Whilst the main objective of a Not-For-Profit (NFP) isn't to make a profit to distribute to its members, the main objective is to ensure sustainability to continue to operate carrying out its purpose.
Be it a School or a Charity, ensuring "sustainability"ultimately means that the organisation can fulfill its commitments to its clients on an ongoing basis. Subsequently, this requires the organisation to have the funds to continue to provide the services promised.
Achieving a profit and cash surplus are essential for sustainability and long term survival. All too often a once off government grant or donation can bring an organisation into a surplus for the financial year.
Relying on good fortune is not smart financial management.
NFP's and their Boards are forever being told about the importance of accountability, transparency and effective management and leadership.
Here are 2 new ideas on what you can also do to achieve financial sustainability.
Tip 1: Technology can help your cause
Sometimes investing in new technology can help streamline operations, reduce overheads, mitigate risk and assist with carrying out your objectives more efficiently.
For example, using a financial system that has automatic purchase orders, timesheets and reporting can potentially reduce the time required in the finance department for these non-value adding tasks. Investing in systems that assist with managing memberships, donations and pledges can help your organisation to raise funds quickly.
Other systems that may help centralise and automate your information and improve your operations include payroll, HRM, WH&S, payments, memberships, volunteers, and general communications.
Technology is helping big corporate firms to succeed, and it can also help you.
Tip 2: Invest in "Intrepreneurship"
Everyone understands that an entrepreneur is someone who shows initiative to take advantage of an opportunity and makes it happen on their own. An “Intrepreneur” on the other hand is someone who identifies ideas and opportunities and can help implement them within the organisation they work for.
Your organisation may have employees and volunteers who have brilliant ideas to help with improving operations, saving money and raising funds. These individuals are vital for innovation and ongoing organisational development.
- How does your organisation ensure that ideas can be heard and implemented?
- Is there a formal structure and framework on how ideas can be developed and actioned?
Ultimately your ability to remain sustainable now and into the future depends on your attitude towards embracing change.
If you'd like more information on Precision MA's experience with assisting NFP's then please contact us for a complimentary consultation.