Development Strategy for Small Nonprofits

How to multiply resources and control costs.

Internal vs External

• A Development Director has to have specific strategies for 2 key areas of resource management;

1.Capping overhead costs– Bringing in additional resources

• An internal control on spending must not translate into frugal management. Investment into the organization must be made smartly to ensure longevity and reduce turnover.

• External resources must be larger than the agency's current need in order to allow for expansion, contingency planning and emergency funds.

Internal Strategies

Generate dedicated workforce with minimum cost

Affordable Workforce

• Volunteers are the lifeline of a small nonprofit. The cost of maintaining volunteers is minimal but requires expert screening and work guidelines.

• College students make excellent interns and dedicated workers. Contact the local Univ/College (College of Social Sciences, Business and Law) to establish a recognised internship program for credit.

• Another important demographic is the elderly and retired community. These are more specialized workers, willing to volunteer for a good cause and can fill the gaps in key management and admin support.

• Volunteers are also community mouthpieces and marketing channels.

Managing VolunteersInviting volunteers to work for an agency could be rewarding or challenging. An expert manager would utilize the saved resources from healthy volunteerism to great advantage.1. Allow volunteers to carry admin tasks such as customer

service, filing, communications etc. This would spare enough resources to hire specialized managers for program development, financial management and operations.

– Invest liberally into creating a comfortable, rewarding work space for volunteers. This would establish a reputation for your agency as a professional mentorship organization. The money invested in decent work stations, stationary and adequate meeting space would be returned ten folds if the volunteers dedicate themselves fully.

Smart Technology

Watch Industry Trends• Agencies must always measure themselves agaisnt

contemporaries and learn from it. Healthy competition has never hurt anyone. Nonprofits are always on the lookout for cost efficient strategies and smart/no cost technologies. Here are a few for reference;

1. Skype- used for free communications no matter where you need to stay connected globally.

– Linked-In- used for free networking. Connect with people in your field, poach qualified connections for skilled based jobs or just share ideas.

– Facebook/Social Networking- used for free publicity, creating a following and sending out free updates on programs.

– Idealist- used for free recruitment.

Youth & Community EngagementOne of the most remarkable youth engagement strategies for a grass roots organization is to feed off of the youth energy and use it productively. Many nonprofits struggle with image and representation on their websites. Here are a few tips;1. Your website is your business card. If you can't afford to

have a custom look developed for you, find means to make it happen for little or no cost.

– An excellent tool is to work with the local IT/Design school and announce a competition for best design that represents the mission/vission/goals of your agency. The winning designer could be your future IT manager. students are eager to invest their creativity and showcase it as a resume highlight.

Fair & BalancedYour management could make or break an organization. If an agency is declining, the people at the top are most to blame. Here are a few tips;• Provide competitive salaries and benefits. Its better to

have fewer happy employees than too many disgruntled ones. 

• Meet your team halfway in exploring creative ideas to maintain and prosper the agency. In other words, allow them ownership.

• If costs must be cut internally, the top earning 1% should feel the crunch first. The ultimate cost of high turnover at the mid-management level is 3 times higher than loosing a senior executive.

• If you earn a reputation for an exploitative agency, the community would shun you entirely. Reputation is key.   

Sharing is RewardingOperations, logistics and admin costs often cripple nonprofits. An exciting new idea is Co-Working Spaces.• As a tool to reduce overhead costs, some

agencies in the Pacific North West are opening their doors to similar, small scale nonprofits for Co-working spaces where work stations, printers, fax machines and telephones are shared for a monthly fee.

• Its a winning tool because it could cut operations costs and provide additional income. It also provides excellent networking opportunity with local small businesses.

In-House Gems• It is never smart to assume people hired for a specific task

are 'One Trick Ponies'.• Prepare a roster of 'In-house' assets and skills. Find out

what the hobbies are, what research backgrounds people hold and where their interests lie. Having a plan-B within the agency could save costs and avoid over dependence on outside sources for essential functions such as database management, market research and analysis, skill specific project design such as Human Trafficking or GBV or even PR tools such as Country Reports or Brochures.

Multiplying Resources

Explore & Diversify Funding SourcesAgencies hurt themselves by exhausting their funding base especially if the funding source is individual donors. Following are some key funding sources;1. Community of donors- individuals, families, local

businesses.– Corporate donors- large companies engaging in

philanthropic marketing– Multi-lateral donors- UN agencies, EC, Regional

development bodies and Development Banks (World Bank etc).

– Bi-lateral Donors- Government agencies (USAID, DFID)– Private Foundations.

Community of donors• The most sensitive of all donor relations.

Needs constant care and communication. It is imperative that success in such donor ties is measured not by the number of donors retained, but by the number of donors gained each year.

• Relying on individual patronship and support is a faulty strategy at best because its open to complete decline if the economy fails, the donor population frizzles or the donors find a more appealing cause.

Individual donor engagement tools

• If a donor takes on a sponsorship role for a project, ensure that they can build a lasting, substantive relationship with the beneficiary.

• Raise funds for donor field trips or beneficiaries convention. Seeing is believing and donors need to connect with people who benefit from their charitable giving.

• Use smart tools like video blogs, video conferencing and direct communications to bring beneficiaries to reality.

• Apply smart management skills to show the donor their money is going straight to the cause as much as possible.

• Ownership is essential. Invite your donors to enlist atleast one more benefactor to the cause.

• Do not over extend their giving capacity.

Fundraising Strategies1. If you are a sponsor driven agency, donors should be able

to choose between monthly sponsorship donations or an annual sum.

2. Develop a chapter scheme or a national conference of donors that meets every year to showcase the work done through their charitable giving. This is an excellent tool to build a community of loyal supporters who share a common cause.

3. The annual conference has to be tickets/registration event with enough funds raised to cover event costs, meals and speakers costs. Above all, the fee must allow for some of the beneficiaries to travel to the US for meeting the donors face to face.

• Launch a major gifts or a targeted fundraising drive once a dedicated donor base has been established. The fundraising drive must have a clear goal e.g 2 million USD.

• An effective tool is to divide the campaign into 3 tiers. Match each tier with a specific set of deliverables, e.g

$100 would pay operation costs of an orphanage for a month. $500 would pay 1 teacher's salary for a quarter$5000 would help build a new orphanage  • Bring local artists and craftsmen into your list of supporters

by providing them with a venue and a cause to support. Local musicians could play music at the farmer's market and donate a fraction of the proceeds to the agency.

• Develop donor testimonials and provide them with recognizable mementos like t-shirts and hats to identify with the agency. The testimonials could be posted online.

• Approach notable local and national figures for a board leadership role. A seat on the board should come with some decent donations and a lot of networking potential.

Corporate & Business Donors• Enlist with the local chambers of commerce and build local

support for your cause.• Invite local businesses to engage in 'Philanthropic

marketing'; a tool designed to promote a product by donating a share of the sale to a charity. Drop donation boxes at busy business spots with effective beneficiary images to entice people into donating to your cause.

• Once the agency has enough operational funds to hire a dedicated development specialist, approach larger international corporations such as google or Coca-cola to support your work.

• Work with local news media to show case your efforts and generate interest locally. 

Solicited & Specialized Funding

All other sources of funding including foundation grants and awards require the services of a dedicated grant writer and development specialist who has extensive knowledge of donor specific requirements, deadlines, submission criteria and presentation styles.