Get Clear To Drive Better Business Revenue

In a time when many nonprofits are still conservative about growth potential, some of the most successful organizations are the ones with a “clarity of purpose.”

Probably not surprising to most association executives, a recent industry survey found that two of the top financial challenges for nonprofits in 2013 are expected to be improving revenue forecasting and creating new revenue streams.

What may be more noteworthy is that almost three-quarters of associations and nonprofit organizations plan to grow this year, if at a moderate rate.

More people are planning to grow. They know they need to grow, but the growth is still a challenge.

According to the Nonprofit Financial Outlook for 2013 [PDF], in which Veris Consulting and Brittenford Systems surveyed roughly 100 nonprofit executives—almost 60 percent of whom represent membership and trade associations—72 percent of survey respondents said they plan to grow, but 57 percent said the growth will be slow.

“More people are planning to grow,” said John Gillespie, managing director, CFO Practice, Veris Consulting. “They know they need to grow, but the growth is still a challenge.”

Gillespie said some of the most successful nonprofit organizations he’s talked to have “a clarity of purpose”—there is a clear connection between donors and return on investment. “They have an ability to quickly demonstrate results,” he added.

Translated to associations, there should be a clear connection between dues and member value.

One way to do this is to make better use of metrics, which the Veris survey found not many organizations are doing—only 40 percent said they report on key operational metrics to boards.

Gillespie said there is still a “fuzziness” around analytics in associations because there is no standardization around measurements. For example, “a job created” could mean different things to different associations. Measuring data also takes time and discipline, and people are still trying to prove that data can lead to results.

But metrics show progress and impact, Gillespie said in a soon-to-be-released white paper detailing five strategies for rethinking revenue and development. “Metrics are more important than ever,” Gillespie said. “Nonprofits need to move towards more detailed strategic and fundraising plans specifying financial, operational, program, and development metrics with realistic benchmarks to assess progress towards larger goals.”

How has your association clarified its strategy and business goals?

Katie Bascuas

By Katie Bascuas

Katie Bascuas is associate editor of Associations Now. MORE

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