Author: Peter Cantelon, Executive Director
The words “non-profit” and “long-term stability” can seem antagonistic to one-another if you have been in the space for any length of time.
Having worked in the non-profit sector for almost 20 years now and about the same amount of time in the for-profit sector I can tell you no one worries about revenue more than the non-profit sector.
With so much of a typical non-profit’s revenue tied up in government granting the idea of stability can seem laughable when so much can depend upon who is elected every four years not to mention election cycles that do not overlap between municipal, provincial and federal governments.
With this reality an enormous amount of time and energy is consumed simply staying ahead of the different grant cycles and worrying about whether or not that next government grant is coming in.
One of the reasons for this is the sector’s heavy reliance on single-source grant revenue as a means of survival. By single-source I mean when your granting is predominantly (more than 50 percent) coming from one benefactor – usually one of the three levels of government – federal, provincial and/or municipal. This circumstance leaves you vulnerable.
Research by StatsCan released in 2017 shows that the largest source of income for the non-profit sector is from government. With remaining average income in descending order coming from sales, donations, memberships fess, businesses and investment income.
Combine these income realities with a recent American study by Nonprofit HR which found that 45 percent of non-profit employees would be looking for new employment within the next five years (by 2025 in this instance) and the idea of stability in non-profits seems bleak.
Reasons given for the turnover in the study included not enough pay, limited career mobility and non-profits being poorly run.
An organization that is spending all of its time hunting for operational revenue, hiring and re-training new staff has little to no time left to actually implement its vision. This is not a recipe for stability. Simple existence is not stability.
Stability is a circumstance wherein an organization is confidently resourced enough to focus on and implement its vision over a long period of time.
Stability is possible but it requires a long-term vision and strategy that focuses on slowly growing and diversifying operational income and investing in the organization’s future – and by future I am talking about 20, 30 and 40 years ahead – not four.
While I have painted a picture primarily focused on income the real enemy to stability is tenure-based limits in vision. By this I mean when board, management and staff wanting to see the entirety of the organization vision implemented and operational within their two to four year lifespan.
The result of this is a panicked and exhaustive pace that tends to burn out and demoralize staff, volunteers and board members for the sake of the noble mission, failing to recognize that the greatest value generated is that over time and not immediately.
A non-profit capable of implementing its vision in manageable increments over 100 years is arguably having an exponentially larger impact than one that burns bright for five to 10 year and then burns out.
The key to long-term stability is in the words long-term. While you may be meeting immediate needs in your community you need to be proactively managing towards the future with the next board, director and staff in mind.
It’s not easy. Stability requires community – a community of non-profits helping one-another. It requires long-term vision and diversified income sources and investments without a heavy reliance on one source…but it is possible.