The things we are unable to touch, smell, or taste are the tangibles. Many of the intangible can still be seen (acts of kindness) and felt (love for example). It is easy to measure tangibles. It is harder but necessary to measure intangibles.

You must articulate the intangible value of your services and be willing to do it often. In addition, you must share the value in ways that resonates with clients who have very little time to think about what you are saying. You must periodically provide the clients with the thoughts that they would think if they had time to reflect on the value of your services.

Even when clients think about the value, they seldom think deeply about it. In addition, most of their family members lack the experience to make all of the connections necessary to appreciate the full value of your mission.

If you are unable to express the intangible value of your mission, there is a risk you will lose clients and the support of their families. You may have an excellent program, but if the family members are unsupportive, your outcomes will underperform your potential. In addition, you will create an opportunity for other nonprofits to attract the attention of your clients, their families, and your donors.

All of the preceding is true for donors. It is harder for the donors to see the intangible value. The family has an opportunity to notices changes in their family member. Donors only have what you tell them and what they hear.

The better you are at talking about the intangible value, the more everyone will hear about your mission. Talking to families and donors about the intangible value, gives them more to talk. Your nonprofit benefits from the word of mouth when the families have something to say.

Next Step:

Make a list of the things that give intangible value to your mission

Determine how to express the intangible value so that it resonates with clients and their family members

Determine how to express the intangible value so that it resonates with the donors

Develop a way of listening to determine if your expression of the intangible value is being shared with others

Make adjustments in the message to ensure it is accurately shared

Sustainability depends more on the intangible value than the tangible value. It is very difficult to have compelling tangible value. If it is tangible, everyone is aware of it. Other nonprofits can and are copying the tangible value or working hard to eclipse it. When the tangible value is similar, it is the intangible value that determines where the clients go for services and who the donors support.

A compelling presentation of your nonprofit’s intangible value is the best way to increase the number of clients served (capacity building) as well as donor generosity.

Don’t wait!

There is only one reason why you should act now rather than wait:

The need for the services your nonprofit offers has never been greater.

There is risk associated with taking action in a weak economy but consider:

Waiting to make a change increases the risk that potential clients will suffer and someone else will emerge to meet their needs. The only way to serve the unserved in your community is to do something different.

Founding your nonprofit was a risk. If your founders could find the support needed to start something, you can find support to grow it to capacity.

If the economy slips, you will probably have more demand for your services. How many can you turn away before someone opens a competing organization?

What you do to increase capacity may be ineffective. You will benefit in many ways from the effort and it is doubtful it will reduce your capacity to serve.

There are nonprofits who are increasing their capacity to serve. The formula for success exists. The only way to find your formula is to change what you are doing. The two ways to discover what will work for your nonprofit are to experiment (a fresh idea or copy someone else) or hire a consultant to guide you.

How do you increase capacity?

A right, yet counterintuitive answer is to add depth to your current programming. Doing more for your current clients is a great way to draw in new clients.

Donors want meaningful, measurable, and durable change in your clients’ lives. When the donors recognize the change you are making in the lives of others they will provide the support you need to increase your capacity to serve. Your referral sources will reward you with more clients. New donors will be easier to recruit.

Next Step:

Determine which of the clients’ unmet or under met needs if eliminated will make a significant change in their lives

Create a plan to meet the selected need or hire a consultant to help you create a plan

Track the evidence of change (anecdotal and quantitative)

Communicate the evidence to your donors and referral sources

It is impossible to increase sustainability by waiting. Sustainability is an ever-changing goal that becomes more demanding with each passing second. You must be proactive to keep your current level of sustainability and aggressive if you want to improve the sustainability of your nonprofit.

What are the needs of your clients that fit with your mission, when meet will result in meaningful change in your clients’ lives, and will resonate with your donors?

Here are two answers to the same question “How is your niece doing?”:

1. Good. Her husband has finally been arrested for his abusiveness. She is living at home and receiving food from the 10^th Street Pantry.

2. Good. Her husband has finally been arrested for his abusiveness. She is living at home and receiving food from The Good Life Pantry (TGLP). TGLP has convinced her to serve nutritional meals and you can see a change in the way the children look and act.

TGLP is creating a meaningful change in the lives of the people they serve and the community recognizes and appreciates what TGLP is doing. If the 10^th Street Pantry had the capacity to serve more families, would you advise them to advertise more? Does TGLP need a marketing program or is their word of mouth good enough? Should either pantry spend their money on marketing or mission?

The purpose of marketing is to ensure the prospective customer knows you exist, have a product or service, and that the product or service meets an important need.

It is easy to imagine that TGLP is at the top of everyone’s list. Almost everyone in the community who deals with people in need of food knows about them. However, it is unnecessary for TGLP to advertise.

TGLP still needs donors. Their ability to do more than just feed the hungry makes them the clear choice among local food pantries. TGLP has a great story to tell. It is a story donors like to hear. Donors want to know that their gifts create meaningful, durable change.

By the way, at which pantry would you rather work? Which do you think has the easiest time hiring the best people available?

Next Step:

Analyze your programming or hire someone to help you determine what changes are necessary to eliminate your need for marketing

Develop a plan to make the changes the evaluation identified or hire someone to help you

Measure and document the change in your clients’ lives that result from the programming changes

It is expensive and time consuming to do the objective analysis. Missing the opportunity to deeply touch each life is more expensive.

The organizations with the highest sustainability are making meaningful and durable changes in the people they serve. They have high capacity utilization because they deliver highly valued services.

Will your nonprofit be the best one in town by the end of 2012?

The ideal candidate is someone with 40 years of experience, increasing responsibility, the energy of a 20-year old, and a great attitude. The attributes that make a great attitude are enjoys learning, service to others, innovative, constantly exploring new ideas, strives for excellence, and is passionate about your mission.

Since the ideal candidate is harder to find than hen’s teeth, it might be a good idea to prioritize the wish list. Attitude is the only ‘must have’ on the list.

With a great attitude, everything else is possible. The passion that comes with the attitude will ensure the energy is always present. The world is changing rapidly, everyone needs to be an innovator, continuous learner, and curious explorer (no organization can evolve faster than its slowest member). Service to others is a cornerstone of a nonprofit’s existence.

Almost everyone learns what the job requires after they start. Someone with a great attitude learns faster and costs less to educate. They find new uses for old information and they explore the depth of the subject beyond what is required. Inexperience is cheap and a good attitude makes inexperience good value for money.

Next Step:

Make attitude the most important criteria when hiring a new person

Circulate your opening only in the areas where you are likely to find the people with the best attitude

Limit your interviewing to the candidates with the best attitude

The attributes of a great attitude are also the attributes of a nonprofit with high sustainability. The best way to create a culture committed to having a sustainable organization is to hire the attitude. It is much easier to teach skills than it is to modify someone’s attitude.

Continuing high unemployment means many job applicants for every opening. Only interviewing the candidates with the best attitude is the most efficient way to find the best candidate for your opening.

Sustainability starts with the people we hire.

Selecting the right norm to challenge is difficult. Most norms are relevant. In addition, challenging more than one norm at a time is usually over committing to change. The internal norms are easier to change. The external norms have a significant impact when they change.

As the senior leader, you also know that you see the organization from a different perspective. When you challenge a norm at your level, it sends cascading changes down through the organization. That is okay. Changes are sometimes uncomfortable for the staff and sometimes the staff welcomes the challenge. It depends on the challenge and its presentation. Remember, one challenge to the norm but with many cascading ripples in your pond (changes).

Picking the right challenge is the key to success. Here are a few questions to ask of your stakeholders (staff, volunteers, clients, families, donors, referral sources, and advocates):

What is the most important goal that is also proving to be the most difficult to reach?

What are the barriers our success?

How is the lack of success affecting our stakeholders?

When the goal is reached what are the benefits to our clients, their families, and other stakeholders?

What are the new processes that will enable success?

What processes must evolve or be abandon to enable success?

What must the organization do more of to enable success?

Who (stakeholders, clients, community members, and others) are most interested in our success and how can they help us achieve success?

There are two possible strategies for selecting a norm to challenge once you have answers to the preceding questions. If you are new to this process, pick an easy challenge and use it as a training opportunity for yourself, your board, and the staff. Otherwise, pick the challenge that offers the greatest benefit to the greatest number of stakeholders.

Regardless of the strategy, you will notice that the questions help you prioritize your decision making process, focus your planning, and provide you with the information necessary to motivate your stakeholders to support the step forward.

Next Step:

Solicit your stakeholders’ input before selecting the challenge

Decide which of the many challenges facing your nonprofit is most important

Create a plan to eliminate the challenge

Engage the stakeholders to help you execute the plan

The stakeholders are stakeholders because they believe in the mission and want the mission to succeed. Therefore, they will willingly lend a hand with success as long as they understand what their role is and how it will help to achieve success.

Relevance is part of sustainability. Challenging the norm keeps a nonprofit relevant. The process of continuously challenging relevance becomes a process of continually increasing sustainability.

How much better than normal will your nonprofit be by the end of the year?

Final point: Let your stakeholders choose the norm to be challenged even if it is less important and valuable than the one you would have chosen. Their enthusiasm for change will ensure success. In addition, after using this process 2 or 3 times, the stakeholders will see the wisdom of your favorite and provide it with the enthusiastic support that will assure your success.

One youth program leader expresses the value of her faith-based program:

“Our faith is our anti-bullying program”

It is easy to agree that instilling faith in her children has the potential to reduce or eliminate bullying. Ending or preventing bullying is certainly valuable and important. However, is it worth the annual cost of serving a child? Recreational programming and tutoring assistance are also valuable. Is the whole package really worth the cost?

A decline in donor support suggests that the donors are looking for more. The decline can occur in the number of donors, the generosity of the donors, or both.

In this case, the donors are looking for more than keeping one child from bullying others, better grades, and recreational activities. The donors want to know that a meaningful and durable change is taking place.

If the youth program specifically recruited bullies, it might be possible to assert that the program ends bullying. However, it is hard to make that assertion when most of the children do not have a history of bullying.

If the program is going to claim success based upon its faith-based programming, it is important to communicate to the donors what is happening. What is the real value of faith development to the community?

The first step is to assess the child when he or she starts the program. Without the initial assessment, it is impossible to determine if any change occurred.

The nonprofit must be able to predict the change in the child.

Inward Condition – Does it create a child who is confident, poised, caring, kind, humble, obedient, positive, optimistic, calm, at peace with the world, hopeful, diligent, disciplined or some combination?

Assuming they are able make changes, what are the outward indicators that verify the change has occurred?

Outward Indicators – Does that translate into greater success, durable relationships, higher achievement, other things, or a combination?

What is the long-term value of the changes?

Long-Term Benefits (Outcomes) – What are the benefits at the next level of education, in his or her career, marriage, socially responsible, personal fulfillment, joy, happiness, or a combination.

Without all of the preceding, the donors assume they are receiving value for their gift. Knowing there is value, provides the donor with a sense of fulfillment and purpose. When the donors know the value of their gift, they respond with loyalty and generosity.

Next Step:

Look at how your nonprofit expresses its value verbally, in writing, and on the website

Determine if the value is clear and compelling for the clients and the donors

Re-express the value in terms of the change in inward condition, outward indications, and the long-term benefits from the change

Tell your donors what you are achieving and how the changes are going to reshape the world

Remember that since the donors underwrite many of your expenses, they need to see and understand your value. Their generosity is directly related to their understanding of your value.

Your donors, and the value your nonprofit creates for those it serves, are important to long-term sustainability. A decline in donor support is an indication of declining value and sustainability.

For your clients, the most valuable output from your programming is the long-term benefits.

If a client understands the lifelong value of your programming, they are more likely to complete the program and you are more likely to retain the client  long enough to achieve the goals your donors want.

Success requires an organization to be very creativity when dealing with complex, messy, hard to solve, and poorly defined problems, which require the organization to deal with many unknowns. In addition, these problems tend to take a long time and are expensive to solve.  That is a good description of the work of most nonprofits.

Of course, that also sounds like the challenge that faces someone who wants to build the tallest building, a new jet liner, or drill an oil well in a harsh environment.

The businesses that do those things well also attract significant investments from government, individuals, and large institutions. Does it make sense to copy the best practices from the businesses that do solve the tough problems well? Raising efficiency and effectiveness means the people who need the benefits the nonprofit offers receive those benefits at the earliest possible moment. Why would any of us want anything else?

Commercial activity drives our economy and society. Are nonprofits likely to find success by emulating the best practices of highly successful businesses or is it better for the nonprofits to do things differently in our highly competitive world?

The vast majority of donors receive their money from commercial activity. This is as true for the day laborer as it is for the billionaire. If they spend 8 hours or more each day thinking about costs, efficiency, return on investment, etc. why use different terms when asking for a donation? Is it going to be easier to create a compelling argument for a gift to your organization if you use terms and concepts familiar to the donor?

Soliciting a donation is highly competitive. When making a donation, our choice of who to give to includes more than a million nonprofits. Whether we are shopping or working, we are constantly making comparisons of products, services, or activities based upon cost, effectiveness, efficiency, return, emotional appeal, benefits, etc. How do you suggest donors decide on one food bank over another or choose an animal shelter over a youth center? If I have a finite charitable budget, how do you suggest I allocate it between cancer research and a homeless shelter without understanding which will do the greatest good for the greatest number as well as the potential for long-term meaningful success?

Next Step:

Create a compelling emotional case for giving to your nonprofit

Create a compelling, logical, and practical business case for donating to your nonprofit

Ensure your business model will deliver the compelling results predicted by the preceding steps

Communicate with your donors the emotional and logical reasons for giving as well as how your business model will produce the predicted results

There are many things about for-profits that are easy to criticize. However, their best practices are worth copying. After all, we call them ‘best practices’ for many reasons. One of the reasons is that the best practices lead to increased sustainability. Sustainability ensures your clients will continue to receive services and your employees will continue to have a place to work.

If you would like to read what other people think about this topic click here for a recent article from the Wall Street Journal.

Specialization and diversification are interesting challenges. Specialization tells the clients why they need you. For example, “We provide the unemployed with jobs.”

Unutilized capacity at you nonprofit indicates an insufficient number of people need what you are offering. You may feel that everyone needs or would benefit from your area of specialization but the clients are telling you that they have other needs.

In this case, how well you provide the specialized services is unimportant. Your clients are telling you it is good but the unutilized capacity is telling you it is insufficient. Continuing to offer your services is fine but how do you fill the underutilized capacity?

1. Diversify – One possibility is that your nonprofit is over specialized. If so, it is time to diversify. Should the diversification be in breadth or depth?

Breadth – As an example a jobs program might add public speaking to its interviewing skills program. This broadens the client’s communication skills.

Depth – As an example a jobs program might add resume writing and interviewing skills.

Regardless of your choice (breadth or depth), it is important to choose an area of underdeveloped strength. If the program is known for providing articulate employment candidates, it is a add breadth or depth to the communication component makes sense. If an award winning public speaker teaches the communication curriculum, but the job candidates receive very little recognition for their ability to express themselves, creating additional breadth or depth is unlikely to enhance the success of the candidates.

2. Value – Possibility the specialization lacks purpose in the client’s opinion. This suggests the client either is unable to understand how public speaking will help him or her in the future or lacks interest in developing public speaking skills. Success is still possible but the focus must be something other than public speaking.

3. Revisit Relevance – Possibly the area of specialization has lost its relevance in today’s society. In that case, it is time to rewrite the mission statement. What is the community need that fits with the strengths of the nonprofit?

Next Step:

Decide which of the three options is the one that will fill your capacity

Discuss your decision with the current clients to determine how the decision is likely to affect them

Discuss your decision with prospective clients, donors, referral sources, and other supporters

Develop an implementation plan

Sustainability depends on being relevant. Every organization drifts toward irrelevance periodically. In a slow moving industry like transportation, relevance spans decades. In a fast moving industry like technology, relevance is short lived. Several outside forces are driving change in the nonprofit segment and causing change to happen quickly. One must expect nonprofit relevance to be hard to maintain.

Helping nonprofits with underutilized capacity is our area of specialization. We look forward to helping you increase the demand for your services and client retention.

How many times have we heard the adage, “It’s not what you know, it’s who you know that matters.”? That is certainly true when one collaborates. If you know the right person with whom to collaborate, it is a marriage made in heaven.

There is a difference between a service provider and a collaborator. A service provider is someone who has a transactional relationship with your nonprofit. They do something and they receive compensation. Service providers are necessary and we all need them and sometimes need to be service providers.

A collaborator also receives compensation but not typically from your nonprofit. From your nonprofit, they receive intangible benefits. However, in most cases, the intangible benefits are more important than financial compensation to the collaborators.

What should one look for when selecting a collaborator?

Support – An organization (nonprofit, government agency, or corporation) that provides nonfinancial support to your nonprofit. Examples of support are advice, advocacy, referrals, or volunteers.

Purpose – An organization whose purpose aligns in some way with your nonprofit’s purpose. For example, they touch your clients’ lives in a way that enables or facilitates your mission. They might provide pre-services, post services, or parallel services.

Accountability – An organization that is more than coincidentally involved (They do more than donate yesterday’s unsold newspapers to your literacy program.). They have goals and expectations of themselves and your nonprofit when providing services and they are willing to be held to goals and expectation your nonprofit has (mutual accountability).

In other words, there is a symbiotic relationship. Both organizations care about the other’s sustainability and well-being. The loss of the other organization would matter. There is an incentive for the two organizations to help each other succeed.

Until the partnership meets the three preceding criteria it is a relationship with the potential to become a collaboration. One of the reasons collaboration is seen as more work than it is worth is because people mislabel their relationship. They refer to something less than collaboration as collaboration.

Next Step:

Make a list of organizations (nonprofits, government agencies, and corporations) where a synergistic relationship might be possible

Prioritize the list based upon the greatest benefit to your clients and mission

Develop a process for qualifying and selecting potential collaborations

Rigorously evaluate each prospective relationship before beginning to work together

Collaborations are more work to create than service relationships. The collaboration usually lasts longer, is more beneficial, and harder to dissolve than a service relationship.

Collaborations provide the community with a more robust solution. The community benefits from the increased breadth and depth of the collaboration. This encourages broad and generous community support.

Collaborations provide mutual sustainability. Which of your current synergistic relationships would be easiest to transform into a collaboration?

Before deciding how to respond, one should decide if a response is necessary. If the decline in support is temporary then the best response is do nothing and wait for the problems to pass.

It is Mission Enablers’ opinion the trend will continue and accelerate. Even when the economy improves, we expect the trend to continue. In addition, we expect government to increase its willingness to charge nonprofits fees for services (taxes).

The decrease in support (funding) and increase in demand (new fees and taxes) will affect the financial strength of some nonprofits. Now is the time to insulate your nonprofit from damage.

The first step is to list the ways your nonprofit receives government support in all forms. Direct payments, indirect payments, and lower property taxes, are probably the tip of the iceberg.

The next step is to decide which is the biggest threat to your financial strength. This might be based upon the size of the support, number of clients who receive support, likelihood of a group of donors adopting the need, probability of the support being removed, or a combination of criteria.

Now is the time to begin recruiting donors to augment the government support. Some of the threats are ones the donors might embrace directly. One example is free or reduced lunches. Donors are likely to understand why a child needs a quality meal. However, some of the government support covers items that have very little emotional appeal for donors. In that case, donors need to be encouraged to increase their support for the overall mission.

In addition, it is unlikely the government will lower tax rates for individuals or corporations. There is a possibility that the tax benefit for making a charitable contribution will decrease. As a result, individuals and corporations will have the same or less to give while the demand for their generosity increases.

The final step in the process is to increase the value of what you do for your clients. In some cases, this is as simple as expressing the value in terms the community understands and values. In other cases, it means adding value to the process. The new value must be something the community understands and appreciates.

It is unlikely that your current donor base has the capacity to offset the government support. The non-givers in your community are your best hope for offsetting your loss of government support. In every community, there are hundreds of individuals who give very little to charity. Their primary reason is they fail to see the value their gift will produce. Because of their minimal history of generosity, few, if any, of the other nonprofits are paying attention to them. They are unlikely to be an easy source of funds but they are probably the best new source.

Next Step:

Determine all of the ways your nonprofit is vulnerable to a reduction is government support or an increase in fees (taxes)

Determine which threat is the most serious

Begin gathering donor support to offset the loss of government support

Attract the support of the non-givers in your community by re-expressing your school’s value to the community

Sustainability depends on preparing for a crisis before it happens. It is the way to ensure the crisis never happens. The “Year 2000 Computer Glitch” is a great example. It may be the largest non-event in the history of the world. That is because the world took the warning of potential trouble seriously.

Is your nonprofit ready to face the decline in government support with a yawn?