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Effect of the Economy on Non profits

Posted August 17, 2010 11:10 AM by Ted Jackson

The Guidestar Survey of Nonprofits released today reveals that non profits continue to struggle with declining donations and increased demand on services. With an emphasis on the first five months of this year the survey shows that while things are stabilizing somewhat, current conditions are being compared with some of the worst years ever. Competition for resources, pressure to restrict services, and the need to do more with less increases the importance of disciplined strategy management through tools such as Balanced Scorecard and Logic Models.

The Guidestar Survey identifies a number of trends affecting American non profits in the first half of 2010.

  • Donations: 40% decreased; 28% remained the same as last year and 30% experienced and increase in donations over last year.
  • The most mentioned reasons for the decrease in donations: decrease in the number of donors; decrease in the size of donations and decrease in the size of corporate donations
  • Demand: 63% of organizations experience increased demand for services
  • Responses to reduced budget: 58% reduced services; 50% froze hiring; 38% had layoffs Some organizations are forced to make major changes in their organizations strategy and others likely are positioned to do so soon. It will be increasingly important to communicate your new direction to the organization. Please take the time to lay out a strategy map to depict your strategy. And use the Balanced Scorecard or strategic measures to monitor your progress as you head down this new path. The only thing we can be sure of these days is that nothing will go as we expect it to. So use your strategy management process to help you navigate these uncharted waters.

    You can review these and other data from the survey at Bridgestar Survey