Introduction
According to Giving USA, 2024 Report, donations by individuals are shrinking as compared to the other donors’ contributions. The report cites that this phenomenon reflects uncertain economic circumstances, including rising inflation, which peaked at the end of 2022, and remained relatively high at the beginning of 2023, and going into 2024. As individual giving is declining overall, it is important to streamline non-profit systems, reducing unnecessary overhead costs, and operate as lean as possible. Operating in a lean business model will allow the highest percentage of funds to be spent directly on socially impactful programming. One US-based global non-profit on the decline due to reductions in donations, wanted to adjust their business model and programming to ensure that they could manage through fluctuations in funding.
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In prior years, they kept the operations focused on only one country in Africa, and this allowed the non-profit to keep the expenses low and thus they could manage fluctuations in funding levels. As they began to grow operations to reach more participants in need, they required more funding to support the additional expenditure. However, you have to invest in marketing and staff in order to generate more donations, and without resources to invest, they had to accept the funding that was coming from individual donors who were already donating to the organization. This left the global non-profit no choice but to adjust operations in order to manage within their current structure.
Opportunities and Challenges
This global non-profit in decline had been in operation for almost 20 years, however they did not invest into the financial or operational systems to support growth and efficiency. The non-profit did not have written processes, technology or software set up and integrated. This hindered the workflow and created more manual work for staff. At the same time, there was no data to prove the impact of the activities, and no checks and balances to ensure fiduciary responsibility.
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The non-profit had expanded their footprint to two additional countries in Central America in recent years, and while the number of countries grew, the systems were not upgraded to ensure proper tracking and analysis was in place for decision-making purposes. Staff did not have clearly defined job descriptions to ensure streamlining tasks and workloads, and thus the non-profit could not manage the cash flow needs when the funding levels dropped below what the operations required.
The global non-profit was in decline because it could not manage the fluctuations in funding. They needed to find a solution to this challenge to ensure they did not have to shut down their operations and they could continue supporting the participants of the program.
NEXUS WIN Methodology
To tackle this critical issue, this US-based global non-profit on the decline worked with the consultants of Nexus Strategy and Growth Partners to focus on Revenue Growth and a new Revenue Model. After Nexus conducted a discovery period to fully understand the global non-profit’s opportunities and challenges, they moved forward with a Strategic Plan and its following initiatives that are part of the NEXUS WIN Revenue Methodology under the Pillar: Winning Foundational Strategy.
STEP 1
Assessed the current operations, financials, and management structure.
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STEP 3
Evaluated the programming model, costs, opportunities to generate revenue, and adjustments to staffing.
STEP 5
Planning for the longer-term solution, Nexus facilitated a process with staff and the board of directors showing a phased growth plan in management and operations.
STEP 2
Reviewed the current processes and capabilities of staff by conducting internal interviews with staff and the board of directors.
STEP 4
Focusing in on a short-term solution, Nexus made various recommendations to restructure the operations and management structure.
These strategic initiatives were planned and executed to directly address the challenges this US-based global non-profit on the decline was experiencing. Nexus facilitated sessions to assess all systems, personnel management structure, as well as programming models, and provided clearly defined recommendations to streamline all systems, reduce unnecessary overhead costs, and manage program delivery costs more efficiently.
Results
As a result of this strategic plan, the US-based global non-profit on the decline, implemented the recommendations that Nexus set forth and reduced their overhead costs by 500K monthly, while still providing top quality programming to participants.
These results exceeded their expectations and set a new revenue model and standard for their business model and operations. They could now continue building their fundraising efforts, while at the same time having control over their expenses. As some months showed less income from donations, the non-profit could still pay all of the staff salaries, other expenses, and programming. They were also able to use the adjustments made as a lean non-profit business model that showed very favorably on grant applications as more funds were going directly to programming instead of administration.
As Regional Director of Africa of a US-based non-profit on the decline, “I would highly recommend working with the staff of NEXUS as our non-profit is now in a place of empowerment, and a clear direction towards growth.”
Are you facing a similar challenge? Do you wish to make a breakthrough and achieve your most pressing goals like this US-based global non-profit on the decline did?
NEXUS Strategy and Growth Partners offers a free discovery session to help you gain clarity around your main challenges and how to solve them.
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We can help turn your biggest challenges into results, just like how we helped this US-based global non-profit on the decline, adjust its systems and program delivery to operate as a lean business model, and continue to provide quality programming to participants.