In November I blogged about a presentation given by Todd Polyniak of Sax Macy Fromm, an accounting firm in Clifton, NJ. That article "How Can We Possibly Stay Afloat in These Tumultuous Times?" is one of my most read blog articles and it is in the Nonprofit Good Practice Guide database.
Sax Macy Fromm
How Can We Possibly Stay Afloat in These Tumultuous Times?
NonProfit Good Practice Guide
Last week I attended another breakfast presentation and heard Todd give his update entitled “Bracing for Change.” This article provides a summary of Todd's preentation with some editorial comment by me along the way.
Todd started out with highlights of change over the last 24 months including political milestones, highpoint and lowpoint news stories and some economic indicators bringing us to where we are today with 9.4% unemployment and corporate meltdowns. He comes to the conclusion that many others are coming too… some things have changed permanently and require us to take a fresh look at how we face the world. He expressed concern about a leadership crisis among nonprofits with leaders feeling directionless and scared and employees having low morale. This is not different than at many for profit businesses. Todd offers 6 steps for a “new way of seeing normal.”
Respond with a Plan
Doing nothing and doing something rash will both be risky. So for the first step, Todd advises planning. You’ll always find me in agreement with this approach.
•Consider alternative scenarios and not just two all or nothing options*
•Quantify the impact of the various scenarios
•Assess the vulnerabilities of your competition
*(I highly recommend David LaPiana's new book, "The Nonprofit Strategy Revolution" for assessing alternatives)
•Protect your financial fundamentals (Remember Todd is an accountant)
•Protect your existing core programs
•Understand and maximize your value and competitive advantage (If Hildy Gottlieb is reading this she is screaming but David LaPiana is cheering)
Gain Long Term Advantage
•Invest for the future – Perhaps hire some great talent now in the job market
•Pursue opportunistic and transformative mergers and acquisitions
•Rethink the way you do business
•Strategically focus on the most important things – Set Priorities
•Don’t get caught fighting the last war instead of this one
•Address lack of commitment by the Board
•Address the need to take action quickly
Todd went on to reference Guidestar’s 10/08 survey citing decreasing contributions and increased demand for services. There was nodding heads in the audience with these comments. He noted the budget cutting happening in nonprofits but encouraged, as he did in November, that the best approach is to defend your top line. He strongly advocated for contacting donors by phone, thanking them, asking how they are doing and asking for support for an emergency fund (optional). He suggested setting numerical goals to make these contacts. I find this refreshing and basic sound advice.
Todd recommended that nonprofits review their Investment Policy Statement as it may make sense to update it. He made a powerful plug for reviewing the approval process and content of your 990 calling for you to “bulletproof you image.” (I’ll be writing more about that in a subsequent post).
Todd shifted gears and discussed human resource strategies you should embrace if you are downsizing including care for survivors, provide predictability, increase understanding, yield some control, and show compassion. At my son’s employer they reduced the factory workers to a 32 hour week and found that some working mothers preferred a shorter day, eliminating childcare hours at one end of the day to a four day week. Being willing to adjust workers hours according to their desired schedules helped morale quite a bit.
Todd then quoted the Fred Factor principles. He dove into the need for individuals to build relationships, continually create value for others and regularly re-invent ourselves.
Well this post is long enough and so I’ll call it a wrap. Thanks, Todd for providing the material for another important post.