Thursday, March 08, 2012

Stop acting like a deer in the headlights and get busy reinventing your nonprofit

We Are Out Of Money ....and if your nonprofit isn't working to reinvent itself you're going to get left behind.

The federal government is facing record budget deficits and interest payments to service its rapidly accumulating debt.  When you factor in that 1/4 of state government funding and 1/3 of local government funding come from Washington, D.C., the pinch will be felt everywhere....from highways to schools to local parks.

The Boomers are starting to retire, which means Social Security and Medicare will chew up larger percentages of an already bloated budget.  Moreover, state and local governments have their own pension bomb to address...$3 trillion in unfunded pension and retirement liabilities.  As early as 2017, these will be eating up 27% of the Pennsylvania state budget.

Finally, American households are saturated with debt....nearing 95% of GDP.  They lack wiggle room to give more.

Economic growth is needed, but don't expect that alone to cure your ills. In order to make good the losses from The Great Recession as well as bring the federal budget into balance, our economy would need to grow at 7-8% annual rate for the next 15-20 unheard of level, even during the boom following the Second World War.

The world is screaming at us: The Status Quo Is Not An Option. With shrinking dollars and growing needs, every nonprofit needs to reinvent its business for the coming austerity.  Even if you’re not the direct beneficiary of public funding, please don’t assume that you don’t need to think about these cuts. The competition for foundation grants, major gifts, and fee-based contracts will skyrocket as those whose public monies are cut look to other funding sources—like yours. Performance is the best way to protect your organization and meet the growing demands that are coming your way.

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