Best Practices in Nonprofit Management

May 25, 2011

Your Presenter:

• Peter Brinckerhoff• 217-341-3836• peter@missionbased.com

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1. Your organization is a mission-based business.2. No one gives your organization a dime!3. Nonprofit does not mean no profit!

Money is the enabler of mission! Profit is the enabler of MORE mission! Where do we get the money to grow?

Three Core Philosophies…

Here’s a way to think of sources of capital

Reserves

Debt

This Year’s Net

Future Profits

Current Profits

Past Profits

Capital Sources Capital Generators

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Nonprofit For-Profit

Corporation Yes Yes

Board as fiduciary Yes Yes

Primary Goal Stakeholder value through Mission

Shareholder value through Profit

Requires Sound Management

Yes Yes

Requires Accountability

Yes, to the community Yes, to the shareholder

Needs Strategy? Yes Yes

Profit fuels growth Yes Yes, along with shareholder capitalization

Are nonprofits and for-profits really that different?

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Sarbanes-Oxley (SOX) is REQUIRED for public for-profit companies over a certain size.

For non-profits, most of the requirements are simply best practice; things such as: Audit Committee Bidding Your Audit Work Whistleblower compliance Conflict of Interest

SOX compliance is also becoming more a standard for foundation funding.

For more information on SOX and your nonprofit, go to: http://www.sox-online.com/nonprofits.html

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What about SOX?

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A viable mission statement

Ethical, accountable and transparent

A businesslike board

Strong, well-educated staff

Embrace technology for mission

Social Entrepreneurs

A bias for marketing

Financially empowered

A vision for where you are going

Tight controls

All of these characteristics work together

What Works? Nonprofits that succeed…

• Ethics, Accountability and Transparency• Leading Your People

• NOTE: This is 90 minutes of a three-day course I teach with Roger Hallowell.– August 2-3 in Seattle– November 2-3 in Vienna (no, not Austria)

Today, we’ll get to:

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The mission is the why of your nonprofit. Ethics, Accountability and Transparency are how. All of these must start inside the organization.

It’s not just for outsiders. All of these require personal leadership. All of these are risky-you can easily fall off the

pedestal.

Ethics, Accountability and Transparency

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State your case in your values. Think these through collaboratively, and don’t just put

obvious things in.

Have values that require discussion to implement. Be analog not digital. Google’s key value?

Don’t have values you can’t live with.

Share and amend as needed.

Start with Values

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Use your values in your employee and volunteer recruitment.

Use your values as a management and decision-making tool.

Enforce values in your behavior management. Be public-hold yourself accountable!

More on values

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Respect: We will treat others as we would like to be treated. We do not tolerate abusive or disrespectful treatment.

Integrity: We work with customers and prospects openly and sincerely. When we say we will do something we will do it. When we say we cannot or will not do something then we won’t do it.

Communication: We have an obligation to communicate. Here, we talk the time to talk to each other….and to listen. We believe that information is meant to move and that information moves people.

Excellence: We are satisfied with nothing less than the very best in everything we do. We will continue to raise the bar for everyone. The great fun here will be for all of us to discover just how good we can really be.

Have some values….

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Two old (and still correct) credos: Treat others the way you want to be treated. The right thing to do is the smart thing to do—and the smart

thing to do is the right thing to do.

Sounds trite—but really profound. How do people want to be treated? How is right also smart?

Hold people (and yourself) accountable but allow for mistakes. If you don’t like the ethics of the people around you and you’re

the leader—look to yourself first.—John Maxwell

Ethics in your nonprofit

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Take responsibility for your own actions—and fess up when you mess up. Everyone knows that everyone makes mistakes. What people

want to see is how you lead through your errors.

Then start with internal accountability by being public with expectations to both staff and board. Budget, work plans, strategic plans and ethics.

Finally, let your community know what your plans are and ask them to help you by holding you accountable.

Accountability

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Measure outcomes, not activity. Measure against mission. Measure methods against values. Go very public.

What do we measure?

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Share your information inside the organization. Share your information outside the organization. Use tech to the max to do this.

Transparency

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Your mission is the why of your organization. Your values are the how. Transparency, ethics, accountability all start inside

the organization, then move out. There is more AbilityOne training available on this

topic.

Ethics, Accountability and Transparency Takeaways

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Key philosophy: Your organization needs good staff a lot more than your

good staff need your organization!

Leading Your People

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You have to lead from the front — be visible and accessible.

“People don’t care how much you know until you know that you care.” — John Maxwell

Be a mission cheerleader.

Leadership in Nonprofits

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Treats management as a support function, not a restrictive one.

Values direct service staff above all. Pushes decisions as close to the line of service as

possible. Flips the organization chart upside down. Works in competitive environments and with

younger workers.

Bottom-up management

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This traditional organizational chart was developed for large organizations in non-competitive environments.

It worked-under those conditions.

The traditional model…

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By valuing the people who deliver service, training them, and empowering them, the organization is more responsive, flexible, provides higher quality service and is more competitive.

And staff stay longer.

The improved model…

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You are an enabler, not a restrictor. Treat others the way you would like to be treated. Be a leader, but be willing to follow. When you are praised, pass it on; when criticized,

take the fall. They are not your staff. You are their supervisor.

Thus the supervisor’s job is to get the tools and training in the hands of those closer to the line of service, to encourage, coach, mentor them, and to let them do their jobs.

Components of bottom-up management.

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Good delegation Delegating both the work and the authority. Holding people accountable for outcomes not process.

Good evaluation Constant, supportive and firm. Then there’s leadership by NOT being the leader...

This also requires:

Leadership Lessons from The Dancing Guy

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You need your good staff more than they need you. Leadership is a support function. You support those

you supervise. There are many Ability One Courses on this

subject.

Leadership Takeaways

Questions?

Questions about:– Best Practices

– The Nonprofit Environment

– The recession and nonprofits

– Anything that’s on your mind!

Thanks for coming!

Later today, I’ll be doing two sessions on Smart Growth for CRPs. Hope to see you there!

Session Evaluation Information

SESSION TITLE: NPA Best

SESSION CODE: L-W900