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.
Community needs are growing—will donations keep up?
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 things not-for-profits can do right now
Nobody knows how the current health and economic crises will play out around the world, let alone in Australia, in the coming months, especially as the Prime Minister recently stated that we may need to adapt for up to 6 months to completely control COVID-19.
NFPs must be proactive immediately to cut needless spending, review programmes, and increase donor engagement in order to support existing programmes and direct new initiatives in order to stay afloat during this crisis. Here are seven steps you can take right now to improve your crisis management skills:
1. Steady and ready your team
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’s vital to communicate with your staff on a regular basis, recognise the changing reality, and demonstrate your organization’s support and flexibility during these trying times. Assist your team in maintaining a healthy balance between long-term goals and day-to-day requirements and priorities.
With nearly every employee now expected to work from home, video conferencing has never been more crucial. It also makes it easier to have talks where a physical visit was previously required. On a regular basis, the goal is to soothe anxieties, boost flexibility, keep cheerful, and encourage your valuable team members.
2. Communicate with donors right away
NFPs must plan ahead for the additional funding requirements that the epidemic and economic recession would inevitably bring. Request that your current contributors assist you in establishing a financial reserve that will enable you fulfil needs as the situation evolves. Ensure that your significant donors are on board by giving them further assurance that their gifts are making a difference.
Large donors are increasingly accounting for a higher share of total contributions. This year, the goal is to ensure that you remain a top priority for your significant donors, despite the fact that smaller donors may have less to give in an uncertain economy.
3. Stay on top of your financials
It’s a good idea to take a close look at your existing financial status right now. Where can you save money right now to prepare for a reduction in individual donations? Is it possible to redirect funding to current initiatives that address community epidemic or economic needs?
How much would it cost to start new programmes to address new problems? Your donations will not only appreciate your concern for them, but they will also feel as though they are helping to make a difference.
4. Apply donor engagement best practices to your website and communications
Use strong visuals to communicate your vision. Ensure that all of your messaging contributes to and reinforces your brand.
Bring donors into your tale by using stats that show how important your purpose is and personal stories about how you’ve impacted others. Ensure that your website, social media, and campaigns make it simple for individuals to donate.
Make sure you’re responsive while remaining respectful of the current situation. People want to believe that their contributions are making a difference, thus they want to believe that they are making a difference.
5. Review current programs
Knowing that demands will grow at the same time as the economy slows, it’s time to look at recent programme success in terms of money outlays vs programme outcomes. What programmes have had the most impact?
What programmes will be required in the future? Key performance indicators should be available through your financial management system, allowing your team to make educated decisions.
6. Apply for new grants
If you want to provide pandemic-related services, seek for federal, state, and local grants and apply early.
7. Get creative with fundraising
Physical events in all professions have been forced to be cancelled or postponed due to social separation restrictions.
In-person fundraising events, such as charity auctions, banquets, and athletic events, would be severely impacted.
Consider how you might be able to duplicate some of these experiences online, or even better, get creative and build totally new ones. Facebook Live, online meeting software, and social networking can all be beneficial.
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
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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.