It’s true that running a non-profit organisation is harder than running a for-profit organisation. Also their primary goal is not to make profits for business owners, instead use those profits to support / promote their mission or cause and drive a social impact. Hence, their challenges are different and keep changing from time to time.
However there are some common challenges that every nonprofit or charity organisation faces and should find a way to overcome them.
1) Making it sustainable
Every nonprofit has a great idea with a big vision to serve the greater good. But attaining long-term sustainability is crucial for the success for any nonprofit. They need to ensure that they continuously receive enough funds on an ongoing basis to be self-supporting. Along with financial support there are other challenges with long-term sustainability such as how to effectively make use of limited resources, don’t make a mistake of taking on too many projects, ensure that nonprofit boards are not fragmented in their goals / priorities, no willingness to accept change etc.
2) Finding & retaining right volunteers
It has always been challenging for nonprofits to find and recruit a right volunteer to support their mission. It’s an ongoing and time consuming process with attrition rates being high. Once the selection of the right candidates for volunteering is done based on their passion, skills and availability, you cannot be sure on how long they will stay. It’s a fact that no nonprofit can function without volunteers. So, finding and retaining the right volunteers is never easy.
3) Undefined processes
Many nonprofits fail in having the right processes and procedures in place to lay a solid foundation. Without processes, it’s difficult to ensure consistency and control across the organisation. Reason why it’s challenging is because most of the time nonprofits focus only on fundraising and give very little or no attention to staff training, team coordination, investment in software & tools, volunteer retention etc. Without a proper planning of these, it’s not possible for any nonprofit to attain required success.
4) Lack of internal communications
The most underrated challenge for any nonprofits is lack of internal communications. Managing staff, team collaboration, resource sharing and documentation are essential for any nonprofit to work effectively. But many nonprofits are least bothered and don’t give enough time to fix up communication barriers and make it simple and effective.
During this coronavirus pandemic, we have seen a large number of nonprofits struggling to effectively communicate with their staff members, volunteers and board members due to lack of right remote working tools, technologies and internal communication strategy.
5) Failure in donors retention
All nonprofits need recurring donors but many of them struggle to retain them. It’s because they fail in building a healthy donor relationship. Lack of personal interactions, not sending updates on how their money was utilised in achieving their goals, treating them as ATMs, poor communications, not striking a balance between new donor acquisition and donor retention are some of the key reasons for poor donor retention.
6) Changing government regulations & tax reforms
Due to changes in government policies, regulations and taxation schemes, it becomes even difficult for nonprofits like other businesses to manage and adjust their existing campaigns, future plans, new initiatives etc. Of course there is not much they can do here but need to have a strategy to tackle this unpredictable challenge.
Entire world is facing new challenges in this Covid-19 pandemic and we may see more in the future, who knows. So, nonprofits should stay positive and should continue to find creative ways to tackle these challenges and move forward.