Challenges facing nonprofits

May 20th 2020

Nonprofit organisations continue to face unique challenges in our ever-changing world.

The difficulties they face are not just acquiring new donors, but other more complex challenges like engaging their community, promoting their brand, retaining their current base of donors, legal responsibility and social responsibility.

Here are a few key takeaways for challenges currently facing nonprofits.

1. Acquiring and retaining donors

Recruiting new donors and retaining existing ones can be a challenge. Nonprofit organisations need to prove their value to prospective donors and existing members if they want to succeed in the current landscape. 

Proving their value relates to some of the other challenges that nonprofits face, such as promoting their brand, engaging their community, and showing social responsibility, but a strong mission statement, as well as a passionate team, also helps nonprofits to communicate their value. The same is also true when it comes to acquiring grants from foundations or the government, in which doing so has become increasingly competitive over the past few years.

2. Keeping up with regulations and tax reform

Changing regulations and tax reform requires diligent effort from nonprofits to adapt to their changing circumstances. Politicians and policies for many countries tend to change so quickly that keeping up with what is happening can be difficult for nonprofit organisations, as well as understanding how it will affect your nonprofit organisation.

Changes in regulations also tend to demand more and more transparency from nonprofits, requiring more time to be spent on sophisticated reports and taking time away from your nonprofit’s core mission. To combat these changes, consider looking at technology that can assist in creating these reports, as well as joining local groups or communities for nonprofits that can help you understand your obligations from changing policies or regulations.

3. Engaging their community

Nonprofits struggle to engage their local community. Community engagement is critical for nonprofit organisations because it increases the recognition of your organisation, opens up networking opportunities, and helps you to source valuable volunteers and donors from your local community.

To better engage your community, contribute to discussions in your area, participate in local events, and be a consistently positive presence in your local community. With a strong mission statement behind you, staying involved with your local community can help inspire others to engage with your nonprofit organisation.

Another way to engage your local community is by creating mutually beneficial opportunities with other local businesses, groups, and nonprofits. Take the time to learn what is important to your local community, and see how you could help foster a mutually beneficial relationship from that.

4. Promoting their brand

It can be difficult to stand out in a landscape where many businesses and groups are competing for attention. Your brand is important to communicate your message across the noisy environment, as well as differentiate you from other similar nonprofits, increase trust, improve brand loyalty, and engage with your community.

So, how do you promote your nonprofit brand? The first step is to make sure you have a really strong vision and mission statement, as this forms the foundation for your nonprofit. The next step is to understand your audience, the people that could become advocates for your work, volunteers, and donors.

Once you know these core elements, build your brand’s representation around these elements to create an authentic nonprofit that engages effectively with their community. With your strong branding behind you, get involved in the community and engage people across platforms like local events, social media, and your website.

Storytelling is also a valuable tool for branding; tell authentic stories about your work, the people, or inspiration through formats like discussion, videos, graphics, articles, and posts. Storytelling is one of the easiest ways to effectively communicate who you are, what you do, and why you do it.

5. Adopting technology

A lot of nonprofit organisations have the misconception that adopting technology is expensive, and in the wake of financial hardships has opted to stay with manual, paper-based processes. This also has a ripple effect in the sense that refusing to adopt technology diminishes their competitive edge and overall effectiveness for modern challenges, which in turn can make it even harder for nonprofits to stay afloat.

Adopting technology can streamline your business processes and simplify your workflow, saving nonprofits both time and money. 

One way nonprofits can adopt technology is by going paperless, a paperless office saves money on paper, printing, office space and other expenses, as well as improving team collaboration and productivity. To go paperless, consider using technology like Xero for accounting software, Locale Central to replace your paper forms or checklists, and Google Drive to store your documents securely on the cloud.

Automation can also save time typically spent on repeatable business processes, such as sending reports or processing files. When considering how you could add automation to your nonprofit, take a look at Zapier. How Zapier works is you can trigger an automation when something happens on one app, such as receiving an email that matches a certain criteria, then your automation can perform actions on other apps, such as sending an invoice, updating a spreadsheet, or sending a text message.

Technology can also help with generating complex reports, creating a brand presence online, securing grants, engaging with your local community, and other important duties for your nonprofit organisation.

6. Showing social responsibility

Public skepticism is on the rise, and nonprofits that misuse donation dollars have generated mistrust in other nonprofit organisations that can be hard to recover from. To maintain a good standing with the community, nonprofits are increasingly needing to show that they are socially responsible.

Showing social responsibility is about communicating that your actions are for the benefit of society at large, which requires transparency and a good framework for engaging with your community. One way to show your social responsibility is to provide regular updates on new milestones you have achieved to show people what your nonprofit is working towards and the results that it is achieving.

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