Year-End Planning for Nonprofits: How to Find Success in the New Year
Planning for the new year must include realistic goals. Here are three tips for year-end planning for nonprofits.
The end of the year is a time for your nonprofit to reflect on the past and plan for the future. And if you’re like me, planning is the fun part! Teams get to dream big and imagine the possibilities of what they can accomplish in the year ahead.
The trouble, however, is that too often, failure is baked into the strategies nonprofits put in place to make big dreams come true. And as a result, they often set themselves up for failure in the year ahead before the new year has even begun.
How Nonprofits Set Themselves Up for Failure…And How to Stop
After years of helping nonprofits reach big goals, I’ve seen too many organizations make the same planning mistakes time and time again.
Here are the three biggest mistakes I see. And here’s how to avoid them.
1. The Goals are Too Ambitious
Don’t get me wrong; ambition is a powerful asset. Overly ambitious goals that create unrealistic expectations of what’s possible, however, are not helpful or healthy for your organization.
Examples can include:
· Adding several new strategies without doing the due diligence to determine whether the organization truly has the capacity and resources to implement those strategies.
· Considering a strategy or effort that’s not properly vetted – typically ideas that come from someone of influence like a board member or outside partner – that end up derailing actual priorities.
Do this instead:
First, adhere to your strategic plan. And if you don’t have a strategic plan, or if you haven’t revisited your existing plan recently, now’s the time to undertake this planning exercise.
Second, before you finalize next year’s plan, remove 25% of the planned activities. In our experience, nonprofit teams always feel like they have more time or money than they actually do. It’s better to build a little white space into your plan than create a rigid document with an unrealistic list of to-dos that succeeds in nothing more than overwhelming your team.
2. The Team is Over-Extended
Expecting your staff to continually absorb new or bigger responsibilities without off-loading others is a recipe for long-term failure.
I recently worked with an organization that had no shortage of creative, ambitious ideas for new programming. The team was eager to offer newer and better offerings for their community, many of which they had already started to implement.
And while this sounds excellent, the discovery phase of our strategic planning process unearthed that staff felt overworked, under-compensated, and just plain exhausted.
Do this instead:
The organization had failed to connect the dots between the newly implemented activities and the burnout impacting everyone. Through our work together, they finally recognized the need to make the team’s workload more manageable.
If you find yourself in this situation, conduct a drop, add, keep, improve (DAKI) exercise to identify and revise work plans, making room for the most important activities.
3. Fundraising Goals are Based on Budgetary Gaps Rather Than Data
When fundraising goals are based on gaps in a nonprofit’s budget rather than the previous year’s results or donor data, disappointment isn’t far behind.
As a former fundraiser and a consultant who has helped many nonprofits establish and meet realistic fundraising goals, this misstep hurts my heart. And I truly believe that this particular misstep is responsible for so many people fleeing the profession.
You’ve likely heard the quote from Albert Einstein where he said, “The definition of insanity is doing the same thing over and over again but expecting a different result.”
This saying is so true, especially when it comes to fundraising. Again, it’s great to have ambition when setting out to raise money. But it’s equally important to know that the rule of thumb is that without an additional allocation of resources for your development program, you should expect a 10% increase in funds raised from one year to the next.
Do this instead:
Look at key data to establish your future fundraising goals. Pay attention to the following:
Historic Giving Data:
Total dollars raised per fiscal year
Number of donors per fiscal year
Average gift amount
Overall ROI
Cost to raise a dollar
Giving Patterns and Trends:
Strategies used to raise funds
Significant increases and decreases in funding
Donor retention rate
Donor acquisitions
Special circumstances (like a pandemic!) that affected the prior year’s results
Staffing and Resource Allocations Over Time
Pertaining to staff, we all know how hard it is to hire for development positions right now. If you have an open position on your development team, understand that it’s likely to be open for a while, making it unrealistic to expect significant fundraising gains without someone doing the work.
Each of these data points and considerations must inform your annual fundraising goals. Remember, simply wanting “more donations!” without a realistic plan and goals to get you there is not a strategy.
End the Year by Establishing a Realistic Plan and Goals for Your Nonprofit
I love planning. Just like Emily Dickinson, I dwell in Possibility. And yet, I also love achieving success and accomplishing goals. By setting realistic goals and using these strategies to reach them, you’re much more likely to fully realize your plan’s objective, better manage your resources – including your team – and celebrate the end of next year, having reached your goals and feeling proud of everything you accomplished.
About The Author
For the past 25 years, Dani has helped nonprofits at local, regional, and global levels find sustainable solutions to tricky growth and funding issues. She works with leaders and teams to optimize their approach to fundraising, strategic planning, marketing, and more! Dani is passionate about helping motivated people build vibrant and effective nonprofit organizations—so they can make a meaningful impact in the world!