just good people with good intentions and a lack of organization and little to no understanding of what a nonprofit board is supposed to accomplish.

The first board of directors for new NPO’s is typically comprised of people united in their vision for the organization. They took the steps to “make it happen”. They are emotionally and often financially invested in providing goods or services to needy populations of one sort or another. They are the “founders”. That’s a great place to start, but the very closeness they first enjoyed, eventually leads to a sort of organizational paralysis. 

The Board, by definition, is not supposed to perform the daily duties of running the organization. They are supposed to formulate policy, generate the first budgets, write and approve the first strategic plan, and provide ongoing ethical, financial and legal oversight (governance) for the organization. At the outset, the lines between employee and board member are going to be blurred.  Most initial boards do not observe a firm policy for term limits and recruitment of new board members.  They may have such a policy in the bylaws, but in reality, their investment in the organization makes it very difficult to add new blood.

If I could design the perfect first board, I would envision it as having enough members to form committees or at least to have “specialists” in one area or another.

My ideal board would have:

A.  One member with a financial background, to evaluate investment strategies and assess the financial statements with a professional eye. This could be a CPA, a banker, an investment broker or anyone that deals with numbers and finance on a daily basis.

B.  A marketing/public relations/fundraising professional to evaluate fundraising and campaign strategies.  

C.  An attorney, to ensure that the NPO doesn’t run afoul of the myriad regulations governing nonprofits.

D.  One or more business owners or managers, to provide common sense perspectives on the organization.   

E.  The founding members, to keep the passion alive.

If the founders themselves encompass these attributes, fantastic!  If not, I would advise them to recruit members that do, at the outset.   One caveat here…although I recommend having professionals on the board, remember that they can’t benefit monetarily from those skills as contractors to the organization while they are serving on the board. Your financial person can’t be the CPA who performs your audit, for instance.

And, as hard as it may be, plan on adding new people to the board on a regular basis.  That might be every two years, it might be every four years, but recruit, evaluate and add them regularly. Of course, that means that at some point, someone is going to have to “retire”, or you are going to have a 500-member board.  Plan for that in your initial bylaws, and accept that if new members are properly vetted, they will be an asset to the organization.