From an operational perspective, establishing mission priorities within a nonprofit—while often associated with Marketing, Strategic Planning or other more ambiguous components of organizational development—is central to the financial stability of an NPO and should be a key part of any Financial Planning project. ESC has developed this particular strategy to help nonprofit leaders define those priorities, particularly in terms of organizational programs, so that clients and local nonprofits may create their most sound financial foundations possible.
The graphic above shows a target structure, where the core represents the mission, and each layer moving outward marks a core-related peripheral, then an income peripheral, then non-income factors. This structure can be used when thinking about mission priorities in relation to your nonprofit’s financial plan. Essentially, nonprofit leaders should focus on the mission and core competencies of the organization at large, determine which services are marginal to the core mission, and identify alternatives for services deemed to fall outside the core.
In assessing mission priorities related to an organization’s financial health, nonprofit leaders should initially focus on the mission and core competencies as they are. If you have multiple programs or activities, this is the time to define them, do mini P&L’s (Profit & Loss Statements), and ask three questions:
1.) Is the program or activity central to the mission?
2.) Does the program or activity contribute financially to the organization beyond direct expenses?
3.) Is this organization exceptionally effective at performing this service?
These can be tough questions to answer truthfully. Programs can be dear to valued board or staff members, or funders. Services that do not meet these criteria are candidates for elimination or a shift to another organization through some type of collaborative effort. In the end, asking these questions and making logical decisions based on the answers assures the sustainability of the mission and the overall stability of the organization.
ESC of New England offers consulting services in Financial Planning, Fundraising and many other areas of nonprofit management. If you are interested in learning more about how ESC can help your organization better fulfill its mission, please contact Director of Consulting Ulea Lago at firstname.lastname@example.org or call 617-357-5550.