The range of organization and management varies as well, from seat-of-the-pants, one or two people overwhelmed from doing the bulk of the work, to professionally manage with paid staff, and everything in between. Here are some tips to help you and your organization become more effective and successful.
Many people are confused about the concept of a non-profit organization. The terms Non-profit, Not-for-Profit, or Tax-exempt, all mean the same thing and is simply a special type of business entity. An organization that is recognized by the Internal Revenue Service (IRS) as a non-profit, or tax-exempt, business is treated differently than a regular for-profit business for tax purposes. Meaning a non-profit generally doesn't pay taxes. Some of the tax issues can be complex, so if you have any questions or doubts, contact an accounting professional familiar with non-profit tax issues. Generally, though, if you are a small organization, have received your non-profit status from the IRS (you have to apply for it), and adhere to your defined mission, you're fine.
The most important thing to remember is that non-profit does not mean for-loss. You still have to make money. The only real difference between a non-profit and a for-profit business is where any extra money goes. For any organization to remain viable, you have to have more money coming in than you have going out. What happens to that excess between what comes in and what goes out is what makes the difference between a non-profit and a for-profit business. In a non-profit, the excess stays in the organization to help it achieve its mission. In a for-profit business, the excess (the profit) is distributed to the owners of the business. It's that simple.
So, remember, you still have to make money. You have to have more money coming in than you have going out. You just use all the money to help the organization do what it was set up to do.
One of the most helpful and least used tools for any organization is planning. Instead of just starting to do things, sit down first and plan what you're going to do. Then on an ongoing basis, sit down for regular planning sessions. The benefits are enormous.
The level of detail of your plans, and the amount of time spent planning, will depend on the size of your organization and what it is you do. If you're helping with your children's sport team, and you're doing the bulk of the work yourself, you might have just a short to-do list that you put together in 15 minutes. More likely, though, you'll need to sit down with the other board members or volunteers for an hour or two, in several sessions, to develop a plan with enough detail that will give you clear direction and help you guide the organization.
When planning, always start with the end goal in mind. Set the target. Identify specific goals that you want to reach. Again, depending on your size and the nature of your organization, your planning time frame will vary. If you're just getting started with planning, your time horizon will be shorter. As you become more experienced with the planning, you can extend your time horizon out a little further. For your child's sports team, your plan might just cover the length of the season, maybe even just three or four months. Most organizations, however, will want to plan two or three years out. Any longer than that, you're generally talking about larger, well established, and more complex organizations.
So what's in these plans that you're making? There's going to be two parts to the plan; the goals you want to achieve, and how you're going to reach them. If you’re working on a two year plan, the goals will define where you want to be, what you want to be doing, two years from now. Say you're a service type organization that helps homeless people. Your goals might include that two years from now you're going to be providing two meals a day to 500 individuals a day, up from one meal a day to 100 individuals. Maybe you're a rugby club, and your goals might include that in two years you're going to have a paid coach on staff, two full sets of team owned game jerseys, or the funds to begin building your own clubhouse. OK, that might be a stretch for most clubs, but you get the idea.
Once you set these goals, you have to identify how you're going to achieve them. If you're going to increase from one meal a day to two meals a day, or go from no team owned game jerseys to two full sets, how are you going to do that? What are the intermediate steps? Who is responsible for doing what? If you're going to provide more meals, you need more food. You might need larger or better equipped facilities. You might need more volunteers. If you determine that you'll need 20 volunteers a day, but you now only have 5, you have to determine how you'll get the additional volunteers. Maybe you advertise more, apply for more grants, or hire a volunteer coordinator. Whatever the steps are to reach those goals, write them down so everyone knows what needs to be done and who's responsible for doing it.
When you plan, you have to monitor your progress against that plan. You don't want to wait until the end of the plan's defined time period to see whether you achieved the goals that you were aiming for. You want to monitor progress along the way, so that if things aren't going as expected you can make adjustments to get back on track. Or, if things are going as planned, you can focus on the other areas that need more attention, and not waste time on things that are working well.
Another benefit of planning is that you have something to evaluate new or unexpected opportunities against, rather than just trying to figure out on their own if they're a good idea or something you should pursue. Something that sounds like a good idea might not be something you want to pursue when it's evaluated against your plan. Of course, if it is a good idea, and has been properly analyzed and evaluated, you can change your plans. It's always better to plan, and change the plan when called for, than not to plan at all. Planning helps you focus, and that's what you need.