By: Steve Zimmerman
In nonprofits across the country, leaders continue to discuss and pursue the somewhat elusive sustainability. They face a coming year with more options and more pressures, but few certainties.
Many stakeholders have grown tired of the status quo. The sector is offering up new solutions to seemingly intractable social problems and funding challenges through collective impact, social enterprises, and social impact bonds. While demands for everyday services remain high, innovation is being pushed and pursued in every subsector.
This dynamic environment makes the path to success and impact unclear, requiring forward moving nimbleness by all nonprofits. Sustainability is not a destination. It doesn’t lie at the end of a perfectly implemented roadmap. Rather, it’s an orientation or way of thinking that allows leaders to hold the context of their environment in mind with their intended impact and to make strategic decisions in the moment.
We call this way of thinking the sustainability mindset.
Sustainability is also more than a collection of strong revenue streams. It encompasses both financial sustainability as well as the ability to deliver high impact, relevant programs—what we call programmatic sustainability. These are not two separate conversations, but one and the same. It’s not enough to have strong programs if there is no financial engine to support them.
The goal is impact, not financial strength. These concepts are deeply interconnected, yet they’re seldom discussed in an integrated manner. Every decision nonprofit leaders make about finances affects the organization’s ability to deliver on its mission as well as the other way around.
These characteristics of sustainability show why it seems so elusive. Unfortunately, many management structures — including traditional strategic planning — don’t adapt easily to such fluidity. Today, nonprofits need to focus on implementing, learning, and adjusting their strategies to accommodate new information.
For nonprofits to survive, let alone thrive, everyone – board and staff – needs to be engaged in understanding the business model. Tools can help with this, but first boards and staff must move away from periodic planning to recognize that in our fast-changing environment, strategy happens every day. Only then can we fearlessly make strategic decisions to shape our communities in pursuit of exceptional impact and financial viability – or nonprofit sustainability.
Originally posted at the N.C. for Nonprofits blog on September 2, 2014.