Dealing with Chaos: Three Steps to Take Right Now

It’s been a chaotic and exhausting week. And, it’s only the beginning of threats to cut government funding of nonprofits.

To help you, we are framing three steps you can take – right now – to communicate appropriately, guide your board, and keep your donors informed.

These steps not only touch on fundraising but also on governance and organizational strategy.

1.  Communications: Educate your supporters about your budget and what could be at risk.

This is an excellent opportunity to share a robust explanation of your organization’s funding model. Help everyone understand what level of funding may be at risk.

It’s always helpful when your supporters can understand more about where the money comes from, and where it goes. A pie chart can be very helpful to communicate this breakdown.

Sharing this level of detail about your budget helps donors feel engaged and informed. You are showing them how their own contributions help make an impact. And they always appreciate financial transparency.

If you’ve done a good job of keeping donors feeling like they are in the know, then you have the door open to be even more forthright about the current financial risks you face.

Your donors may be surprised to discover how much of your funding comes from government sources. And how much of your budget may be vulnerable to government cutbacks.

Help them understand this, by simply explaining the bare facts. It will help set up future appeals for help mitigating any reductions in government funding.

2.  Board of Directors: Educate your board and strengthen your governance processes.

Your board may be faced with some strategic decisions very soon that could have major consequences.

It’s a great time to review governance procedures. For example, how functional is your board decision making process?

We recommend that you start with discussing such formidable topics as “how do we make decisions?” and “what’s the best way to make decisions?”

The reason I am bringing this up is this: in a crisis, boards may make quick decisions based on limited information that can have drastic consequences both long term and short term.

Don’t let your board run off into the woods and head in the wrong direction. Don’t let them make seat-of-the-pants decisions that could cripple your organization in the long run. Don’t let the loudest voices in the room inform your strategy.

Good decision-making is a process. It’s done slowly, with thought. It also:   

• Invites respectful, robust discussion.
• Is based on hard data and real facts – not people’s opinions or feelings.
• Considers what the impact will be of the decision – long run and short run.
• Invites input from various constituencies or departments that may be impacted by the decision.
• Examines potential consequences – “This means that we will . . . “

3.      Fundraising: Draw Your Donors Closer.

This is the time to pull your donors closer and closer. Remind them how wonderful they are to partner with your organization. Thank them for their commitment to our mission.

Start with a more emotional point of view in terms of why they believe in your work and what they are helping to make possible in the world.

Start with honoring your relationship, and then discuss money issues. Only then should you remind them about their gifts.

You can share how much their support means, and how much you value and appreciate their long term support and contributions.

After honoring their relationship, you can share the facts. They will be quite interested to know what’s going on!

It’s a great time to discuss your funding model: x% comes from earned income; x% comes from government support, and x% from philanthropy. This is probably something you’ve never shared with your donors.

Keeping your donors informed at this level brings them close and closer. Keep them in the loop. Send them updates regarding what’s going on and how your work is or may be impacted.

There is a story arc that is just beginning to unfold. You can share this story with your donors as it progresses – keeping them sitting on the edge of their seats to find out what is next.

Hopefully the story arc will have a happy outcome. We certainly can hope so!

Bottom Line: Dealing with Chaos – Successfully.

If you can pull your donors closer, share transparent financial information, and strengthen your governance processes, you’ll be in a better position to withstand a changing external environment!