Mistakes to Avoid When Running a Nonprofit
A lot of work goes into making a nonprofit run smoothly, and a lot can go wrong. Here are five mistakes to avoid if you want to keep yours afloat.
Running a nonprofit is admirable. It shows a desire to change the world and a willingness to devote oneself to a charitable cause.
Unfortunately, good intentions are not enough. Business sense, logistical skill, and leadership capabilities are also crucial.
“New nonprofits face significant challenges if they are to survive and have an impact,” writes Wolfgang Bielefeld of Nonprofit Quarterly. These challenges include lack of visibility, confusion about structure, overconfident leadership, and shallow systems.
To thrive, nonprofits must avoid these five common traps in their industry.
1. Under-investing in fundraising
Fundraising is a nonprofit’s lifeblood. You need to engage in it as much as possible.
That means allocating a fair percentage of the money you raise toward more fundraising.
Underinvesting in fundraising is the most common reason nonprofits fail, according to Joe Garecht of The Fundraising Authority.
“For most organizations, if they are spending as much of their fundraising revenue as possible on providing programs and services, that is a good thing,” says Garecht. “But many nonprofits don’t see their development operations as an investment."
2. Hiring the wrong people (and failing to manage them)
Nonprofits often make employment mistakes due to limited resources.
According to Siobhan Kelley of The Nonprofit Times, these mistakes fall into the following categories:
– Poor hiring practices: Be selective.
– Lack of record keeping: Maintain disciplinary and performance records.
– Opting for salaries instead of hourly wages: Research state regulations.
– Not firing problem staffers: Address toxic workplace behavior.
3. Failure to manage the legal side
To avoid legal issues, ensure you have proper governing documents in place and are familiar with nonprofit regulations. Be willing to make difficult decisions and manage conflicts of interest.
4. Lacking a qualified leader (or giving a leader too much power)
Effective leadership is crucial for a nonprofit’s success. Ensure your executives are competent and have the necessary skills. Avoid board members overstepping their role and meddling in day-to-day affairs.
5. Missing out on marketing
Promote your nonprofit through a well-designed website, social media, and branding. Treat nonprofit marketing as you would for-profit marketing.
Jay Wilkinson of Firespring emphasizes the importance of investing in a functional and engaging website to increase donations, decrease expenses, and engage with your audience.
Closing thoughts
Running a successful nonprofit is challenging, but the reward is making a difference in the world and making it a better place.
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