Archive for March, 2012

Forecasting- One Step Ahead

Friday, March 30th, 2012
Dan Charobee

Dan Charobee

 

How much? How many? When? Where? How long will it take? How long will it last? These questions provide leaders with essential planning information, but each is subject to the fatal flaws of forecasting.
Having worked with many executives that appear to have a natural instinct for forecasting the future, I found success is due to intense interest, experience, education (formal and self education), and effective communications. Here is what they know:
  • GIGO, coined during the advent of the computer age, corrupted results and reports due to this simple data problem; garbage in, garbage out. Qualify the information you are using.
  • ASSUME corrupts facts, making an “A–” out of “U” and “ME”. Verify all assumptions.
  • Weighted Forecasting comes from high value placed on producing high numbers. “Kill the messenger”, inexperience, and forecasts out of sync with operating cycles are culprits. Plan for realistic forecasts and adjust the timing to the situation.
  • Moving On, the tendency to develop a forecast to meet demands then let it go. Without relationships to objectives, it becomes a test, a painful experience; something to be forgotten. Integrate it into your communications.
One client questioned every research piece we prepared. How did this apply to his organization? What did this data tell him? Why was it prepared this way? How did other organizations use the information? What did we recommend for him specifically? We answered and they took the lead position in their field.
Larger, established organizations typically have systems for forecasting. They include baseline, break-even, last year plus/minus, planned growth, benchmark, and target. These systems consider estimates, industry trends, past performance, program development, and recruitment. To qualify the results and meet objectives, the best executives adjust their forecast and recommit resources to meet inherent operational changes. They do it by developing the timing and manageability of their forecast system.
In other words, make it yours. If you have busy, regular deadlines, consider your forecast to be a sign post to what is coming up around the corner. Then, begin to push the horizon further by opening communications with your stakeholders, talking about trends, opportunities, and foreseeable problems.
Whether you are handling revenue streams, client interactions and event participation; or preparing a financial projection for major funding; effective forecasting is one of your best tools for success.

Author: Dan Charobee, Executive Coaches of Orange County, www.ECofOC.org

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Six Critical Questions for Nonprofit Boards

Monday, March 26th, 2012
Bob Cryer

Bob Cryer

Mario Morino, Venture Philanthropy Partners Chairman, recommends that nonprofit boards answer six critical questions to insure that their nonprofit is prepared for changes that might lie ahead.

  1. “What conditions could change precipitously, endangering our mission and those we serve?” If a lot of your funding comes from a few sources (governments, foundations, major donors), how would you survive a major cutback from some of those sources? 
  2. “What can we do to improve the outcomes of our programs?” Too many nonprofits put a lot of effort in improving their processes, and never actualize big, non-incremental improvements that can save lives, enable more youths to graduate, or help more unemployed workers get jobs.
  3. “What is our organizations ‘baseline’ budget for providing the minimum acceptable level of service to clients?” You need a contingency plan for what is the smart thing to do if you have a major revenue loss. A zero based budgeting approach prepares you to always be able to keep delivering your core services with acceptable quality.
  4. “Who could we turn to if we were at risk of having to fold our tent?” For-profit businesses typically know who they would go to if they had to sell their business for whatever reason. Identifying and developing those relationships now will enable you respond effectively if you are suddenly facing a crisis.
  5. “How can we change our prospects by building on what we already know?” It is important to explore new opportunities that are directly tied to your mission and are not more than one step away from your core competency. Incentivize your staff and board to search for ideas to grow your nonprofit based on this “one-step away” principle.
  6. “What can we do to strengthen our revenue base?” First, expect everyone to play a role, not just the fundraising committee and team. Don’t just focus on your current base, but consider new sources based on the “one-step away” concept. But proceed with new sources cautiously. They can lead to a loss of mission focus and a dilution of scarce internal resources.

You can read Mr. Marino’s complete five page article on “Saving the Ship by Rocking the Boat” at: http://www.vppartners.org/learning/chairmans-corner/saving-ship-rocking-boat

Author:  Bob Cryer,  Executive Coaches of Orange County,  www.ECofOC.org

 

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What are Executive Directors talking about?

Thursday, March 22nd, 2012

Larry Tucker

In March of 2011, the Executive Coaches of Orange County launched the Executive Director Forum program. We currently have two active forums meeting monthly. Martha Ryan, another executive coach, and I facilitate one of the forums. To some extent, the issues raised at these sessions are a barometer of what executive directors are concerned about. So I looked back at all the issues we covered in our forum during these past seven months to see if I found any trends.  

The most interesting finding was the diversity of issues. There were about 30 issues covered during these seven meetings and the topics were all over the place: 

  • Starting an advisory board
  • Dealing with difficult board members
  • Breathing life into a development committee 
  • Reorganizing
  • Developing personal goals
  • Preparing for significant staff transition
  • The ethics of using various fund-raising organizations
  • Prioritizing an ED’s responsibilities
  • Starting a social enterprise
  • Establishing an advisory board
  • Finding a development coordinator  

There is one outstanding trend though. Of the 30 issues we addressed, 6 of them related directly to interactions with the board or individual members of the board. Half of those were about getting the board more involved in general or in very specific activities.  

The other less significant trend, at least as shown by this data, is dealing with work/life balance. Although this came up in three or four issues, it was referenced often throughout our discussions.  

Of course, this is data from only 12 executive directors in 12 organizations, so it shouldn’t be construed as a global study. But the results certainly emphasize the diversity of issues that EDs deal with day-to-day.

Author:  Larry Tucker,  Executive Coaches of Orange County,  www.ECofOC.org

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Did You Know?

Monday, March 12th, 2012

Adrianne DuMond

Did you know that the charitable donations made by Americans in 2009 was $303.75 Billion? According to the 2010 Giving, USA Annual Report from the Center of Philanthropy at Indiana University, 75% of the donations came from individuals. That is a sum of $227.41 Billion. This number does not include bequests, which are another 8% or $23.80 Billion. 

Did you know that the reasons people give to charities are:

  • It’s part of the donor’s value system.
  • It’s part of living responsibly.
  • They want to make a difference. 

Did you know the reason people do not give?

  • They don’t believe that the organization really needs or wants their gift.
  • Solicitation is infrequent or poorly communicated.
  • They don’t believe a gift will make a difference.
  • They don’t feel wanted, needed, or valued.
  • They receive no direct, personalized appeal.
  • They aren’t asked. 

Did you know there is an excellent web site called Boardsource (news@Boardsource.org) that provides in depth information for Boards and staff? They provide an e-newsletter, free of charge. A membership (for an individual, $99/year plus lower rates for a group) gives access to training, webinars, assessment tools, and consulting resources. I pulled the above information from a demo for training on fundraising. I have found their information to be useful and very practical.

Author: Adrianne DuMond, Executive Coaches of Orange County, www.ECofOC.org

 

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Looking Ahead to Donations Summaries

Monday, March 5th, 2012

Robin Noah

This time of the year has the busiest and biggest donation months most non-profits will experience. It is a very busy time leaving little time for administrative duties. Some folks figure they can catch up in January.  

As I overview nonprofits I find that for many nonprofits January is always the busiest month of the year because in some cases end of year donation receipts are sent out to donors. If you are still doing this consider that you don’t have to send out donation receipts. There is no law that requires non-profits to send them out unless the donor specifically requests or if they are $250 or more. So you could save some time and money by not sending them out unless requested, or if during the year you included donation information on your thank you letter. Of course we do not want to devalue a chance to communicate with donors so maybe the process can be used to do a little marketing for the New Year. 

How about designing a letter that can be a Holiday greeting, a summary of the year to date donations and stories of how your mission is being carried forward … and how the donors’ contribution became a part of the successes. 

A non-profit organization needs to find an emotional connection to their existing and potential audience at hand 

It’s a good way of reminding donors how much they have given and even if they aren’t going to use it for tax purposes most people seem to appreciate it. However, if the letter is for tax deduction purposes remember that the deduction statement must meet the IRS requirements for a donation receipt. Here are highlights of the IRS Publication 516 that spells out the requirements. The letter must:  

  • Be written – or printed; no verbal receipts
  • Include the amount contributed
  • State whether the donor received any goods or services for the donation
  • Include the name of your organization
  • Include the date of contribution  

You can include other comments including a thank you for their continued contributions – now and in the future. If you have been sending receipts with donations as received and you included the 5 items shown above you do not need to send a summary letter.  

However; I recommend that your review the IRS rules to ensure that you are following the appropriate rules for the type of donations your organization receives.  

Note: This article is simply an overview and is not an advisory re taxi issues. The IRS or your CPA is your best resource for tax matters.

Author:  Robin Noah,  Executive Coaches of Orange County,  www.ECofOC.org

 

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