Inside Philanthropy

A blog on philanthropy and nonprofit news and issues. A publication of Philanthropy Journal.

July 5, 2011

Investment needed in nonprofit operations

By Todd Cohen

Communities need a break-through strategy to provide the operating support that is critical for local nonprofits.

That will require true leadership from philanthropic and community leaders.

Instead of empty talk and posturing about how important nonprofits are, local leaders should create pooled funds that would invest in the fragile infrastructure of local nonprofits.

To raise those funds, which could be housed at local community foundations, civic and business leaders need to dig deep into their own pockets and also wage a forceful public campaign to raise money from philanthropies, corporations and individuals.

The campaigns should enlist local media, including newspapers, broadcasters, communications firms, social media and bloggers, to help tell the story of nonprofits.

That story is simple: Nonprofits are indispensable to our communities, and they are hurting.

Nonprofits take on our toughest jobs, the ones government and business either ignore or only talk about.

It is the mission of nonprofits to address the symptoms and causes of our most complex social and global problems, and they are heroic in their continuing effort to stretch their limited resources to attack those problems.

And their organizations have been stretched to the breaking point by an economy wasted by the greed of the financial-services industry and its cronies, particularly the housing industry.

Demand for the services nonprofits provide is rising because the crippled economy also has devastated the lives of nonprofits’ clients.

Nonprofits often lack the organizational capacity to operate effectively because they lack the investment they need in staff and board training and in planning, fundraising and technology.

Their boards typically are oblivious about what their role should be in developing a vision and strategy for the organization, and in contributing and helping to secure the resources the organization needs.

And funders and donors, disconnected from the realities of the charitable marketplace and of the day-to-day job of running a nonprofit, are locked into funding priorities that focus on pet programs and ignore nonprofits’ fundamental need for operating funds.

Funders also increasingly require that nonprofits provide “metrics” that show the impact of the funds they receive, a requirement that simply adds to nonprofits’ workload.

Yet funders fail to make the investment nonprofits need to handle that additional workload.

After the economy broke down nearly three years ago, organizations and individuals in some communities stepped up and created pooled funds to support basic and emergency services that nonprofits provide to people in need.

The creation of those funds reflected true leadership and commitment, and can be a model for establishing funds to provide the operating support that nonprofits desperately need now.

Leadership is one of the most overworked words in the nonprofit sector, a term typically used to describe someone with a forceful personality who talks big but often fails to actually do anything except pursue personal ambition.

True leaders talk quietly but authentically, and they lead by serving.

What our communities need today are servant leaders who are willing to champion, with honesty, conviction and commitment, the need to provide the operating capital that community-based nonprofits need so they can continue to serve people and places in need.


  • At 11:55 AM, Blogger David Geilhufe said…

    "Nonprofits often lack the organizational capacity to operate effectively because they lack the investment they need in staff and board training and in planning, fundraising and technology."

    This has been true for quite awhile, but we haven't been able to credibly tackle this issue, at least in the technology part of the space.

    There seems like a real need to come up with different models of achieving capacity building that are more commercial in nature.

  • At 2:11 PM, Anonymous Anonymous said…

    Telling the community that we are "hurting" and "stretched beyond the breaking point" is like asking for funding for a sinking ship. Stories do communicate the importance and need for an organization, but with many potential supporters ignoring mail, email and even facebook messages these days due to over-stimulation, we struggle with getting even positive messages across. Staff and overhead resources are sorely needed, yet common knowledge of the subject dictates that non-profits not ask for funding for these things. Forget a raise, non-profit staff are finding that they must choose between a less-than-livable wage and being unemployed. What is the solution?


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