How is Your Organization’s Fiscal Equilibrium?

This is the first post in a series of three on Organizational Equilibrium, written by Non-Profit Consultant Derek Link.

In the present economy, many non-profit organizations would probably say their fiscal equilibrium is a bit off center. Some might even say they’re wobbling like a top spinning slowly down and dangerously out of balance.

If ever there was a time for your fiscal feedback loops to be utilized and re-evaluated, this is probably it. If your fiscal stool had only one leg, you’re probably already on the floor or headed that direction. Sources of funding have dried up rapidly as discretionary income of individuals and organizations has slowed to a trickle.

A wise fiscal plan for a non-profit does not count on one source of income. It’s wise to cultivate multiple sources including grants, donors, planned giving, annual campaigns, special events, merchandising, etc. Weaving together a sustainable intelligent fund raising design creates equilibrium, and paying attention to feedback loops - like timely statistics on income from all sources – can give you valuable information to ensure that efforts to raise money are targeted toward all possible sources.

Diversification of fund raising is crucial at times when donors are struggling (as they are now), and government is giving away lots of grants (as they are now). It’s wise to have strategies for both donor appeals and grant writing. Paying attention to feedback and planning ahead can give your organization something to grab onto when traditional fund raising methods are slow or closed completely.

Another key to financial stability is to have an audit conducted each year by an accountant who knows the non-profit world and can offer sound advice and feedback. This feedback loop not only provides an external review of your fiscal practices, it also adds an important level of accountability.

So in order to stabilize your fiscal equilibrium pay attention to feedback you’re getting right now. There may be changes and adaptations your organization needs to make in order to maximize your organization’s income during this turbulent economic time. By paying attention to your fiscal feedback loops, your organization can survive and thrive while less agile organizations fold up their tent and move along.

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Parts 2 (How is Your Organization's Governance Equilibrium?) and 3 (How is Your Organization’s Operational Equilibrium?) of this series will be posted on February 18th and 20th.