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The Quest for the Sustainable NGO

PCDN Global

January 5, 2016

I recently had the pleasure of training a dynamic group of young NGO leaders on the fundamentals of fundraising, who asked some tough questions during the session. "Are we organizations or movements?" "What if a donor pressures you to promote their political agenda?" "How do we make ourselves sustainable?"

When Changu Siwawa, herself an NGO leader, saw my online post about it, she asked me to share some ideas about sustainability. In response, here are my thoughts on positioning an organization for long-term resilience with links throughout for further reading:

  • Define Sustainability: The term is thrown around a lot by donors and implementers alike. As one blogger points out, sustainability as a concept can be problematic and “is in large part determined by funders, not nonprofits.” What does it mean for your organization and its mission? Is it less reliance on one specific donor? Having enough funds in reserve to keep serving your constituents during tough times? Once your vision for sustainability is clear, you can better set concrete targets and move closer to meeting them.
  • Improve Efficiencies: This isn’t about lowering your overhead in order to please funders—there’s a lot more to it. I mean using existing resources wisely and eliminating redundancies in programmatic and administrative processes. Hire and retain the best staff possible, including good finance staff, and encourage your teammates to thoughtfully critique procedures and make improvements. Build relationships with businesses whenever possible and ask for discounts on products and services. And maximize volunteer time where it makes sense. Efficiency lessens the overall burden on fundraising.
  • Focus Your Time: If you’re an NGO leader, what’s the best use your time? What percentage should you, on average, spend on fundraising? On general outreach to raise awareness of your organization, build strategic partnerships, etc.? Discuss with your leadership team and your board and ask for honest feedback about what would best help your organization with its stated plans and goals. Compare notes with your peers to see how other leaders spend their time. Revisit this on a regular basis, as the needs of your organization are dynamic and how you prioritize your time should be adjusted accordingly.
  • Diversify Funding?: Much like with personal investments, common wisdom is that having multiple donors can help protect against changes in the funding landscape, such as when a primary funder suddenly shifts priorities. But not all donors are created equal. Some require a higher level of effort to cultivate, such as lengthy proposal submissions. And diverse funding can come with its own transactional costs, including responding to varied reporting requirements and maintaining multiple donor relationships.There are a lot of myths around diversification, and specializing on one category of funding may be the key to growth, assuming growth is a goal for your organization.
  • Know Your Landscape: What are your peer organizations doing to become more resilient? Pay attention to those in your geographic area, even if they have a different technical focus, as well as those in neighboring communities and countries that do similar work to you. Build relationships or leverage existing ones to discuss what’s working for the NGO sector as a whole and, when possible and appropriate, provide feedback to funders with a collective voice about any of their unrealistic expectations and what they can do to break the “Nonprofit Starvation Cycle.”

In the end, sustainability is a highly complex issue that organizations around the world struggle with. For some, starting an endowment makes sense. For others, it’s launching a social enterprise. Certain nonprofits merge operations—a move not to be taken lightly—in order to become more financially viable and expand services.

Examine these existing models critically and continue to “deconstruct sustainability” through ongoing conversations, both with colleagues at peer groups about what it looks like for your sector and within your NGO about what it means for your specific group.

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