Not-for-profit crisis management: 7 things you can do right now
Governments, corporations, and not-for-profits (NFPs) are racing to adapt and respond as the coronavirus (COVID-19) epidemic spreads around the world.
As the Australian government, for example, imposes restrictive restrictions on its citizens and implements economic programmes, this creates uncertainty and a confidence problem in our financial market.
In this time of public health and economic uncertainty, non-profits require a complete financial picture in order to respond promptly to changing community needs.
Despite the Australian government’s efforts to support non-profits, the broader economic crisis is anticipated to result in a drop in donations.
It’s vital for nonprofits to assess their present financial condition, cash flow estimates, and make informed decisions early on to secure financing and attract contributors.
Will donations keep up with the rising demands of the community?
Charity donations are directly associated with the economy, as NFP financial leaders are aware.
As seen in the graph below, demonstrating both financial stewardship and great outcomes is an effective way to increase disposable income and increase the chance of significant corporate and individual donations. When it falls, disposable income falls, and contributors are more inclined to withdraw.
Given the current state of the economy, it is more critical than ever to engage your contributors and demonstrate to them how your initiatives are achieving your objective. You’ll be able to clearly demonstrate both financial stewardship and favourable consequences in the future.
Seven initiatives not-for-profits can take immediately
Nobody knows how the current health and economic crises will play out around the world, let alone in Australia, in the coming months, especially considering that the Prime Minister recently stated that we may need to adapt for up to six months in order to completely control COVID-19. In light of this recent statement, nobody knows how the crises will play out in Australia.
In order for non-governmental organisations (NGOs) to maintain their operations during this period of economic uncertainty, they need to take urgent proactive measures to reduce spending on activities that aren’t necessary, conduct programme reviews, and improve donor participation. The following is a list of seven actions that you may implement right away to improve your skills in crisis management:
1. Prepare and get your team ready
Organizations, people, relationships, and community are all important to non-profits. COVID-19 has wreaked havoc on people’s lives, causing fear and uncertainty at home, work, and in the community. With the Australian stock market in a panic and no clear indication of when it will recover, company donations are certain to suffer.
It is of the utmost importance to maintain open lines of communication with your workforce on a consistent basis, acknowledge the ever-shifting nature of the situation, and demonstrate that your firm will continue to support them despite the challenges they face. Help your team strike a sustainable balance between the short-term and long-term goals, as well as the day-to-day requirements and priorities they face.
Video conferencing has never been more important than it is today that practically all employees are expected to perform their jobs from home. It also makes it simpler to engage conversations in situations where a physical visit was required in the past. On a daily basis, your most valued team members should be comforted, their flexibility should be increased, they should maintain a positive attitude, and they should be encouraged.
2. Keep in touch with donors right away
Non-profit organisations have an obligation to make advance preparations for the increased financial demands that the epidemic and the economic downturn would certainly bring. Make a request to the people who have already contributed to help you create a cash reserve that will enable you to meet your requirements regardless of how the situation develops. Make sure that your key donors are on board by providing them with further assurance that the difference being made by their donations is being noticed.
The contributions made by large donors are accounting for an ever-increasing proportion of the total amount. This year, the objective is to make certain that you continue to be a top priority for your large donors, despite the fact that lesser donors may be unable to donate as much due to the uncertain state of the economy.
3. Keep an eye on your finances
It would be wise for you to examine your current financial situation very carefully right this very second. Where can you make financial cuts right now to get ready for a possible decrease in the amount of money donated by individuals? Is it possible to reroute funding to existing efforts that address the social or economic needs of the community?
How much money would it take to initiate brand new programmes to deal with brand new issues? Not only will the recipients of your donations appreciate your compassion for them, but they will also have the impression that they are contributing to the improvement of the situation.
4. Use best practises for donor interaction in your website and communications
To effectively express your vision, utilise powerful graphics. Make sure that every message you send contributes to and bolsters your brand in some way.
Donors can be drawn into your story by include statistics that demonstrate the significance of your mission as well as personal anecdotes that describe the impact your organisation has had on others. Make certain that your website, social media, and other marketing efforts make it easy for individuals to donate to your cause.
Ensure that you are responsive while maintaining a polite attitude towards the existing circumstances. People want to believe that they are making a difference because they want to believe that their efforts are making a difference and because they want to believe that they are making a difference.
5. Examine current initiatives
It is time to evaluate the success of recent programmes in terms of the amount of money spent vs the outcomes of such programmes in light of the fact that demands will increase at the same time as the economy will slow down. Which programmes have been the most successful overall?
What kinds of programmes will be necessary in the years to come? Your system for financial management should provide access to key performance metrics, which will enable your team to make informed decisions.
6. Request new grants
If you wish to provide services that are relevant to the pandemic, you should look for funds at the federal, state, and local levels and submit your application as soon as possible.
7. Be inventive when raising money
In every industry, there has been a widespread cancellation or postponement of physically demanding activities because of limits imposed by social separation.
The situation would be very difficult for fundraising activities that take place in person, such as charity auctions, banquets, and sporting events.
Think about the ways in which you might be able to recreate some of these experiences online, or even better, challenge your imagination to come up with whole new ones. Benefits can be gained from utilising Facebook Live, other online meeting software, and social networking.
For all of mankind, these are truly historic times. Increased need and probably declining donations are projected to put strain on Australian non-profits. In order to create an effect, address requirements, and get sufficient funds, NFP crisis management will necessitate flexibility and proactive management. To overcome these exceptional obstacles, we’ll need to work together.
NFPs in Australia will face uncertainty on two fronts: a global public health crisis and global economic downturn. We at Sage are with you and want to show our support for this vital sector of caring. We are confident that you will emerge stronger as a result of your ability to be adaptable and find innovative methods to help your communities.
6 things business clients must focus on in a crisis
COVID-19 has no effect on a small number of firms. Caren Hendrie, director of The Hendrie Group, outlines six key areas of concentration for business owners in distress in this article.
The COVID-19 situation has provided us with a never-before-seen set of obstacles to conquer. This is especially true for accountants and bookkeepers, whose job include running our own businesses while also assisting customers through some of the most stressful times in their careers.
However, it is because of this unique scenario that accountants and bookkeepers are at the forefront of company consulting right now. And we witness these experts rising to the occasion time and time again to contribute their knowledge, training, and skillsets in order to assist business owners in dealing with the crisis.
These consultants have been known to pull rabbits out of hats, despite the fact that they are not magicians. Simple, perspective-shifting conversations and practical guidance can sometimes lead to life-changing answers.
In terms of such advice, my firm’s motto comes to mind: ‘Plan for the worst and hope for the best.’ Now is not the time for operators to hide their heads in the sand and hope for the best.
Instead, smart planning will determine whether you gain a competitive advantage or risk failure.
Here are the top six areas to focus on in your planning, based on the most recent interactions we’ve had with our business clients.
1. Cash flow
Everyone has heard the adage “cash is king,” but in a crisis, cash is your company’s lifeblood, and it’s critical that your clients get enough of it through their system.
Government stimulus benefits are fantastic, but you must understand what they imply for you and your clients.
Many business leaders will pocket the entitlements and hope that they will live longer than the infection; if they do not, decisions will become hurried and reactive rather than strategic.
Business owners should be aware of the following:
- What does the money imply for their company?
- How long do you think it’ll last?
- How much longer will they be able to keep the doors open?
- How much longer will they be able to keep the doors open?
- How will they be able to keep it going if the scenario lasts longer than anticipated?
They must also understand their break-even point and the minimum sales required to cover overheads. They must be able to recognise what they need to focus on in order to keep the doors open if sales do not go as planned.
This is the moment to keep a close eye on sales and the sales funnel and compare them to the projection. If there isn’t enough business in the pipeline, clients must consider what they can do and devise a strategy for obtaining more employment.
It can be worthwhile to advise them to concentrate on their core products or services, which will generate the most revenue.
If your clients have a team, have them plan and roster workers based on production requirements. Reduce overtime and double time as much as possible, and search for alternative methods to cut expenditures. Based on updated sales predictions, they may need to reassess all workforce requirements.
Unfortunately, your clients may be forced to make some difficult personnel decisions. If they do, it’s a good idea for them to hire an HR professional because the current circumstance has its own set of rules.
This is an excellent time for your clients to collaborate with an HR professional, either in-house or outsourced. There are many complicated employment rules, and it’s vital that your clients are aware of them.
Your customers must be informed of their rights, obligations, and continuous workplace liability, whether they are cutting hours, standing team members down, or even working from home.
Right now, communication is crucial.
Employees are just as terrified as their bosses. Encourage your clients to explain how the announcement will affect their employees when it is announced. Encourage them to be open and honest during this crisis; excellent leadership could be a game-changer for their business on the other side.
Stay in the know
To assist you in keeping your firm functioning, receive regular business news and suggestions in your mailbox.
4. Existing clients or customers
This is a time for you to take care of your clients, and for your clients to take care of their own. We believe it is past time to communicate routinely about the coronavirus because most individuals already have or can easily find the information they require.
Your clients and theirs need to know what kind of assistance is available to them right now.
Your clients need to know what steps you’re taking to keep supporting them, as well as how they’ll keep in touch with you and how their work is moving. Their clients are no different; communication is essential not only to ensure that clients feel supported, but also to identify areas where more help or services can be provided.
This is a good time to be optimistic. Remember that your clients will remember how you made them feel more than anything else.
Consider why your clients require you now more than ever, and encourage them to do the same for themselves. If you don’t know, chances are they won’t either.
5. Be proactive!
‘Dynasties are born of adversity,’ as the adage goes. Your clients can’t sit around watching Netflix no matter how much they want to.
They must become more engaged and inventive. People continue to have problems that need to be handled, and they are likely to require more assistance than ever before. Many business owners will take to the ground, bunker down, and blame the situation for their current state of affairs.
As a result, now is the ideal time for your clients to get in front of potential new clients and introduce themselves.
Being cautious with their spending doesn’t imply businesses should eliminate marketing budgets entirely; rather, it means making informed judgments rather than rash ones. Stopping all marketing activities right now could be the worst thing your clients can do.
Encourage clients to consider who they’re going for, what their pain points are, and what your client can do to alleviate them. Prepare them for the necessity to change their ways.
We’re in a different era, so it’s time to think creatively and differently.
6. Personal state and mindset
We have no influence over coronavirus (apart from adhering to government restrictions), but we do have power over what we focus on and how we feel. It’s all about being ready for the worst and hoping for the best.
Maintain a sense of perspective and be aware of what you read, watch, and listen to. This situation will be over soon.
As a business owner and leader, your clients’ job is to devise a strategy and have the confidence to put it into action. They will, with your assistance.
How to survive an industry-wide crisis
It’s difficult to get by as a little fish in a large pond surrounded by hungry sharks. When that pond turns out to be a swamp, as the Financial Services Royal Commission has discovered, SME accountancy and financial advisory firms have reason to be concerned.
So, as an SME, how can you continue to survive when your entire business is being dragged through the mud?
For example, according to ASIC, Australia’s corporate regulator, 90% of financial advisers who provide advice to self-managed super funds do not act in their clients’ best interests.
It’s impossible to overestimate the damage to one’s reputation as a result of that alone.
Many more instances of general malfeasance in the financial planning business have been reported on the front pages of Australian newspapers.
Since the commission’s inception, calls to the Independent Financial Advisers Group of Australia have surged five-fold, according to David Brammall, president of the association.
Those calls usually involve smearing the industry’s name and, as a result, dwindling career opportunities.
Around the time of the Great Recession, disillusionment with the industry reached new heights when some business advisors admitted to receiving payments for convincing clients to invest in unsustainable, tax-evasive agriculture schemes like Timbercorp.
Hopefully, the long-awaited commision chaired by former High Court Judge Kenneth Hayne will “drain the swamp,” but what practical steps can you take as a SME walking through what is now widely perceived as a quagmire to protect your reputation?
Credibility is key
Maintaining credibility (and being able to show it) is critical in any industry.
For example, the franchising industry is under pressure, thanks to a slew of angry franchisees from a variety of industries.
If those companies are large enough, they can simply weather the storm, but if you are a small business, you may not have the resources to navigate the turbulent waters generated by industry-wide melancholy.
How you answer will decide how well you navigate those seas.
Acknowledge industry-wide issues
Inform them ahead of time that you are aware of a larger issue and that your company is committed to resolving or avoiding it.
If you talk directly to your clients, your good reputation is considerably more likely to endure widespread industry effects and be minimised on a micro level.
Clearly state what your company values, especially if others in the industry have been accused of or proven to just pay lip respect to the concepts.
Make it clear how you aim to uphold these ideals in the present and future.
Empathize with clients who have been harmed by broad industry dysfunction.
Demonstrating your empathy and understanding isn’t an admission of guilt; it demonstrates to your clients that you care about their business.
Show how your company plans to deal with the bigger situation and what efforts it will take to protect clients.
Demonstrate effective crisis management
If the worst happens and you have a rogue employee on your hands, explain how your company already has governance mechanisms in place to limit the damage.
This will not only show your clients that their needs have always come first, but it will also help you avoid negative press attention.
You don’t want to be scrambling to put together a crisis management plan after the media has contacted you.