Five Life Stages of Nonprofit Organizations A discussion of characteristics, obstacles and opportunities at each of the stages. Information from Judith Sharken Simon‟s book. Review – Five Stages Imagine & Inspire Found & Frame Ground & Grow Produce & Sustain Review & Renew Seven Arenas of Organizational Life Governance Staff Leadership Financing Administrative Systems Products and Services Staffing Marketing Nonprofit Organizations Obstacles & Opportunities Obstacles – those factors and incidents (mostly internal) that can hinder an organization from achieving success. Opportunities – those positive elements or factors (internal or external) that can aid an organization in achieving success Imagine & Inspire Challenge – Dream the dream Organizational Arenas Staff Leadership – the person with the dream Products/Services – maybe but only in mind Obstacles – Too many to list Opportunities – The Dream Tips – Imagine & Inspire Go or no-go Decision Time Is this the way you want to spend all of your time over the next several years of your life? Is it going to be possible to spread YOUR dream to others to make this a reality? Think about who can help make your dream come true! Found & Frame Challenge – Dream to Reality You decided to go and you have your formal nonprofit organization (501c3) This stage usually lasts one to two years Found& Frame Organizational Arenas Governance – Begins to be formal Board Formed Board Meeting/Thinking/Working Staff Leadership – Still entrepreneurial Focused and driven Financing There is some Pretty much day-to-day Found& Frame Organizational Arenas Administrative Systems Informal and only as needed Staffing You and some dedicated volunteers Products/Services One major activity Several mission-related activities Marketing – informal/opportunistic Found & Frame Obstacles Fear of formality Fear of diluting the vision Vision still isolated to founder Need to maintain enthusiasm Opportunities Excitement Inspiration Ground & Grow Challenge – how can we build an organization that will be alive? DURATION – two to five years Obstacles – Overwhelmed with details of organization Overwhelmed with possibilities Opportunities Sense of accomplishment Others sharing sense of purpose Ground and Grow Arenas of Organization Governance Expansion of board for expertise rather than passion Board – still reacting to leadership of founder and is not yet into strategic planning Working board involved with day-to-day Ground and Grow Arenas of Organization Staff Leadership – Executive Director Formal director named, maybe even paid. Makes most of PRIMARY decisions Significant internal/external responsibilities Called „pulse‟ of organization in Stage 3 Ground and Grow Arenas of Organization Financing More financing is available Much financing is required More sophisticated budget prepared Funding relationships solidified Funding needs barely being met Discussing how to generate “income.” Ground and Grow Arenas of Organization Administrative Systems All of a sudden are required Office space/equipment Office assistance Accountability systems Sophisticated budgeting (software systems) Personnel or HR system being discussed Ground and Grow Arenas of Organization Staffing Stage Three is when staffing is needed to meet growing demands of organization New staff driven by the mission New staff are still often volunteers Volunteer recruiter/coordinator important in this stage HR systems are often still informal but are being discussed at this stage Ground and Grow Arenas of Organization Products/Services – Challenge – keep up with the demand generated by increased public awareness Capacity – often time to say “no” to certain ideas because of not having capacity Marketing – becomes more aggressive Develop a promotional tool or two Still rely on word of mouth Plan rare at this stage (but would be good!) Produce & Sustain Organization in its Prime Challenge – keep the momentum and keep moving forward Produce & Sustain Organization in its Prime Obstacles – board too involved in day to day and not enough involved in governing Not enough risk taking Too much risk taking Stagnation Produce & Sustain Organization in its Prime Opportunities – Recognized leader in the field Secure and growing Providing worthwhile products/services New staff with new ideas Organization is stable People feel good about the organization Produce & Sustain Arenas of Organization Governance – Board in its prime Rotating membership New ideas and broader focus True governing – strategic planning Healthy diversity Clear lines of authority between board and director All seeking longevity of organization Produce & Sustain Arenas of Organization Staff Leadership Strong Executive Director Strong leadership team assisting director Need for delegation Often have to recognize “founders syndrome” Financing Relatively stable Good systems in place Remains critical to survival of organization Produce & Sustain Arenas of Organization Administrative systems Bureaucracy is in place and helping organization to thrive Staffing Number of employees at peak Specialized functions Volunteers still integral and self perpetuating Someone might be fired Produce & Sustain Arenas of Organization Products/Services Well designed Results oriented Client focused Quality enhanced Beginning to expand Marketing – Sophisticated Detailed planning Detailed implementation Review and Renew What needs to Change? Obstacles – Resistance to change Isolation of organization Too much control Opportunities for new service to clients for new partners For new ideas and leadership Review & Renew What needs to change? Governance/Leadership – has the organization‟s leadership become stale? Board may need to change Executive director needs to be change agent Roles and responsibilities need to be clarified Exit of founder is indicator of Stage 5 Thorough review of the mission as well as the organization Looking for collaboration opportunities Review & Renew What needs to change? Financing/Administration/Staffing Often expand development office to support changing/expanding mission of regeneration Centralizing many systems; revitalizing the bureaucracy Lots of staff changes with more requirements to collaborate with each other and others New staff and veterans must learn to co-exist Review & Renew What needs to change? Products/Services Redefine the product, program New, collaborative approaches Marketing Not nearly as aggressive in early stage Begins aggressively when new direction is solidified. Need a solid plan for the new image/vision Decline & Dissolution What is the health of the organization? Answer to know (no matter what stage) How do you tell the health of organization? Conflict (internal or external) Funding Loss of passion Close/dissolve Implement turn-around strategy Life Stage Knowledge This is a tool for helping your organization adapt to the changing requirements of a vital organization. Every non-profit organization will be on its own timetable. This knowledge may help you plan the next stage – or may help you help the founder plan the next stage. Serve with enthusiasm and competence!
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