5 Steps for NPOs to Strengthen Development

Although some recent economic news offers positive signs, the donor activities from all corners of the development platform shows little indications of improvement. In light of the ailing economy, many American donors are making cuts to their giving levels to churches and especially to other non-profit organizations. Clearly these donors are skittish about the future and become more pessimistic about the timing of the heralded economic recovery.

I have posted below the highlights of the findings from 2010 Barna study and have also given the 5 foundational step all non-profits must take in this season of history.

These are a few of the conclusions of a recent Barna study.

Recalibrating Donations

Many Americans appear to be significantly cutting back on charitable giving in order to adjust to the downturn. Nearly half of all adults (48%) said they had reduced their giving to non-profit organizations (excluding churches and houses of worship) in the last three months. Churches were slightly less likely to be affected but were certainly not immune to cutbacks: three out of ten Americans had dropped their level of support to churches and congregations (29%) in recent months.

Outlook + Impact on charitable organizations

 

Perhaps most concerning for charitable organizations, Americans are settling in for what they perceive to be a long recovery. Three-quarters of adults (75%) believe the economy will take two or more years to recover, and nearly half (42%) contend the economy will take more than three years to come back. In the first few months of the economic crisis, Barna surveys showed that three out of five adults (62%) felt it would take two years or more and just 32% felt it would take more than three years to recover.

Their gloomy outlook may be connected to the personal financial pressure many are experiencing. Americans reported feeling the impact of the economic crisis right away, but for many it has intensified since then. The current survey shows that three out of every four adults claim to have been personally affected by the economy (75%). Furthermore, the percentage that report being affected in a major way has also risen over the last 14 months, from 22% to 27%.

Stable Tithing

One measure of American generosity that has stayed relatively consistent – despite the economic turmoil – is the practice of tithing. This is the concept embraced by many Christians of giving ten percent (or more) of one’s income. Overall, 7% of all adults reported donation levels equaling at least 10% of their income. The percentage of adults who tithe has remained constant since the beginning of the decade, falling in the 5% to 7% range.

Tithing levels, which could include both church and other charitable giving, were highest among evangelicals (24% of whom give at least 10%), non-mainline Protestants (13%), churchgoers (11%), and non-evangelical born again Christians (10%). Those over the age of 45 (9%) were nearly twice as likely as those under the age (5%) to tithe. Also, the study showed that income level was not correlated with tithing: just 9% of upscale adults gave at least one-tenth of their income, while 11% of the downscale set gave an equivalent proportion.

Who Worries, Who Keeps Giving?

Although most adults report being negatively affected, some groups were more likely than average to take a financial hit. This included Boomers, parents of minors, downscale adults, and residents of the Northeast. Those who were most likely to reduce giving to churches were divorced adults, parents, and Catholics. Donors who were least likely to report drops in church giving included Elders (ages 65-plus) and evangelicals.

Donors most likely to constrict their giving to other types of non-profits included middle-income adults, divorced individuals, parents, homeschool families, and downscale adults. The most loyal donors to non-profits were singles, evangelicals, mainline Protestants, and upscale adults.

Americans who are most pessimistic about the economy’s turnaround are residents of the West, political conservatives, and Republicans, while those most optimistic include Democrats, political liberals, African-Americans, singles, and those under the age of 26. Still, even among the favorably inclined segments, a minority of each group believes that a recovery is coming in the next year.

5 foundational step all non-profits must take:

1. Control costs on all sides of the table. Every department has “something” to consider. Engage the team in thinking thru how best to stop waste.

2. Look for “lean” process improvements even if it means investing in technology and people to do so.

3. Think outside of the normal lanes of past historical performances. Do not place the proverbial rope around your neck because “we’ve always done it that way.” Break free, think future. If you don’t have that gift, find people that do.

4.  Use the current and future technological innovations to seek ways to execute your mission with less: reach more people spending less time, money and resources while being way more effective.

5.  The  audience, you are trying to reach, must become the center piece for all activities. Focus on the target market; who they are, what they do or don’t like or love. Get to know that and you will be able to speak to them in a tone, manner and language that they understand and are even drawn to.

I in the next few weeks i expand on these 5 elements. Stay tuned.

The findings are based upon a nationwide sample of 1,008 American adults, conducted in January and early February 2010.

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